Abiomed CEO Minogue on DoJ probe, FDA call

Abiomed

Cardiologists aren’t paying much attention to the noise around Abiomed (NSDQ:ABMD) and its flagship medical device, the Impella heart pump, at least according to chairman, president & CEO Michael Minogue.

That noise centered around a pair of events during the 4th quarter: news of a U.S. Justice Dept. probe into its marketing of the Impella pump and an FDA decision to require the device to undergo a more rigorous approval process.

The Danvers, Mass.-based medical device company revealed the DoJ probe last year, sending share prices down more than 30% in a day. A month later a federal watchdog agency panel voted to require that the Impella undergo the FDA’s pre-market approval protocol, which ordinarily requires extensive clinical trials before approval is granted.

Minogue downplayed the effect on Abiomed’s cardiologist customers after he was asked during a conference call with investors about all the "noise" surrounding the 1-2 punch.

"I think that there definitely was noise. For the most part, our average user and physician is not tied into that noise. Certainly some folks may hear about it and track more of the information," Minogue said. "The most important factor to customers, again, is just improving patient outcomes, so I think in their grand scheme they are really, again, focused on using the technology, because they believe it’s the right thing for their patients."

The DoJ investigation has prompted at least 3 lawsuits against Abiomed, a pair of purported class actions and a shareholder derivative suit, all alleging that the company and its management deliberately concealed allegedly illegal marketing practices for the Impella 2.5 device that led to the probe.

As for the FDA’s decision, Minogue said the agency has yet to consider "the totality of the data" behind the Impella pump.

"Since the December panel meeting, we have had multiple conversations with the FDA and have recently submitted an extensive briefing document, outlining the totality of the Impella data to demonstrate safety and effectiveness," he said. "The summary includes 262 patients under [an] FDA IDE-approved protocol, 685 patients that meet the FDA clinical evidence requirements, including the Impella registry, and also references 201 publications, covering 1,877 patients.

"It is important to note this library of clinical evidence required 7 years of studies and a $30 million investment by Abiomed. Additionally, with over 12,000 U.S. patients supported to date, Impella maintains a low adverse event rate relative to the MDR rate listed by the FDA," Minogue said. "From a hemodynamic perspective, there is extensive clinical literature demonstrating that Impella provides significantly more hemodynamic support than the [intra-aortic balloon pump]. Since the 510(k) clearance in 2008, Impella has become the most widely-used heart pump in the United States. We have been encouraged by the FDA to submit a formal PMA and we hope to gain additional clarity as to the agency’s expectations for the submission after our meeting with them later this quarter."

ABMD shares closed down today after the company reported a profit decline for its fiscal 3rd quarter. Shares ended at $13.54, down 6.0% on the day.

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