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Analysts Expect a Rebound in Drug-Eluting Stent Sales

BUSINESS NEWS

Although many medtech market observers once viewed drug-eluting coronary stents as being on a trajectory for continued growth, sales of the products declined significantly in the final quarter of 2006. Boston Scientific Corp. (Natick, MA) reported that fourth-quarter revenues from its Taxus drug-eluting stent were $506 million, down almost 20% from $606 million in the year-earlier quarter. Similarly, Cordis Corp. (Miami Lakes, FL), a Johnson & Johnson company, reported that fourth-quarter sales of its Cypher drug-eluting stent fell 15% to $580 million. Taxus and Cypher are currently the only FDA-approved drug-eluting stents on the market.

The sales falloff is generally attributed to concerns arising from recent clinical studies, some of which indicated a significantly higher incidence of late-term thrombosis with drug-eluting stents than with their bare-metal counterparts. The findings were initially reported last September at the 2006 World Congress of Cardiology in Barcelona, Spain. However, studies reported at the annual Transcatheter Cardiovascular Therapeutics conference in October and a meeting of FDA's circulatory system devices advisory panel in December generally concluded that the risk of blood clots associated with drug-eluting stents was within acceptable limits and that the devices were safe and effective when used as intended by the manufacturer.

However, the latter findings have apparently done little to quell the anxieties of patients, physicians, and hospitals when it comes to the use of drug-eluting coronary stents. Prior to the reports of potential blood clots, the devices accounted for 85–90% of all coronary stents implanted in the United States. Most analysts estimate a current usage rate of 70–75%.

Adding to the gloomy climate for the devices, news recently began to circulate that the Centers for Medicare and Medicaid Services (CMS; Baltimore) was about to review its reimbursement coverage of drug-eluting stents. The report initially appeared in the Wall Street Journal and was picked up by numerous industry and business news services.

Responding to the speculation regarding a coverage review, Barry Straube, MD, chief medical officer at CMS, said, "There is no plan for any change in current policy toward drug-eluting stents at the present time." However, he added that CMS is always assessing whether new evidence about a medical technology warrants the agency's attention.

Although sales of drug-eluting coronary stents have taken a significant hit, most analysts see little—if any—permanent damage to the category. Many expect that, with time, next-generation products already in the pipeline will stimulate growth over the long term.

Gunderson

Thomas Gunderson, a managing director and senior medtech analyst at Piper Jaffray & Co. (Minneapolis), says he does not see any signs of a comeback just yet. "The probability of a recovery is high, but it may take a year or more to get back to an 80–85% usage rate," he says.

Jan Wald, PhD, a medtech analyst with A.G. Edwards Inc. (St. Louis), says that new drug-eluting stents–such as the CoStar from Conor Medsystems (Menlo Park, CA), which uses a bioabsorbable polymer to hold its drug--will be well received by cardiologists. J&J's Cordis recently acquired Conor.

Wald says other advanced stent designs on tap for market entry in 2008 and beyond will further restore physician and patient confidence in the category. Abbott (Abbott Park, IL) has a new bioabsorbable drug-eluting stent in development that is made of polylactic acid and is designed to be fully absorbed and slowly metabolized by the coronary artery.

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