Nearly three years after Beckon Dickinson spun off its diabetes care unit, the Franklin Lakes-based global medical technology company aims to slim down even further to focus on its core business.

As part of a plan announced Feb. 5, BD seeks to divest its diagnostic and biosciences divisions and continue as a pure-play medtech company.

Under the proposal, the “new BD” will concentrate on four segments. The company believes these pillars align with “both essential needs and higher-growth trends” in health care:

• Medical Essentials: Medication delivery solutions and specimen management, like IV catheters, blood collection solutions, syringes and advanced needle technologies;
• Connected Care: Tech-powered medication management solutions and advanced patient monitoring device;
• BioPharma Systems: Biologic drug delivery for medications that rely on patient self-injection, including GLP-1 treatments;
• Interventional: Urology & critical care, peripheral intervention and surgery businesses.

According to BD, the separation plan has been in the works since early 2024. It supports the company’s larger five-year strategy, designed to focus on high-growth and high-margin markets. Initiated in 2020, that plan calls for long-term, compounded annual revenue growth of 5.5% or more.

Shedding the diagnostics solutions and biosciences businesses will enable BD to pursue more tuck-in acquisitions and invest in high-impact R&D within its four new operating segments, the company said.

In 2024, diagnostics solutions and biosciences brought in a collective $3.4 in sales. The units make diagnostic products such as those used to detect infectious diseases and cancers.

BD’s remaining medtech business generated revenue of $17.8 billion last year. According to the company, medical essentials and interventional are the unit’s two biggest businesses, bringing in about $6.2 billion and $5 billion, respectively.

An ‘exciting next step’

In a statement, Tom Polen, chairman, CEO and president of BD, said, “Our BD 2025 strategy has transformed the company into a faster-growing, more profitable organization positioned at the forefront of long-term growth trends in health care, and we believe today’s announcement is an exciting next step in unlocking significant potential value for all our stakeholders.”

“We believe the separation will position New BD as a differentiated medtech leader and enable optimized investment to accelerate our innovation pipeline and ongoing margin enhancement through BD Excellence to further fund growth. We believe Biosciences and Diagnostic Solutions is expected to deliver substantial value as a pure-play leader in life sciences and will be well-positioned to execute on its unique and compelling solutions and growth opportunities. This transaction is designed to position both businesses to thrive in our respective sectors and deliver value for shareholders,” he said.

In addition to announcing the divestment, BD reported first quarter earnings of $5.17 billion in revenue, beating Wall Street’s expectations of $5.1 billion.

According to BD, its board of directors has approved the transaction and is open to pursuing a spinoff or outright sale. The company intends to announce more details by the end of fiscal 2025.

CNBC noted that the news came two days after activist investor Starboard Value took a stake in BD and was pushing the company to sell its life sciences unit.

Power plays:

BD was named to the inaugural 2024 NJBIZ New Jersey Businesses Power List. Find out who else was named here.