Medtronic plans to launch its Melody transcatheter pulmonary heart valve by April 2010, pending humanitarian device exemption approval from FDA.

The company "hope[s] to launch the product in the second half of the fiscal year," which ends in April 2010, CEO Bill Hawkins said during an Aug. 25 earnings call for the firm's fiscal first quarter (ended July 31).

Medtronic's humanitarian device exemption application gained a unanimous approval recommendation from FDA's Circulatory System Devices panel July 22 (¹ Also see "FDA Panel Unanimously Endorses Medtronic's Transcatheter Heart Valve" - Medtech Insight, 27 July, 2009.).

Composed of a piece of bovine jugular vein supported by a platinum-iridium stent, the device is intended for the approximately 1,000 patients per year in the U.S. who experience failure of a previously repaired right ventricular outflow tract. The valve would be a stopgap to allow patients to delay their next open heart surgery.

The population Melody addresses is small, but FDA approval would give Medtronic the first transcatheter heart valve on the U.S. market.

Melody and other transcatheter heart valves addressing the larger aortic heart valve replacement opportunity are already available outside the U.S.

Medtronic gained a stake in the transcatheter aortic heart valve market earlier this year through its acquisitions of CoreValve and a smaller Israeli company, Ventor Technologies, for a combined $1 billion (² Also see "Medtronic Catapults Into Transcatheter Valve Market With Billion-Dollar Buys" - Medtech Insight, 2 March, 2009.).

CoreValve's ReValving percutaneous aortic valve is the market leader in Europe, where it has only one competitor, Edwards' Sapien . Hawkins noted during the earnings call that the integration of CoreValve is progressing well.

"The breadth and capacity of our global cardiovascular infrastructure has greatly enhanced CoreValve's ability to meet the growing demand for its products by accelerating the development and scalability of the CoreValve operations," Hawkins said. He added that Medtronic's Santa Ana, Calif., valve manufacturing facility played a "critical role" in CoreValve's performance during the quarter.

At the time of Medtronic's acquisition of CoreValve, ReValving controlled about 56% of an approximately $80 million to $100 million market. According to Hawkins, the transcatheter valve market currently is "annualizing at roughly $200 million, and we continue to command half the market."

Medtronic reiterated that it plans to begin a U.S. ReValving study in mid-fiscal 2010.

Medtronic Cardiovascular Sales Grow 9%

Medtronic's cardiovascular unit, which includes transcatheter valves, reported first-quarter revenue growth of 9% from the same quarter last year, to $689 million - or 15% on a constant currency basis.

The gain was driven by endovascular and structural heart disease product sales, up 41% and 16%, respectively, to $118 million and $218 million on a constant currency basis.

The cardiovascular division's performance included $353 million in coronary device sales, up 8% on a constant currency basis but relatively flat on a reported basis. The firm credited momentum from the launch in Japan of its Endeavor zotarolimus-eluting stent during the quarter.

Hawkins noted that Medtronic's share of the worldwide coronary stent market is "above 20%."

Spinal Revenue Weighed Down By Biologics

Medtronic's spinal segment revenue of $915 million for the quarter was up 7% from last year, or 8% on a constant currency basis. The total includes core spinal product sales of $696 million, up 9%, and biologics sales of $219 million, down 1%.

Since the firm's 2007 acquisition of balloon kyphoplasty device maker Kyphon, Medtronic has struggled to grow the business, which is part of its core spinal product segment. Kyphon sales rose only "modestly" in the first quarter, Medtronic CFO Gary Ellis noted.

The company recently released initial results of the randomized, multi-center FREE trial comparing the Kyphon system to non-surgical therapy, which showed the balloon kyphoplasty device to be more effective in treating symptoms of acute vertebral compression fractures (³ Also see "Research In Brief" - Medtech Insight, 9 March, 2009.).

During the earnings call, Hawkins said the firm should have two-year results of the FREE study by the end of the calendar year, which may aid uptake of the technology. "We are continuing to be very bullish on the role that kyphoplasty will play" in treating compression fractures, he stated.

While biologics product growth has been stagnant, Medtronic continues to invest in "initiatives to capture the long term value of this franchise," according to Hawkins. For example, the company is seeking expanded indications for its Amplify bone morphogenetic protein product. Hawkins said the firm is hoping to gain FDA approval for posterolateral fusions later this year.

Bone morphogenetic protein represents "a small part of our business now, but we think it has the potential to be a $250 million to $500 million market," the exec said.

Meanwhile, neuromodulation segment sales of $373 million were up 7%, or 11% on a constant currency basis, aided by sales of InterStim neurostimulation and Activa deep brain stimulation systems.

The company's diabetes business was also a strong performer in the quarter, with revenue up 10%, or 15% at constant currency, to $295 million, on sales of insulin pump and continuous glucose monitoring products.

Medtronic's largest business unit, cardiac rhythm disease management, reported sales of $1.34 billion for the quarter, up 3%, or 7% at constant currency. The total includes $775 million in implantable cardioverter defibrillator sales and $536 million in pacemaker revenue.

Hawkins said Medtronic is "cautiously optimistic" that the upcoming release of data from Boston Scientific's MADIT-CRT study Sept. 1 at the European Society of Cardiology Congress will benefit the overall defibrillator market.

Early results in patients with mild heart failure supported expanded use of premium-priced cardiac resynchronization therapy defibrillators (⁴ Also see "MADIT-CRT Data Support Expanded Cardiac Resynchronization Market" - Medtech Insight, 29 June, 2009.).

The firm reported corporate revenue of $3.9 billion for the quarter - up 6%, or 10% on a constant currency basis.

- Brooke McManus ( ⁵ b.mcmanus@elsevier.com )

Medtronic Plans To Launch Melody Valve In The U.S. By April 2010

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