HeartFlow to go public via merger with Glenview-backed SPAC Longview

HeartFlow, a precision heart care company, has agreed to go public via a merger with Longview Acquisition Corp II, a blank check company backed by Glenview Capital Management.

HeartFlow, a precision heart care company, has agreed to go public via a merger with Longview Acquisition Corp II, a blank check company backed by Glenview Capital Management. When the deal closes, the newly combined company will operate as HeartFlow Group and is expected to trade on the New York Stock Exchange under the ticker symbol “HFLO.” The transaction will also provide the combined company with an estimated $400 million in cash for growth capital, product development and general corporate purposes.

PRESS RELEASE

REDWOOD CITY, Calif. & NEW YORK–(BUSINESS WIRE)–HeartFlow Holding, Inc. (“HeartFlow”, or the “Company”), the leader in revolutionizing precision heart care, and Longview Acquisition Corp. II (NYSE: LGV) (“Longview”), a special purpose acquisition company sponsored by affiliates of Glenview Capital Management, LLC (“Glenview”), announced today that they have entered into a definitive business combination agreement that will support HeartFlow’s vision of revolutionizing precision heart care. Upon completion of the proposed transaction, the combined company will operate as HeartFlow Group, Inc. and is expected to be listed on the New York Stock Exchange (“NYSE”) under the symbol “HFLO.” The transaction will also provide the combined company with an estimated $400 million in cash for growth capital, product development and general corporate purposes.

Company Overview
Founded eleven years ago, HeartFlow is revolutionizing precision heart care with non-invasive, personalized cardiac tests and associated enterprise software suite solutions to address heart disease, the leading cause of death in the world. HeartFlow’s core product, the HeartFlow FFRCT Analysis, is a non-invasive cardiac test for stable symptomatic patients with coronary artery disease (CAD), the most common type of cardiovascular disease. With the HeartFlow FFRCT Analysis, the Company currently targets a $10 billion total addressable market opportunity that it plans to expand to over $50 billion through the introduction of new products, new customer site additions and increased utilization of HeartFlow in existing healthcare systems over the coming years.

Starting with a standard coronary computed tomography angiogram (CTA), the HeartFlow Analysis creates a digital, personalized three-dimensional model of the heart and provides CTA-derived Fractional Flow Reserve (FFRCT) values along the coronary arteries. This information helps physicians understand the degree to which a coronary blockage is impeding blood flow to the heart and determine the best treatment for each patient.

HeartFlow’s technology and business model democratize access to best-in-class diagnostic precision and therapy optimization for all patients. CAD diagnosis and management are rife with disparities in access and care across socially vulnerable populations, who often receive less care, and less than optimal care. The HeartFlow Analysis provides objective quantitative results, minimizes the need for patient visits, and enables access in diverse settings of care from primary care clinics to physician offices to hospitals. As such, HeartFlow delivers the same high-quality solution to all patients regardless of gender, race, ethnicity, geographic location, and socioeconomic status.

The HeartFlow Analysis is based on more than 25 years of scientific research and clinical data on the patient-specific modeling of blood flow in arteries. The Company has performed the HeartFlow Analysis on more than 100,000 patients through clinical development and commercialization.

The HeartFlow Analysis has regulatory clearance and is commercially available today in the U.S., the EU, the U.K. and Japan. The Company’s commercial footprint includes over 470 customer sites globally, with 300 of those in the U.S., including 80% of the top 50 heart hospitals in the U.S., as listed by U.S. News and World Report.

There are currently more than 425 publications specific to the HeartFlow Analysis in peer-reviewed medical journals studying over 10,000 patients with up to five years of follow up data. The data clearly demonstrate a higher diagnostic accuracy compared to other non-invasive tests2, an 83% reduction in unnecessary invasive angiograms, and with that a significant reduction in the total cost of care3.

HeartFlow is led by an experienced management team with significant cardiology, medical technology, and software expertise. The current Board of Directors is comprised of a combination of highly regarded investors and experienced operating executives including Chairman William Weldon, former Chairman and CEO of Johnson and Johnson, and Lonnie Smith, former Chairman and CEO of Intuitive Surgical. John Rodin, CEO of Longview, will join HeartFlow’s Board of Directors upon completion of the merger.

Management Comments
“We believe that our non-invasive, artificial intelligence-enabled, cloud-based enterprise software solution can transform cardiovascular care with risk assessment, diagnosis planning and treatment management,” said John H. Stevens, MD, President, CEO and Co-Founder of HeartFlow. “Importantly, we have brought together a talented group of individuals with deep expertise in technology, cardiovascular medicine, and the business of healthcare and a deep commitment to patients to deliver on this vision. I’m incredibly proud of the HeartFlow team in reaching this important milestone.”

