Cardiac-monitoring device maker Bardy Diagnostics has agreed to an acquisition by Hillrom, a medical technology provider specializing in smart hospital beds and other connected monitoring tools. The $375 million deal is expected to close during fiscal Q2 2021.
Bardy's flagship product is the Carnation Ambulatory Monitor, often referred to as the CAM patch. It's a P-wave signal-capturing wearable that is placed along the sternum, where it can remotely monitor patients’ cardiac activity or detect arrhythmia over a seven-day period. The patch's readings are uploaded to Bardy's companion patient management portal, which providers can use to access reports or receive monitoring alerts.
"We set out to elevate ECG monitoring through an entirely new approach to signal processing, ECG reader training and report analysis tools and format, which allow for precise diagnoses of both common and abstruse arrhythmias," Dr. Gust H. Bardy, the founder of Bardy Diagnostics, who shifted from CEO to chief medical officer just a few months back.
"Our team coupled advanced diagnostics with comfort and ease-of-use for the patient, and simple implementation for clinicians. By joining Hillrom, we will broaden our footprint globally with the goal of providing greater patient value and more confident physician diagnoses."
WHAT'S THE IMPACT?
"This acquisition provides Hillrom with a highly strategic and differentiated diagnostic cardiology platform aligned with our vision of 'Advancing Connected Care,' as well as an attractive, recurring high-growth revenue stream and gross margin profile," Hillrom President and CEO John Groetelaars said in a statement.
"BardyDx brings a talented team with significant commercial, clinical and scientific expertise, and dedicated independent diagnostic testing facilities. We look forward to welcoming the 230 employees who will join us in our mission of enhancing outcomes for patients and their caregivers."
That "high-growth revenue stream" currently sits at about $30 million annually, according to the announcement, although Hillrom said it expects to drive new adoption by introducing Bardy's products into Hillrom's existing global brand and capabilities.
In addition to the nine-figure price tag, the larger tech company noted that it will also be absorbing Bardy's $20-plus million in net operating losses. Still, Hillrom said that it expects the transaction to be dilutive in the first year, and by year five generate a 10% return on its invested capital.
THE LARGER TREND
News of Bardy's deal landed right alongside the announcement of another wearable cardiac monitoring company's purchase – Preventice Solutions, which is being scooped up by Boston Scientific for a little under $1 billion. Much like Hillrom, Boston Scientific said that the connected technology would help to flesh out its existing patient-monitoring offerings for provider customers.
Both Bardy and Preventice fall alongside the long list of vendors active in the remote monitoring and "hospital at home" space. Many of these products have received a boost during the pandemic, thanks in part to new telehealth and remote monitoring allowances from the Centers for Medicare & Medicaid Services as well as a general loosening of regulation from the FDA.