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| Sapien 3 valve--Courtesy of Edwards Lifesciences |
Edwards Lifesciences' ($EW) Sapien 3 Valve for patients too frail for open heart surgery received FDA approval Wednesday afternoon months ahead of expectations, sending the stock up more than 4%, as investors bet on quick adoption of the latest iteration of the TAVR device.
The FDA approved the device following a clinical trial of 583 patients with aortic valve stenosis who were at high risk for open heart surgery, or who could not undergo the surgery due to excess risk.
Sapien 3 has a new skirt at the base of the transaortic valve replacement, described by the company as a cuff of fabric surrounding the valve frame, to minimize paravalvular leakage, or the leakage of blood around the valve.
"Clinical data showed that the Sapien 3 Transcatheter Heart Valve is superior to the first generation Sapien Transcatheter Heart Valve, with significantly less leakage through and around the valve," said Dr. William Maisel, acting director of the Office of Device Evaluation at FDA's device arm (CDRH), in a statement.
Equity analysts at Jefferies said in a research note that the company's "gold standard TAVR system" will gain market share over competitor Medtronic's ($MDT) CoreValve due to the approval, citing the experience of the device in Europe, where it was approved in January 2014.
"Following CE Mark approval early last year, Sapien 3 now accounts for over 90% of volumes in that geography and we would anticipate similarly rapid and extensive conversion from (the second-generation Sapien XT) in the U.S. as the commercial launch unfolds in the months ahead. While competition in the European market continues to intensify in light of multiple recent competitor approvals and launches, Edwards has still managed to gain share thanks to adoption of Sapien 3. In the U.S., with Medtronic continuing to aggressively launch CoreValve and multiple competitor PMA studies actively enrolling patients, Sapien 3 should similarly benefit Edwards' competitive position now that FDA approval is in hand."
The analysts "await clarity from the company in terms of timing and pace of launch and the ability to ramp production of Sapien 3 now that approval is in hand much earlier than anticipated."
But the news isn't all bad for Medtronic, Boston Scientific ($BSX) and St. Jude Medical, whose TAVR devices are in trials for FDA approval. "Today's earlier-than-expected approval is the latest sign of the FDA's growing comfort around transcatheter valves, which bodes favorably in terms of the regulatory pathway for future-generation devices and expanded clinical indications," Jefferies' analysts Raj Denhoy and Imron Zafar wrote.
Edwards' case was strengthened by the Sapien 3's strong European post-market data registry results on display at the at the EuroPCR conference in Paris.
During the conference, Medtronic presented strong results of its third-generation CoreValve Evolut R in a bid for CE mark approval. The Evolut R can be put in reverse and repositioned if the cardiologist wants to make adjustments following the initial placement of the device via delivery catheter.
The gap between Sapien 3's CE mark and FDA approval was 18 months long, but it's been shrinking as the FDA moves to get the latest TAVRs onto the market faster in light of mounting evidence that they are safe and effective in frail patients, for whom open heart surgery is risky.
Meanwhile, St. Jude's Portico recently resumed its pivotal trial in the U.S. after it was cleared of safety concerns that turned out to be fairly insignificant.
Edwards' first generation was the first to get FDA approval in the U.S. in 2011.
TAVRs are considered one of the medical device industry's most significant and high-profile clinical advancements because they enable therapy using a minimally invasive transcatheter-based approached, rather than invasive open heart surgery.
Prior to the debut of TAVRs, some elderly and frail heart disease patients had no surgical options available to them. "Because of the overall risks and extended recovery time associated with open-heart surgery, about 30 percent of patients are considered inoperable or at high risk for surgical complications and are not referred for open heart surgery," the FDA wrote in its release on the approval.
Besides approval of new TAVRs, industry observers should watch for signs that the devices are being used on an increasing subset of elderly patients, including those with a lower (but still significant) risk of suffering adverse events from open-heart surgery.
The Sapien 3 was approved patients for whom open surgery is deemed by a clinician to be "too risky" or "highly risky."
- read the release
- here's FDA statement