Core Viewpoint - Merit Medical Systems, Inc. has signed a definitive asset purchase agreement to acquire the C2 CryoBalloon™ device and related technology from Pentax of America, Inc. for a total consideration of $22 million, aiming to enhance its offerings in the gastroenterology market and improve patient outcomes [1][8]. Company Overview - Merit Medical is a global leader in healthcare technology, focusing on the development, manufacture, and distribution of proprietary medical devices used in various medical procedures [14]. - Pentax Medical, a subsidiary of the HOYA Group, specializes in flexible, reusable endoscopy solutions and is committed to delivering high-quality endoscopic equipment [15]. Acquisition Details - The acquisition includes a $19 million cash payment at closing and potential contingent payments of up to $3 million based on certain milestones [8]. - The C2 CryoBalloon device is designed to treat chronic gastroesophageal reflux disease (GERD) and other gastrointestinal tissue disorders through controlled freezing treatments [3][4]. Market Impact - The acquisition is expected to strengthen Merit's position in the multibillion-dollar gastroenterology market, providing more treatment options for patients suffering from conditions like Barrett's esophagus [5][9]. - The C2 CryoBalloon is projected to contribute approximately $1 million in revenue from November 1, 2025, to December 31, 2025, and is expected to generate between $6 million to $8 million in revenue for the twelve months ending December 31, 2026 [8][9]. Financial Projections - The acquisition is anticipated to dilute Merit's non-GAAP net income and earnings per share by approximately $0.4 million and $0.01, respectively, for the initial period [8]. - For the full year 2025, the acquisition is projected to dilute GAAP net income and earnings per share by approximately $0.5 million and $0.01, respectively [8][10]. Integration Plans - Merit plans to transfer product manufacturing to its facility in South Jordan, Utah, and expects to retain some PENTAX employees involved in the C2 CryoBalloon business to leverage their expertise [7].

Core Insights - PENTAX Medical has entered into an asset purchase agreement with Merit Medical Systems for the acquisition of the C2 CryoBalloon technology, which aligns with its strategic focus on core flexible reusable endoscopy solutions [1][2][4] - The C2 CryoBalloon technology, which has been part of PENTAX Medical's portfolio since 2017, provides a minimally invasive treatment option for patients with Barrett's Esophagus and other gastrointestinal disorders [2][3] - The transition allows PENTAX Medical to concentrate on its core strengths while Merit Medical is expected to enhance the adoption and impact of the C2 technology [3][4] Company Overview - PENTAX Medical is a division of HOYA Group, specializing in flexible, reusable endoscopy solutions, and is committed to delivering high-quality imaging and intuitive solutions for healthcare professionals [5] - Merit Medical, founded in 1987, develops and distributes proprietary medical devices across various medical fields, including endoscopy, and employs approximately 7,300 individuals globally [6] - HOYA Corporation, established in 1941, is a leader in healthcare and technology innovation, providing advanced products for life care and supporting various industries with high-precision components [7]