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Apple won't license Masimo's patents despite Apple Watch import ban | AppleInsider
(appleinsider.com)
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Don’t have to license a patent if your worst case scenario is you just buy the company.
I actually don't think you are too far off. About a week ago i read about Masimo unavailing their watch for $999. Not many people will buy a watch for that much even with a blood ox system in it.
I think Apple will wait a year or two for them to "fail" by not succeeding like the investors want and then offer to purchase the company. A super low ball price and then just keep moving on with their plans.