Edwards Lifesciences Corp. (EW), the largest maker of artificial heart valves worldwide, said first- quarter sales rose 14 percent as U.S. doctors began implanting its Sapien device.
Edwards generated $41 million in U.S. sales for Sapien, which was approved by the Food and Drug Administration in November to replace a failing aortic valve without cracking open the chest. The Irvine, California-based company reduced its forecast for Sapien’s 2012 sales by $30 million to $530 million to $600 million because of an expected delay in approval for broader U.S. use, European market pressure and foreign exchange rates, the company said today in a statement.
Net income rose to $65.1 million, or 55 cents a share, from $63.9 million, or 53 cents, a year earlier, the company said today in a statement. Profit excluding certain items of 53 cents a share topped the average estimate of 48 cents from 22 analysts compiled by Bloomberg. Revenue rose to $459.2 million in the quarter, beating the $449.9 million average estimate.
“The launch here in the U.S. got off to a slow start in January, but the momentum built throughout the quarter,” said Glenn Novarro, an analyst at RBC Capital Markets in New York. “That’s why the results came in better than expected. Physicians and hospitals are embracing the technology. The sites that have launched have healthy waiting lists.”
Edwards rose 4.2 percent to $76.39 in extended trading at 5:51 p.m. New York time after closing at $73.33. The shares declined 12 percent in the past 12 months.
Sapien is approved for patients who can’t tolerate open heart surgery. Edwards has been working to train more doctors how to implant the $30,000 device and ensure insurance coverage. An FDA advisory panel is slated in June to review whether the device should be allowed for patients who would be eligible, though at high-risk of complications, for open-heart surgery.
The June panel hearing means the second, broader approval won’t come until the second half of the year, later than the company originally anticipated, Novarro said in a telephone interview. The surgery-eligible U.S. patients aren’t likely to have access to Sapien until the end of the year, he said.
Sales for 2012 will be at the lower end of the previously given range of $1.95 billion to $2.05 billion, the company said. Edwards lowered the top of its range for U.S. Sapien sales to $200 million to $240 million for 2012, from an earlier estimate of $200 million to $260 million.
The reduced sales forecast was less than might have been anticipated for a three-month delay in the next approval because demand for Sapien among patients who can’t tolerate surgery has been faster than anticipated, Chief Executive Officer Michael Mussallem said today in a conference call with analysts.
Edwards has trained 60 medical centers to implant Sapien since it was approved in the U.S., he said. While uncertainly about insurance reimbursement caused some facilities to postpone training and delay procedures, others stepped into their slots, he said.
“Physician and hospital interest in our Sapien program remains very high,” Mussallem said. “We still expect to train 150 to 250 new commercial sites in the first 12 months.”
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