Brief summaries of recent medtech market and industry developments. This month we cover J&J's and Medtronic's moves in a-fib, Abbott's acquisition of AMO, Northstar Neuroscience's demise and Invatec's European launch of its drug-eluting balloon. Plus a snapshot of ambulatory surgery in the US.

The ophthalmic industry has traditionally stood alone, with its own device and pharmaceutical companies selling products marketed to specialists. So the announcement on January 12 that diversified giant Abbott Laboratories would acquire Advanced Medical Optics was initially astonishing, as was the hefty premium that Abbott offered. Perhaps Abbott was willing to pay more than it otherwise would have because of the recent divestiture of its Abbott Spine business. In AMO, Abbott is getting a business that almost can't fail to grow by double digits (despite recent economic stresses on the laser vision correction market) because of the demographics of the ophthalmology industry and improving margins on products like intraocular lenses, which serve the burgeoning elderly cataract patient population.

These days, medtech investors need to be much more selective about how they spend their capital. In pursuit of steady streams of early-stage opportunities with a high likelihood of success, VCs are establishing closer ties with entprepreneurs and executives they feel can do it again.

After an initial warm welcome for first-generation femoral artery closure devices--including a few high-profile exits--sales have stalled. Early devices are flawed, indicating the technical challenge is tougher than it looks. A dozen or so start-ups are trying to address the technology problems that have hampered the pioneers. The newcomers face high hurdles as early experience with first generation devices temper clinician and investor enthusiasm. All will have to prove, in large, rigorous clinical trials, that devices are more complication-free and are as easy-to-use as market leader Angio-Seal, and that they're at least as safe, if not safer, than manual compression. But although start-ups face a great of skepticism about particular technologies, they also inherit a $350 million market made up of devices with an average selling price of $200, which is an endorsement of this new device market. At the same time, an enormous opportunity remains in the 75% of the market that remains unpenetrated.