St. Jude Medical (St. Paul, Minnesota) reported that it is combining its Cardiac Surgery and Cardiology divisions to create a new Cardiovascular division, effective Jan. 1, 2007.

The company said the new division will focus on developing and bringing to market medical device technology and services to help patients who suffer from vascular disease or structural heart defects. It will incorporate the activities currently managed by the Cardiac Surgery and Cardiology divisions, although the company will continue to have specialized cardiac surgery and cardiology sales forces.

Company spokesperson Angela Craig told Cardiovascular Device Update that as a result of the consolidation, the company has determined that 30 employee positions represented redundancies between the two divisions and consequently those positions would “regrettably” have to be eliminated, and some employees would be given added responsibilities. She noted that the affected jobs were “senior administrative positions.”

“This strategic reorganization is another example of St. Jude Medical’s commitment to continuous improvement and to focusing on the needs of our customers,” said Daniel Starks, chairman, president and CEO, in a statement. “Our cardiology and cardiac surgery businesses will be stronger together than each business is separately. By streamlining our organization, we can boost operating efficiencies and ultimately use the associated savings to invest in research and development. This in turn is expected to strengthen our competitive position and improve St. Jude Medical’s total growth profile both in cardiology and in cardiac surgery to benefit our customers, employees, and shareholders.”

Starks said that the creation of the new division, coupled with the expansion of the two units’ respective sales forces and recent new product introductions, are part of a comprehensive program to position St. Jude Medical “to deliver a minimum 15% growth in 2007 and beyond.”

Craig noted that the two divisions have offices in the St. Paul area and that the company plans on retaining both of the offices, at least in the near term.

The Cardiovascular division will be led by George Fazio, who has served as president of the company’s Cardiac Surgery division since 2004. Prior to his current role, Fazio was appointed president of St. Jude Medical Europe in 2001. His preceding roles included president, health care services, and general manager for the company’s operations in Canada.

Paul Buckman, currently president of the Cardiology division, will become corporate vice president of business development. Since joining St. Jude Medical in 2004 in his current role, Buckman has overseen a significant expansion of the Cardiology division’s products and programs.

In addition, the company is initiating several changes to enhance the efficiency and effectiveness of its sales and customer service operations in certain international geographies.

As a result of these restructuring plans, the company said it expects to incur a pre-tax charge of $25 million to $35 million in 3Q06.

Prudential Equity Group (New York) senior med-tech analyst Larry Biegelsen wrote in a research note that the restructuring will reduce annual selling, general and administrative expenses by an estimated $6 million, or 1 cent per share.

While he views the restructuring as a positive development, Biegelsen said he believes “it supports our view that spending requirements to reaccelerate ICD [implantable cardioverter-defibrillator] sales growth will limit earnings growth.”

Accord results in integrated Innova

GE Healthcare (Waukesha, Wisconsin) and Volcano (Rancho Cordova, California) reported FDA 510(k) clearance for the integration of Volcano’s intravascular ultrasound imaging (IVUS) capabilities onto GE’s Innova all-digital X-ray cath lab imaging system – the first time such systems have been integrated.

GE said that the digital cardiovascular imaging system is designed to give interventional cardiologists and interventional radiologists “a clearer view of coronary and peripheral vessel morphology in a more accessible manner than previously available.”

“This is truly a first,” Anita Makhija, GE marketing manager for the cardiac X-ray system, told CDU. “There have been IVUS systems available in the past, and of course, imaging systems have been used for several years. But this is the first time in the industry that we have an integrated product.”

The integrated product, which the companies will commercialize under the name “Innova IVUS,” comes as a direct result of the agreement entered into by GE Healthcare and Volcano in mid-March. That agreement was reported at this year’s meeting of the American College of Cardiology (ACC; Bethesda, Maryland).

“This partnership and this development we have done with Volcano really is going to be giving us a chance to give our customers advanced, real-time imaging in the cath lab,” Makhija said. “They will be able to conduct therapeutic procedures right at the tableside. It’s going to be really easy to use, be simple ... and it’s basically just helping [clinicians] integrate their workflow much better.”

It is made possible, in part, due to Volcano’s latest PC-based IVUS platform that reduces the size, weight and noise of the IVUS console, allowing the unit to be located in the control room or in other areas outside of the daily traffic pattern of the cath lab.

Makhija said that previously, when Volcano’s IVUS was sold on a stand-alone basis, it required moving a 480-pound system into the cath lab. Because it also was “very difficult to turn on the system,” only 12% to 15% of the interventional cases that were done were routinely using IVUS.

Now, however, “we’ve kind of changed the game by integrating it,” she said. What that means on an everyday basis for using it is that when a cardiac cath patient comes into the cath lab, the system automatically pulls in the IVUS information.

With integrated IVUS, clinicians are expected to have easier access to imaging tools that can help them better determine the extent of cardiovascular disease and assist in performing therapeutic procedures such as stent placement and assessment. It also is intended to help physicians determine the length of lesion as well as optimal stent length and diameter.

