US-based medical device maker Boston Scientific Corp today agreed to acquire Cameron Health Inc for $150 million in cash and additional payments of up to $1.20 billion on achieving certain regulatory and sales milestones.

San Clemente, California-based Cameron Health has developed the world's only subcutaneous implantable cardioverter defibrillator - the S-ICD System that can be implanted beneath the skin, unlike conventional defibrillators, which require thin, insulated wires to pass through the venous system and into the heart.

The S-ICD System sits just below the skin and leaves the heart and blood vessels untouched. This one-of-a-kind technology has the potential to expand the reach of ICD therapy, offering physicians and patients a new alternative to traditional ICDs.

Boston Scientific will pay $150 million on closing and another $150 million if Cameron's S-ICD System gets the US Food and Drug Administration approval.

The world's second-largest cardiac-device maker will pay another $1.05 billion upon the device generating specified revenue over a six-year period. 

The S-ICD System has been commercially available in select countries, including several major European countries, since 2009. Boston Scientific said that the system has been clinically evaluated in a variety of studies and has been implanted in more than 1,000 patients worldwide.

The company expects the FDA to approve it by the first half of 2013.

The S-ICD System was designed to eliminate the complications associated with transvenous leads, creating an important new treatment option for patients at risk of sudden cardiac arrest," said Kevin Hykes, president and CEO of Cameron Health.

For Boston Scientific, which has made 13 acquisitions in the last 5 years, the Cameron deal would be one of its largest acquisitions since its 2006 purchase of Guidant Corp for $28.5 billion.
 
"The acquisition of Cameron Health builds on Boston Scientific's commitment to introducing innovation in the CRM space and represents an important part of our strategy to generate top-line revenue and market share growth. We believe that the S-ICD System represents a breakthrough treatment for patients at risk of sudden cardiac arrest,'' said Hank Kucheman, CEO of Boston Scientific.

The Massachusetts-based company has been grappling with the aftermath of its Guidant acquisition, and big legal settlements. Sales of the company's cardiovascular instruments, including drug-coated stents have been sluggish for years and have fallen both in the US and the international markets.

The medical communities have raised questions on the benefit of stents compared to drug therapy.

In 2011, its arch rival Johnson & Johnson said it would abandon the coronary stent business and end development of its next-generation Nevo drug-coated coronary stent as well as wind down production and sale of its older Cypher stent by the end of the year.

J&J's exit would benefit its competitors like Medtronic, Boston Scientific and St. Jude