) sent safety advisory to hospitals regarding the use of its
pocket system controller for mini heart pump device, HeartMate
II. The Pleasanton, Calif.-based company received reports of four
deaths and five patient injuries that happened while switching
from primary system controllers to backup system controllers.
Investors reacted negatively to the news, resulting in a 2.7%
fall in THOR shares to $36.22 after the market closed yesterday.
Meanwhile, shares of the rival heart pump maker,
HeartWare International, Inc.
) rose 0.1%.
HeartMate II left ventricular assist device (LVAD) is implanted
in patients with advanced heart failureto help the heart pump
blood. It is connected to an external battery pack and a system
controller, which alarms patients if the battery runs down.
THOR started selling the new system controller for the device in
Aug 2012 in Europe and in May 2013 in the U.S. It has been
prescribed to 2,142 patients since Aug 2012.
THOR revealed that four patients died while struggling to change
their controller themselves while five others lost consciousness
or suffered decreased blood flow due to difficulty in switching
However, THOR claimed that the deaths and injuries occurred not
due to problems or defects in controllers but due to lack of
training. Therefore, it didn't recall the devices. The company
stated that the affected patients may not have received proper
training with the new controller and failed to understand its
difference from the old controller model.
As a result, THOR advised that all the patients using the new
controller and their caregivers should be retrained from using
the new controller as they are at a higher risk of experiencing
difficulties in the switching process.
THOR posted adjusted earnings of $17.5 million or 30 cents per
share for the fourth quarter of 2013, which declined 9.3% from
$19.3 million or 6.25% from 32 cents per share in the comparable
quarter a year ago. Earnings per share were in line with the
Zacks Consensus Estimate.
THOR's revenues in the quarter dipped marginally by 0.2% to
$128.2 million, lagging the Zacks Consensus Estimate of $130.0
million. Revenues from HeartMate product line came in at $111.7
million, reflecting a 5.2% year-over-year increase due to the
expansion of its international business.
For fiscal 2014, THOR expects revenues in the range of $520-$535
million. The current Zacks Consensus Estimate of $528 million
lies within the guided range. The company also expects adjusted
earnings per share of $1.40-$1.50 for the year. The current Zacks
Consensus Estimate of $1.28 million lies below the guided range.
Currently, THOR retains a Zacks Rank #3 (Hold). Some
better-ranked stocks in the medical instruments sector include
Natus Medical Inc.
). Both of them carry a Zacks Rank #1 (Strong Buy).
NATUS MEDICAL (BABY): Free Stock Analysis
CYNOSURE INC-A (CYNO): Free Stock Analysis
HEARTWARE INTL (HTWR): Free Stock Analysis
THORATEC CORP (THOR): Free Stock Analysis
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