Johnson & Johnson’s $13 Billion Deal for Shockwave Medical: A Boost for MedTech Industry.

Johnson & Johnson has recently approved a $13 billion deal for Shockwave Medical, a company that specializes in technology that helps open clogged arteries. This health care giant will pay $335 in cash for each share of Shockwave, with the total deal value including cash acquired. Founded in 2009, Shockwave focuses on intravascular lithotripsy technology that uses sonic pressure waves to crack calcium lesions in arteries and restore blood flow. It is similar to a technique used to break up kidney stones.

J&J Chief Financial Officer Joseph Wolk stated that the market for this technology is still in the early stages of scaling up. He sees potential for growth both in the United States and internationally, with the company expecting annual sales to reach at least $1 billion. J&J will use cash on hand and debt to pay for the acquisition, which will dilute the company’s adjusted earnings per share by 10 cents this year and 17 cents in 2025. This deal comes after J&J announced plans to acquire Abiomed, another cardiovascular technology company, for $16 billion. These acquisitions are expected to enhance J&J’s medical device division.

After J&J separated its consumer health division, leaving only pharmaceuticals and MedTech as its main segments, the Shockwave deal is pending approval from regulators and shareholders and is anticipated to close by the middle of the year. After the deal was announced, shares of J&J increased slightly to $152.82, while Shockwave Medical Inc. saw an increase to $325.50. The companies are working towards finalizing the acquisition