St. Jude Medical expects to reverse the trend of declining sales in its pacemakers business by launching five products this year, including a novel leadless pacemaker.

April 17, 2013

2 Min Read
St. Jude Medical Will Acquire Nanostim and Reverse Sales Declines In Pacemakers in 2013

St. Jude Medical plans to reverse the trend of declining sales in its pacemakers business by launching five products this year, including a leadless pacemaker through the acquisition of Nanostim said CEO Daniel Starks, in an earnings call Wednesday.

St. Jude has previously mentioned its plans to acquire Nanostim in an investor meeting but has not disclosed terms of the transaction. That will allow the company to launch the world's first "leadless pacemaker"

In a news release in late 2012, Nanostim announced that its minitarized, leadless pacemaker had been implanted in the first patients. It also said that St. Jude has an exclusive option to buy Nanostim once it achieves certain milestones

Nanostim's novel device will however, be only part of the story in St. Jude's attempt to reverse the fortunes of its struggling pacemaker business. In the first quarter, revenue of that business slipped 12 percent to $251 million from $285 million in the first quarter of 2012. In the fourth quarter of 2012, sales of pacemakers were down 11 percent. The same story of steady decline has persisted throughout last year.

But Starks believes a turning point is nigh. Five new pacemaker product lines will be introduced in Europe and Japan this year. In Japan, the company has had no MRI-compatible pacemaker, for which there is a "particular demand," he said. That will be addressed with the launch of the Accent MRI line of pacemakers in Japan in the third quarter of the year. But St. Jude has also been pressured by lower average selling prices in Japan.

Even before that, in the second quarter, Europe will see a new pacemaker platform from the Minnesota device make that will be attractive to customers than current St. Jude pacemakers available in the market. Starks said this launch will "improve competitive position" of St. Jude among customers than are cost sensitive. 

"Taking all these factors together we expect steady improvement to the growth profile of our pacemaker business as we move through the remainder of 2013." Stark said.  

-- By Arundhati Parmar, Senior Editor, MD+DI

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