Expanded Use for BSX's Watchman - Analyst Blog

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With the CE Mark approval based on the results from the ASAP (ASA Plavix) study,  Boston Scientific 's ( BSX ) Watchman Left Atrial Appendage ("LAA") Closure Device can now be used to treat an expanded patient population. Subsequently, patients with atrial fibrillation ("AF") who are at high risk of stroke and cannot take anticoagulant therapy would benefit from this recent approval.

AF, affecting approximately 15 million people globally, disrupts the ability of the heart to beat regularly and pump blood efficiently. Watchman is introduced into the heart via a flexible catheter to close off the LAA and capture any clots formed in the appendage. This reduces the risk of stroke and thereby eliminates the need for long-term use of blood thinning medications.

In another development, the European Society of Cardiology included LAA closure devices in the revised Guidelines for Management of Patients with Atrial Fibrillation .  This was based on favorable data from the PROTECT AF trial, which demonstrated that the Watchman device was non-inferior to warfarin and resulted in a 38% relative risk reduction for stroke, cardiovascular death and systemic embolism compared to long-term warfarin therapy. Besides, the ASAP Registry demonstrated a 77% reduction for ischemic stroke in patients contraindicated to warfarin.

The Watchman device was inducted in Boston Scientific's portfolio following the acquisition of Atritech in March 2011. While the device is approved in Europe since 2005 and in some Asian countries since 2009, the company is yet to receive approval in the US. Boston Scientific has completed enrollment in the PREVAIL study, a confirmatory study to gain approval from the US Food and Drug Administration. The company is looking at receiving approval in fiscal 2013.

The challenges rife in the core segment of stents and defibrillators do not show any sign of abatement . This is also reflected in the lowering of the outlook for 2012 . As a result , Boston Scientific is looking at other new therapies to drive its top line. To achieve this objective, the company has been active on the acquisition front. The latest is the acquisition of Cameron Health, with which Boston Scientific will have access to the S-ICD system, a subcutaneous implantable cardioverter defibrillator ("ICD"). However, the competitive landscape remains tough with the presence of Medtronic ( MDT ) and St Jude Medical ( STJ ).

We have a Neutral recommendation on Boston Scientific. The stock retains a Zacks #3 Rank ("Hold") in the short term.


 
BOSTON SCIENTIF (BSX): Free Stock Analysis Report
 
MEDTRONIC (MDT): 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: BSX , MDT , STJ

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