- Blackstone Group Inc (NYSE: BX) announced it is investing $337 million in Medtronic plc (NYSE:MDT)
Medtronic plc (NYSE:MDT) and Blackstone Group Inc (NYSE: BX) recently announced that Medtronic is intending to significantly increase research and development funding in its Diabetes Group through an agreement to receive $337 million of funding from funds managed by Blackstone Life Sciences, including co-investors, aimed at advancing new, innovative products especially designed to reduce the burden of diabetes management.
This announcement
This announcement was made in connection with the start of the virtual 80th Scientific Sessions of the American Diabetes Association (ADA). And Medtronic’s diabetes device portfolio is designed to improve patient outcomes and provide greater lifestyle flexibility to Type 1 diabetes patients — which includes approximately 22 million individuals worldwide and 1.5 million individuals in the US.
Blackstone Life Sciences has substantial experience in executing development funding agreements in the pharmaceutical and biotech industry. And this investment will help expand and accelerate meaningful innovation for patients.
As part of the agreement, Medtronic will receive up to $337 million in funding over the next several years to fund four identified Diabetes R&D programs. Medtronic is not disclosing the specific development programs for competitive reasons.
Medtronic’s engineering, clinical, and regulatory teams will perform the development work to activate these programs. And the funding received will be equal to the R&D expenses incurred.
If it is successfully commercialized, then Medtronic will pay royalties which are expected to be in the low- to mid-single digit range as a percentage of sales. And additional terms of the arrangement were not disclosed.
The ADA Annual Scientific Sessions is the largest diabetes meeting in the US where endocrinologists from around the world gather to discuss the latest advancements in diabetes research, prevention, and care.
Key Quotes:
“This investment is important for people living with diabetes, as we expect it will expand our offering of future insulin delivery and sensor innovations that have the potential to improve patients’ management of their diabetes. Over the past 12 months, Medtronic has significantly increased its investment in Diabetes R&D, including investments in a series of near-term programs such as the MiniMed™ 780G insulin pump system, our Personalized Closed Loop (PCL) system, our extended wear infusion set, and our Zeus and Synergy sensors. The added investment from Blackstone empowers us to pull forward specific programs in our pump and CGM pipeline that aim to address unmet patient needs, beyond PCL and Synergy.”
– Sean Salmon, Medtronic executive vice president and president of the Diabetes Group
“This collaboration, our first investment in the medical devices space, demonstrates how Blackstone Life Sciences is using its capital and expertise to help bring vital technologies, with the potential to save lives, to patients who need them. We look forward to partnering with Medtronic, the leader in this space, to advance their next generation of innovative medical devices for diabetes patients.”
– Nicholas Galakatos, Ph.D., global head of Blackstone Life Sciences
