The first of Medtronic's (NYSE:MDT) Activa line of deep brain stimulation (DBS) devices gained FDA approval in 1997 and since then the field has expanded hugely. This expansion could now accelerate following the start of U.S. trials of the Activa PC+S DBS system, which not only treats the symptoms of Parkinson's disease but also senses electrical activity in the brain -- the first time this has been possible. Medtronic says Activa PC+S could become the standard of care when it reaches the market. But it is as a step toward a "closed-loop" system -- one that senses where electrical impulses are required and delivers them to order -- that the device's true worth lies.
Medtronic will implant the first Activa PC+S in a US patient in the coming months. The data collected over the coming months and years will go towards developing an algorithm to connect the sensor with the stimulator, interpreting the electrical changes in the brain and converting them into the correct response. As impulses vary from person to person, such a system’s behaviour would be unique to the patient. It is even possible that a closed-loop system could prevent events; in the case of epilepsy, for example, it could react to changes that herald a seizure, heading off the attack before any external signs appear.
Sales Growth to Slow
If Activa PC+S allows Medtronic to get the jump on its rivals in terms of innovation and, more importantly, translate this into increased sales in the next five years or so, it will come as something of a relief to the company. In its full-year 2013 results, the Minneapolis company recorded neuromodulation revenues of $492 million, an increase of 7% on the previous year, with analysts from Deutsche Bank noting a double-digit uptick in sales of the DBS franchise in both the U.S. and elsewhere during the quarter to April 26, 2013.
However, EvaluateMedTech's consensus forecasts show that this state of affairs will not continue. In the U.S., Medtronic's DBS annual sales growth will fall from 10% in 2013 to a low of just 1% in 2016. The FDA is not renowned for its swiftness at waving innovative implanted devices through. Two of Medtronic's previous DBS systems obtained humanitarian device exemption (HDE), generally a quicker route to market (see table). This could bring hope that Activa PC+S could reach the U.S. in a few years' time, helping arrest the growth slide.
All data sourced to EvaluateMedTech.