Boston Scientific (Natick, Massachusetts) last month reported a "historic quarter," saying its profit in the second quarter ended June 30 nearly tripled to $313 million, boosted by strong sales of its recently approved drug-eluting stents (DES) and favorable currency exchange rates. While the company reported a 71% jump in sales – largely because of the new Taxus stent – it also took a $57 million after-tax charge, or about 6 cents a share, from costs tied to the voluntary recall of 96,000 of its stents because of a dangerous defect in the balloon delivery system for the devices. The defect has been associated with three deaths as well as 43 serious injuries.

Boston Scientific reported a sharply expanded recall of both the Taxus DES and Express 2 bare-metal stent systems in mid-July, involving some 85,000 Taxus systems and 11,000 Express2 systems. The company's shares have lost nearly a fifth of their value since it initially announced the recall on July 2. "We were not looking for a recall, but we were prepared for it," said Paul LaViolette, senior vice president and group president of the cardiovascular unit, during a July 26 conference call. LaViolette said the company has completed the Taxus recall and that most U.S. accounts have been restocked.

LaViolette reported that, at its lowest level during the stent recall, Boston Scientific had about a 55% U.S. market share of the DES sector. He said that on July 23 the demand for the Taxus product was back to 87% of the normal pre-recall levels for that day. "We feel as if the recall has been executed, the product transition is completed, we clearly maintained drug-eluting stent leadership throughout the process, and now we're focused almost exclusively on the offensive – trying to rebuild customer comfort and restore our market shares to at least second-quarter levels."

Jim Tobin, CEO of the company, said during the call, "While we're not where we'd hoped to be, we feel we can recover." Of the 85,000 recalled Taxus units, 63,000 had been returned from the field as of the July 26 conference call.

Boston Scientific's worldwide cardiovascular sales nearly doubled to $1.19 billion, compared with $615 million in the quarter a year earlier, reflecting the strength of the Taxus launch. The company said 3Q04 market growth would be about flat in comparison to the current quarter, due to a seasonal drop in procedures and the disruption in sales resulting from the recall. Overall, sales jumped to $1.46 billion from $854 million a year earlier and EPS improved to 44 cents a share from 15 cents per share in 2Q03. Excluding the recall and the $740 million acquisition of neurostimulation specialist Advanced Bionics (Valencia, California) in June, Boston Scientific estimated that EPS would have been 51 cents (6 cents associated with the recall and 1 cent associated with the acquisition). The company said it expects market growth to resume in the fourth quarter, reaching a $3 billion U.S. run rate by year-end or early in 1Q05.

Berlin Heart gets U.S. media attention

For two particular reasons, 2004 has been a very good year thus far for Berlin Heart (Berlin) in the U.S. market. First, the company plans to file for a humanitarian device exemption (HDE) for its pediatric heart assist device with the FDA – and, secondly, it received lengthy and detailed front-page coverage of that heart pump in The New York Times last month. The Times article documented the use of Berlin Heart's pediatric heart-assist device in keeping alive Miles Coulson, a 3-month-old who had been born healthy but whose heart had begun to fail after a few weeks, apparently because of a viral condition. The pediatric version of Berlin Heart's assistive technology was used for Miles to support his fight for life either until his own heart had recovered sufficiently, so the pump could be removed, or a transplant heart is found for him.

"We place this device in two-day-old babies, even newborns," said Johannes Mueller, MD, a director for Berlin Heart, speaking with Cardiovascular Device Update from Germany. "It's so small we can use it in every size." Thus far, three other children in the U.S. have been treated with Berlin Heart devices. One recovered and two received transplants, enabling removal of the pump. That it can be used in such small babies highlights the need for such a device in the U.S. since none for the pediatric population is yet approved here.

Mueller noted that the HDE guidelines allow for implantation in 5,000 individuals annually, but that the actual need is much less. He estimated "a maximum of about 300 implantations per year" in the U.S., "so the limit of 5,000 doesn't bother us at all." Other very small heart support devices are on the horizon, supported by grants totaling more than $22 million from the National Institutes of Health (NIH; Bethesda, Maryland), but it could take up to five years, or more, for those devices to come on-line commercially, experts say.

The Berlin Heart device is not actually a heart but more like a ventricular-assist device – one that works through a percutaneous attachment to the baby's own heart. It is not small, but then it isn't implanted like a replacement heart or a ventricular assist device. "Only the cannulae goes through to the aorta," Mueller explained, with the pump and a drive console outside the body. The pump has about a 10 mm capacity, and he described the drive unit as "a big console, really quite big, about the size of a small refrigerator." Comparable percutaneous heart assist technologies, though not for pediatric use, are being developed in the U.S. by CardiacAssist (Pittsburgh), with its TandemHeart percutaneous ventricular assist system, and Orqis Medical (Lake Forest, California) with its Cancion Cardiac Recovery System.

Mueller said that with use of its system, "the first effect you see is that the condition of this baby improves immediately. That's what we want to obtain first. The next step is to look at heart function and in some children see improvement of heart function because of unloading of the heart." He reported that the company received CE marking for the device about six years ago, and it has been used since then in about 90 pediatric cases. Further out, he said Berlin Heart is planning to apply with the FDA for approval of its Incor VAD system, for treating end-stage congestive heart failure, sometime in 2005.

