Pfizer completes sale of Shiley product lines

By DAVE McNARY UPI Business Writer

IRVINE, Calif. -- Pfizer Inc. said Friday it has completed the sale of most of its troubled Shiley Inc. unit to a subsidiary of Italian conglomerate Fiat Group for $250 million.

The deal, first announced on Dec. 20, will not include seven product lines which Pfizer has said have 'unusual growth potential,' nor does it include Shiley as a corporate entity.


Shiley, of Irvine, Calif., will continue to handle the liabilities from the failures of its Bjork-Shiley Convexo-Concave heart valve, which has been implanted in 86,000 patients. About 450 of the valves have fractured so far, leading to nearly 300 deaths.

Shiley withdrew the valve from the market in 1986 when federal regulators recalled it. Executives at New York-based Pfizer have said its decision last summer to put most of Shiley on the sales block was not related to problems with the heart valves, but stemmed from a previously announced strategy to focus on more technologically oriented product lines.

Shiley, started in the garage of engineer Donald Shiley in 1966 and sold to Pfizer in 1979, has about 1,100 employees and $170 million in annual sales. It will continue to operate the Shiley Heart Valve Research Center, a program designed to establish a patient registry and assist recipients of potentially defective valves.


The original announcement in December had not included a sales price. Pfizer said the purchase included $230 million in cash and the assumption of about $20 million by the Fiat unit, Sorin Biomedica S.p.A. , an affiliate of SNIA BPD S.p.A., of Milan, Italy.

The Shiley product lines being sold include devices used in open heart surgery, blood-handling devices, the Monostrut artificial heart valve and a line of tracheostomy tubes.

Pfizer indicated that Sorin Biomedica will retain the businesses and that virtually all of the affected employees will not be affected.

'We are pleased that these product lines have been sold to a large, technology-oriented company with the resources in place to enable it to maintain these medically important products,' said Henry McKinnell, president and chief executive officer of Pfizer's Hospital Products group.

McKinnell said the transaction should not have a significant impact on the financial results of Pfizer, which has annual revenues of more than $6.5 billion.

The Shiley businesses that were not sold include Howmedica, which specializes in artificial joints and trauma products; Valleylab, which sell electrosurgical and ultrasonic surgery systems; Schneider, which produces angioplasty devies; and American Medical Systems, which produces implantable devices to treat impotence and incontinence.


Three small product lines were also retained: Infusaid, which produces infusion pumps; Biomedical Sensors and Strato Medical Corp., which specializes in vascular access products.

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