Boston Scientific to enhance urology portfolio by acquiring Axonics in $3.7bn deal

Boston Scientific Corporation (NYSE: BSX) has entered into a definitive agreement to acquire Axonics, Inc. (Nasdaq: AXNX), a leading medical technology company specializing in urinary and bowel dysfunction devices. The acquisition, valued at $71 per share in cash, reflects an equity value of approximately $3.7 billion and an enterprise value of about $3.4 billion.

Addressing the Growing Need for OAB and Fecal Incontinence Treatment

In the United States, nearly 30 million adults aged 40 and older suffer from overactive bladder (OAB) symptoms, while 19 million adults deal with fecal incontinence. These conditions significantly impact the quality of life, mental health, and daily activities. Boston Scientific’s acquisition of Axonics represents a strategic move to address these widespread health concerns.

Boston Scientific Expands in Urology and Neuromodulation with Axonics Acquisition

Axonics’ Innovative Product Portfolio

Axonics’ product lineup includes the Axonics R20 and F15 Systems, delivering sacral neuromodulation (SNM) therapy, a minimally invasive procedure for treating OAB and fecal incontinence. SNM therapy functions by sending mild electrical pulses to the sacral nerve, improving communication between the brain and the bladder. Clinical studies have demonstrated Axonics Therapy’s effectiveness in enhancing patients’ quality of life with no serious device-related adverse events.

Boston Scientific’s Commitment to Urology and Neuromodulation

Meghan Scanlon, Senior Vice President and President of Urology at Boston Scientific, expressed excitement about incorporating Axonics technologies into their portfolio. This acquisition allows Boston Scientific to venture into sacral neuromodulation, a growing field with opportunities to improve patient care.

FDA Approval and Anticipated Financial Growth

In January 2023, Axonics received FDA approval for its fourth-generation Axonics R20 neurostimulator, boasting a 20-year battery life. Axonics expects to generate approximately $366 million in net revenue in 2023, a 34% increase from the previous year. This revenue growth is expected to significantly benefit Boston Scientific’s Urology business in 2024.

Transaction Details and Financial Outlook

Boston Scientific anticipates completing the transaction in the first half of 2024, subject to customary closing conditions. The acquisition’s impact on Boston Scientific’s adjusted earnings per share is projected to be neutral in 2024 and accretive thereafter. The GAAP earnings per share impact is expected to be less accretive or more dilutive due to amortization expenses and acquisition-related net charges.