Medical device giant Boston Scientific will acquire remote cardiac monitoring company Preventice Solutions for nearly $1 billion. The deal will include $925 million in cash and up to $300 million in milestone payments.

Boston Scientific (NYSE: BSX) already had a 22% stake in Preventice prior to the deal. The Minnesota-based company makes wearable cardiac monitors that adhere to patients’ chests. They can be used to help physicians detect arrhythmias in patients, such as atrial fibrillation or tachycardia. Last year, Preventice reported net sales of $158 million, a 30% increase from 2019.

The deal should complement Boston Scientific’s range of diagnostic and surgical devices for cardiology, which include pacemakers and stents. Boston Scientific currently makes an implantable cardiac monitor to detect arrhythmias, but Preventice’s devices could serve as a wearable alternative.  It will also acquire Preventive’s algorithms to detect, classify and interpret variations in heart rhythm data.

“This acquisition will provide Boston Scientific with a foothold in the high-growth ambulatory electrocardiography space, which strongly complements our recent entrance into the implantable cardiac monitor market and will serve as an important component of our category leadership strategy in cardiac diagnostics and services – a nearly $2B market anticipated to grow double digits annually,” Scott Olson, Boston Scientific’s president of Rhythm Management, said in a news release.

The use of wearable devices for remote patient monitoring has boomed in recent years, as Apple, Fitbit and AliveCor received FDA clearances for algorithms designed to help users detect potential arrhythmias. Last year, the Centers for Medicare and Medicaid Services began allowing physicians to bill Medicare for remote monitoring that takes place in patients’ homes, and has further expanded coverage since the start of the pandemic.

“We have been humbled to provide thousands of physician practices with services based on near real-time clinical data to enable the diagnosis and management of more than one million cardiac patients, without needing to interrupt their daily activities,” Preventice CEO Jon Otterstatter said in a news release. “Boston Scientific has been a key investor in Preventice for more than five years and we believe the company has the commercial reach, diagnostics expertise and operational infrastructure to bring these advanced monitoring technologies to more patients worldwide.”

The deal is expected to close in mid-2021.

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