Edwards Lifesciences Corp. says it won’t go back to the drawing board after a setback on a heart valve the company sees as a growing part of its business.
The issue arose after Edwards said the company is unlikely to get the regulatory go-ahead to start clinical trials of a less invasive heart valve this year. The Irvine-based company now expects to hear from the Food and Drug Administration about a trial early next year.
That prompted a heart surgeon and an analyst who follows Edwards to question whether the company needs to redesign its so-called percutaneous heart valve. That could add to the time it would take Edwards to enter what it sees as an emerging market.
A redesign of the valve could be needed before Edwards gets federal approval to start clinical trials, said Alexander Arrow of Lazard Fr & #269;res & Co. in New York.
In a report issued after Edwards’ investor day earlier this month, Arrow wrote that Dr. Jeffrey Moses, a cardiologist who spoke to attendees, said he thought the valve needed to be changed. Before the product is launched in the U.S., Edwards would have to add a protective feature to help heart surgeons avoid hurting the heart’s mitral valve, the doctor said.
The stakes are high for Edwards. The company is the largest maker of heart valves implanted via open-heart surgery. But industry watchers see valves inserted via catheters gaining a big share of the market in years to come.
After first downplaying the threat posed by less-invasive valves, Edwards earlier this year paid $125 million to buy New Jersey’s Percutaneous Valve Technologies Inc., an up-and-comer in the less-invasive heart valve market.
The valve questioned by the analyst and surgeon comes from the acquisition.
Edwards said it is working on issues with regulators but a valve redesign isn’t needed.
“As we announced, our plans to implement enhancements to the delivery system to improve ease of device delivery and implantation will not require any design modifications, said Barry Liden, an Edwards spokesman.
The company said it hopes to have complete U.S. regulatory approval for its Cribier-Edwards percutaneous aortic heart valve by 2007.
Any delays in bringing the valve to market could give competitors a leg up, according to analyst Arrow.
They include France’s CoreValve SA and 3F Therapeutics Inc. in Lake Forest.
Arrow said he sees 3F Therapeutics as Edwards’ biggest threat in the percutaneous heart valve market. 3F gained a lot of buzz last year when Boston Scientific Corp., an Edwards rival, led a $14.2 million venture capital financing round (see related story, page 16).
Another company working on less-invasive valves is Minneapolis-based Medtronic Inc., which has a valve plant in Santa Ana.
3F’s potential competitive threat to Edwards stems from what Arrow called “deliverability,” a term doctors use to describe their ability to get an implantable device to the exact spot in a patient’s body.
“Given the clinical challenges Edwards/PVT faces, a heart valve startup, 3F Therapeutics, has, in our view, replaced PVT as the company with the most promising non-surgical aortic heart valve,” Arrow wrote.
Edwards’ way of implanting less-invasive valves is to go through the arteries. That could damage healthy leaflets in a patient’s mitral valve or require a smaller catheter, according to Arrow.
3F’s approach relies on a small incision in the chest, along with a catheter to move the valve to the heart, he said.
Edwards’ Liden passed on a question about whether Edwards would be interested in buying 3F, saying the device maker’s policy is not to speculate about acquisitions or collaborations.
Jan Wald, who follows Edwards for A.G. Edwards & Sons in St. Louis, also was cautious about the company’s percutaneous valve issue, albeit with milder language than Arrow.
“Our opinion here has not changed over the past year,” Wald said in a report detailing his impression of Edwards’ investor day. “We think that these technologies definitely have a ‘cool’ factor, but not much beyond that right now.”
As for delays, they’re to be expected, according to Wald.
“We talked to one of the doctors after the conference who told us that it may take four to five years after approval before we see widespread adoption due to issues he has seen to date,” he wrote. “In short, we think investors should appreciate what could be novel technologies but not ignore the timelines or the risks.”
During the conference, Edwards executives said questions remain about how sick a patient needed to be to participate in a trial and what kinds of comparisons should be used.
The delay news was overshadowed by Edwards’ revenue and profit growth for 2005, which pushed the company’s shares higher. Edwards’ stock got another boost last week on word of a valve approval in Japan. The company had a market value of $2.4 billion as of last week.
