Edwards Lifesciences, MD+DI's 2016 Medtech Company of the Year, pioneered transcatheter aortic valve replacement and has remained the top player in the market. Can the valve powerhouse repeat its success in transcatheter mitral valve replacement?
In the past year alone, Edwards Lifesciences has scored numerous victories in its transcatheter aortic valve replacement (TAVR) business: expanded use of its Sapien 3 valve in intermediate risk patients, regulatory approval for the valve in Japan, and quarter after quarter of impressive sales growth. It's hard to believe that the Irvine, CA, company only entered the TAVR market in the mid-2000s, when its pioneering Sapien valve received CE Mark.
Even more impressively, TAVR may be just the beginning of Edwards's transcatheter heart valve success. The company now has its sights on the transcatheter mitral valve replacement (TMVR), a market that could dwarf the TAVR opportunity and keep Edwards riding high for years to come if its platform performs well.
Path to TAVR Triumph
How did a company once known mainly for its surgical heart valves turn itself into a vanguard of minimally invasive devices? Michael Mussallem, the chairman and CEO of Edwards, emphasized the company's focus on continual improvement with that first Sapien valve.
"Our approach was to really try and learn fast and improve . . . As good as the first-generation therapies were, we knew there were opportunities to make it better," he said.
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The commitment to iteration has clearly paid off. Edwards is currently selling its third-generation TAVR product, Sapien 3, and the minimally invasive procedure is now available to patients who are not as sick as the original inoperable group thanks to gradual expansion of the device's indications for use. In April, the company announced that findings from the PARTNER II trial found that the Sapien 3 valve had shown superiority over surgery in intermediate-risk patients, demonstrating a lower rate of all-cause death and disabling stroke versus surgery at 30 days (2.0% versus 8.0%) and at one year (8.4% versus 16.6%).
"Results from the PARTNER II trial . . . should establish the Sapien 3 valve as the new benchmark for the treatment of intermediate-risk patients with severe, symptomatic aortic stenosis," Vinod Thourani, MD, codirector of the Structural Heart and Valve Center of the Emory Heart and Vascular Center, chief of cardiothoracic surgery at Emory Hospital Midtown, and professor of surgery in the division of cardiothoracic surgery at Emory University School of Medicine, said in a release.
After that stellar data came regulatory approvals. In August, the Sapien 3 valve received FDA approval for use in intermediate-risk aortic stenosis patients, followed by CE Mark for the same expanded indication in September. While there is some subjectivity around just who qualifies as intermediate-risk, the group is defined as those with a predicted surgical mortality risk of 3% or higher at 30 days.
At the time of the FDA-approved indication expansion, Stifel analyst Risk Wise estimated the new patient group would help add another $600 million to the U.S. TAVR market by 2020, driving it to $2.1 billion.
The TAVR expansion is geographic, too--Sapien 3 was approved in Japan in March. The company will also continue its pattern of gradual, continuous improvement by extending TAVR therapy to more patients. An IDE study of low-risk patients, PARTNER III, was started earlier this year and will include approximately 1300 patients.
Edwards isn't stopping there. Mussallem told MD+DI the company will keep trying to build on the Sapien platform.
"Can we enhance the ease of use? Can we make that procedure simpler and cost effective? . . . Can we reduce complications for these patients? . . . How do we shorten the recovery time for these patients so that their overall outcomes and experience improve?" he asked rhetorically.
Edwards has posted consistent, strong TAVR sales growth, including a more than 40% year-over-year increase in the first three quarters of 2016.
TMVR: The Next Chapter?
If today's TAVR titan was known primarily as a surgical heart valve company 10 years ago, could it be recognized mainly for its TMVR platform in another decade?
As with Sapien, Edwards is aiming to be the first to commercialize a TMVR solution. Although the TAVR market opportunity is vast, forecasted to reach more than $5 billion by 2021, the transcatheter mitral opportunity may be considerably larger. In a September 2015 research note, Joanne Wuensch, analyst at BMO Capital Markets, wrote that the TMVR opportunity "is potentially 4.5 [times] larger than the transcatheter aortic valve replacement (TAVR) market."
It makes sense that Edwards has set its sights on the space.
"This is one we really care about, where our strategy is to be first," Mussallem said.
