Shares of Inari Medical were trading around $48 earlier today. The deal was announced after market close.
The deal has been approved by the boards of both Portage, Michigan–based Stryker — the world’s second-largest orthopedic device company and fifth-largest device company overall — and Irvine, California-based Inari Medical, which develops thrombectomy systems for treating venous diseases.
The companies expect to close the transaction by the end of the first quarter of 2025, pending a tender of a majority of outstanding Inari shares, regulatory approval and other customary conditions.
Stryker characterized Inari’s product portfolio for venous thromboembolism (VTE) as “innovative [and] highly complementary to Stryker’s Neurovascular business,” which develops and manufactures devices and systems for vascular access, embolization, thrombectomy, angioplasty and stenting.
“The acquisition of Inari expands Stryker’s portfolio to provide life-saving solutions to patients who suffer from peripheral vascular diseases,” Stryker Chair and CEO Kevin Lobo said in a news release. “These innovations elevate the standard of care for venous thromboembolism patients and will accelerate Stryker’s impact in endovascular procedures.”
Inari’s portfolio includes nitinol-enabled devices and systems like the FlowTriever for pulmonary embolism (PE), ClotTriever for deep vein thrombosis (DVT), LimFlow system for chronic limb-threatening ischemia (which Inari purchased for up to $415 million in 2023), and the new Artix thrombectomy system for acute limb ischemia.
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“Inari has positively impacted the lives of hundreds of thousands of patients through the development of purpose-built tools that address unmet patient needs,” Inari CEO Drew Hykes said in the release. “With Stryker’s capabilities and global infrastructure, we will be even better positioned to accelerate the development of innovative new solutions and expand our footprint.”
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Stryker cited CDC statistics showing that up to 900,000 people in the U.S. are affected by VTE.
Analysts react to the Stryker-Inari deal
Stryker executives will discuss their financial expectations from the deal on Jan. 28 during the company’s fourth quarter 2024 earnings call.
Needham & Co. analysts Mike Matson, David Saxon and Joseph Conway said they expect the deal to be about 30 basis points accretive to Stryker’s organic growth and about 70 basis points accretive to gross margin, but about 2.4% dilutive to Stryker’s 2025 estimated earnings per share.
BTIG analysis Ryan Zimmerman expects no regulatory hurdles, but said peripheral vascular competition from Penumbra is a concern, with the company taking peripheral vascular market share with its Lightning Flash and Bolt launches.
“Even with [Stryker’s’ muscle behind [Inari], we expect that [Penumbra] will grow its Thrombectomy business above market, similar to what we’ve seen in Neurovascular,” Zimmerman wrote in an email to clients. “Whether or not this matters to [Stryker] in the near-term though may be less of a concern, but longer-term it will need to overcome this.”
He also noted the U.S. Department of Justice’s ongoing investigation into Inari sales practices, but said Stryker’s deal shows the company’s “comfort in navigating this issue.”
