Boston Scientific to Acquire Rhythmia Medical

Natick, Mass.-based Boston Scientific Corporation is acquiring Rhythmia Medical Inc., a medical device company with focus in arrhythmia, for up to $265 million as it seeks to expand in the fast-growing electrophysiology market.

“The acquisition of Rhythmia Medical is a decisive step forward for Boston Scientific in the electrophysiology ablation business, including the high-growth segment of complex ablation,” Boston Scientific CEO William Hank Kucheman said. “Electrophysiology is a $2.5 billion market and growing at a double-digit pace, representing a key growth opportunity for us.”

Burlington, Mass.-based Rhythmia Medical develops mapping and navigation solutions for cardiac catheter ablations and other electrophysiology procedures, including atrial fibrillation and atrial flutter.

Atrial fibrillation is a disorder that disrupts the ability of the heart to beat regularly and pump blood efficiently. Catheter ablation enabled by 3-D mapping and navigation commonly is used to treat heart-rhythm disorders, including atrial flutter and atrial fibrillation.

The deal is expected to close by Oct. 12.

Once the mapping system is cleared by the U.S. Food and Drug Administration and receives CE Mark approval in Europe, Boston Scientific expects to begin a limited market launch of the system in 2013 and full market launch in 2014.

The medical device giant will pay Rhythmia $90 million when the transaction closes, and up to an additional $175 million in contingent payments based on regulatory, commercial and sales-based milestones through 2017.

Boston Scientific officials do not expect the deal to have a material impact on adjusted per-share earnings for 2013 and 2014. The impact should be break-even to accretive thereafter.