This $16 Billion Deal Takes Two Leaps of Faith
With the coronavirus still raging, it's far from clear when Siemens Healthineers's takeover of Varian Medical Systems will pay off.
Fighting cancer.
Photographer: Mikhail Japaridze/TASS via Getty Images
The aspiration for the biggest medical deal of the year is commendable — to transform cancer treatment so sufferers can live longer and better lives. In pursuit of this goal, German diagnostics group Siemens Healthineers AG has agreed to pay a high price to acquire U.S. radiotherapy specialist Varian Medical Systems Inc.
Covid-19 has displaced existing medical priorities this year. Cancer hasn’t gone away, but spending on the technology used to treat it has, at least temporarily. With elective procedures pushed out to make space for coronavirus patients, and hospitals spending heavily on safety measures, Varian’s underlying revenue fell by 19% in its most recent quarter. A 14% decline in orders for its oncology systems division was a troubling indication of the future trajectory.