Reuters Predicts Uptick in Medtech M&A (HealthPointCapital)
A new Reuters report predicts that medtech M&A will escalate in 2013, an uptick they attribute to the looming device tax and recent management transitions. Reuters speculates that as small companies become pressured by the 2.3% device tax, set to go into effect in January, buying opportunities could emerge for strategics. Further, recent management changes, including new CEOs at J&J and Medtronic, may have slowed M&A, which should reverse as new leaders settle into their organizations.
According to the report, medtech M&A has reached a three-year low, a trend that has been observed in orthopedics as well. Deals in the sector have slowed in the wake of the largest in its history, J&J’s $21 billion acquisition of Synthes, in 2011. However, Reuters identifies several market segments and companies that may be a source of future deal activity. Medtronic may be considering acquisitions in the emerging markets, based on rumors over the summer concerning potential targets in India and China. Reuters also states that Nuvasive, Wright Medical and Tornier may be likely candidates to be acquired.