Morning Briefing
Summaries of health policy coverage from major news organizations
Med-Tech Firm's Strong Cash Flows Lead To Deals; New Venture Capital Spin-Off To Take Over Biotech Investments
Bloomberg: Health Care Costs Continue Driving Deals For Med-Tech Companies
Medical-device companies, under pressure from hospitals and health insurers to keep expenses down, are capitalizing on strong cash flows and the stumbling stock market to beef up cost-controlling technologies that may be critical to maintaining growth. Three of the biggest makers of medical technology, Medtronic Plc, Abbott Laboratories and Stryker Corp., announced acquisitions Monday that target improved health-care efficiency and quality. Each of the deals bolsters the acquirers’ offerings in ways that address the needs of doctors and hospitals to control spending while reducing errors and waste. (Cortez and Lauerman, 2/1)
Bloomberg: Index Ventures Spins Off Biotech Investment Arm Into New Firm
Index Ventures, best known for funding startups like Skype and the creator of the Candy Crush Saga online game, is spinning off its biotechnology investments into a new venture-capital firm. The separation highlights the success of Index’s approach to the biotechnology industry: investing in early-stage companies focused on one product. That has cut in half the time needed to reach a return on the investment, as it quickly becomes apparent whether the product will succeed or fail. (Hallam, 2/2)
Reuters: GSK And J&J Back $1 Billion Biotech Spin-Off From Index Ventures
Index Ventures, an early investor in technology hits like Skype and Dropbox, is spinning off its biotech portfolio into a new $1 billion (695 million pounds) business, with backing from drug giants GlaxoSmithKline and Johnson & Johnson. The new Medicxi Ventures business will be led by the existing life sciences team from Index Ventures and includes all the current biotech portfolio companies. Medicxi said on Tuesday it had raised 210 million euros ($229 million) for a new fund focused on early-stage life sciences investments in Europe, with GSK and J&J each contributing 25 percent. (2/2)
Bloomberg: TE Connectivity To Buy Permira's Creganna For $895 Million
TE Connectivity Ltd., a maker of equipment used in harsh environments, agreed to buy health-care device company Creganna Medical from buyout firm Permira Advisers for $895 million in cash. Creganna, based in Ireland, designs and makes gear for medical-device manufacturers. The company had sales of about $250 million last year, TE Connectivity said. (Serafino, 2/1)
Bloomberg: Gilead CEO Martin To Step Down, Will Be Replaced By COO
Gilead Sciences Inc. Chief Executive Officer John Martin, under whom the company developed one of the fastest-selling drugs of all time, will step down and be replaced by Chief Operating Officer John Milligan. Martin, 64, will remain as executive chairman. He has served as CEO since 1996, a year when the company’s total market valuation, about $1 billion, was less than the company’s two blockbuster hepatitis C treatments now bring in in a single month. (Armstrong, 1/30)
