Edwards Lifesciences Corporation
(
EW
) has received the much awaited recommendation from the advisory
panel of the US Food and Drug Administration ("FDA") for its Sapien
transcatheter heart valve ("THV"). The panel recommended Sapien
(via both transfemoral and transapical delivery) for high-risk
patients with severe, symptomatic aortic stenosis. Consequently,
shares gained 7% to close at $96.88 yesterday.
The panel voted 11-0 (with one abstention) supporting that the
benefits of the Sapien outweighed the risks. Although the FDA is
not bound to follow the panel's recommendations, it generally does
so. The panel, however, remained concerned about increased risk of
stroke.
In November 2011, Sapien received FDA approval for the treatment
of inoperable patients with severe, symptomatic aortic stenosis.
Since the launch of Sapien in US, in November 2011, Edwards has
imparted training at approximately 60 centers and is on track to
render training at 150-250 new commercial sites in the first 12
months. The favorable recommendation is significant for Edwards as
approval for the high-risk patients will expand the targeted
patient population.
The company submitted a pre-market application in April 2011 of
Sapien (for high-risk patients) based on data from Cohort A of the
Partner trial. The trial compared the outcomes of high-risk
patients for traditional open-heart surgery who were evenly
randomized to receive either surgical aortic valve replacement or
the Sapien valve via transfemoral or transapical delivery.
Edwards had expected an earlier panel date. The one-quarter
delay besides a decline in southern Europe and unfavorable foreign
exchange rates compelled the company to cut its THV guidance for
the fiscal year by $30 million to a band of $530−$600
million. The mid-point of US Sapien sales guidance for 2012 was
lowered by only $10 million to $200−$240 million despite the delay
in approval for Cohort A patients. This was possible due to
better-than-expected ramp up in Sapien sales in US.
The FDA had raised concerns regarding some adverse events in a
document published by it. The agency did not find any significant
difference in mortality between the treatment (aortic stenosis
patients treated with Sapien valve) and control groups (patients
undergoing open heart surgery) up to one year.Moreover, data beyond
two years was limited due to which mortality comparisons over the
long term were unclear. The agency is in favor of post-approval
studies if Sapien receives final approval.
We have a Neutral recommendation on Edwards. The stock retains a
Zacks #3 Rank (hold) in the short term.
EDWARDS LIFESCI (EW): Free Stock Analysis
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