Johnson & Johnson (NYSE: JNJ) has announced the acquisition of Shockwave Medical, Inc. (Nasdaq: SWAV) for a staggering $335.00 per share in cash, totaling an enterprise value of approximately $13.1 billion, inclusive of cash acquired.
This definitive agreement, approved by both companies’ boards of directors, marks a significant expansion of Johnson & Johnson MedTech’s footprint in the cardiovascular intervention sector.
Joaquin Duato, Chairman and Chief Executive Officer of Johnson & Johnson, said, “With our focus on Innovative Medicine and MedTech, Johnson & Johnson has a long history of tackling cardiovascular disease – the leading cause of death globally.
The acquisition of Shockwave and its leading IVL technology provides a unique opportunity to accelerate our impact in cardiovascular intervention and drive greater value for patients, shareholders and health systems.”
Strategic Expansion into Cardiovascular Intervention
The acquisition propels Johnson & Johnson MedTech into a leading position within the high-growth markets of coronary artery disease (CAD) and peripheral artery disease (PAD), bolstering its cardiovascular portfolio with Shockwave’s pioneering intravascular lithotripsy (IVL) technology.
This move follows Johnson & Johnson MedTech’s successful acquisitions of heart recovery leader Abiomed and atrial fibrillation innovator Laminar, complementing its Biosense Webster electrophysiology portfolio.
Shockwave’s IVL technology, a minimally invasive treatment for calcified arterial lesions, has been used to treat approximately 400,000 patients worldwide. The addition of Shockwave’s technology, including the Reducer System for refractory angina, is expected to solidify Johnson & Johnson MedTech’s leadership in cardiovascular intervention.
Tim Schmid, Executive Vice President and Worldwide Chairman of Johnson & Johnson MedTech, said, “Shockwave offers a truly differentiated opportunity to further enhance our leadership position in medtech, expand into additional high-growth segments, and ultimately transform the future of cardiovascular treatment. Shockwave’s IVL technology for treating CAD and PAD, and its strong pipeline, are in a class of their own. We look forward to bringing Shockwave’s solutions into Johnson & Johnson MedTech and the hands of more physicians around the world.”
Transaction Benefits and Future Prospects
The acquisition is poised to:
- Enhance patient care globally by integrating Shockwave’s IVL with Johnson & Johnson MedTech’s existing platforms.
- Accelerate the adoption of leading technologies for complex percutaneous coronary intervention (PCI) procedures.
- Fuel growth in underpenetrated markets with a robust pipeline for innovation in CAD and PAD.
- Increase Johnson & Johnson MedTech’s global reach and scale, with Shockwave expected to become its thirteenth priority platform.
- Improve operational margins immediately upon closing, with an anticipated dilution of adjusted earnings per share by approximately $0.10 in 2024 and $0.17 in 2025.
Transaction Details and Leadership Transition
The transaction will be financed through cash on hand and debt, with Johnson & Johnson maintaining its strong balance sheet and commitment to R&D investment, competitive dividends, and strategic acquisitions. Post-acquisition, Shockwave will function as a business unit within Johnson & Johnson MedTech’s Cardiovascular portfolio. Michael Bodner, Global Head of Heart Recovery at Abiomed, will oversee the new business unit, with Isaac Zacharias, Shockwave’s President and Chief Commercial Officer, transitioning to Worldwide President of Shockwave. Doug Godshall, President and CEO of Shockwave, will provide advisory support during the transition.
This strategic acquisition is set to reshape the landscape of cardiovascular intervention, offering new hope and advanced treatments for patients with cardiovascular diseases.
“Shockwave has transformed the treatment of complex calcified arterial disease through the pioneering development of intravascular lithotripsy, and it is our mission to make this remarkable technology available to patients worldwide,” said Doug Godshall, President and CEO of Shockwave.
“As part of a larger, more diverse organization, with broad expertise and a core focus on improving patient outcomes, we are confident we will be able to further solidify IVL as the global standard of care for patients. I am deeply grateful to our team members and colleagues whose efforts have made today’s milestone possible; their accomplishments and passion have been extraordinary. I could not think of a better partner and home than Johnson & Johnson as the Shockwave team prepares to write its next exciting chapter.”
Leave a Reply