St. Jude Medical Inc. (NYSE: STJ) said Tuesday it will spend $60 million to acquire a 19-percent stake in CardioMEMS, a company developing wireless heart monitoring technology for heart failure.
The deal also gives St. Jude, based in Little Canada, Minnesota, the right to eventually purchase all of CardioMEMS for $375 million, should the startup hit certain milestones.
CardioMEMS, headquartered in Atlanta, Georgia, is developing tiny, wireless sensors implanted directly in the right pulmonary artery. The system uses radio frequency energy to record and transmit, in real time, cardiac output, heart rate and blood pressure data to a physician.
“Technologies that help improve the management of heart failure can not only provide meaningful benefits for patients, but can also do so in a cost effective manner that is particularly important given recent health care reform in the U.S. and the attention to health care costs worldwide,” Dr. Eric S. Fain, president of the St. Jude’s cardiac rhythm management division, said in a statement.
“Investing in CardioMEMS reaffirms our commitment to technology platforms that improve heart failure management and the potential benefits of hemodynamic monitoring for both patients and the health care economic system,” Dr. Fain said.
The CardioMEMS system reduced the rate of hospitalizations from heart failure by 30 percent during a clinical trial called CHAMPION. “The results demonstrated the potential for hemodynamic monitoring to reduce the need for costly hospitalizations while improving quality of life,” said Dr. Jay Yadav, founder and CEO of CardioMEMS, in the St. Jude statement. Yadav, an interventional cardiologist at Piedmont Heart Institute in Atlanta, formerly worked at the Cleveland Clinic.
“As we work toward the commercialization of this promising technology, we are excited to have the support of a company like St. Jude Medical, with its significant expertise and focus in the areas of cardiac rhythm management, heart failure disease management and other cardiac technologies,” said Yadav, an interventional cardiologist at Piedmont Heart Institute in Atlanta, formerly worked at the Cleveland Clinic.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
St. Jude’s investment could help it leapfrog rival Medtronic Inc. in the race to develop remote cardiac monitoring technologies. Medtronic already sells the Reveal system, which doctors implant just below the skin in the upper chest. The device monitors the heart rhythms of patients who suffer fainting spells.
CardioMEMS, however, targets patients with more severe cardiac diseases like heart failure and aneurysms, and doctors implant the system directly in the heart.
The company also employs MEMS (microelectricalmechanical) technology that create millimeter-sized sensors equipped with internal features on the nanoscale level. MEMS technology, the company says, results in energy efficient sensors that consistently generate reliable measurements.
