ABIOMED Inc. (ABMD): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report

By Zacks Investment Research,

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ABIOMED reported impressive second-quarter fiscal 2015 results. The company also raised the lower end of its revenue guidance for fiscal 2015, which is another positive in our view. We believe that the anticipated approval of Impella 2.5 by Feb/Mar 2015 will serve as a significant growth catalyst for the company. ABIOMED's expanding product portfolio, growing addressable market, positive clinical trials for Impella RP and Symphony are other encouraging aspects. However, intensifying competition remains a concern, which will likely hurt pricing power. Moreover, higher research & development expenses will negatively impact profitability. Considering these factors, we maintain our Neutral recommendation and set a price target of $36.00.


Headquartered in Danvers, MA and founded in 1981, ABIOMED Inc. (ABMD) is engaged in developing, manufacturing and marketing of medical products, designed to assist or replace the pumping function of the failing heart. The company's products are mainly sold in the U.S., Canada, Europe and Japan.

ABIOMED's revenues increased 15.8% year over year to $100.7 million at the end of six months of fiscal 2015. International sales accounted for 11% of total revenues. Its main product line, Impella, contributed almost 91.2% of total revenues. Meanwhile, non-impella products (AB5000), largely focused on the heart surgery suite, contributed 2% of total revenues.

Impella 2.5 (via femoral artery) is primarily used by interventional cardiologists to support patients in the cardiac catheterization lab (cath lab). The percutaneous micro heart pumps with integrated motors and sensors received 510(k) clearance from the U.S. Food and Drug Administration (FDA) in Jun 2008 for partial circulatory support for up to six hours. In the European Union (EU), Impella 2.5 is approved for use for up to five days. The device can pump up to 2.5 liters of blood per minute. Notably, the total number of customer sites deploying the device reached 910 at the end of the second quarter of 2015.

In Oct 2014, the FDA approved ABIOMED's Impella 2.5 for use in the indication of high-risk percutaneous coronary intervention (PCI). Currently, the company expects to get the Pre-Market Approval (PMA) for the safety and effectiveness of Impella 2.5 by Feb/Mar 2015.

The Impella 5.0 (via femoral artery) and Impella LD (implanted directly through an aortic graft) received 510(K) clearance in Apr 2009, for circulatory support for up to six hours. In the EU, the devices are approved for up to ten days' use. These devices are primarily used in the heart surgery suite and support patients who require higher levels of circulatory support as compared to the Impella 2.5. These equipment can pump up to 5 liters of blood per minute.

Impella CP received 510(k) clearance in Sep 2012 and provides blood flow of approximately one liter more per minute than Impella 2.5. By using an extracorporeal bypass control unit, Impella CP offers partial circulatory support for up to six hours. It can also provide partial circulatory support for up to six hours, during procedures not requiring cardiopulmonary bypass. Notably, Impella CP is approved in the European Union and Canada.

Impella RP is a catheter-based axial flow device that can pump more than four liters of blood per minute during right heart failure. In Sep, 2014, ABIOMED announced clinical trial results of the device from the RECOVER RIGHT study, which showed a survival rate of 73% in the overall patient population that participated in the study. The device has already received approval in the European Union and countries which require CE marking.

ABIOMED's non-impella based products include AB5000, which is used to support acute heart failure patients. The company's Symphony device designed to treat chronic patients with moderate heart failure is currently undergoing human clinical trials outside the U.S.

In Jul 2014, ABIOMED acquired Germany-based device maker, Entwicklungsgesellschaft mbH (ECP), for $13 million in cash, with additional potential payouts of $15 million.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Stocks
Referenced Stocks: ABMD , EU , PCI , K

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