HeartWare International (NSDQ:HTWR) decided to back out of the REVIVE-IT study of its left-ventricular assist device, citing the need to focus efforts on the company’s efforts to win FDA approval for the device.
The REVIVE-IT study, which the HeartWare had contributed about $600,000 to, was designed to evaluate the company’s LVAD system in patients with lower-risk heart disease.
The decision to pull out of the study is "not too surprising," according to analysts at Leerink Swann.
"Given the ongoing delay in REVIVE-IT protocol approval, it’s not entirely surprising that the company has chosen to withdraw," analysts Danielle Antalffy and Robert Marcus wrote in a note to investors. "Because HTWR’s HVAD is not yet approved in BTT or DT, our sense is that FDA may have been uncomfortable allowing investigators to proceed with a device that is not yet approved in current indications in this less-sick patient population."
Backing out of the study, which will free up about $9 million in the company’s coffers over the next few quarters, won’t affect HeartWare’s FDA application, the analysts added. Approval for HeartWare’s LVAD system as a so-called "bridge to transplant" is still expected by the end of the 4th quarter of 2012.
"While shares could come under pressure today on the news, we believe there is no read-through to upcoming Bridge-to-Transplant (BTT) approval for HVAD – which we continue to expect in mid-4Q12 and, more importantly, no change in the company’s long-term strategy to penetrate and help grow both the BTT and ultimately the Destination Therapy (DT) markets," according to the note.
HTWR shares did slide a bit today, trading 1% lower at $87.70 as of about 1:45 p.m.
If investigators move forward with the REVIVE-IT study despite HeartWare’s absence, it may prove a boon to rival LVAD maker Thoratec (NSDQ:THOR), analysts added.
"With THOR’s HeartMate II the only LVAD currently approved in both BTT and DT, investigators could choose HeartMate II for REVIVE-IT in this less-sick patient population," they wrote.
THOR shares were up 1.9% to $35.14 as of about 1:45 p.m. today.
