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Medical devices major, St. Jude Medical, Inc. (STJ - Analyst Report) recently launched its revolutionary MediGuide technology, a three dimensional (“3D”) navigation device used to assist electro-physiologist evaluate cardiovascular anatomy. It is the first-of-its-kind medical imaging technology in the global medical device industry.

Per the American Heart Association, humans are increasingly being exposed to harmful ionizing radiation as billions of people are undergoing radiation-based imaging tests regularly. The MediGuide technology uses innovative recorded fluoroscopic image instead of conventional live fluoroscopy to effectively reduce radiation exposure time during medical imaging surgeries.

The technology applies 3D visualization to already recorded fluoroscopic images in real-time and uses magnetic trackers to locate the exact position of MediGuide enabled devices inside the heart. Along with Siemens Healthcare’s Artis zee angiography systems, St. Jude’s MediGuide technology enables enhanced navigation during electrophysiology (EP) surgeries.

Based on its unique features, the MediGuide technology (earlier belonged to the AF division) should further expand the product portfolio of the Cardiovascular and Ablation Technologies Division (“CATD”). St. Jude recently merged its Atrial Fibrillation (“AF”) Division and Cardiovascular (“CV”) Division to form the CATD.  

According to the company, there is considerable growth opportunity for the MediGuide product. Recent data shows that out of the billions of radiation-based imaging studies performed by physicians all over the world in a year, one-third of them are cardiovascular patients.

For 2012, St. Jude expects sales between $870 million and $895 million from the AF business alone. Based on the uniqueness of this new product, we expect that the company should be able to either meet or surpass its expectations.

The University of Kansas Hospital in Kansas is the first institute in the U.S. to use this technology and its physicians very much impressed with the device’s ability to perform procedures with significantly less radiation exposure.
 
With a market cap of $13.63 billion, St. Jude is a leading medical device manufacturer with a solid rate of growth over the past decade. 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 cost saving measures, are expected to boost results in 2013 and beyond, we remain cautious about the increased competition, weakening Euro, the soft CRM market and the overall tough macroeconomic conditions.

A still choppy CRM space overhangs on St. Jude and its peers Medtronic, Inc. (MDT - Analyst Report) and Boston Scientific Corporation (BSX - Analyst Report). We currently have a Neutral recommendation on St. Jude, which carries a short-term Zacks #3 Rank (Hold rating).

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