Medtronic Up on Positive CoreValve Data - Analyst Blog

Shares of medical device major Medtronic Inc. MDT rallied nearly 2% since the company announced favorable data on CoreValve at the American College of Cardiology ACC. This data taken from the final follow-up of the CoreValve CE Pivotal Study, showed better long-term durability along with remarkable clinical performance of CoreValve sans any chance of structural valve dysfunction over a span of four years. This study was conducted entirely on severe aortic stenosis patients who were treated with the self-expanding CoreValve System.

Besides the capacity for long-term durability, this study also highlighted CoreValve's potential to improve the quality of life of patients over the first year and sustain it through the next three years. Per the results, 74% patients showed improvement from baseline and 83% patients remained free from stroke at four years follow-up.

According to Medtronic, the CE Pivotal Study will help it achieve CE (Conformité Européenne) Mark in Europe for the CoreValve System to treat patients who are physically unfit to undergo aortic valves replacement through traditional open-heart surgery.

In Jan 2014, Medtronic received the earlier-than-expected U.S. Food and Drug Administration (FDA) approval for its CoreValve System for three different access routes – transfemoral, subclavian and direct aortic – in extreme risk patients. For high risk patients, on the other hand, Medtronic continues to expect that the FDA approval should come in by mid-fiscal 2015.

We note that last week at a late-breaking clinical trial session at the ACC, Medtronic announced favorable data of CoreValve on high-risk patients. Per the presentation, the High Risk Study of CoreValve U.S. Pivotal Trial proved the superiority of CoreValve over surgical aortic valve replacement (SAVR) at one year in patients who are suffering from severe aortic stenosis and are considered ‘high risk' cases for surgery.

Medtronic happily reveals that FDA is satisfied with the favorable CoreValve Trial results for high-risk patients, and hence determines no requirement for an external expert panel hearing any further. This action by FDA marks an encouraging step toward achieving regulatory approval for the use of the CoreValve system in high-risk patients.

Medtronic has witnessed robust growth in the transcatheter valve business (over 60% compounded annual growth rate over the past two years) on the back of CoreValve. The transcatheter valve, valued at approximately $700 million last year, is expected to grow to $2.5 billion by 2020.

Other Stocks to Consider

While Medtronic carries a Zacks Rank #3 (Hold), other stocks worth considering in the medical products sector are St. Jude Medical Inc. STJ, Meridian Bioscience, Inc. VIVO and SurModics, Inc. SRDX. All these stocks bear a Zacks Rank #2 (Buy).