Innova IVUS allows clinicians to access IVUS commands on the Innova Central touchscreen. Clinicians have the option of using additional IVUS control devices as well, such as a trackball or joystick. Previously, the IVUS was the stand-alone system.

The IVUS Patient Interface Module (PIM) can hang on the bedrail while the IVUS CPU is located away from lab traffic in the control room, GE said.

The patient information automatically transfers from the Innova System to the IVUS, eliminating the need to manually enter patient data. Clinicians have the flexibility to view IVUS images on the existing monitor bank, a separate, dedicated IVUS monitor and/or a monitor in the control room. By integrating with the lab’s archiving system, Innova IVUS cases are stored as sub-studies along with the cath lab study, further facilitating access to all patient information, which is particularly useful for prior study comparisons.

GE has the “largest installed base of flat-panel detectors – over 1,200 installed globally,” Makhija said, noting that there is a “huge opportunity to bring to our customers this integrated solution.”

Current GE cath lab customers can modify existing cath lab rooms with the new integrated IVUS system. Customers will be able to contract with one vendor, GE, for their purchasing, installation and field service needs.

“This technological development heralds a new beginning for advanced, real-time imaging in the cardiac catheterization laboratory,” said Laura King, global vice president and general manager, interventional cardiology and surgery at GE Healthcare. “It is also further evidence of GE Healthcare’s continued commitment to cardiology by bringing state-of-the-art, clinically relevant technologies to the cath lab.”

Scott Huennekens, president/CEO of Volcano, added, “The successful completion of an FDA 510(k) by each of the companies represents both the culmination of months of product development collaboration, as well as the opportunity to begin commercializing Innova IVUS. We believe this fully integrated product will shorten procedure time that has been historically associated with IVUS and provide clinicians with easier access to important information provided by IVUS.”

As the clinical relevance of IVUS has increased, particularly with the recent innovations in IVUS-based, real-time tissue characterization and IVUS/angio image co-registration, so too has the market need for an integrated, easy-to-use system, GE said.

Mark Wholey, MD, chairman of the Pittsburgh Vascular Institute, elaborated, “When you have a catheterized patient on the table, you need your diagnostic and therapeutic tools to be ready — there for quick and simple implementation. Many times it is just not an option to ask the staff to roll in the IVUS console, turn it on and wait for it boot up. We have been asking for this advance from the IVUS companies for some time now. We are thrilled that Volcano and GE have recognized the need and responded with this integrated product.”

“IVUS, advanced 3-D angiographic imaging techniques and non-invasive imaging technologies such as MDCT and MRI hold the promise of unlocking many important mysteries surrounding the cause and progression of coronary and peripheral artery disease. Only by combining the information from several, if not all, of these modalities will we be able to gain a clear understanding of this disease. The integration of IVUS with Angio systems is an important step in making truly integrated imaging feasible and practical for a wide array of physicians,” said Rob Schwartz, MD, of the Minneapolis Heart Institute and Foundation.

Innova IVUS is currently available for sale to GE Healthcare customers and will be co-marketed by the GE and Volcano sales and marketing organizations in the U.S., Europe, certain markets in Asia and other world markets and is expected to be available to customers beginning in September.

GE said it also would collaborate with Volcano to provide “cath lab design, installation and field repair/service of this new system.”

NMT, AGA withdraw stroke HDEs

After the FDA recently notified NMT Medical (Boston) and AGA Medical (Golden Valley, Minnesota) of its intent to formally propose to withdraw the Humanitarian Device Exemptions (HDE) marketing approvals for those companies’ two patent foramen ovale (PFO) occluders — previously approved for the treatment of patients with recurrent cryptogenic stroke – both firms have agreed to voluntarily withdraw their marketing approvals under that designation.

The devices affected by the reclassification are NMT’s CardioSEAL STARFlex septal occlusion system and the AGA Amplatzer PFO occluder.

The companies agreed on Aug. 14, to the voluntary withdrawal, which becomes effective on Oct. 31.

In a press statement, the FDA assured physicians and patients that those who currently meet the approved HDE indication will continue to have access to these devices through an FDA-approved investigational device exemption (IDE) at healthcare facilities across the U.S.

The FDA said it encourages institutional review boards at these facilities “to consider the proposed IDE protocols in an expedited manner when possible.”

HDEs are a special type of marketing approval granted for devices intended to treat fewer than 4,000 people a year in the U.S., and the FDA uses them as a mechanism to encourage development of medical devices for rare conditions. Companies are allowed to market devices under an HDE so long as they are shown to be safe and have probable benefit.

Given the larger number of patients eligible for the device, the FDA said it believes that the devices should be subject to the same requirement that applies to all class III (highest risk) devices that do not meet the narrow criteria for the HDE, namely, a demonstration of reasonable assurance of both safety and effectiveness, not just safety and probable benefit.

One of the companies, NMT, said it sees the FDA action as a mostly positive step for the use of the technology in the treatment of cryptogenic stroke.