The company describes the Incor system as using magnetic-suspension bearings, "almost completely silent" in operation and having a "virtually unlimited service life." The focus of use is bridge to recovery, bridge to transplantation or as "an ideal alternative to transplantation solution."

St. Jude to add two divisions

St. Jude Medical (St. Paul, Minnesota) in late July rolled out plans to create two new divisions by the end of this year, reflecting the expansion and growth opportunities of its vascular closure, cardiology and electrophysiology product lines. It also reported one key executive appointment, promotions for three executives and one planned retirement. The company said its Daig Division (Minnetonka, Minnesota) would become two new divisions, Cardiology and Atrial Fibrillation. Both divisions will be headquartered at the current Daig location in Minnetonka.

The Cardiology Division will be led by Paul Buckman, who is joining St. Jude Medical after serving as chairman and CEO of ev3 (Plymouth, Minnesota) and as president of the Scimed Division of Boston Scientific from 2000 to 2001. Buckman has more than 30 years' experience in the med-tech industry. He built ev3, which is focused on endovascular therapies, from inception to $80 million in revenues, St. Jude said in its statement.

The Cardiology Division will focus on St. Jude's products and services for cardiovascular catheterizations. It will, the company said in a statement, build on the market leadership position of the Angio-Seal vascular closure devices. St. Jude's angiography and catheter introducer product lines will be part of that division.

The Atrial Fibrillation Division will be led by Jane Song, who has been president of the company's Cardiac Surgery Division since 2002 and previously was senior vice president, operations for St. Jude's Cardiac Rhythm Management business. The Atrial Fibrillation Division will focus on medical technology and services to help cure atrial fibrillation (AF) as well as address the broad field of electrophysiology. The Epicor Medical (Sunnyvale, California) high-intensity focused ultrasound (HIFU) technology for the surgical ablation of cardiac tissue, acquired by St. Jude earlier this summer in a $185 million deal, will be part of the division as the organization focuses on curative approaches to AF. The division will encompass all of Daig's technology, products and resources for AF and also for other types of electrophysiology catheterization procedures.

George Fazio, president of SJM Europe since 2001, will succeed Song as president of the Cardiac Surgery Division. Fazio joined the company in 1992. Replacing Fazio will be Denis Gestin, currently vice president, Northern Europe and Africa, and previously manager of St. Jude's subsidiary in France. Buckman, Song and Fazio all will report to St. Jude Chairman, President and CEO Daniel Starks. Gestin will report to Joseph McCullough, president of St. Jude Medical International.

Mayo Clinic, IBM to mine health data

Electronic medical records (EMRs) are being implemented, however slowly, in many hospital and managed care systems. Meanwhile, advanced computer technology is providing the ability to identify broad developments and trends in a variety of consumer, industrial and scientific fields. And by combining these two strategies, the Mayo Clinic (Rochester, Minnesota) and IBM (Armonk, New York) have committed to riding the front edge of these ongoing waves in healthcare.

A new partnership of the two organizations – acknowledged behemoths in their respective fields – was unveiled last month, with the hope of adding a significant new dimension to patient data mining. When fully mature, the project also could provide important new approaches to healthcare research. The primary clinical goal of the link-up, according to Nina Schwenk, MD, an internist and vice chairperson of the board of governors for Mayo, is to enable not only a "drill-down" into an individual patient's healthcare history, but also a broader "horizontal" approach to patient diagnostics and treatment.

Outside of the healthcare field, this approach has been called pattern recognition and has been used to identify a variety of trends, such as consumer buying habits and credit care scams. In healthcare, the result of the project could be the ultimate in personalized medicine and "best practice" case management.

Schwenk told Cardiovascular Device Update that, "right now," Mayo has in place the EMR strategy, with electronic entry of a person's health history at the hospital's facilities allowing a comprehensive look at that history to structure a disease management plan. "So if I'm sitting in an office with a patient," Schwenk says, "and the patient has, say, lung cancer, I can access all the medical information on that patient gathered here – the type of tumor, lung specialists and surgeons [seen], test results, everything available in a single-source way. I can also then go ahead and do a literature search and figure out what's the best treatment from that literature."

With the new partnership, IBM will use that information, combined with a large number of Mayo's patients, to develop a database system, she says, that adds a significantly broader dimension to this case management approach. "Such a database," Schwenk says, "will allow us not only to look at that person's information by drilling down vertically, but also horizontally. We have 4.4 million records available electronically. So we can tell, over the last few years, how many patients have had that type of tumor – their ages, how many had the same lab abnormalities, and the types of treatment they received. And I can tell how they did with the treatment they received."

The goal of this effort: to be able to produce "a mini-clinical study" for each individual patient. With such information, she says, "I can more efficiently and hopefully better treat that patient and say 'This treatment is going to work better for you than another standard treatment.'" In consumer terms, this means the ultimate customization of a therapeutic plan by providing the most up-to-date information, even at the genomic level, to produce the most far-reaching version of personalized medicine. Thus, Schwenk says that the database will ultimate provide even a "genomic profile" of a patient and other patients with the same type of disease, or information concerning how one genetic type metabolizes a particular medication. "That's going to take a while to get there," she adds, noting that the entire project will take several years to be fully developed.

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