SC 14D9/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

AMENDMENT NO. 5
TO
SCHEDULE 14D-9

Solicitation/Recommendation Statement under Section 14(d)(4)
of the Securities Exchange Act of 1934

ALARIS MEDICAL SYSTEMS, INC.
(Name of Subject Company)

ALARIS MEDICAL SYSTEMS, INC.
(Name of Person(s) Filing Statement)

COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)

011637 10 5
(CUSIP Number of Class of Securities)

David L. Schlotterbeck
President and Chief Executive Officer
ALARIS Medical Systems, Inc.
10221 Wateridge Circle
San Diego, California 92121
(858) 458-7000
(Name, address and telephone number of person authorized to receive
notices and communications on behalf of the person(s) filing statement)

with copies to:

Marjorie Sybul Adams, Esq.
Piper Rudnick LLP
1251 Avenue of the Americas
New York, New York 10020
(212) 835-6000

o   Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.

                 ALARIS Medical Systems, Inc., a Delaware corporation (“ALARIS” or the “Company”), hereby amends and supplements its statement on Schedule 14D-9 (the “Statement”), initially filed with the Securities and Exchange Commission on May 28, 2004, as amended and supplemented to date, with respect to the tender offer by Blue Merger Corp., a Delaware corporation (“Subcorp”) and a wholly owned subsidiary of Cardinal Health, Inc., an Ohio corporation (“Cardinal Health”), to purchase all of the outstanding shares of the Common Stock, par value $0.01 per share, of the Company (“Company Common Stock”), at a purchase price of $22.35 per share (the “Offer Price”), net to seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated May 28, 2004 (the “Offer to Purchase”), and in the related Letter of Transmittal (which, together with any amendments or supplements to the Offer to Purchase and the Letter of Transmittal, collectively, constitute the “Offer”).

Item 9.  Exhibits

The following Exhibits are filed with this Amendment No. 5 to this Statement:

Exhibit No.	Description
(a)(22)	Complaint filed in United States District Court for the Central District of California, Southern Division, captioned ICU Medical, Inc. v. ALARIS Medical Systems, Inc., Case No. SACV04-0689 AHS (RNBx), filed June 16, 2004.
(a)(23)	Press Release issued by ALARIS Medical Systems, Inc., dated June 18, 2004.

2

SIGNATURE

                After due inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this Statement is true, complete and correct.

Dated: June 18, 2004 ALARIS MEDICAL SYSTEMS, INC.

By: /s/ DAVID L. SCHLOTTERBECK
————————————————
David L. Schlotterbeck
President and Chief Executive Officer

EX-99.(A)(22)

Exhibit (a)(22)

DONALD L. MORROW (SBN 66922)
PAUL, HASTINGS, JANOFSKY & WALKER LLP
695 Town Center Drive
Seventeenth Floor
Costa Mesa, CA 92626
Telephone: (714) 668-6200
Facsimile: (714) 979-1921

JOHN M. BENASSI (SBN 074137)
STEPHEN S. KORNICZKY (SBN 135532)
S. CHRISTIAN PLATT (SBN 199318)
CHRISTOPHER K. EPPICH (SBN 228025)
PAUL, HASTINGS, JANOFSKY & WALKER LLP
3579 Valley Centre Drive
San Diego, CA 92130
Telephone: (858) 720-2500
Facsimile: (858) 720-2555

Attorneys for Plaintiff
ICU MEDICAL, INC.

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

SOUTHERN DIVISION

ICU MEDICAL, INC., a Delaware corporation,	CASE NO. SACV04-0689 AHS (RNBx)
Plaintiff,	COMPLAINT FOR PATENT INFRINGEMENT
vs.	DEMAND FOR JURY TRIAL
ALARIS MEDICAL SYSTEMS, INC., a Delaware corporation
Defendant.

        Plaintiff ICU Medical, Inc. (“ICU Medical”) complains against defendant Alaris Medical Systems, Inc. (“Alaris”) as follows:

JURISDICTION

        1.      This is an action for patent infringement arising under the Patent Laws of the United States, 35 U.S.C. § 271 et seq. The Court has jurisdiction over this action pursuant to 28 U.S.C. §§ 1331 and 1338(a).

        2.     Venue is proper in this district under 28 U.S.C. §§ 1391 and 1400(b).

THE PARTIES

        3.     Plaintiff ICU Medical is a corporation organized under the laws of the State of Delaware, having its principal place of business and corporate headquarters located at 951 Calle Amanecer, San Clemente, California 92673.

        4.     On information and belief, at all relevant times mentioned below, defendant Alaris was and is a corporation organized under the laws of Delaware, with its principal place of business and corporate headquarters located at 10221 Wateridge Circle, San Diego, California 92121-2772.