The company said that the FDA made the decision because it believes that since the HDE was approved back in 2000, clinical conditions have significantly changed and the subset of patients who once qualified for consideration for PFO closure has increased beyond the 4,000-patient threshold.

NMT stressed that the withdrawal does not reflect a device safety issue. It also noted that the CardioSEAL will continue to be commercially available in the U.S. under a pre-market approval (PMA) indication for ventricular septal defects.

In conjunction with the decision, the company said it also received FDA approval for a new PFO/stroke IDE called CARS (Closure After Recurrent Stroke). NMT said the CARS IDE will supplement its ongoing CLOSURE I clinical trial to evaluate the connection between PFO and stroke.

The company will provide eligible patients of both CARS and CLOSURE I with NMT’s newer STARFlex implant technology. Patients previously covered by the HDE only had access to NMT’s original CardioSEAL device.

While the CARS IDE will provide continued PFO closure access to certain patients who previously were eligible for treatment under the HDE, it noted that patients in the CLOSURE I trial receive the implant at no cost, while those covered under the new CARS IDE can be charged for the device.

“Approval of the CARS IDE, combined with our ongoing CLOSURE I trial, allows the company to maintain two sources for PFO closure in the U.S.,” said John Ahern, president/CEO of NMT in a company statement. “We remain focused on our stroke/transient ischemic attack (TIA) objective to complete CLOSURE I and become the first company to gain PMA for these indications — a potential market of 250,000 U.S. patients annually,” he added.

Both companies have spent several years trying to enroll patients that have suffered an embolic stroke and have been found to have a PFO in trials — NMT with the 1,600 patient CLOSURE I trial and AGA with its 500 patient RESPECT (Randomized Evaluation of Recurrent Stroke comparing PFO Closure to Established Current Standard of Care Treatment) trial – and both have experienced significant delays in completing enrollment. The HDE approvals — specifically for the treatment of patients with recurrent cryptogenic stroke due to presumed paradoxical embolism through a PFO and who have failed conventional drug therapy — were viewed as a steppingstone toward the ultimate goal of the slow-in-coming ischemic stroke indication

Ahern responded that his company “continues[s] to work with our investigators, the clinical community and the FDA to make changes to the CLOSURE I study design in order to accelerate patient enrollment.” He added that the company “anticipates a shift of some recurrent stroke patients with PFOs to the CARS IDE from the original HDE since patients will have access to the new STARFlex technology.”

While he was mostly upbeat about what the designation change would mean for the PFO technology, he acknowledged that at this time “it is difficult to determine the impact on product revenue in the U.S. as a result of the transition from paid-for HDE devices to the paid-for devices under CARS.”

That said, he also indicated that the new CARS IDE “is a significant competitive achievement for NMT and is necessary to accommodate the growing demand for more advanced PFO/stroke treatments.”

Xtent latest device firm in IPO waters

Xtent (Menlo Park, California) broke a several-week hiatus of initial public offering (IPO) filings in the device sector, reporting last month that it has filed a registration statement with the Securities and Exchange Commission for an IPO potentially raising up to $103.5 million. The numbers of shares to be offered and the price range have not yet been determined.

The company said it intends to use the net proceeds for clinical trials, R&D activities, building commercialization infrastructure, general corporate purposes and working capital.

It plans to list its stock on the Nasdaq Global Market under the symbol XTNT.

Xtent says it is addressing the fact that a single DES doesn’t fit all anatomies or that there is frequent need for more than one stent and more than one procedure. It banners its system as offering a “customizable” approach to stenting and the ability to place different stent lengths (as opposed to multiple stents) in one procedure or multiple stents with one device and without multiple procedures.

Xtent licenses a bioabsorbable polymer from Biosensors International (Singapore) and its drug formulation from Occam International (Eindhoven, the Netherlands), a Biosensors subsidiary.

Earlier this year, the company said it had received funds in a Series D round but did not disclose the amount. And in early 2005, it brought in $25 million

For its IPO, Piper Jaffray & Co. will be acting as the book-running manager and Cowen and Company, Lazard Capital Markets and RBC Capital Markets are acting as co-managers.

Xtent is a portfolio company of The Foundry (Redwood City, California), a medical device incubator.

MedicalCV (Inver Grove Heights, Minnesota), a cardiovascular surgery company, has requested withdrawal of its registration statement, filed with the SEC on May 19, “due to continuing unsettled conditions in the equity markets,” it said in a statement.

Marc Flores, president/CEO, said, “In the best interest of the company and its shareholders, we have decided to take the focus of the management team away from fundraising in a difficult market. We continue to focus on the introduction of the minimally invasive ATRILAZE system for cardiac tissue ablation. We will carefully manage our resources which we believe will be sufficient to support our planned introduction to the market and physician training.”

MedicalCV’s Atrilaze ablation system utilizes laser energy in cardiac tissue ablation procedures in open-heart surgery. The Atrilaze system is currently being used as a potential means to treat atrial fibrillation in concomitant open-heart surgical procedures.