Edwards profit up as heart valve sales accelerate
(Reuters) - Edwards Lifesciences Corp (EW.N) on Monday posted fourth-quarter earnings that beat analyst expectations on strong sales of its replacement heart valve that is implanted in a less-invasive procedure than open-heart surgery.
The medical device maker said sales of the new valve, called Sapien, surged more than 72 percent in the quarter.
For patients with diseased heart valves, the Sapien product offers an alternative valve replacement method to open-heart surgery in which the patient's breastbone is cut open and the heart temporarily stopped. Doctors expect such minimally invasive techniques for replacing valves to eventually become the standard of care.
The initial product launch in 2011 included only inoperable patients, for whom the valves were threaded to the heart from the femoral artery in the leg using a catheter.
Edwards gained U.S. approval last fall to sell the Sapien transcatheter valve for use in a wider group of patients. It also won approval for a second delivery approach involving an incision through the ribs.
"The quarter certainly shows this is gaining momentum in the United States," said Jefferies & Co analyst Raj Denhoy.
Valves implanted via the newer approach through the ribs generated more than 45 percent of U.S. Sapien sales in the quarter, reflecting strong interest in the procedure, Edwards Chief Executive Michael Mussallem told analysts on a conference call.
Edwards said fourth-quarter net income rose to $91.1 million, or 77 cents per share, from $63.1 million, or 53 cents per share, a year ago.
Excluding special items, the Irvine, California-based medical device maker reported a profit of 90 cents per share, compared with 62 cent per share, a year ago. Analysts had expected Edwards to earn 77 cents were share, excluding special items, according Thomson Reuters I/B/E/S.
Fourth-quarter net sales increased 18.7 percent to $510.5 million. Sales of transcatheter heart valves climbed 72.8 percent in the quarter, to $161 million, driven by the ongoing U.S. launch of the Sapien brand valve. U.S. transcatheter valve sales were $80.7 million.
Patients who receive replacement heart valves have aortic valve stenosis, a condition in which calcium deposits clog the valve and reduce blood flow, which can lead to heart failure or cardiac arrest. A replacement valve helps restore normal blood flow.
Edwards sells its next-generation transcatheter valve, a smaller and easier-to-implant device called Sapien XT, in Europe. Among its competitors in Europe are Medtronic Inc (MDT.N), whose transcather valve is currently in U.S. clinical trials. St Jude Medical Inc (STJ.N) late last year also won approval from European regulators to sell a transcatheter aortic heart valve.
Edwards said it expects to submit its application to sell Sapien XT in the United States to U.S. regulators by mid-year.
Edwards said it continues to expect a full-year profit of $3.21 to $3.31 per share excluding items, on sales of $2.1 billion to $2.2 billion. Analysts had forecast a full-year profit of $3.27 per share on sales of $2.14 billion.
Edwards' shares rose less than 1 percent to $93.75 in after-hours trading from a close of $93.06 Monday on the New York Stock Exchange.