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| St. Jude Medical Ellipse ICD--courtesy of St. Jude Medical |
We're picturing some St. Jude Medical ($STJ) executives alternatively giving each other "high fives" and crossing their fingers this morning.
Here's why: The Minnesota device company stalwart has gained FDA approval for its new Ellipse implantable cardioverter defibrillator (ICD), a tiny device shaped by input from 200 physicians who carved their vision in clay. The U.S. approval follows a similar CE mark from European regulators just last month, and so that's where the "high fives" come from. But we see the finger-crossing stemming from this: The product likely faces some serious expectations as far as helping the company's cardiac rhythm management division rebound. Its success would also deflect negative attention the company has received over issues such as its now-recalled Riata leads.
For the first quarter of 2012, the company saw implantable cardioverter defibrillator sales dip 3% to $450 million, with pacemaker sales declining 4%. St. Jude also worked hard during that period to continue streamlining the overall CRM business, including shutting down operations in Sweden. Last month, when St. Jude CEO Daniel Starks discussed the company's results, he said he expected CRM momentum to improve with products such as the Unify Quadra ICDs, which also gained FDA approval not that long ago. And so the Ellipse ICD will also be counted on to boost sales momentum.
St. Jude's announcement touts the Ellipse ICD as "the industry's smallest high-energy ICD," designed with an angled header and rounded edges to improve how a lead wraps around the device once it's connected. This matters, according to the company, because doctors can then use a smaller incision and reduced pocket size for the device. Also highlighted as a selling point: the device has "new discrimination algorithms" designed to keep "inappropriate shocks" to a minimum.
The company says Ellipse will work with the Durata defibrillation lead. St. Jude has been heavily promoting the lead's safety and reliability, even as it struggles with fallout regarding its earlier-generation Riata leads, which the FDA slapped with a Class I recall last fall after reports of a higher rate of insulation failures than initially reported. They've been off the market since 2010.
- here's the release