St. Jude flexible cardiac catheter approved in EU, aims for FDA

St. Jude CEO Daniel Starks

St. Jude Medical ($STJ) is hoping to strengthen its franchise in ablation catheters--thin, flexible wires inserted nonsurgically into the heart to treat cardiac arrhythmia. Its FlexAbility irrigated ablation catheter has garnered a CE Mark in Europe, where it has marketed the TactiCath contact-force sensing irrigated ablation catheter since 2012. The company hopes to get FDA approval by year end for both FlexAbility and TactiCath.

These offerings expand St. Jude's electrophysiology product line, which includes high and low voltage cardiac resynchronization therapy devices, diagnostic and therapeutic electrophysiological catheters as well as navigation technology for them. St. Jude is the largest player in the $14 billion electrophysiology market, the company said in its recent second quarter call.

St. Jude reported net sales of $1.45 billion during the second quarter; that included $733 million from cardiac rhythm management products such as defibrillators and pacemakers, $257 million from atrial fibrillation products, $351 million in cardiovascular products such as vascular and structural heart devices and $107 million in neuromodulation products.

The fastest growing segment during the second quarter was atrial fibrillation products, which was up 8% over the second quarter of 2013. Overall, St. Jude net sales was up only 3%. The company is hoping these ablation catheters will help expand its growth rate in atrial fibrillation, which is the most common type of cardiac arrhythmia and affects an estimated 34 million patients globally.

St. Jude acknowledged on the call that its top atrial fibrillation competitor is Johnson & Johnson ($JNJ), which garnered an FDA approval in February for its Thermocool Smarttouch ablation catheter to treat drug-resistant paroxysmal atrial fibrillation, sustained monomorphic ischemic ventricular tachycardia and Type I atrial flutter.

St. Jude Chairman, President and CEO Dan Starks said that he expects TactiCath, chronic pain products and CardioMEMS products to drive sales acceleration into the second half and even more so in 2015. The company completed an acquisition of CardioMEMS last quarter and launched its FDA approved heart failure monitoring device.

As for FlexAbility, "If you think about FlexAbility and TactiCath with force-sensing, the combination of the two really get us in a meaningful way to have leading technology in the ablation catheter space where we haven't been strong in the past," Group President Eric Fain said on the second quarter call. "FlexAbility, really you can think of as a work force ablation catheter we've had over 50 KOLs that have worked with us throughout the development process to provide their input in terms of the handling characteristics and we've gotten consistent strong feedback and we're really excited now to get started in patients."

FlexAbility is designed to reduce ablation procedure complications with its ability to bend and conform to the cardiac anatomy, decreasing the amount of pressure distributed to a patient's heart wall while increasing the stability of therapy delivery.

Investor confidence in St. Jude is high; they've pushed shares up 9% this year so far. But in the last month, St. Jude has pulled back about 3%.

- here is the FlexAbility press release
- and the transcript and press release for the St. Jude second quarter call

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