St. Jude Medical (NYSE:STJ) met Wall Street’s expectations during the final quarter of 2014, despite what CEO Dan Starks described as "setbacks" with its Portico transcatheter aortic valve implant and the disappointing renal denervation market.
The St. Paul, Minn.-based company reported sales of $1.44 billion for the 3 months ended Dec. 31, a 1% uptick from the $1.42 billion reported for Q4 2013. St. Jude officials said adjusted earnings per share should be 88¢ to 90¢, excluding impairment charges and ongoing restructuring actions that cut 14¢ from GAAP earnings.
"The takeaway is we delivered results in line with expectations and we expect investors to respond to the results – solid and uncontroversial," Starks told investors during a presentation at the J.P. Morgan Healthcare Conference in San Francisco yesterday.
The sales gains, Stark said, came despite significant setbacks in 2014, including a worldwide “pause” on implantations of its Portico TAVI device in a U.S. trial and in Europe, where the replacement heart valve is already on the market.
A St. Jude spokeswoman told MassDevice.com at the time that the company initiated the pause after CT scans turned up a potential problem with the valves in "a small number of cases." The issue, involving what company officials called "reduced valve leaflet mobility," was seen in patients after 4D CT scans at 30 days.
Starks highlighted net sales from the company’s recently acquired CardioMEMS product, which reached $11.9 million in the quarter. St. Jude closed the $455 million deal for CardioMEMS in June, days after the FDA approved its Champion HF device. The technology, which was developed and spun out of the Cleveland Clinic, took more than 11 years to bring to market.
Starks recently called the CardioMEMS Champion HF implantable heart monitor the company’s "single most important new growth driver" and predicted the market for the product would exceed $1 billion. In his investor presentation yesterday, Starks reiterated his bullish stance on CardioMEMS as 1 of St. Jude’s primary drivers for 2015 growth and said the attention paid by investors to the product was justified.
Starks also noted that investors could expect to see a return to growth from the company’s neuromodulation business in the U.S., after the FDA cleared it of manufacturing violations at its Plano, Texas, and Sylmar, Calif., facilities.
St. Jude also said it’s board authorized it to buy back up to $500 million worth of its own stock; the company reported 287 million shares outstanding as of Jan. 13.