Investors drove down shares of Irvine heart valve maker Edwards Lifesciences Corp. after an analyst downgraded the company’s stock on concerns about a new type of heart valve.
In a note to clients, JPMorgan Chase & Co. analyst Michael Weinstein downgraded Edwards to “underweight” from “neutral.”
Weinstein said he sees a higher than expected risk of deaths from the company’s less-invasive heart valve and expects shares to reflect this in the month ahead.
Shares of Edwards were off about 10% last week with a market value of $3.1 billion.
Weinstein said JP Morgan’s research findings are likely to show a six-month mortality rate higher than Wall Street’s and cardiologists’ expectations for Edwards’ Sapien transcatheter aortic heart valve program.
The Sapien valve is inserted via a catheter to avoid open-heart surgery.
In addition, the brokerage also said the results could have negative implications for Edwards’ clinical trial of the valve.
The trial is looking at the Sapien valve in patients who are considered high risk or who aren’t candidates for traditional open-heart valve replacement surgeries.
“We view FDA approval for a high-risk surgical indication as less likely, and as of right now, we’d suggest that the transapical approach probably won’t make it to the U.S. market,” Weinstein said. “If FDA approval is a question, then it is unlikely that any of the larger players in cardiovascular would step up to the plate on Edwards.”
,
Vita Reed
