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Edwards Lifesciences Buys Harpoon Medical, Expands Portfolio

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Edwards Lifesciences Corporation (EW - Free Report) recently acquired Harpoon Medical, Inc. — a privately-held medical technology company focused on beating-heart repair for degenerative mitral regurgitation (DMR).

Per the agreement, Harpoon Medical’s flagship beating-heart repair procedure for mitral valve patients — HARPOON system — will be added to Edward Lifesciences’ Surgical Heart Valve Therapy portfolio for treating structural heart disease. However, the HARPOON system is yet to receive CE Mark approval.

Financial Details

Edwards Lifesciences paid $100 million in cash to close the deal on Dec 1. Moreover, the company is liable to pay another $150 million on achievement of certain pre-decided milestones over the next 10 years.

Recent Developments

Interestingly, Edwards Lifesciences has been witnessing strength in the Surgical Heart Valve Therapy segment on strong uptake of the EDWARDS INTUITY Elite valve system.  Progressing in this space, the company received FDA approval for INSPIRIS RESILIA aortic valves in July 2017. Notably, it is the first-of-a newly created group of resilient heart valves that incorporate the advanced RESILIA tissue. The company plans to commercially launch the product in the United States and Japan in 2018, followed by the successful launch of INSPIRIS RESILIA in Europe earlier in 2017.

Market Potential

We believe that unhealthy lifestyle and a rise in ageing population will continue to result in high incidence of cardiovascular diseases. This is further strengthened by data provided by GBI Research. Per the report, the global cardiovascular diseases market will see a CAGR of 4.1% by 2019. Within this space, the U.S. market is expected to witness the highest momentum at a CAGR of 4.7%. Moreover, per a report by Medgadget, the global heart valve repair and replacement market is expected to rise from $2,281.2 million in 2014 to $3,767.0 million in 2020, at a CAGR of 8.7%.

Thus, in view of the current market potential, we believe that the company’s efforts will help boost the top line.

Share Price Performance

Edwards Lifesciences has been gaining investor confidence on consistently positive results. Over the last year, the company’s share price has outperformed the broader industry. The stock has gained 35.4% compared with the broader industry’s 21.5%.



Zacks Rank and Key Picks

Edwards Lifesciences carries a Zacks Rank #3 (Hold).

A few better-ranked medical stocks are PetMed Express, Inc. , Align Technology, Inc. (ALGN - Free Report) and Myriad Genetics, Inc. (MYGN - Free Report) . Notably, PetMed, Align Technology and Myriad Genetics sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

PetMed has a long-term expected earnings growth rate of 10%. The stock has rallied roughly 84.1% over a year.

Align Technology has a long-term expected earnings growth rate of 28.9%. The stock has gained 137.4% in a year.

Myriad Genetics has a long-term expected earnings growth rate of 15%. The stock has gained 97.5% in a year’s time.

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