Leading medical devices maker St. Jude Medical (STJ) has completed its acquisition of medical technology firm LightLab Imaging for roughly $90 million. LightLab will be integrated into St. Jude’s cardiovascular division.

Massachusetts-based LightLab specializes in optical imaging technology that helps physicians diagnose and treat cardiovascular conditions. The company is a pioneer in the development of Optical Coherence Tomography (OCT), a next-generation imaging technology.

OCT is an optical signal acquisition and processing technique that employs near-infrared light to generate high-resolution images that are ten times better (in resolution) and twenty times faster (in image capture) than those produced by the competing intravascular ultrasound imaging systems (IVUS) marketed by incumbent players such as Volcano Corp. (VOLC) and Boston Scientific (BSX).

LightLab received clearance from the Food and Drug Administration (FDA) in May 2010 to market its first OCT products (C7-XR imaging system and companion C7 Dragonfly imaging catheter) in the U.S. These products are also approved for marketing in Europe and are currently awaiting regulatory clearance in Japan. LightLab’s OCT technology has been used by the clinicians in 40 countries across the globe to perform high resolution imaging of vessel structure in numerous coronary interventions.

The OCT market has been projected to grow at a double-digit rate over the next five years. The IVUS market is growing at an annual rate of 10%?15% and is forecasted to reach $500 million in 2010. The OCT imaging market could potentially grow at a faster rate than IVUS in future, offering a lucrative business prospect for St. Jude.

With LightLab acquisition, St. Jude Medical is now the first company to offer a comprehensive product portfolio that includes both OCT and the company’s Fractional Flow Reserve (FFR) technology. FFR technology, which was acquired by St. Jude through its acquisition of Radi Medical in 2008, is an index that identifies and measures the severity of coronary artery narrowing.

This unique combination (OCT-FFR) provides cardiologists with comprehensive information to assess and determine the lesions that warrant coronary interventions, resulting in better treatment outcomes.

The acquisition of LightLab has enabled St. Jude to compete and expand in the intravascular imaging market. It also accelerates its cardiovascular business by offering a comprehensive suite of novel products. St. Jude expects OCT to offer an additional $20 million in revenues to its cardiovascular business during the second half of 2010.

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