Developer of tumour-targeting ‘sonic beam’ fields takeover offers

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Johnson & Johnson-backed HistoSonics, a developer of sonic beams that attack tumours, is pursuing a sale after fielding takeover bids from several suitors, said people familiar with the matter.

HistoSonics, which makes a non-invasive ultrasound treatment for the most aggressive form of liver cancer, is seeking a valuation of more than $2.5bn, one of the people said.

Medical device manufacturers including Medtronic, GE HealthCare and Johnson & Johnson, which already holds a stake in the privately held group, are evaluating the business, they added. Other suitors could emerge.

The sale comes amid a dry spell for deal activity. The number of tie-ups in the Americas region in the first four months of the year dipped to its lowest level in almost a decade, but a few large transactions buoyed total deal value to $629bn, keeping it roughly flat compared with last year.

A sale could be clinched in the near future, with final bids expected in the coming weeks, though a deal may fall apart and the current owners may decide to hold on to the business, the people cautioned.

HistoSonics had also tapped advisers to explore a public listing, but a sale was prioritised as market turmoil has shut down listing markets in recent weeks.

Founded in 2009 with technology developed by the University of Michigan, HistoSonics’ lead product uses a sonic beam to blast and destroy tumour tissue, as part of a process known as histotripsy. The US Food and Drug Administration approved the technology to treat liver cancer in 2023, and is being studied in kidney and pancreatic cancer.

The Ann Arbor, Michigan-based business has benefited from fast-growing sales in recent years following its first regulatory approval in the US, with revenues expected to reach $100mn this year and $200mn next year.

Citigroup is advising HistoSonics on the sale.

HistoSonics’ backers include Johnson & Johnson’s venture capital arm as well as venture capital firms Lumira Ventures and Alpha Wave Global, according to data provider PitchBook. The company raised $102mn funding round last year.

HistoSonics, Medtronic and Johnson & Johnson did not immediately respond to requests for comment. GE HealthCare and Citigroup declined to comment.