Johnson & Johnson MedTech has agreed to sell its Acclarent portfolio of ear, nose and throat devices to Integra LifeSciences, which hopes to provide hardware for a range of procedures aimed at the neck and up.
The deal’s terms include $275 million paid upfront, to be topped off with another $5 million tied to future regulatory milestones. Currently housed under J&J’s Ethicon division, the Irvine, Calif.-based Acclarent will become part of Integra’s Codman Specialty Surgical unit—which it also picked up from J&J, through a $1 billion deal in late 2017.
“This acquisition presents Integra with a rare opportunity to become a key player in the ENT segment,” Integra President and CEO Jan De Witte said in a statement. “We are looking forward to welcoming the Acclarent employees to the Integra team. Together, we can make a profound impact on the future of ENT and neurosurgery.”
Integra said it believes Acclarent’s lines of balloon catheters for expanding the sinuses and other airway devices will complement its current Codman offerings in cranial reconstruction and brain electrosurgery.
Integra also has its own ENT products through its MicroFrance line of instruments for general and plastic surgery. But the company estimates that the ENT specialty devices segment is growing between 5% and 6% and that the acquisition will add about $1 billion to Codman’s total addressable market, pushing it above $6 billion.
Acclarent’s U.S. sales totaled about $110 million in 2022, according to Integra, which also said the gross margins of the company’s ENT products generally align with its own.
“The ENT segment is an anatomical adjacency to neurosurgery. For example, this acquisition will provide opportunities for ENT and neurosurgeons to closely collaborate on tumor care using skull base approaches,” said Mike McBreen, president of the Codman division. “Acclarent’s strong commercial capabilities, R&D expertise, advanced portfolio and deep clinical knowledge will be important assets to Integra, allowing us to deliver future innovation not only within ENT but also across our other CSS technology platforms.”
The deal, structured as a stock purchase agreement, is expected to close by the second quarter of 2024. Integra said that, after the handover, transition services and manufacturing will be provided for up to four years.