Leading medical devices company,
St. Jude Medical Inc.
), has received the Food and Drug Administration's ("FDA") approval
to launch its AMPLATZER Vascular Plug 4 ("AVP4") device in the U.S.
The technology is used in minimally invasive transcatheter
treatments to occlude abnormal vascular blood vessels to reduce
pressure on the damaged vessels or reroute blood supply to
With roughly 50,000 peripheral embolization procedures performed
every year, St. Jude's Cardiovascular division is poised to
considerably benefit from the new product, which is the first of
its kind in the medical vascular products market.
Revenues from St. Jude's Cardiovascular segment moved up 3%,
both in terms of reported and constant currency, to $336 million in
the first quarter of fiscal 2012. Within the Cardiovascular
segment, structural heart devices sales increased 8% to $155
million, partly offset by lower revenues from vascular offerings,
which fell 2% year over year to $181 million.
The AVP4 is a unique device, which can access smaller and more
difficult blood vessels and treat them with greater efficiency and
precision than embolic coils and surgical clips. It also allows for
better cross-sectional vessel coverage and can be flexibly
The AVP4 received CE Mark approval in July 2009. AVP and AVP II
are the two other products from the AMPLATZER Family of Vascular
Plugs available in the U.S.
St. Jude is consistently producing revenue growth and positive
earnings surprises over the past several quarters. We are impressed
by its solid fundamentals, healthy growth trajectory, strong
product mix, robust pipeline and cost management initiatives.
While a host of new growth drivers (including new products and
emerging markets) are expected to boost results in 2012 and beyond,
we remain cautious about increased competition, a still soft
Cardiac Rhythm Management ("CRM") market and the dilutive impact of
A still choppy CRM space overhangs on St. Jude and its peers
). Our long-term Neutral recommendation on St. Jude is in agreement
with a short-term Zacks #3 Rank (Hold).
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