Thoratec's previous move to sell its International Technidyne Corporation (ITC) division to Danaher for $110 million has been terminated, after the companies failed to agree on the terms of the transaction, particularly surrounding its regulatory filings and system quality.
According to Pleasanton, Calif.-based Thoratec, part of the reason the deal fell through was because the of the FDA’s delay to clear the company's initial 510(k) submission for its ProTime InRhythm product, which helps with anticoagulation monitoring. Rather than continue to negotiate the closing conditions of the deal, the agreement was terminated.
However, Thoratec said that it intends to re-submit a 510(k) application for InRhythm to the FDA later this year.
While Thoratec said that it anticipates that its ITC division will be sold within the next 12 months, it will currently account the division as “held for sale,” and will display results in the company’s second quarter 2010 financial statements.
Under the initial terms of agreement, Danaher would have paid Thoratec $110 million in cash upon the deal's closing. Additionally, the transaction would have included an earn-out that was based on the achieved annual gross profit levels. Thoratec estimated these earn-outs, which would have been rolled out over a course of three years, to be $26 million.