Minneapolis-based implantable medical device maker Medtronic has acquired Chanhassen, Minnesota-based Cardiocom, a remote patient monitoring and disease management company, for $200 million in cash. As the Wall Street Journal reported, this acquisition represents a diversification for Medtronic, from it’s core offering of implantable medical devices to home health monitors working to help providers reduce hospital readmissions.
“With broad healthcare reform initiatives focused on growing economic challenges, healthcare systems in every region of the world are striving to continuously improve outcomes, increase access, save cost, and improve the efficiency of healthcare delivery. The acquisition of Cardiocom is one step we are taking toward providing a combination of products and solutions that can help address those challenges,” Omar Ishrak, chairman and CEO of Medtronic, said in a statement.
The company expects the acquisition to have a neutral impact on earnings for 2014, but considers it a long term investment, according to the press release.
Cardiocom, which was founded in 1997, has a number of provider-facing telehealth offerings. The company’s Diabetes Management System uses a wireless glucometer, but transmits the readings over a landline. Cardiocom also offers a connected weight scale called the Telescale and a telehealth hub for connecting providers to patients with conditions including heart failure, hypertension, COPD, asthma, diabetes, chronic kidney disease and end stage renal disease. Notably, the company was contracted to provide telehealth technology to the US Department of Veteran Affairs in 2011.
Cardiocom is not affiliated with Canadian company CardioComm Solutions, the mobile ECG company that produces the HeartCheck Pen, although, as Medtronic has typically focused on cardiac patients, some confusion between the similarly named companies is inevitable.
The Journal reports that Medtronic will initially use Cardiocom’s telehealth technology in the treatment of heart failure patients, monitoring weight gain as a predictor of heart failure. As time goes on, the company may move into diabetes management, building on Cardiocom’s existing platform.
Cardiocom made it onto MobiHealthNews’s radar last year when it was sued by Robert Bosch Healthcare for patent infringement, along with three other companies. One of those companies, Waldo Health (now known as Televero Health), settled the case, while another, MedApps, was acquired by Alere, who rebranded the company Alere Connect. Because Alere already held licenses for the patents, the case was most likely dropped. The case against Cardiocom is apparently still pending; what affect this acquisition will have on it remains to be seen. In the past, Cardiocom President and CEO Daniel Cosentino called the case “groundless and without merit.”
Although Cardiocom has not focused on smartphone access, Medtronic has dabbled in various areas of mobile health for a long time. In 2011, the company created a smartphone app for physicians to access data from its implantable devices. Last year, the company contributed early funding to Cambridge, Massachusetts-based sensor company MC10. It has also has been developing iPad games to help train surgeons, and recently released a clinical decision support app for heart surgeons called “Seize Simplicity.”
Medtronic was also embroiled in a long-running controversy with ePatient advocate Hugo Campos, who has been petitioning the company for a number of years for unfettered access to the data from his implantable device. Campos eventually received some of that access last month after reaching out to Ishrak on Twitter, although he still says the information is incomplete.