Could Medtronic Have Better Spent $43 Billion?
Paul Nouri, CFP
Paul Nouri, CFP
Growth Needs Resuscitation, But Medtronic Still Looks Like A Value
Stephen Simpson, CFA
Stephen Simpson, CFA
Apr. 1, 2015, 12:30 PM
- Medtronic (MDT -2.1%) initiates a new clinical program, called SPYRAL HTN, to evaluate its next-generation renal denervation technology. It will begin with two global studies designed to address the issues in its earlier SYMPLICITY HTN-3 Phase 3 trial, which failed to achieve its primary and secondary efficacy endpoints.
- In the new studies, each enrolling 100 patients with moderate-to high-risk hypertension, physicians will use the company's Symplicity Spyral catheter and Symplicity G3 radiofrequency (RF) generator, both investigational in the U.S. and Japan. In SPYRAL HTN-OFF MED, the primary objective is to isolate the effect of renal denervation on blood pressure (BP) reduction. In SPYRAL HTN-ON MED, patients not achieving adequate BP control despite taking anti-hypertensive drugs will comprise the treatment group. Based on the successful outcomes of the two studies, the company will design a pivotal Phase 3 trial that will support regulatory applications in the U.S. and Japan.
- Renal denervation, using RF energy to ablate nerves in the wall of the renal artery, is an approved procedure to control resistant hypertension. Destroying the nerves in the artery interrupts the renal sympathetic nervous system and reduces BP. Its efficacy, though, has been questioned. About a year ago, Medtronic announced that SYMPLICITY HTN-3, failed to demonstrate efficacy compared to a sham control. The company believes that the trial design was the culprit, specifically the medication parameters, patient population and procedural variability. It believes that these issues will be corrected in the new trials.
Mar. 30, 2015, 5:03 PM
- The FDA approves a new indication for Medtronic's (NYSE:MDT) CoreValve System, a self-expanding device for aortic value replacement, to treat patients who have had a tissue aortic valve replacement and are in need of a second one, called "valve-in-valve" replacement.
- CoreValve is an artificial heart valve made from the heart of a pig. It is attached to a flexible, self-expanding nickel-titanium alloy frame and is placed in the heart via catheter. Once release by the end of the catheter, it expands automatically, anchoring itself to the old failed valve. Once in place, it expands and closes properly, restoring aortic valve function.
- The original indication was the treatment of patients with aortic stenosis (narrowing) who are considered "high" or "extreme" risk for surgical aortic valve replacement.
Mar. 30, 2015, 11:31 AM
- The Japanese Ministry of Health, Labour and Welfare approves Medtronic's (MDT +1%) CoreValve System for patients with severe aortic stenosis who are unable to undergo surgery. Aortic stenosis is a narrowing of the aortic valve which obstructs the flow of blood from the heart thereby making the heart work harder to pump blood.
- CoreValve is used in a procedure called transcatheter aortic valve implantation (TAVI). An artificial heart valve is inserted into the heart replacing the diseased aortic valve and restoring the size of the aortic opening.
- The CoreValve has a self-expanding frame which enables the doctor to place the device in a controlled manner thereby increasing the accuracy of placement. It was cleared in the E.U. in 2007 and in the U.S. in January 2014.
Mar. 27, 2015, 9:30 AM
- Medtronic (NYSE:MDT) completes its acquisition of privately-held Sophono, a developer of magnetic hearing implants. Terms are not disclosed. The business will be part of Medtronic's Surgical Technologies division within the Restorative Therapies Group segment.
- Sophono's magnetic bone conduction hearing implants have been placed in more than 4,000 patients in 42 countries. They are indicated for patients at least five years of age with single-sided deafness or conductive, mixed hearing loss.
- According to the World Health Organization, disabling hearing loss affects 360M people worldwide.
Mar. 18, 2015, 3:33 PM
- The FDA approves Medtronic's (MDT +1.6%) Protege GPS self-expanding peripheral stent system for the treatment of stenotic lesions in the common and external iliac (pelvic) arteries. The approval was based on clinical trial results that showed 95.8% nine-month primary patency (the interval between the placement of the stent and any intervention to reopen the blood vessel) and 98.6% freedom from target vessel revascularization (no repeat procedure).
- The Protege GPS, developed by Covidien, expands to a predetermined diameter to restore blood flow. It was previously cleared for use in superficial femoral (upper leg) and subclavian (upper chest) arteries.
