A Medical Device Daily

Covidien (Dublin, Ireland) has agreed to acquire Power Medical Interventions (PMI; Langhorne, Pennsylvania) in an all-cash deal worth roughly $64 million.

PMI, a provider of computer-assisted, power-actuated surgical cutting and stapling products, had 2008 revenues of $9 million. The boards of both companies have approved the deal. A subsidiary of Covidien will pay $2.08 in cash per share of PMI common stock. Aggregate consideration, including assumption of debt, will total about $64 million. The companies expect the deal to be complete by Sept. 25.

PMI's first powered stapling platform, the SurgAssist, was introduced in 2001 and has been used in more than 45,000 procedures globally, the company noted. Over the last two years, PMI has introduced wireless Intelligent Surgical Instruments that "have the potential to revolutionize and expand minimally invasive surgery applications, as well as enable novel surgical procedures to benefit surgeons, patients, hospitals and healthcare networks," the company said. Covidien, which develops technology for advanced surgical procedures, considers itself a world leader in surgical stapling.

"By combining these technological assets with our global infrastructure, we will be delivering differentiated solutions to our customers," said Scott Flora, president of Surgical Devices at Covidien. "As a pioneer in surgical stapling, we are committed to providing healthcare technology that enables advanced surgical techniques and improves patient outcomes."

Covidien said it does not anticipate the acquisition will have a material impact on its fiscal 2009 sales or operating margin outlook. The transaction will be slightly dilutive in 2010, but the underlying strength of its existing businesses is expected to offset the dilution, the company said. Once the transaction has been completed, Covidien will report the PMI business as part of its Endomechanical product line in the Medical Devices segment.

"We are excited to join Covidien's Surgical Devices business unit and look forward to establishing a technology platform that will advance surgical stapling and instrumentation beyond the capabilities of existing manually operated devices," said Michael Whitman, president/CEO of PMI.

In other dealmaking activity:

• PeriGen (Princeton, New Jersey) reported the acquisition of the software and related assets of LMS Medical Systems (Montreal), a provider of maternal-fetal monitoring and interpretive technologies. Financial terms were not disclosed.

Currently contracted in 36 hospitals nationwide, PeriBirth, PeriGen's advanced clinical decision support system, has supported more than 310,000 births and is built on more than 6500 OB protocols, regulatory standards, and best practices, the company noted. The PeriBirth solution is designed to provide clinicians assurance that the prescribed and recommended course of care is followed and documented.

With this acquisition, PeriGen said it expands its reach into Canada and adds a number of patents and OB technologies that are cleared by the FDA, licensed by Health Canada, and bear the CE mark for Europe.

LMS was founded by obstetrician Emily Hamilton, MD, an associate professor of Obstetrics and Gynecology at McGill University (Montreal). Hamilton will assume the role of senior VP of Research for PeriGen.

• Patriot Scientific (Carlsbad, California) reported that Cardiac Science (Bothell, Washington) has purchased a Moore Microprocessor Patent (MMP) portfolio license from The TPL Group (Cupertino, California). Cardiac Science makes automated external defibrillators, electrocardiograph devices, cardiac stress and Holter systems, cardiac rehabilitation telemetry, and data management systems that connect with hospital information, electronic medical record, and other information systems, and joins more than 60 other companies that have become MMP licensees.

The MMP portfolio patents cover techniques that enable higher performance and lower cost designs, and are fundamental to consumer and commercial digital systems ranging from DVD players, cell phones and portable music players to communications infrastructure, medical equipment and automobiles, which today have dozens of microprocessor-based features and benefits. The portfolio contains intellectual property that is jointly owned by the privately-held TPL Group and Patriot. It includes seven U.S. patents as well as their European and Japanese counterparts. According to Patriot, it is widely recognized that the MMP portfolio protects fundamental technology used in microprocessors, microcontrollers, digital signal processors, embedded processors and system-on-chip devices.