J&J to Acquire Diabetes Care Businesses for $1.3 Billion

In a move to regain supremacy in the diabetes market, Johnson & Johnson (New Brunswick, NJ, USA) has agreed to acquire Inverness Medical Technology, Inc. (Waltham, MA, USA), excluding certain businesses of Inverness, for about US$1.3 billion in stock.

Inverness makes products for the self-management of diabetes, including electrochemical blood glucose monitors and test strips. The company will split off its businesses in women's health, nutritional supplements, and clinical diagnostics to form a new publicly traded company owned by Inverness shareholders. The remaining diabetes care products businesses will become part of Johnson & Johnson's LifeScan franchise, a supplier of blood glucose monitoring systems for home and hospital use.

The Inverness businesses to be acquired by J&J include its electrochemical blood glucose meters and strips and two recent Inverness acquisitions. These are LXN Corporation, which makes dual glucose and fructosamine monitors, and Integ Incorporated, which has developed new interstitial-fluid sampling technology. In addition, J&J will gain rights to the Debiotech S.A. technology that will be used to develop an external insulin pump.

"The worldwide market for self-testing, whole blood glucose products was approximately $3.5 billion in 2000 and is forecasted to more than double by 2010,” said James T. Lenehan, vice chairman of J&J and worldwide chairman, medical devices and diagnostics group. "This acquisition will position LifeScan to enter new market segments and help establish a lasting leadership across the diabetes care marketplace—one of Johnson & Johnson's major platforms for growth.”





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