Medtronic cancels $738 million deal for wearable insulin patch maker EOFlow

Medtronic has terminated its $738 million deal to buy wearable insulin patch maker EOFlow Co.

The medical-technology company disclosed the cancellation Wednesday in a brief filing with the U.S. Securities and Exchange Commission that offered few details.

"Medtronic has exercised its rights to terminate its agreement to acquire EOFlow as a result of multiple breaches on their part," the company said in a statement. Medtronic did not specify the alleged breaches.

Medtronic announced plans to buy South Korea-based EOFlow in May. The proposed deal was seen as a significant step as the company rebuilds its diabetes business.

When the deal was unveiled, Medtronic expected it would close before the end of the year.

EOFlow makes a tubeless, wearable and fully disposable insulin-delivery device. Medtronic had planned to quickly integrate EOFlow into its global diabetes business.

EOFlow, founded in 2011, has been embroiled in legal issues. Massachusetts-based Insulet Corp., which makes a patch insulin pump, sued EOFlow in the summer, charging that its technology was based on stolen trade secrets. Medtronic is not a party to the litigation but has been monitoring the case.

The company's SEC filing noted the termination "does not impact Medtronic's fiscal year 2024 adjusted earnings per share guidance range."

Medtronic, which is legally headquartered in Ireland but operationally headquartered in Fridley, also indicated that it does not believe that it will need to pay any termination fee.

"We remain steadfast in our commitment to bringing a differentiated patch pump to market that integrates our most advanced CGM [continuous glucose monitor] platform and clinically proven meal detection technology algorithm," Medtronic added in its statement.

Last month Medtronic reported results for the second quarter of its fiscal year. Globally its diabetes sales were up nearly 10%. Approximately 65% of the company's diabetes sales come from outside the U.S.