The Irvine, Calif.-based company said during an earnings conference call that it “saw something it wanted to go back and take a look at” and that it would be running internal tests associated with that before it moved forward with the trials.
However, Edwards may still be on target for a 2018 CE Mark for the CardiAQ valve, according to CEO Michael Mussallem.
“We were not saying that the CE Mark is off for 2018, it’s still possible for us to get that. We’ll keep you informed of all the developments. We’re just pausing enrollment. And that’s not really unexpected for something at this early stage and transformative,” Mussallem said, according to a SeekingAlpha conference call transcript.
Mussallem went on to say that the whole program was not paused, only clinical enrollment, and that such a pause isn’t that unusual for an early stage tech such as the CardiAQ valve.
“We’re on a steep learning curve and to place a valve in the mitral position is a tough task and to do it well. The valves are large. The pressures are high. The anatomy is very complex. There are very serious imaging challenges. There’s coagulation challenges. And so we’re on a steep learning curve and we’re very pleased at the pace that we’re moving at. We just decided on this feature that we were going to pause this while we’re going through our own internal tests. So we’ll keep you tuned in. And we’re hopeful that it’s positive and that we’ll be back rolling again in the second quarter,” Mussallem said.
Barclays analyst Matthew Taylor said the pause was “incongruous with Street expectations for a pickup in mitral revenue in 2018 on the back of a TMVR CE Mark approval,” despite Edwards hope that it would still be able to achieve it.
Edwards Lifesciences bought CardiAQ Valve Technologies and its mitral valve device for $400 million last August.
Shares in Edwards have plummeted today in mid-day trading, down 9.1% at $89.06 as of 12:45 p.m. EST.
Valtech makes the Cardioband device, which is designed to reshape the mitral valve using specially designed anchors.
The deal, announced in November 2016, calls for $340 million in up-front cash and another $350 million in milestones over 10 years. It does not include Valtech Cardio’s trans-septal mitral valve replacement program; that business is slated to be spun out on its own before the buyout’s closing, expected in early 2017, but Edwards said last year that it’s due to keep an option to buy.