Irvine-based device maker Edwards Lifesciences Corp. is planning to introduce its less-invasive replacement heart valve in Japan late next year, officials said during the company’s recent investor day.
Edwards Sapien XT, which is inserted via a catheter, is designed for patients who can’t have open-heart surgery to treat aortic stenosis, or a narrowing of the body’s main artery.
“We think Japan is a wonderful opportunity for transcatheter valves, and it’s evidenced by just some of the differences we see in the market,” said Larry Wood, Edwards’ vice president for transcatheter valve replacement.
Japan’s regulators should sign off on Sapien XT in mid-2013 and reimbursement approval is likely to happen at the end of the year, he said in the Dec. 4 presentation.
“The reimbursement process, we think, is probably closer to [a] four to six months sort of process, not a year,” Wood added.
Doctors in Japan tend to perform percutaneous, or under-the-skin, coronary interventions, rather than surgical coronary artery bypass grafting. That indicates a preference for less-invasive procedures like transcatheter heart valve replacement, Wood suggested.
“We know that [aortic valve replacement] is undertreated in Japan and a larger percentage of their population is over the age of 80 compared to the United States,” he said. “So we think this is going to be a great opportunity. But our full launch won’t happen until after we get the reimbursement approval.”
Edwards has been selling Edwards Sapien valves in Europe since late 2007 and the U.S. since the end of 2011. Its U.S. sales grew more slowly than expected because of regulatory delays in approving expanded usage of the device for patients who were less ill.
The company expects Edwards Sapien sales to come in at $710 million to $790 million in 2013. U.S. sales are projected to make up $390 million to $440 million.
Edwards also discussed some of its research and development projects during this month’s investor presentation. Chief Executive Michael Mussallem said the company would continue to spend about 15% of its revenue on research and development.
“We think it’s a critical element of bolstering our long-term horizon,” Mussallem said.
Edwards showcased one of its projects during the day–a heart valve line known as Zeta.
Growth Driver
Company officials indicated Zeta and the Edwards Intuity heart valve, which received European regulatory clearance this year, could help the device maker grow its market share in developing countries because younger patients are more likely to have valve disease in emerging markets.
Edwards believes that transcatheter aortic valve implementation “will continue to move from extreme high risk into more moderate risk, and we think the Zeta and [Intuity] create a real opportunity to serve the broad rest of the curve,” said Donald Bobo Jr., vice president, heart valve therapy.
Zeta is built on Edwards’ GLX bovine tissue platform, which received European regulatory approval this year. Bobo said the company is designing Zeta “to anticipate and give it unique features that would make this platform ideally suited for a ‘valve-in-valve’ in the future.”
Valve-in-valve implantation takes place when an artificial heart valve is seated within a previously implanted pig or cow tissue replacement valve that’s failed.
“It’s early—there’s a lot to be done,” Bobo said. “But it’s something we are excited about.”
Guidance
Edwards provided its 2013 financial forecast later during the day.
The company could see $370.5 million to $382.1 million in 2013 profit on $2.1 billion to $2.2 billion in sales.
After the investor’s day announcements, analyst Michael Weinstein of JP Morgan wrote that Edwards’ recent forecasts seemed “somewhat aggressive, given the ongoing macro challenges in Europe and likelihood that competition will increase significantly.”
David Roman of Goldman Sachs & Co. said Edwards’ 2013 outlook reaffirmed its own “bullish view” that domestic sales of Edwards Sapien face limited risk from Food and Drug Administration approvals or insurer-reimbursement timelines.
Edwards counts a market value of about $10.5 billion. Its shares are up more than 25% this year.
