What's going on?

On Tuesday, Boston Scientific � the $50 billion American maker of medical devices � agreed to buy British healthcare firm BTG for $4.2 billion.

What does this mean?

Boston Scientific makes medical essentials like stents, which hold open damaged blood vessels. It wants to buy BTG in order to expand into (depressingly) high-growth areas of medicine like cancer and blood clots. Among other things, BTG makes tiny products that doctors insert into patients� bodies during minimally invasive surgery. BoSci believes that buying BTG will bring new, complementary areas of expertise to the combined company.

Why should I care?

For markets: Papering over expensive cracks?

Boston Scientific is no stranger to acquisitions � the company has cut more than 20 deals in the last five years � but BTG is its biggest since 2005. And while BTG�s share price jumped 34% on Tuesday, close to the deal price, the buyer�s fell 7%. Boston Scientific�s in the midst of a restructuring intended to shave $100 million off costs, in part by cutting jobs. Adding BTG�s 1,600 employees to its existing 29,000 probably means even more job losses are likely in the future. After all, the very existence of a restructuring plan may suggest the company�s struggled to deliver the �synergies� promised by its previous acquisitions.

The bigger picture: More M&A on the way?

A third of BTG�s sales currently comes from pharmaceutical products � including antidotes for drug overdoses and rattlesnake venom. That doesn�t really gel with Boston Scientific�s hardware-focused business � and the company hasn�t yet decided what it�ll do with that part of BTG. If BoSci decides to sell, it could find a buyer in the guise of European pharma companies, which spent the first half of 2018 chopping and changing their businesses to focus more on dismayingly trendy areas like tumor-treating oncology � and are perhaps keen to take advantage of lower valuations of UK pharma companies compared to global rivals.