The FDA’s concern about the safety profile Medtronic’s (NYSE:MDT) cardiac ablation catheter sent MDT shares down nearly 3 percent yesterday as investors worried about the device’s prospects for approval.
The FDA’s circulatory system devices panel is meeting tomorrow to consider Medtronic’s bid to get the device approved for the U.S. market (it’s been approved in the European Union since December 2006). But a report by the federal watchdog agency released ahead of the meeting raises worries about how safe the device is.
The device, which Medtronic acquired when it bought Ablation Frontiers in 2009, uses radiofrequency energy to destroy the heart muscle cells that cause persistent atrial fibrillation – an irregular heartbeat that lasts between seven days and four years. Although it proved to be effective in treating AF in patients who didn’t respond to standard drug therapy, the device failed to meet a clinical trials safety endpoint, according to the FDA report.
"FDA is concerned about the overall safety profile of the system," according to the report. "Of particular concern is the high peri-procedural stroke rate observed in the trial (2.8% with an upper bound limit of 6.5%). … In addition, there was a higher than expected rate of PV stenosis/symptomatic PV narrowing (4% with upper bound of 8.1%) associated with the use of the system."
That outlook spooked investors on Wall Street. Sanford Bernstein analyst Derrick Sung pegged the device’s shot at winning approval as 50/50, according to Reuters.
“We would emphasize that investor expectations are low,” Sung wrote in a research note.
MDT shares slipped 2.8 percent to close at $33.73 yesterday. The trend continued this morning, with shares trading at $33.71 as of about 10:50, down almost 1 percent.