The past week has been a handful of events for the healthcare
sector impacting many healthcare companies under our coverage.
) brain stimulation devices have shown impressive efficacy in
early-stage Parkinson patients. Meanwhile, news of Merck (
) shelling out over a half billion dollars to settle two
class-action lawsuits in the U.S. relating to its cardiovascular
drug Vytorin made the rounds.
In a recently concluded clinical trial, Medtronic's implantable
deep brain stimulation devices (DBSs), Kinetra or Soletra, showed
strong efficacy in treatment of early-stage patients of Parkinson's
disease. According to the study, the quality of life improved
significantly for patients treated with both drug and DBS, whereas
conditions worsened marginally in patients only on drugs.
About 1.5 million people in the U.S. have Parkinson's disease
and the figure could double by 2030 mainly due to the aging
population. Currently, DBSs are used in patients with advanced
Parkinson's that don't respond consistently to the drug treatment.
With the impressive clinical trial data, Medtronic can now hope for
extension of DBSs to millions of early-stage patients. And, with
the large patient base, any success here could bring in huge
The device is a part of Neuromodulation division in our
model. Going forward, we expect a declining market share as an
increase in the company's sales may not be in proportion to the
increase in global neuromodulation market which is expected to grow
at a very high rate throughout the Trefis forecast period.
Medtronic, however, is currently the only medical device maker with
FDA approval for its DBSs to treat advanced Parkinson's disease.
And, should the regulatory agency decide to recommend use of DBSs
in early-stage patients, it will be well placed to gain market
share. Also, it will have the clinical data to back its claims.
price estimate for Medtronic
, in line with the current the market price.
See our complete analysis of
Merck has agreed to settle two class action lawsuits for a
whopping $688 million dollars. The lawsuits alleged that the drug
maker withheld poor results of a clinical trial called "Enhance"
which was conducted to determine the efficacy of Vytorin. And,
Vytorin sales have been declining since the results of "Enhance"
came out in 2008.
However, the settlement could be one of Merck's efforts to douse
controversies around the drug as investors are eagerly awaiting the
results of IMPROVE-IT, a large study that is being conducted to
prove efficacy of Vyotrin. The data is expected to be released
before June 2013 and any positive outcome there will put the drug
back on growth trajectory. With multi-billion dollar potential of
the drug, Merck can gain back what it has lost in the class action
We are revising our price estimate for Merck to reflect full
year results and recent developments.
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