To that end, Edwards purchased CardiAQ Valve Technologies last year. But the company isn't alone in its interest in TMVR. Also in 2015, Abbott purchased Tendyne, which had performed first-in-human implants of its TMVR device, and invested in Cephea Valve Technologies, with an option to purchase. Medtronic entered the space as well with its acquisition of Twelve Inc. There are standalone companies working in the space, too, like Neovasc and Caisson Interventional.
So far, Edwards is part of the lead pack. An early feasibility study of its TMVR platform in the United States is ongoing, and the company announced in July that it was set to enter a CE Mark trial. The start of that trial was delayed slightly by regulatory processes but is expected to begin before the end of the year, according to management commentary on the third-quarter earnings call near the end of October.
The RELIEF CE Mark trial will be a single-arm study at approximately 15 centers in Europe and Canada. Patients with functional and degenerative mitral regurgitation will be implanted via transapical and transseptal delivery approaches. The system being studied includes enhancements to the CardiAQ platform, including Edwards' advanced tissue technology, more sizes, and a new delivery system.
Abbott's management recently said a CE Mark trial for its Tendyne device is underway, and other players are not far behind, with some having implanted patients through feasibility studies.
In the case of TMVR, will going first be a boon or a bust? Mussallem acknowledged that it can be tough to pave the way, a lesson learned with TAVR.
"Obviously, it sounds great to go first," he said, adding "I think we realized that there's a downside to that, which is there is no pathway, there is no road. It really needs to be established. You're heading into significant uncertainty on almost every dimension . . . It's easier to go second, behind somebody else."
That challenge clearly hasn't dissuaded the company. Mussallem pointed out the benefit of forming physician relationships and working with regulators to determine what is needed. "The value of going first and why we like it is it puts us in the position to learn the most and learn the fastest," he said. "We like those leading-edge conversations. We feel like we learn a lot from that and it helps drive our intent."
Still, TMVR isn't directly comparable to TAVR. Despite burgeoning interest from industry and physicians alike, there is much yet to be discovered about the therapy, and many predict that commercial adoption could still be years away. Analysts have identified hurdles including market segmentation and said issues including deliverability, fixation, and durability must still be resolved. TMVR developers must also amass clinical data proving procedures compare favorably with surgery.
"We view this as a 'high-bar' due to excellent, long-term surgical outcomes data and anatomical challenges making mitral catheter access difficult," Wise wrote in a March 21 research note.
Edwards recognizes the challenge it faces.
"As we've talked about openly, likely technical challenges, patient selection, and clinical timelines will require patience and sustained investment," company spokesperson Heather Chambers wrote.
One early trend that could work in Edwards's favor is emerging physician interest in a transseptal approach to TMVR implantation, as noted by analysts including Wuensch and Larry Biegelsen of Wells Fargo. Although more complex, the transseptal procedure is considered less invasive than a transapical approach. Edwards was the first company to implant using the transseptal approach, though Caisson has now used it and others are likely to follow, according to Biegelsen.
"We believe the best solution for patients will be a transseptal approach, and this is a continued focus for development within our program," Edwards's Chambers wrote.
Looking to Lead
For all the hurdles Edwards and other TMVR players must overcome, the company remains bullish on TMVR.
"You can tell we're enthusiastic," Mussallem said on the third-quarter earnings call. "We wouldn't be beginning a CE Mark trial if we weren't enthusiastic about this, but there's a lot to be proven and the only way for us to really know the answer is to have some good experience."
And the battle won't all be uphill: When it comes to reimbursement, TMVR is expected to be categorized into the same diagnosis-related group classification as TAVR, endovascular cardiac valve replacement, according to Chambers.
Beyond mitral valve replacement, Edwards also has a structured investment in Harpoon Medical, a transcatheter mitral valve repair company, with an exclusive option to buy. Mussallem has described repair as part of a potential "tool kit" for mitral regurgitation.
While transcatheter heart valve products may draw most of the fanfare, Edwards has continued to release critical care and surgical heart valve products. In August, FDA approved the Intuity Elite valve system for surgical aortic valve replacement. That was followed by CE Mark for the Inspiris Resilia surgical aortic valve, which incorporates VFit technology to allow for future valve-in-valve implantation. The Acumen Hypotension Probability Indicator, to give clinicians an early alert of possible hypotension, received CE Mark in October.
"We're committed to be leaders in all of our fields," Mussallem said.