Edwards Gains Go-Ahead for Intuity - Analyst Blog


Edwards Lifesciences Corporation ( EW ) can now initiate the Transform trial in the US with the conditional Investigational Device Exemption ("IDE") from the Food and Drug Administration ("FDA"). The trial will evaluate the company's Intuity valve system in surgical aortic valve replacement ("AVR") procedures. The timeliness of the trial initiation keeps intact the company's expectation of a mid-year approval.

The single-arm Transform trial is expected to enroll approximately 500−700 patients, a size typically followed by other heart valve trials. The Intuity valve is designed to facilitate small incision surgery and rapid valve deployment to speed up procedure.

Although Edwards has yet to fetch an FDA nod for Intuity in the US, it received CE Mark approval in February 2012. The company also initiated two post-approval studies in Europe - Cadence and Foundation - focused on the patient benefits and health economics of this device compared to traditional open heart surgery. Revenue contribution from Intuity in the current year will be modest, which, however, will increase in the coming year.

The company has also begun enrollment of Triton II, a clinical study of next-generation Intuity system, which features enhancements to both the delivery system and the valve. Edwards received conditional IDE from the FDA for the next-generation tissue treatment platform, GLX, last month. GLX received CE Mark approval in May 2012.

The GLX technology will be studied on the company's Perimount Magna Ease Aortic Valve and will be extended to other devices. Safety of the valve and its effectiveness will be the primary endpoints of the trial. The GLX technology is designed to reduce calcification, enable a smaller valve profile and improve ease of use.

Surgical heart valves, contributing 38% to the top line, recorded a 2.2% year-over-year growth in sales to reach $176 million. The 6.6% growth of surgical heart valves in the international market was on the back of penetration of the company's premium products in Europe and Japan. Performance in the US was adversely affected by the introduction of St Jude Medical 's ( STJ ) pericardial valve, Trifecta, last year. The situation is expected to improve later this year with the completion of one year of St. Jude's device. We believe that the company's initiatives to expand its surgical heart valve portfolio should boost revenues in the forthcoming period.

We have a Neutral recommendation on Edwards. The stock carries a Zacks #3 Rank (hold) in the short term.

EDWARDS LIFESCI (EW): Free Stock Analysis Report
ST JUDE MEDICAL (STJ): Free Stock Analysis Report

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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 The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: EW , STJ



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