Boston Scientific has struck a $600 million deal to acquire Augmenix for a device that reduces the side effects of prostate cancer radiotherapy.
Augmenix’s FDA-approved device, the SpaceOAR System, is a hydrogel that creates a space so the prostate can be treated without damaging the rectum.
Boston Scientific has agreed to pay $500 million upfront and $100 million in milestones to add the device to its portfolio. The deal is expected to close in the fourth quarter.
The acquisition furthers Boston Scientific’s attempts to build a leading portfolio of prostate health devices. Urology has emerged as a key focus for Boston Scientific’s busy business development team this year.
The Augmenix deal brings the number of acquisitions struck by Boston Scientific up to eight. Boston Scientific has paid upfront fees of more than $1.5 billion to land those deals.
Two aquisitions stand out in this flurry of activity. In March, Boston Scientific agreed to pay $306 million upfront to buy NxThera for its benign prostatic hyperplasia device. Now, Boston Scientific is set to hand over a further $500 million upfront to buy Augmenix for its prostate health device. The deals, two of the biggest struck by Boston Scientific this year, both boost the company’s urology unit.
In the near term, Boston Scientific expects the deal to have little effect on its finances but it thinks the impact will increase as the years go by. Boston Scientific expects sales of the SpaceOAR System to be $50 million this year and $90 million in 2019. Beyond that, the company forecasts that the Augmenix takeover will become “increasingly accretive.”
The growth forecasts are underpinned by clinical data suggesting the system improves the lives of the estimated 400,000 men who undergo prostate radiotherapy every year. Evidence of the effectiveness of radiotherapy in men with low, intermediate and high-risk disease has made it an attractive option for patients. However, the dose escalation that gives the best results raises the risk of toxicity. The proximity of the prostate to the rectum makes it hard to avoid these side effects.
SpaceOAR is designed to reduce side effects by creating a space between the rectum and prostate. In late-phase trial, patients treated with the system were less likely to suffer rectal toxicity and urinary incontinence. The trial also linked the hydrogel to improved bowel quality of life and other benefits. These improvements were still evident three years after treatment.