The race to acquire Medical Device Startups
The Race To Acquire Medical Device Startups (OrthoFeed)
Medical device startups across the globe raised nearly $4B in equity financing in 2016, placing last year just behind the 5-year high of $4.1B in 2014. NEA stands out as the most active investor in device startups with Versant Ventures, OrbiMed Advisors, and High-Tech Gruenderfonds not far behind.
As medical device companies gain traction, large corporates such as Medtronic, Boston Scientific, and Teleflex are competing in the race to acquire private medical device startups targeting neurosurgery, orthopedics, and cardiology, among other areas.
Below we used CB Insights data to track first-exit M&A activity of top medical device acquirers that have made 5 or more acquisitions since 2012
- Since 2012, median disclosed funding raised by medical device companies prior to their first acquisition was $38M, while median disclosed valuation at time of acquisition was $140M, 3.7x the total amount raised.
- Medtronic is by far the most active acquirer of medical device startups since 2012 with 15 acquisitions. Much of that activity has been fairly recent. Sixty percent of acquisitions since 2012 occurred in 2015. Median disclosed funding of a medical device startup prior to acquisition by Medtronic was $34M. Median valuation at time of acquisition was $150M.