Mar. 16, 2015, 7:44 AM
- Two-year results from the High Risk Study of the CoreValve U.S. pivotal trial show a superior survival benefit in patients receiving Medtronic's (NYSE:MDT) CoreValve via transcatheter aortic valve replacement ((TAVR)) compared to those who underwent surgical aortic valve replacement (SAVR). This is the first study to demonstrate statistically significant survival differences favoring TAVR in aortic stenosis (narrowing of the aorta) patients who are considered high risk for surgery.
- At two years, all-cause mortality in the TAVR cohort was 22.2% compared to 28.6% in the SAVR group (p=0.04). The absolute difference in all-cause mortality between the two cohorts increased from 4.8% at Year One to 6.5% at Year Two.
- The rate of stroke in the TAVR group was 10.9% versus 16.6% in the SAVR group (p=0.05). The major stroke rates were 6.8% and 9.8%, respectively, but the results were not statistically significant (p=0.25). The combined endpoint of all-cause mortality or major stroke favored TAVR (24.2% versus 32.5%, p=0.01).
- Investigator Michael Reardon, M.D., says, "In this trial CoreValve maintains a low and stable stroke rate and the recovery advantages CoreValve demonstrated at one year are maintained at two years. Current ACC/AHA guidelines refer to TAVR as a reasonable alternative to SAVR in high risk patients as judged by the heart team, however these clinical data suggest a change in these guidelines may be warranted for the self-expanding valve in this patient population."
- The data were presented the 64th Annual Scientific Session of the American College of Cardiology.
Mar. 12, 2015, 10:46 AM
- Medtronic (MDT +0.5%) commences a clinical study of its Resolute Onyx drug-eluting stent (DES) in the U.S. in patients with coronary artery disease. The first phase will target patients with small vessels that will require a 2.0 mm stent, which are often untreatable with a DES. Core sizes of the stents will be studied separately.
- Principle investigator Roxana Mehran, M.D., from New York's Mount Sinai School of Medicine says, "One of the biggest challenges we face as interventional cardiologists is treating small, diseased coronary arteries, a common condition seen frequently in patients with diabetes. The initiation of the Resolute Onyx DES with CoreWire Technology is an exciting step forward in providing a treatment option for difficult-to-treat coronary lesions."
- CoreWire Technology builds on the stent manufacturing method called Continuous Sinusoid Technology which molds a single strand of wire into a sinusoidal wave that enables a continuous range of motion. The wire has a denser core surrounded by a cobalt alloy outer layer. This enables the stent to have better visibility during the procedure and, with thinner struts, improved deliverability while maintaining its radial and longitudinal strength.
- The Resolute Onyx DES was CE Mark-cleared in Europe in November. It remains investigational in the U.S.
Mar. 3, 2015, 9:38 AM
- A federal appeals court overturns a $102M jury award to Medtronic (MDT -0.8%) in a long-running patent dispute with NuVasive (NUVA +0.4%) pertaining to spinal implants.
- A jury awarded damages to Medtronic in 2011 after it found that NuVasive's CoRoent XL implants, MaXcess II and III retractors and Helix mini anterior cervical plates violated three Medtronic patents.
- The appeals panel upheld the jury's finding of liability but determined that the damage award was improper because Medtronic is not permitted to recover damages for lost profits or for the sale of conveyed products.
- Medtronic has yet to comment on the situation.
Feb. 24, 2015, 9:43 AM
- The FDA grants 510(k) clearance to privately-held Bioness' StimRouter, an implantable neuromodulation device for the treatment of chronic pain of peripheral nerve origin. It is the first implanted device with a specific indication for peripheral nerve stimulation.
- The system consists of an implanted lead , an external pulse transmitter and conductive electrode and a small hand-held wireless control unit.
- Bioness is yet another medical products firm started by serial entrepreneur Al Mann, the force behind Second Sight Medical Products (EYES +21.3%), MannKind (MNKD -1%), Advanced Bionics and MiniMed.
- Neuromodulation-related tickers: (MDT -0.3%)(STJ -1.9%)(BSX)(NURO)
Feb. 23, 2015, 11:04 AM
- The FDA's Orthopedic and Rehabilitation Devices Advisory Panel votes 5 -1 (2 abstain) that VertiFlex's Superion Interspinous Spacer System is safe and 4 -2 (2 abstain) that the risk-benefit profile is adequate.
- The FDA does not have to abide by the vote in its final decision, but it usually follows the committee's recommendation.
