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J&J: Opening Arteries, Narrowing a Lead

By Amy Barrett The stent wars continue. On Aug. 16, prestigious medical journals released two papers that seemed to give an edge to Johnson & Johnson's (JNJ) drug-eluting Cypher stent over a competing product, Taxus, from Boston Scientific (BSX).

The papers, published in The New England Journal of Medicine and the Journal of the American Medical Assn., will provide more ammunition for J&J as it continues to grab market share from its chief rival.

MARKETING BOOST. "More data being published in highly influential journals is making it more obvious to doctors that, based on the data so far, Cypher is superior," says Citigroup analyst Matthew Dodds.

That's bad news for Boston Scientific. Right now Boston holds about 59% of the $3.4 billion U.S. market for these drug-coated stents, with J&J controlling the other 41%. Surgeons use stents to prop open arteries after angioplasty. And the drug coating on the devices helps prevent those arteries from reclogging.

As more studies have shown Cypher may be more effective at preventing reclogging, J&J gone on the offensive. Citigroup's Dodds now expects J&J's U.S. market share to hit 53% by the end of 2006.

THE CLOT FACTOR. The paper that will likely get the most attention is the JAMA piece. It analyzes six trials -- involving nearly 3,700 patients -- comparing Cypher and Taxus. That analysis showed that patients receiving the Cypher stent had a lower rate of reclogging and a reduced need for repeat procedures.

"There is more and more evidence coming out in support of Cypher," says Dr. Brian Firth, vice-president for medical affairs and health economics at Cordis Corp., the J&J unit that makes the Cypher stent.

One rare but potentially fatal problem is the formation of a blood clot on the stent. A clot is a separate issue from reclogging, the accumulation of scar tissue that can cause an artery to again become narrow and constricted. In the case of that reclogging, the worst-case scenario is usually the need for the patient to undergo a repeat stent procedure.

EASE OF USE. But a blood clot is different. Such clots almost always cause heart attacks. And in many cases, those heart attack prove fatal. The formation of a clot, particularly many months after the implanting of a stent, is extremely rare. But given the often-catastrophic consequences, the issue ranks as a major concern for many cardiologists. So the JAMA analysis does not seem to indicate either device has a safety advantage in minimizing the incidence of clots.

But with more evidence that Cypher may make it less likely that patients need to undergo repeat stenting procedures, Boston Scientific has a real problem. A company spokesman says that the best trial to date -- called the REALITY trial -- involved a large number of medical centers and didn't show a difference in effectiveness between the two stents. And many physicians say that Boston Scientific's product is easier to use and implant than J&J's Cypher product.

PRODUCTION PROBLEMS. Still, it appears that the medical community is moving toward the J&J camp. The outfit's biggest challenge is meeting demand, with the company working to resolve major manufacturing issues after a tough warning letter from the FDA back in 2004.

Analysts say J&J can't move to a more efficient manufacturing system until the FDA's issues are addressed. Cordis' Firth says the company cannot speculate when that will happen. But if J&J can put the problems behind it and ramp up stent production, it could accelerate its market share grab. Barrett is a correspondent for BusinessWeek in Philadelphia

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