Abbott has exercised its option to acquire Cephea Valve Technologies for its mitral heart valve replacement technology.
Cephea received investment from Abbott in 2015 to support the development of a device it thinks can help some of the 4 million people in the U.S. who have mitral valve regurgitation.
The takeover gives Abbott control of another mitral valve technology as it seeks to capitalize on its first-mover advantage in the face of competition from rivals including Boston Scientific, Edwards Lifesciences and Medtronic.
Mitral valve disease has emerged as a key battleground for the medical device industry. Abbott made the early running by acquiring Evalve in 2009 and bringing its MitraClip mitral valve repair device to market in the U.S. four years later. Since then, Abbott has worked to cement its leadership position, notably by paying $225 million to buy Tendyne Holdings, as competition has intensified.
While Abbott's early efforts focused on repairing diseased mitral valves, much of the dealmaking in the sector has centered on devices that replace the faulty parts of the heart. Abbott entered the replacement sector with its takeover of Tendyne, while Edwards and Medtronic bought a place in the race through their acquisitions of CardiAQ Valve Technologies and Twelve, respectively.
Now, Abbott has followed through on a second tentative bet it placed at the time of the Tendyne deal. Rather than buy Cephea outright in 2015, Abbott took a stake in the startup as part of a deal that gave it an acquisition option. Abbott has seen enough in Cephea to take up that option.
Cephea designed its device to conform to the anatomy of patients, thereby increasing the likelihood of it forming a strong seal and having a low profile suitable for antegrade delivery. To achieve these goals, Cephea eschewed a stent-like design in favor of a multi-component structure it thinks makes it better able to adapt to patient anatomy and uses multiple mechanisms to anchor it in place.
Engineers at Cephea have also worked to ensure surgeons can recapture the device in the event that its original location is suboptimal and abort the procedure when necessary.
While Cephea is the latest in a string of mitral valve takeovers, competition for the transcatheter repair and replacement market is just getting started. Boston Scientific, which bought valve repair startup Millipede late last year for $325 million, thinks the market will be worth $1 billion by 2021, but companies have collectively bet billions in the belief it can grow further as the 2020s progress.
Financial terms of the Abbott-Cephea deal were not disclosed.