- Related tickers: (ABT -0.2%)(MDT +0.3%)(JNJ +0.2%)
- Previously: Ad Comm review approaches for Vertiflex spinal implant (Feb. 18)
Feb. 23, 2015, 9:38 AM
- Medtronic (MDT +0.2%) acquires privately-held Elizabethton, TN-based Advanced Uro-Solutions for an undisclosed sum. The company's lead product is the NURO percutaneous tibial nerve stimulation system for the treatment of overactive bladder (OAB). The 510(k)-cleared device consists of a small external stimulator and a single, reusable lead that provides temporary stimulation to the tibial nerve. Medtronic plans to launch the system in the U.S. in the next 12 months.
- OAB affects ~17% of women and 16% of men in the U.S.
Feb. 20, 2015, 1:00 PM
- The FDA approves Covidien's (MDT +0.1%) VenaSeal system for the permanent treatment of patients with varicose veins of the legs. The device works as follows: a trained clinician inserts a catheter through the skin into the diseased superficial vein. The VenaSeal adhesive, a clear liquid, is then injected through the catheter into the vein where it polymerizes into solid material, permanently sealing the vein.
- VenaSeal's value proposition is the avoidance of heat or cutting, which is more traumatic to tissue. It is performed via an in-office procedure that minimizes bruising and enables patients to quickly return to their normal activities.
- The device was developed by Morrisville, NC-based Sapheon, which Covidien acquired in August of last year.
Feb. 18, 2015, 1:54 PM
- The FDA's Orthopaedic and Rehabilitation Devices Panel of the Medical Devices Advisory Committee meets Friday, February 20 to discuss the Premarket Approval Application (PMA) from privately-held San Clemente, CA-based VertiFlex for its Superion InterSpinous Spacer for the treatment of moderate lumbar stenosis (narrowing of the openings for the spinal cord and nerve roots).
- The device, CE marked in Europe since 2007, alleviates back pain via insertion in the lumbar area which decompresses the spine and relieves the pressure. Its value proposition is a one-piece expandable, reversible and motion preserving implant that is easily inserted via a small incision in the back under local anesthesia in the outpatient setting.
- Executive Summary, Panel Questions
- Related tickers: (NYSE:ABT) (NYSE:MDT) (NYSE:JNJ)
Feb. 17, 2015, 8:13 AM
- Medtronic (NYSE:MDT) fiscal Q3 results ($M): Total Revenues: 4,318 (+3.7%); Cardiac Rhythm & HF: 1,269 (+7.2%), High Power: 650 (-0.8%), Low Power: 489 (+11.4%), AF & Other: 130 (+44.4%); Coronary & Structural Heart: 737 (+2.8%), Coronary: 407 (-6.7%), Structural Heart: 330 (+17.4%); Aortic & Peripheral Vascular: 218 (0.0%); Cardiac & Vascular Group: 2,224 (+5.0%); Spine: 740 (-0.5%), Core Spine: 543 (-2.0%), Interventional Spine: 75 (-2.6%), BMP: 122 (-0.5%); Neuromodulation: 487 (+1.9%); Surgical Technologies: 418 (+8.3%).
- COGS: 1,128 (+7.4%); R&D Expense: 373 (+3.6%); SG&A Expense: 1,487 (+2.3%); Net Income: 977 (+28.2%); EPS: 0.98 (+30.7%); CF Ops: (+9.6%), Quick Assets: 17,231 (+26.1%).
- Gross Profit: 3,190 (+2.5%); COGS: 26.1% (+3.6%); Gross Margin: 73.9% (-1.2%); Operating Earnings: 1,330 (+2.4%); Operating Earnings Yield: 30.8% (-1.3%); Net Earnings Yield: 22.6% (+23.6%).
- CF Ops last three quarters: 310, 913, 1767.
- Fiscal Q4 Guidance: Revenue growth: 4 - 6%.
- Shares are up 3% premarket on increased volume.
Feb. 17, 2015, 7:43 AM
- Medtronic (NYSE:MDT): FQ3 EPS of $1.01 beats by $0.04.
- Revenue of $4.32B (+3.8% Y/Y) beats by $70M.
- Shares +0.12% PM.
Feb. 16, 2015, 5:30 PM
Medtronic Plc engages in the medical technology-alleviating pain, restoring health, and extending life for millions of people around the world. Its primary customers include hospitals, clinics, third-party health care providers, distributors, and other institutions, including governmental health... More
Industry: Medical Appliances & Equipment
Country: United States
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