Cardinal Health completes $1.944bn acquisition of J&J’s Cordis
pharmafile | October 6, 2015 | News story | Manufacturing and Production, Sales and Marketing | Cardinal Health, Cordis, mergers and acquisitions
Cardinal Health has completed the acquisition of Johnson & Johnson’s Cordis business: a global leader in cardiology and endovascular devices, for $1.944 billion.
Planning has been ongoing since the acquisition announcement in early March 2015, and Cardinal says the integration is off to a successful start with management teams in place worldwide.
“I’m extremely pleased to welcome our new Cordis colleagues to Cardinal Health,” says George Barrett, chairman and CEO of Cardinal Health. “With an ageing population and the accompanying demand for less invasive medical treatments, health systems around the world are searching for the best ways to ensure the highest quality care in the most cost-effective way.”
Cardinal says Cordis will strengthen its portfolio of physician preference items, which include offerings in the cardiovascular, wound management, and orthopaedics areas. The company is helping customers standardise around medical devices, while offering innovative solutions in supply chain management, inventory optimisation, and work flow tools and data to support the most effective management of the patient.
Cardinal believes the combined companies will now be able to offer high-quality, daily-use products; reliable, trackable inventory and logistics; and deep analytic capabilities that will result in a comprehensive offering for the entire care process, a fact which it says is becoming increasingly important with emerging value-based payment models.
It reasserted its expectation that synergies from the deal will exceed $100 million annually by the end of the 2018 financial year.
Cordis had achieved sales in 2014 of approximately $780 million, split almost evenly between cardiology and endovascular products. Cardinal has acquired a company with a growing portfolio of products.
While the US is its largest single market, 70 percent of total sales come from outside the US, and the company has an international presence in China, Japan, Germany, Italy, France, the United Kingdom, and Brazil, among others.
Cardinal will continue to sell Cordis products under the Cordis brand name, but with a logo that identifies Cordis as a Cardinal Health company.
Integration teams have been engaged since the acquisition was first announced in March 2015. David Wilson remains as Cordis worldwide president, and other executives are in place across all functions and regions, including the Cordis team based in the San Francisco Bay Area, which will remain in the current location.
In addition, global headquarters and a Europe, Middle East and Africa hub have been established in Zug, Switzerland. Singapore will serve as the Asia-Pacific hub, and Puerto Rico as the Latin American hub.
Some 3,000 employees will be joining Cardinal Health when all integration work and transitions are completed over the next few years.
The business will report to Don Casey, Cardinal Health’s Medical segment chief executive officer, a medical device industry veteran, and a former Johnson & Johnson executive.
Casey noted that the combined skills and expertise of Cardinal Health and Cordis have created a world-class technical, clinical, and commercial talent base in cardiovascular solutions. “We are extremely excited to welcome this team, with its deep knowledge, strong customer and distributor relationships, commitment to patients, and innovative spirit, to the Cardinal Health family,” he comments.
Joel Levy
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