Medtronic, a giant among medical device companies, is largely known for its expensive, implantable devices, like pacemakers and heart valves. But, in an announcement on Monday, the company said it plans to expand into chronic disease management with a $200 million all-cash acquisition of Cardiocom.
Founded in 1997, Cardiocom enables healthcare providers to remotely monitor patients with chronic conditions like diabetes and heart disease through products including home glucose monitors and interactive weight scale systems.
As new health laws increasingly fine hospitals for high patient readmission rates, Cardiocom puts Medtronic in a position to take advantage of the shifting tides and reach a broader set of patients. For example, according to the Wall Street Journal, Medtronic’s implantable heart-failure devices can cost more than $30,000 a pop, but only 13 percent of 7.5 million heart-failure patients get the device. The company said plans to start with a focus on heart failure given its experience in that area, but then expand to other conditions, like diabetes.
As we’ve covered before, thanks to new readmission penalties and a healthcare system trying to shift from fee-for-service to fee-for-value, the market for remote monitoring technologies is expected to grow significantly over the next few years. According to a report earlier this year from research firm GBI Research, the U.S. market is expected to expand 184 percent, from $104.5 million in 2012 to $296.5 million in 2019.