Roche To Buy Insulin Pump Producer Medingo For Up To $200 Million

Swiss pharmaceutical company Roche Holding AG (ROG.VX) said Tuesday it plans to acquire medical equipment company Medingo Ltd. for up to $200 million.

MAIN FACTS:

- Roche and Israel-based Elron Electronic Industries Ltd. (ELRN.TV) announced today that they have signed an agreement under which Roche will acquire 100% of Elron subsidiary Medingo, a developer of a semi-disposable insulin patch pump.

- Roche will pay Medingo Ltd.'s shareholders an upfront payment of $160 million as well as up to 25% of the upfront payment in performance related milestones.

- The new Medingo Ltd. micro pump insulin delivery system consists of two parts: a semi-disposable insulin dispensing patch and a remote control, which allows for discreet personalized insulin delivery. It provides the functions of a conventional insulin pump alongside with all advantages of the innovative tubeless patch pump technology.

- The Medingo Ltd. patch pump is not yet marketed. In a next step, production capacities will be scaled-up to prepare for global launch which is expected by 2012.

The acquisition will strengthen Roche Diabetes Care's position in the fast growing segment of insulin delivery systems. In 2009, the insulin delivery system global market was estimated at 1.6 billion Swiss francs ($1.5 billion). While the whole market is growing rapidly, the expectations for the growth of the patch pump segment are even higher.

- The transaction is subject to certain closing conditions, including regulatory approvals. Approval by Elron or Roche shareholders isn't required.

Company Web site: http://www.roche.com

-By Zurich Bureau, Dow Jones Newswires; [phone]; [e-mail]