SUMMARY OF FACTS

ICU Medical, Inc.

        6.        Plaintiff ICU Medical is primarily engaged in the design, development and marketing of proprietary, disposable medical connection systems for use in intravenous (“I.V.”) therapy applications, including needle-free valves. ICU Medical markets a complete line of custom and generic I.V. systems, which include various needle-free valves such as ICU Medical’s CLAVE Connector.

1

COMPLAINT FOR PATIENT INFRINGEMENT
AND DEMAND FOR JURY TRIAL

        7.        Plaintiff ICU Medical is currently marketing its needle-free valves and medical connection systems for use in I.V. therapy applications within this judicial district for commercial sale.

Alaris Medical Systems, Inc.

        8.        Alaris is engaged in the design, development, importation, marketing, use and sale of disposable medical connection systems for I.V. therapy applications. In particular, Alaris makes, uses, sells, offers for sale and imports SmartSite and SmartSite Plus needle-free valves and systems that incorporate one or more such valves (including certain Medley™ System/Gemini System Disposables, Signature Edition® System Disposables, MedSystem® III Disposables, Components, Extension Sets and Gravity Sets) (collectively, “SmartSite and SmartSite Plus Needle-Free Valves and Systems”).

        9.        Alaris sells its SmartSite and SmartSite Plus Needle-Free Valves and Systems within this judicial district and elsewhere throughout the United States. The majority of Alaris’ sales of SmartSite and SmartSite Plus Needle-Free Valves and Systems occur outside of this judicial district.

ICU Medical’s Patent

        10.        United States Patent No. 6,682,509 (“the ‘509 patent”) was duly and legally issued on January 27, 2004, for an invention entitled “Medical Valve and Method of Use,” and was assigned to and is owned by ICU Medical, Inc. A Certificate of Correction of the ‘509 patent was issued by the Patent and Trademark Office on June 15, 2004. A true and correct copy of the ‘509 patent is attached as Exhibit A.

2

COMPLAINT FOR PATIENT INFRINGEMENT
AND DEMAND FOR JURY TRIAL

CAUSE OF ACTION
(Infringement of the ‘509 Patent by Alaris’ SmartSite and SmartSite Plus Needle-Free Valves and Systems)

        11.        Plaintiff ICU Medical hereby incorporates by this reference paragraphs 1 through 10 inclusive.

        12.        Alaris has been and is still infringing the ‘509 patent by making, using, offering for sale, and selling within the United States Alaris’ SmartSite and SmartSite Plus Needle-Free Valves and Systems.

        13.        Alaris has been and is still inducing the infringement of, or contributorily infringing, the ‘509 patent, by inducing others to make, sell, offer for sale and use within the United States, SmartSite and SmartSite Plus Needle-Free Valves and Systems, or by contributing to the infringement by others of the ‘509 patent by providing to others, SmartSite and SmartSite Plus Needle-Free Valves and Systems.

        14.        Alaris will continue to infringe, induce the infringement of, and contributorily infringe the ‘509 patent unless enjoined by the Court.

        15.        Plaintiff ICU Medical is informed and believes, and therefore alleges that Alaris’ infringement of the ‘509 patent is willful.

        16.        Plaintiff ICU Medical has been damaged by Alaris’ infringement, inducement to infringe, and contributory infringement, and is suffering and will continue to suffer damage and irreparable harm as a result, unless the Court enjoins defendant.

PRAYER FOR RELIEF

        WHEREFORE, Plaintiff prays for:

        1.     Judgment that U.S. Patent No. 6,682,509 is infringed by defendant Alaris;

3

COMPLAINT FOR PATIENT INFRINGEMENT
AND DEMAND FOR JURY TRIAL

        2.     A temporary restraining order and preliminary and permanent injunction enjoining Alaris, its officers, agents, servants, employees, and those persons acting in active concert or in participation with them or any of them from infringing, inducing the infringement of, or contributorily infringing the ‘509 patent;

        3.     An accounting of the profits and damages arising out of defendant’s infringement, inducing the infringement, or contributory infringement of the ‘509 patent, an award of those profits and damages together with interest, and a judgment that the profits and damages so adjudged be trebled;

        4.     Judgment that Plaintiff ICU Medical be awarded its attorneys’ fees, costs, and expenses incurred in this action; and

        5.     Such other and further relief as the Court may deem just and proper.

DEMAND FOR JURY TRIAL

        ICU Medical demands a trial by jury for all claims triable by jury pursuant to Fed. R. Civ. P. 38 and Civil L.R. 38-1.

