Smith & Nephew, a multinational healthcare company based in the United Kingdom, announced the acquisition of Healthpoint Biotherapeutics. The $782 million buyout of the wound care product manufacturer sparked mixed feelings among investors. While analysts approved of the company’s purchase, many felt that Smith & Nephew paid too much for the company.
According to a press release by Smith & Nephew, the company believes the buyout will help the company expand its market share in the wound care niche. This includes the market for fast-growing bioactive healthcare services like skin regeneration and wound treatment for diabetic ulcers.
Approximately 25 percent of Smith & Nephew’s business comprises wound care products. However, the company’s flagship products are replacement joints. Healthpoint, a privately-held company, has strong positions in dermal repair, bioactive debridement and regeneration products. During the 2012 fiscal year, these product lines brought the private company $190 million in total revenue. Smith & Nephew plans to integrate the private company's products into its own Advanced Wound Management division.
Olivier Bohuon is the CEO at Smith & Nephews. In response to criticism about the expensive buyout, he stated in prepared remarks, "We believe it's a fair price, it's a good price for acquiring such a growing business and such a future. It's really normal for deals done in this kind of field."
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