Medtronic scores FDA approvals for several new therapies to drive sales

Medtronic recently won several medical device approvals from federal regulators for therapies where the company faces little or no competition.

"It's innovations in areas where there's a big patient need and a lot of patients," said Medtronic CEO Geoff Martha on the company's earnings call in August. "New product innovation is fueling our diversified growth."

Indeed, Medtronic raised its forecast for organic revenue growth for its current fiscal year.

John Boylan, an analyst with St. Louis-based Edward Jones, has been consistently bullish on Medtronic's new product pipeline and likes what he sees with its latest round of FDA approvals.

"Medtronic's new products pipeline and approvals are underappreciated compared to its competitors" he said.

In the medical device business, approvals from the U.S. Food and Drug Administration are always victories as the process routinely takes years.

Take Medtronic's new renal denervation therapy, which disrupts nerves in the main arteries that supply blood to the kidneys. It dates to 2011 when Medtronic acquired startup Ardian Inc., the kidney therapy's original developer.

A clinical trial for the renal device failed in 2014. But Medtronic pressed on while many competitors abandoned the technology. In November, the FDA approved Medtronic's Symplicity Spyral renal denervation (RDN) device, which uses radio waves to reduce hypertension and lower blood pressure.

"There's probably no greater unmet health care need across the globe than hypertension. It's well over a billion people," said Jason Weidman, senior president of Medtronic's coronary and renal denervation division. "We expect that over time, it will be a multibillion-dollar market."

The Symplicity Spyral device targets nerves near the kidneys that can become overactive and cause high blood pressure. After a patient is sedated, a doctor inserts a very thin tube into the artery leading to the kidney. The tube is removed, leaving no implant behind.

"If you can go in and interrupt that overactive signal that's leading to the kidneys, that nerve signal, then you can reduce blood pressure," Weidman said.

There are now only two FDA-approved renal denervation devices in the U.S.

In December, Medtronic secured FDA approval for its PulseSelect pulsed field ablation (PFA) system to treat atrial fibrillation, or A-Fib — an irregular heartbeat. Medtronic was the first to win U.S. approval for pulsed field ablation technology. Competitor Boston Scientific Corp. received FDA approval for its Farapulse PFA system in January, about seven weeks after the Medtronic decision.

Once the FDA approves a product, it takes time to build up sales. Medtronic started selling PulseSelect in January on a limited basis, standard procedure for a new device.

Medtronic spent more than 15 years developing PulseSelect, which uses pulsed electric fields for ablation, a treatment to restore a regular heartbeat. Traditional ablation therapies involve scarring heart tissue through burning or freezing.

But those temperature-based methods have the risk of side effects, including infections, blood clots and blood vessel or heart valve damage.

"It is very reassuring to see that A-Fib ablation is becoming a very safe procedure," said Khaldoun Tarakji, Medtronic's chief medical officer for cardiac ablation solutions. "Complications are really rare."

Dr. Suraj Kapa, a Mayo Clinic electrophysiologist, said ablations often call for having a patient under general anesthetic for four to six hours. Pulsed field ablation is much faster, Kapa said.

"That has the potential to allow us to treat more people, more effectively and also with less risk."

Medtronic's latest version of its Percept RC deep brain stimulation system also recently earned FDA approval. The new model has a rechargeable battery.

The Percept system is sort of like a pacemaker for the brain. "It sends electrical signals and works to change the rhythms of the brain," said Dr. Robert McGovern, an M Health Fairview neurosurgeon.

In January, McGovern implanted the latest version of Percept in Bruce Lunde, 81. Percept is aimed at managing "movement disorders" such as Parkinson's disease, which Lunde was diagnosed with in 2019 after tremors began afflicting his right hand.

With Medtronic's deep brain stimulation, "my tremor ... largely disappeared," said Lunde, who lives in Merrifield, Minn., near Brainerd. "I'm delighted with the way things are working. I feel like it can give people hope."

In April, Medtronic obtained FDA approval for another new product, Inceptiv, a spinal cord stimulator for treating chronic pain. The device can automatically adjust the therapy — a unique feature — to bring better pain relief and to maintain a physician's prescribed level of stimulation.

"There's something like 1.2 or 1.4 million spine operations done a year. It turns out, 30 percent of those patients will continue to have spinal pain," said Dr. Ashwini Sharan, chief medical officer for Medtronic's neuromodulation business.

In a May research note, Robbie Marcus, an analyst with J.P. Morgan, praised the new spinal cord stimulator. "Growth is anticipated above market in the coming quarters off of the launch of the Inceptiv closed-loop [spinal cord stimulator]."

Medtronic is still feeling the afterglow of last year's FDA approval of its MiniMed 780G, the latest generation of the company's insulin pump. Fast Company listed the MiniMed 780G, which automatically adjusts insulin levels every five minutes, among its "2024 World Changing Ideas."

However, the company has come up short on some new devices. Medtronic observers and analysts are impatient to see progress on the company's Hugo robot-assisted surgery system, as well as its Affera cardiac mapping and ablation system. The FDA has approved neither.

For its fiscal year 2024, Medtronic, the world's largest manufacturer of medical devices, spent $2.7 billion on research and development.

Analysts see diversity among Medtronic's newest products.

"It's not any one thing. They have a lot of new things across their various businesses," said Mike Matson, a senior research analyst with Boston-based Needham & Co.

Matson said the new devices are helping boost sales but larger gains are yet to come. He cited Symplicity as an example.

"It should become a bigger product in time. It could be a really big product if they can get broader reimbursement coverage," Matson said.