“We are thrilled to co-invest with the associates, leadership and shareholders of HeartFlow to promote rapid adoption of their life-saving, revolutionary approach to cardiac evaluation,” said Larry Robbins, Chairman of Longview and CEO of Glenview. “For us, HeartFlow’s compelling investment attributes leapt off the page: addressing a massive unmet medical need with proprietary, innovative technology through a highly attractive business model that experts widely cite as delivering superior patient outcomes at lower systemic costs.”

“The HeartFlow team is dedicated to providing heart disease patients the best possible care and democratizing access to this incredible technology,” said William C. Weldon, Chairman of the Board of Directors of HeartFlow. “This partnership with Longview and the Company’s existing investors will propel HeartFlow to further assist physicians in diagnosing, managing, and delivering precision care to patients with CAD.”

Investor Comments
“HeartFlow’s commitment to making cardiovascular care easier for doctors and safer for patients while lowering costs is the reason why we have the utmost confidence in their business model and management team,” said Dr. Tom Hawes, Managing Director of The Blue Venture Fund*. “We have supported HeartFlow since 2011 and we are looking forward to building on our partnership in the future as the company heads towards the public market.”

“We were impressed with the advantages the HeartFlow Analysis offered over existing solutions for evaluating CAD,” said Robert Natzler of Baillie Gifford. “We are extremely excited about its ability to simultaneously improve patient outcomes and physician experience whilst taking cost out of the system – a rare example of a win-win-win in healthcare.”

“Our team is proud to support HeartFlow and the outstanding management team,” said Jeffrey C. Lightcap, Senior Managing Director, Founder, HealthCor Partners. “We remain confident that HeartFlow’s non-invasive and accurate alternative method of calculating FFR, the gold standard for assessing coronary stenoses, has the potential to meaningfully change the heart disease treatment paradigm.”

Summary of the Proposed Transaction
The proposed transaction values HeartFlow at an initial pro forma enterprise value of approximately $2.4 billion and a fully distributed equity value of approximately $2.8 billion at signing. The transaction is expected to deliver up to $599 million of gross proceeds to HeartFlow (all coming from the $690 million cash in trust held by Longview) to accelerate growth as well as repurchase up to $110 million of equity from long-time shareholders and employees, representing approximately 5% pro forma shares outstanding. Any excess cash in trust will be distributed by Longview to its shareholders through a special dividend of up to $91 million immediately prior to closing. Pro forma for the business combination, legacy shareholders of HeartFlow and its employees will own approximately 73.0% of the public company.

The proposed transaction has been unanimously approved by each of Longview’s and HeartFlow’s Board of Directors. The proposed transaction is subject to the approval of Longview’s stockholders and the satisfaction or waiver of other customary conditions, including a registration statement being declared effective by the U.S. Securities and Exchange Commission (the “SEC”), and is expected to close in the fourth quarter of 2021.

Additional information about the proposed transaction, including a copy of the merger agreement and an investor presentation, will be provided in Current Reports on Form 8-K to be filed by Longview with the SEC, which will be available at www.sec.gov.

Advisors
J.P. Morgan Securities LLC and Cowen and Company, LLC are acting as financial advisors to HeartFlow. Cowen is acting as capital markets advisor to HeartFlow. King & Spalding LLP is acting as legal advisor to HeartFlow. UBS Investment Bank is acting as sole financial and capital markets advisor to Longview. UBS and Cowen underwrote the IPO of Longview in March 2021. Ropes & Gray LLP is acting as legal advisor to Longview.

About HeartFlow
HeartFlow is the leader in revolutionizing precision heart care, uniquely combining human ingenuity with advanced technology. HeartFlow’s non-invasive HeartFlow FFRCT Analysis leverages artificial intelligence to create a personalized three-dimensional model of the heart. By using this model, clinicians can better evaluate the impact a blockage has on blood flow and determine the best treatment for patients. HeartFlow’s technology is reflective of our Silicon Valley roots and incorporates over two decades of scientific evidence with the latest advances in artificial intelligence. For more information, visit www.heartflow.com.

About Longview Acquisition Corp. II
Longview was formed to partner with high-quality, growing companies to facilitate their successful entry to the public markets. Longview is sponsored by an affiliate of Glenview Capital Management, a registered investment adviser with a track record of creating value through constructive partnerships with companies operating in the public markets.