by John R. Fischer
, Senior Reporter | January 31, 2018
Varian Medical Systems intends to acquire Sirtex Medical Limited, an Australia-based life sciences company focused on interventional oncology therapies.
If successful, the $1,283 million agreement will mark Varian’s entrance into the interventional oncology market and expand its leadership in radiation management while leveraging its global operations, treatment planning, oncology practice management software, image guidance, and radiation safety capabilities alongside Sirtex’s interventional oncology platform.
“The acquisition is a natural fit, given the two companies’ success in radiation medicine, and will expand Varian’s solutions portfolio into interventional oncology, which we expect to be a billion dollar market by 2022,” Dow Wilson, president and chief executive officer of Varian, said in a webcast.
The acquisition pairs Varian with a global leader in radioembolization, expanding the range of oncology solutions available to both companies’ customer bases while setting the foundation for a new minimally-invasive oncology platform.
Varian end users will be able to use SIR-Spheres Y-90 resin microspheres, the lead product of Sirtex and a targeted internal radiation therapy for certain types of liver cancer. More than 1,090 medical centers together in more than 40 countries have supplied 80,000 doses of the product to treat liver cancer patients.
It holds PMA approval under the FDA, is CE marked and has been approved by Australia’s Therapeutic Goods Administration. Varian itself has filed a 510(k) for its Velocity product and treatment planning area to be able to administer Y-90 treatment planning.
As part of the agreement, Sirtex employees will become part of Varian, following completion of the transaction.
The purchase enables Sirtex’s platform to become more broadly available to the clinical community while allowing Varian to leverage its global footprint, accrue strong financial returns and enhance its current position in cancer centers.
“The Sirtex acquisition moves Varian toward our vision of becoming a multi-modality oncology care company,” a company spokesperson told HCB News. “Interventional oncology is part of that vision. We believe interventional oncology is poised to grow and impact a greater number of patients using noninvasive treatments.”
Varian plans to finance the acquisition through cash on hand and proceeds from borrowings, with a closing date expected in late May 2018. It also expects the purchase to be accretive to earnings per share in the first fiscal year following the closing of the transaction.
The deal was unanimously approved by both companies’ boards of directors, though the transaction is still subject to approval by Sirtex shareholders, the Federal Court of Australia and customary closing conditions, including applicable regulatory approvals.