Irvine cardiovascular device maker Edwards Lifesciences Corp.’s shares fell Thursday after the Centers for Medicare and Medicaid Services said it plans to review its less-invasive replacement heart valve based on concerns raised by doctors over stroke risks.
Medicare’s review will determine whether the federal insurance program for elderly Americans will pay for the Edwards Sapien heart valve, which is up for approval by the Food and Drug Administration.
Medicare’s decisions on coverage are seen as benchmarks for private insurance companies. A decision by Medicare to deny coverage or limit payments could hurt sales.
Shares of Edwards closed down about 7% in Thursday trading, to a market value of about $8.2 billion.
Medicare officials said they will make a decision on Edwards Sapien by June 2012.
Edwards said in a statement that it was “aware for some time” that Medicare plans to review the new heart valve, which is already on the market in Europe.
The device maker noted that a draft of a report called a national coverage determination is “just entering the public comment period, and we expect it to evolve as the societies, regulators and other stakeholders” weigh in.
Jan Wald, an analyst with Memphis-based Morgan Keegan & Co. told the Associated Press that Medicare would likely pay for the Edwards Sapien if it’s approved for the market here before a final determination on coverage is made.
