Critical & general care  

Medtronic acquires gastric electrical stimulator manufacturer Transneuronix

20 August 2005

Minneapolis, USA. Medtronic has completed the acuisition of Transneuronix, Inc., a privately held medical device company focused on therapies designed to treat obesity by electrical stimulation of the stomach.

The acquisition follows Medtronic’s recent announcement regarding the formation of a new business unit, Medtronic Obesity Management. Transneuronix has been conducting research using gastric electrical stimulation for the treatment of obesity for more than eight years in the United States and Europe utilizing an implantable pacemaker-like device that delivers electrical pulses to the stomach.

"The acquisition of Transneuronix plays a key part in our strategy to deliver therapeutic solutions for the worldwide challenges of obesity," said Bill Hawkins, Medtronic president and chief operating officer. "Because obesity is linked to so many associated health problems, there is a great sense of urgency to find successful long-term treatment options for these patients."

"Medtronic has invested in Transneuronix, and we know the technology very well," said Gary Lubben, vice president and general manager of Medtronic Obesity Management. "Through Transneuronix's clinical trial and European market experience, we are confident that we can grow this business and help patients and physicians address a very troubling disease." Medtronic has been a supplier of the company's implantable stimulation devices and programmers.

Under the agreement, Medtronic will acquire Transneuronix for an initial payment of approximately $260 million and will make additional payments to Transneuronix shareholders if significant revenue objectives are achieved.

Transneuronix has been conducting research using gastric electrical stimulation for the treatment of obesity for more than eight years in the United States and Europe. Since the first implant in 1995, more than 700 patients have been implanted with Transcend, the company's Implantable Gastric Stimulator (IGS). More than 300 patients have been enrolled in Transneuronix-sponsored trials that have demonstrated meaningful reductions in excess weight with a good safety profile. Most current therapies designed to treat obesity involve highly invasive surgical procedures with significant early and late complications. The Transcend system has been commercially available in Europe for more than three years, and Transneuronix recently received regulatory approval to begin marketing the Transcend system in Canada.

In the United States, Transneuronix has completed enrollment in its U.S. pivotal trial. The U.S. trial is a multi-center, blinded, randomized control study designed to demonstrate weight loss in comparison to a control group.

"Transneuronix has made great strides in the development of gastric electrical stimulation over the last five years through product enhancements, clinical trials and advances in patient identification and selection," said Dr. Louis J. Aronne, Clinical Professor of Medicine at Weill Cornell Medical College, Adjunct Clinical Associate Professor of Medicine at Columbia University, Director of the Comprehensive Weight Control Program at New York-Presbyterian Hospital, and President of the North American Association for the Study of Obesity.

"We look forward to the clinical results of the U.S. trial this fall and hope this therapy becomes available to patients in the United States in the near future," added Dr. Aronne. New York-Presbyterian Hospital/Columbia University Medical Center is one of eight sites in the United States participating in the trial.

Obese people have an increased risk of developing other serious medical problems such as diabetes, heart disease, high blood pressure, stroke and cancer. The National Institute of Diabetes & Digestive & Kidney Diseases estimates that patients with a high Body Mass Index (BMI) cost the U.S. healthcare system more than $60 billion a year in direct medical costs.

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