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Following Medtronic’s (MDT - Analyst Report) receipt of the US Food and Drug Administration (FDA) approval for its longer sized Resolute Integrity drug-eluting stent (DES) with an indication for patients with diabetes, recently the company again received CE Mark approvals for a favorable labeling update on the Resolute Integrity DES with new information on dual antiplatelet therapy (DAPT). The approvals reflect that the company is working in the right direction to strengthen its coronary business.
According to the updated label, interruption/ discontinuation of dual antiplatelet therapy (DAPT), any time after one month of stent implantation, involves low risk and no increased risk for stent thrombosis. The CE Mark approval was the result of a one year independent analysison DAPT.
The analysis considered 5,000 patients with implanted stents from the global RESOLUTE Clinical Program. The study showed that the first 30 days of the implant procedure involves greater risk of stent thrombosis due to DAPT interruption. However, as this one-month period is over, the risk reduces with no increased risk for cardiac death or target vessel myocardial infarction.
Medtronic’s focus on portfolio upgrade and expansion is inevitable in the face of severe headwinds in its core segments of stents and defibrillators. Other players in the medical devices space such as Boston Scientific (BSX - Analyst Report) and St Jude Medical (STJ - Analyst Report) are also resorting to various alternatives to revive their flagging top line.
In this regard, we note that earlier Boston scientific received CE Mark approval for a label change showing low risk after three months of dual antiplatelet therapy. This leading major also received approval from the FDA for longer lengths of the Promus Element Plus stent.
Despite headwinds such as unfavorable currency movement and global economic uncertainties, Medtronic is enjoying market share gain on the back of the Resolute Integrity drug-eluting stent under the CardioVascular franchise. Given the burgeoning diabetic population in the U.S., the approval should drive utilization rates. Acceptance of the new sizes of the stent should bolster growth of the franchise for the company.
Estimate revision trend for Medtronic’s ongoing and next fiscal reflects a glaring lack of clarity. Accordingly, the stock carries a Zacks Rank #3 (Hold). While we have a non-committal stance on Medtronic, one of the medical stocks carrying a favorable Zacks Rank is Cyberonics (CYBX - Analyst Report). This stock carries a Zacks Rank #1 (Strong Buy).
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