St. Jude Medical (NYSE:STJ) wanted to show the world last week that its new chronic migraine treatment was good enough to win regulatory approval.
Instead, analysts who read into the clinical trial data for the Genesis implanted device were split. While one analyst was impressed by the data, another said that Genesis may still need more clinical evidence to prove its worth to the U.S. Food & Drug Administration.
So was the trial as successful as St. Jude Medical hoped? The company still expects European approval and a product launch later this year.
But St. Jude spokeswoman Denise Landry wouldn’t comment on whether the company plans to do a second clinical trial or whether it is confident it will win approval from the FDA without it.
"We will meet with the U.S. Food and Drug Administration later this year to determine next steps," Landry stated via e-mail.
St. Jude Medical, the Minnesota maker of new innovative medical devices, enlisted 157 study participants, who on average suffered from headaches 26 days per month. There were two groups: one that started getting treatment from Genesis right away, and another whose device didn’t start working for another 12 weeks. Genesis delivers mild electrical pulses to leads placed under the skin at the back of the head to stimulate the occipital nerve, as part of the migraine treatment.
The trial measured data at 12 weeks and then again at 12 months.What J.P. Morgan analyst Michael Weinstein called "impressive" were the results between the two groups at 12 weeks. Patients who got treatment immediately after the device was implanted reported a 28 percent reduction in the number of days they had headaches (seven fewer days a month) compared to the group who didn’t get the treatment immediately.
In his research note on June 23, Weinstein also noted that the device had only a 1 percent overall rate of serious device or procedure-related adverse events.
Weinstein said these clinical trials results would be enough for St. Jude Medical to win European regulatory approval for Genesis.
However, other analysts focused more on the fact that the clinical trial failed to meet the primary endpoint of the study as established by the U.S. Food & Drug Administration. The FDA wanted a statistically meaningful difference in patients who noted that their pain fell 50 percent. And St Jude Medical’s product was able to show a meaningful difference at the 10 percent reduction rate all the way to 40 percent, but not at the 50 percent level that the FDA required.
And that’s where Morgan Keegan analyst Jan Wald has a problem. In an Associated Press article, Wald said that the device may have problems in getting market clearance in the U.S. because it couldn’t meet the primary goal of the clinical trial. He noted that St. Jude Medical may have "used too many surveys and created too many different measurements in order to prove the implant works."
Yet Wald maintained his "outperform rating on the stock."