DATED: June 16, 2004 PAUL, HASTINGS, JANOFSKY & WALKER LLP

By: /s/ S. Christian Platt
————————————————
S. CHRISTIAN PLATT

Attorneys for Plaintiff
ICU MEDICAL, INC.

4

COMPLAINT FOR PATIENT INFRINGEMENT
AND DEMAND FOR JURY TRIAL

EX-99.(A)(23)

Exhibit (a)(23)

 ALARIS Medical Systems, Inc.

 Corporate Headquarters

 10221 Wateridge Circle

 San Diego, CA

 (858) 458-7000 (phone)

 (858) 458-7760 (fax)

News Release

AT THE COMPANY:
Media: Frank Jepson VP Corp. Communications & IR (858) 458-7448 fjepson@alarismed.com	Investors: William C. Bopp Sr. VP & CFO (858) 458-7994 wbopp@alarismed.com

FOR IMMEDIATE RELEASE
June 18, 2004

ALARIS MEDICAL SYSTEMS SAYS
ICU MEDICAL PATENT SUIT IS WITHOUT MERIT

TENDER OFFER AND MERGER WITH CARDINAL HEALTH UNAFFECTED

SAN DIEGO, CA, JUNE 18, 2004 (BUSINESS WIRE) – ALARIS Medical Systems, Inc. (NYSE:AMI) said today that the allegations in the patent lawsuit announced yesterday by ICU Medical, Inc. are wholly without merit and that the Company believes the ALARIS^® SmartSite^® and SmartSite^® Plus needle-free products do not infringe the ICU Medical patent. ALARIS intends to vigorously defend its intellectual property.

On May 18, 2004, Cardinal Health, Inc. entered into a definitive agreement to acquire ALARIS Medical Systems. Commenting on this matter, David L. Schlotterbeck, president and chief executive officer of ALARIS Medical Systems, said, “We believe that the ICU litigation will have no effect on the tender offer or the merger, and that the acquisition of ALARIS Medical Systems by Cardinal Health will close by the end of June as originally announced.” Schlotterbeck added, “We plan to vigorously defend our intellectual property and related products, however long that takes.”

About ALARIS Medical Systems, Inc.

ALARIS Medical Systems, Inc. develops and markets products for the safe delivery of intravenous (IV) medications. Our IV medication and infusion therapy delivery systems, software applications, needle-free disposables and related monitoring equipment are marketed in the United States and internationally. Our “smart” pumps, with the proprietary Guardrails^® Safety Software, help to reduce the risks and costs of medication errors, help to safeguard patients and clinicians and gather and record clinical information for review, analysis and interpretation. We provide our products, professional and technical support and training services to over 5,000 hospital and health care systems, as well as alternative care sites, in over 100 countries through our direct sales force and distributors. Headquartered in San Diego, California, we employ approximately 3,000 people worldwide. Additional information on ALARIS Medical Systems can be found at http://www.alarismed.com.

This news release contains forward-looking statements as defined in the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Persons reading this release are cautioned that such forward-looking statements involve risks and uncertainties including, without limitation, the effect of legislative and regulatory changes affecting the health care industry, the historic seasonality of the Company’s sales, the long sales cycle on large capital equipment sales in North America, the difficulty to precisely predict when hospital capital budgets will permit investment in capital equipment, the potential of increased levels of competition, technological changes, the dependence of ALARIS Medical Systems upon the success of new products (including its proprietary Guardrails^® Safety Software, the Medley^™ Medication Safety System and the Asena^® infusion platform) and ongoing research and development efforts including obtaining regulatory approvals, restrictions contained in the instruments governing the Company’s indebtedness, and the significant leverage to which the Company is subject. These and other risk factors are described in the Securities and Exchange Commission filings of ALARIS Medical Systems, Inc., formerly known as ALARIS Medical, Inc., including Form 10-K for the year ended Dec. 31, 2003, and other filings. On June 30, 2003, the two companies were merged. Subsequent SEC filings are available only for ALARIS Medical Systems, Inc. The Company assumes no obligation to update any forward-looking statements as a result of new information or future events or developments.

This announcement is neither an offer to purchase nor a solicitation of an offer to sell securities of ALARIS Medical Systems. Cardinal Health has filed a tender offer statement with the U.S. Securities and Exchange Commission and ALARIS has filed a solicitation/recommendation statement with respect to the Cardinal Health tender offer. Investors and ALARIS stockholders are strongly advised to read the tender offer statement (including the offer to purchase, letter of transmittal and related tender documents) and the related solicitation/recommendation statement, as amended, because they contain important information. The offer to purchase, the related letter of transmittal and certain other offer documents, as well as the solicitation/recommendation statement, as amended, are available to all stockholders of ALARIS at no expense to them. These documents are also available at no charge at the SEC’s website at www.sec.gov.

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