Medtronic buys Lazarus Effect, maker of clot removal device

Medtronic PLC is acquiring a medical device company that makes a product that helps grab a blood clot from a patient's brain and wrap it like a Halloween candy for clean removal.

Minnesota-run Medtronic said Monday it is paying $100 million cash to buy Lazarus Effect, a privately held Campbell, Calif.-based company working to get U.S. approval to sell a device called the ReCover. The ReCover works with another Medtronic device called the Solitaire, a kind of stent that can be deployed in the brain to scoop out vessel-blocking clots that cause acute ischemic stroke.

The deal to buy Lazarus Effect is Medtronic's eighth of 2015.

The Lazarus Effect acquisition follows the move by the American Heart Association earlier this year to publish new industry guidelines that recommend using devices like the Solitaire in addition to clot-busting drugs in a subset of patients with dangerous strokes. Medtronic says more than 240,000 Americans with acute strokes would be eligible for such a treatment, yet only 13,000 procedures were done in the U.S. last year.

Although rapid use of the intravenous clot-busting drug rtPA (recombinant tissue plasmogen activator) remains the "mainstay" of acute stroke treatment, a series of recent studies documented medical benefit in some patients who had a minimally invasive procedure to fish out the blockage from the brain in combination with the use of the drug. One such stent retriever device is Medtronic's Solitaire.

Last November, Lazarus Effect announced European approval to sell a metal-mesh cover that slides over the stent retriever like a candy wrapper during extraction to prevent what it called a "major limitation" of existing devices, which is dropping clot material.

A randomized clinical trial unveiled about a year ago found that clot particles that were lost while using uncovered retrievers led to ischemic stroke in a new region of the brain 5.6 percent of the time, vs. 0.4 percent in the control group.

"Medtronic has been a significant supporter of the recent clinical work showing improved outcomes of ischemic stroke patients treated with endovascular therapy," Martin Dieck, co-founder, president & CEO of Lazarus Effect, said in a statement Monday. "Their support of data driven clinical evidence and the success with their Solitaire stent retriever device make them the clear market leader for treating ischemic stroke … We look forward to working closely with Medtronic to bring this next generation platform forward to the benefit of future patients."

Medtronic began the year by acquiring surgical supplier Covidien in a Jan. 26 stock-and-cash deal valued at $49.9 billion that moved the combined companies' legal address to Ireland, but kept its top executives in Minnesota. The deal generated tax savings for Medtronic and gave the company more ability to invest its overseas cash in U.S. companies without generating repatriation taxes.

Since then, Medtronic has acquired seven other companies, most of them devicemakers based in the U.S. Although several of the deals came with undisclosed terms, Medtronic has spent at least $688 million on acquisitions since June.

Medtronic said it expects the net impact from its Lazarus Effect acquisition to be neutral to earnings in fiscal year 2016. The company's shares closed at $64.52, down $2.01, or 3 percent.

Joe Carlson • 612-673-4779