Biomet to Acquire Trauma Division of DePuy Orthopaedics
Biomet has entered a binding agreement to buy the trauma division of Johnson & Johnson (J&J)-owned DePuy Orthopaedics for $280 million in cash. The move comes after J&J announced its intent to buy Switzerland-based orthopedic device company Synthes almost a year ago. J&J would fold Synthes into DePuy Orthopaedics to create, according to the company, possibly the largest orthopedics business in the world. This anticipated acquisition raised concerns with European antitrust authorities due to its size, which prompted Biomet’s agreement to acquire a portion of DePuy Orthopaedics.
The European Commission in Brussels said in November that it was concerned that the merger of J&J and Synthes would cause a rise in orthopedic device prices —in other words, it would create a monopoly. J&J had a hearing before European Union antitrust regulatory officials in February.
J&J currently is working with European antitrust authorities to finalize the acquisition of Synthes, while Biomet’s agreement will expire on June 1.
"We believe this divestiture will satisfy all regulatory concerns relating to the pending purchase of Synthes by Johnson & Johnson, but we will not know with certainty until the regulatory processes in the E.U. and U.S. are completed," said Bill Price, vice president of media relations at J&J. The Biomet offer can be extended under certain circumstances.
With the DePuy purchase, Biomet expects expanded presence in the sports, extremities and trauma businesses, according to Jeffrey R. Binder, president and CEO of the Warsaw, Ind.-based company.