Medtronic plc (MDT - Free Report) recently announced FDA approval for its MiniMed 670G system for patients with type 1 diabetes between seven and 13 years of age. Notably, the approval was based on positive data from an at-home pediatric study.
Study in Details
The multi-center study had enrolled 105 participants within the 7-13 years’ age group. The trial had a two-week run-in phase and a study period of three months. Notably, 97% of the participants chose to continue using the system under a Continued Access Program. The study results also demonstrated data from the pivotal trial of MiniMed 670G system on patients aged 14 years and above.
MiniMed 670G at a Glance
Post the receipt of FDA approval in 2016, Medtronic had commercially launched MiniMed 670G in June 2017. It is a Hybrid Closed Loop (HCL) insulin delivery system for Type I diabetic patients. The MiniMed 670G system features Medtronic’s latest Guardian Sensor 3, a glucose sensor with increased accuracy and enhanced performance. This is the only FDA-approved sensor to control a hybrid closed loop system, including diagnostic technology that continuously checks sensor health. The system also has Medtronic’s most advanced algorithm — SmartGuard HCL technology.
Diabetes Business in Focus
Medtronic is consistently trying to enhance the Diabetes business. The company saw a 21.3% rise at constant exchange rate in Diabetes business revenues during fourth-quarter fiscal 2018. The company benefited from a solid uptake of new sensor-augmented insulin pump systems in the United States and international markets along with increased production capacity for the same.
Recently, the company announced the receipt of FDA approval for the Guardian Connect continuous glucose monitoring (CGM) system for diabetes patients between the ages of 14 to 75 years.
Notably, the system was scheduled to be made available in the first quarter of fiscal 2019 (May-July 2018).
The company also announced that the FDA has approved a new arm indication for the Guardian Sensor 3 continuous glucose monitor (CGM), which is used with the MiniMed 670G insulin pump.
Notably, Medtronic expects double-digit growth in the segment in fourth-quarter fiscal 2018, courtesy of consistent performance by MiniMed 670G system in the United States along with enhanced sensor supply capacity.
Additionally, Medtronic has been gearing up for the international introduction of the MiniMed 670G and the U.S. launch of new professional CGM iPro 3 in 2019.
An ageing population, unhealthy lifestyle, rising awareness and higher expenditure in healthcare are likely to drive the highly competitive diabetes market.
Per a report by Mordor Intelligence, the global market for diabetes care devices is projected to reach a value of $30.25 billion by 2021, at a CAGR of 5.93%. Considering the bullish market sentiments, we believe that the latest development has been strategic.
Share Price Movement
Medtronic has been gaining investor confidence on consistently positive results. Over the past three months, the company’s share price has outperformed its industry. The stock has gained 10.7% in comparison to the industry’s 7.4% increase.
Zacks Rank & Key Picks
Medtronic carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Genomic Health (GHDX - Free Report) , Abiomed (ABMD - Free Report) and Stryker Corp. (SYK - Free Report) .
Genomic Health has an expected earnings growth rate of 187.5% for the current quarter. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Abiomed has a projected long-term earnings growth rate of 27% and a Zacks Rank of 1.
Stryker has a projected long-term earnings growth rate of 9.7%. The stock carries a Zacks Rank of 2 (Buy).
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