Abbott stent expected to be top seller
Abbott Laboratories and Medtronic are poised to seize one-third of the $5 billion in annual heart-stent sales with new versions of the drug-coated devices.
Studies suggest the Abbott and Medtronic stents are more effective than artery-opening products sold by market leaders Johnson & Johnson and Boston Scientific Corp.
Libertyville Township-based Abbott's new Xience stent may become the top seller because of superior technology, according to Samin Sharma, director of interventional cardiology at Mount Sinai Medical Center, who implants more stents than any other New York doctor.
By 2009, Abbott and Minneapolis-based Medtronic, the world's largest maker of heart devices, will each be selling about $1 billion a year of drug-coated stents, preferred by doctors because they keep arteries open longer. Investors may benefit next month when new study results are released.
The Xience is forecast to account for 8 percent of Abbott's operating profit, Lehman Brothers analyst Robert Hopkins said last week in an investment note.
"It's going to be quite a land grab," said Phil Nalbone, a medical device analyst at RBC Capital Markets in San Francisco. "We have a new generation of stents that are easier to use and may have significant advantages in effectiveness and safety."
Abbott introduced the Xience device last year in Europe as its first entry in the drug-coated stent market. Abbott stock has risen 10 percent in the past 12 months.
Medtronic shares have increased 16 percent in the past year. The Endeavor stent, available in Europe, is its first drug-coated version. Last year, Medtronic generated $276 million from Endeavor and $249 million from bare-metal devices costing about $300, a 10th as much as drug-coated stents.
Boston Scientific has plummeted 23 percent in trading since studies linked its Taxus stents to blood clots at a cardiology meeting a year ago in Europe. The Natick, Massachusetts-based company plans to introduce its next-generation Taxus Liberte stent next year in the U.S.
Johnson & Johnson, based in New Brunswick, N.J., gets less than 5 percent of its sales from stents. The company's shares have lost 3.5 percent in the past year.
Boston Scientific and Johnson & Johnson say they have long-term data that will help them compete with Abbott and Medtronic. New studies show their stents are particularly effective for high-risk patients, such as those with diabetes.
Stents are tiny metal mesh tubes that keep arteries open after doctors clear clogged vessels with inflatable balloons. The devices are coated with a chemical polymer and drugs to prevent tissue from growing inside the device and re-blocking the artery, the main complication of older, bare-metal models. The $3,000 drug-coated stents almost completely displaced bare-metal versions in the U.S. in 2005.