Philips to acquire Raytel Cardiac Services to expand into United States home cardiac monitoring market

Amsterdam 04 October 2007Royal Philips Electronics will acquire United States-based Raytel Cardiac Services, a division of Raytel Medical Corporation, and other ancillary operations from SHL Telemedicine Ltd., for approximately USD 110 million in cash. Subject to receipt of regulatory approval, the transaction is expected to close in the fourth quarter of 2007, upon which Raytel will become part of Philips' Home Healthcare Solutions business group. Raytel Cardiac Services is a United States provider of home cardiac monitoring services that doctors prescribe to heart patients. Headquartered in Windsor, Connecticut, Raytel Cardiac Services employs highly-trained cardiac technicians working at monitoring centres, where they analyse patient data and provide real-time patient information to prescribing physicians.

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Acquiring Raytel Cardiac Services represents a further step in Philips' health care strategy of improving patient outcomes in specific care cycles, such as cardiology. "Heart disease is the number one killer in the west. So Philips has invested heavily over the years to become the top supplier to hospitals of medical equipment for managing heart disease. Patients are living longer and health care costs are rising, so we're looking for innovative and effective ways to support both patients and the health care system. Raytel can help us extend the cardiac care cycle into the home, which is where patients prefer to stay, and where we see opportunities for addressing health care costs as well as quality of life issues", stated Ron Feinstein, CEO of Philips' Home Healthcare Solutions business group.

The activities Philips is acquiring are expected to have 2007 sales of approximately USD 55 million. In the coming years, Philips aims to grow Raytel Cardiac Services by capitalizing on its existing relationships with 15.000 referring physicians and cardiologists who serve over 200.000 patients annually. Philips aims to leverage these relationships for Philips Lifeline's products and services as well as for Philips' in-house line of remote patient monitoring products and services.

New products and services based on Philips' and SHL's products and solutions, such as congestive heart failure (CHF) monitoring in the home are also expected to fuel growth. Given that Philips Lifeline's 750.000 subscribers often suffer from a variety of chronic illnesses, including CHF, Philips expects they too would benefit from a cardiac monitoring service supported by trained cardiac technicians that Raytel offers.

Since Raytel sells to physicians and cardiologists, these activities will be rebranded under the "Philips" name to benefit from the strength that the "Philips" brand enjoys among health care professionals.

Raytel Cardiac Services is a telemedicine company and a provider of remote pacemaker and ICD monitoring and cardiac diagnostic testing in the United States. The company's highly trained health care professionals use telephone and Internet technology to monitor patients with pacemakers, suspected arrhythmias, implanted defibrillators and other cardiac related conditions. Reports are generated on each patient and forwarded to their doctor for review.

For nearly three decades, Raytel Cardiac Services has been a strong player in remote cardiac monitoring and testing services. Their services include pacemaker monitoring, arrhythmia monitoring, Holter monitoring, ICD monitoring, and anticoagulation patient self-testing. More company news is available in the VMW February 2006 article New Raytel service helps women at risk of sudden cardiac death.

Royal Philips Electronics of The Netherlands is a global expert in health care, lifestyle and technology, delivering products, services and solutions through the brand promise of "sense and simplicity". Headquartered in The Netherlands, Philips employs approximately 125.800 employees in more than 60 countries worldwide. With sales of 27 billion euro in 2006, the company is a market leader in medical diagnostic imaging and patient monitoring systems, energy efficient lighting solutions, personal care and home appliances, as well as consumer electronics. More company news can be found in the VMW September 2007 article Philips awarded state-wide telehealth equipment GPO contract by the California Association for Health Services at Home.


Leslie Versweyveld

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