FDA’s pelvic mesh ban spooks investors

April 17, 2019 By Brad Perriello Leave a Comment

The FDA’s ban on U.S. sales of pelvic mesh products for pelvic organ prolapse may have spooked investors, but should only have a minimal effect on the books at Boston Scientific (NYSE:BSX) and Coloplast (CPH:COLO-B) – the only companies still selling mesh for prolapse in the U.S. – according to analysts and the company.

Yesterday the FDA ordered an immediate halt to sales and distribution of Boston’s Uphold Lite and Xenform products and Coloplast’s Restorelle DirectFix. Today Boston said the ban is expected to deliver a $25 million top-line hit, which amounts to about 0.003% of its annual revenues.

“Boston Scientific continues to assess any potential additional impact to the business,” the company said, noting that it will update investors during its first-quarter results report next week.

For Coloplast, prolapse mesh sales represent roughly 0.2% of its total revenues, “therefore the financial impact is immaterial and does not impact our financial guidance,” the company said today. Coloplast reported revenues of roughly $2.49 billion for its last fiscal year.

“Our mission at Coloplast is making life easier for people with intimate healthcare needs. Pelvic organ prolapses can be a painful, embarrassing and a debilitating issue for the women who suffer from it. While mesh sales to treat POP in women account for approximately 0.2% of our global revenue, we firmly believe that patients and their physicians should have a choice of therapies. We are disappointed with the FDA’s decision because it reduces the treatment options for women with POP. We remain committed to providing alternative therapies,” CEO Kristian Villumsen said in prepared remarks.

Still, investors pushed both stocks down yesterday and today, with BSX shares closing off -4.3% at $36.17 apiece yesterday; the stock was down -1.2% to $35.73 per share today in mid-morning activity in New York. In Copenhagen, COLO-B shares were down -2.7% to kr678.40 today.

Analysts said the selloffs are over-done.

“Overall we view any negative impact to sales as minimal,” SVB Leerink analyst Danielle Antalffy wrote yesterday in a note to investors. “But, understandably so, investor concern seems to be focused around litigation risk and could justify the selloff we’re seeing today. However, we followed up with management and view any litigation risk around FDA’s order as minimal.”

Boston had already settled 95% of the transvaginal mesh product liability lawsuits it faced as of the end of last year, Antalffy noted.

“While this is a credit negative for Boston Scientific – one of the two remaining manufacturers of this product – Moody’s does not expect the impact to be material,” added Moody’s senior vice president Scott Tuhy in a statement emailed to MassDevice.com. “Boston Scientific has stated its global surgical mesh business is about 1% of total sales. Of that 1% of revenue, not all will be impacted by the FDA announcement because some of Boston Scientific’s mesh business is outside of the US or is sold for different indications.”

($1 = kr6.60841)

MTD Micro Molding late president to be inducted into Plastics Hall of Fame
MTD Micro Molding this week announced that its late president Dennis Tully will be inducted into the Plastics Academy’s Plastics Hall of Fame. Tully is one of six posthumous inductees this year, who are elected by living members of the Hall of Fame after a screening process. “These new posthumous inductees proudly represent the length… […]
This neural implant can be both remotely charged and programmed
Engineers at Rice University’s Brown School of Engineering are touting the first neural implant capable of being programmed and charged remotely with a magnetic field. Kaiyuan Yang, Jacob Robinson, Zhanghao Yu and Joshua Chen collaborated to develop the integrated MagNI (magnetoelectric neural implant) microsystem, which could allow imbedded devices such as a spinal cord stimulator… […]
Integer shares up after Street-beating Q4
Integer Holdings (NYSE:ITGR) shares were up at close today on fourth-quarter results that topped the consensus forecast, despite a big dip in profits. The Plano, Texas-based company posted profits of $11 million, or 33¢ per share, on sales of $325.6 million for the three months ended Dec. 31, 2019, for a 57.2% bottom-line slide on sales… […]
These young medtech companies raised the most money in 2019
Medical device industry insiders may very well remember 2019 as the year that IPOs came back — but another sign that the U.S. economy has left the Great Recession far behind. Among the top investment deals in the space, half involved public offerings, according to the MoneyTree report from PricewaterhouseCoopers (PwC) and CB Insights. Total investments in… […]
Teleflex Medical OEM acquires medical tubing company
Teleflex Medical OEM (Wayne, Pa.), today announced the acquisition of IWG High Performance Conductors (HPC), a medical tubing and wire components manufacturer. The addition bolsters Teleflex Medical OEM’s position in the arena of custom-engineered medical devices and its ability to provide clients with technologies used in electrophysiology, drug- and stent-delivery and neurovascular interventions, according to… […]
Integer expands to Israel
Integer Holdings (NYSE:ITGR) today announced it has acquired medtech manufacturer Inomec, formally establishing its presence in Israel. The Plano, Texas-based company said the acquisition will enable it to create an R&D and sales center in the region and adds important catheter design, clinical and pilot manufacturing capabilities to its portfolio. “Acquiring Inomec strengthens our research… […]
Why non-magnetic capacitors matter in medical imaging
The quality of an MRI image depends on the homogeneity, or uniformity, of the magnetic field. Component material choice is paramount; even the smallest trace of magnetism inside an MRI scanner can disrupt the field and harm the quality of an MRI image. Peter Matthews, Knowles Precision Devices Magnetic resonance imaging (MRI) equipment uses a… […]
This heart valve can adapt as a child grows
Boston Children’s Hospital is touting a new design that could allow children to maintain the same prosthetic heart valve until adulthood, which could also benefit adults with heart valve defects. Current prosthetic heart valves implanted in children with congenital heart disease are fixed in size, which requires multiple open-heart surgeries during childhood to replace the… […]
Simulating Reality With 3D Printed Medical Models
The medical breakthroughs that cure disease, restore health and prolong life aren’t created in a vacuum. They rely on the convergence of visionary minds and cutting-edge technology. This case study explores how the Jacobs Institute is leveraging 3D printing technology from Stratasys® to elevate medical device innovation and training, using ultrarealistic anatomical models created by… […]
These ‘smart’ bandages could heal chronic woulds
UConn biomedical engineers are touting a wirelessly controlled “smart” bandage and corresponding platform for delivering medications to chronic, non-healing wounds. UConn’s School of Dental Medicine, School of Medicine and School of Engineering comprise the biomedical engineering department, which contributed to developing the smart bandage. Ali Tamayol, an associate professor at UConn, led the development of… […]
How to cook up a successful medtech company
New medical device companies need much more than money to get their businesses started. A medtech-specific accelerator can help with seed funding and positioning for a Series A round. Shai Policker, MEDX Xelerator As we dive into 2020, the medtech sector will continue to offer tremendous opportunity for innovators and investors alike, with growth projected… […]