MRG analyst offers insight into BSX-Atritech deal
By Amanda Pedersen

Last week Boston Scientific (Natick, Massachusetts) added Atritech (Plymouth, Minnesota) to its shopping list, announcing its intention to acquire the company for $100 million upfront plus potential payments of up to $275 million. The deal gives Boston Scientific a device backed by strong clinical evidence and puts the company in an ideal position in the endocardio left atrial appendage (LAA) market, according to Karene Dumoulin, principal analyst of cardiovascular at Millennium Research Group (MRG; New York).

MRG hosted a conference call Thursday during which Dumoulin offered some insights into what this latest deal could mean for Boston Scientific.

The Massachusetts firm has been on a buying spree lately, with its recent acquisition of Sadra Medical (Campbell, California) for $225 million in cash up front with the potential of up to $225 million more in milestone payments (Medical Device Daily, Nov. 22, 2010) and Asthmatx for $193 million (MDD, Sept. 21, 2010).

Atritech has been working on the Watchman, a device designed to close the LAA in patients with atrial fibrillation who are at risk for ischemic stroke. The company completed the first randomized clinical trial for a device used to close LAA. The 800-patient randomized trial, PROTECT-AF, demonstrated a 38% relative risk reduction for stroke, cardiovascular death, and systemic embolism compared to long-term warfarin therapy.

Boston Sci said last week it hopes to have FDA approval for the Watchman sometime in 2013 (MDD, Jan. 20, 2011). The company is now just starting its PREVAIL study, which is set to enroll up to 400 patients.

The Watchman has been approved for sale in Europe since 2009, but Atritech doesn't have as strong a sales force as Boston Scientific to get the device into the hands of physicians overseas.

While building its clinical evidence to support the Watchman device, Atritech has already started planning for the EVOLVE trial, an uncontrolled trial testing the performance of the next generation Watchman device.

"So Atritech is definitely ahead of the game," Dumoulin told call listeners Thursday.

Atritech faces competition from AGA Medical (Plymouth, Minnesota), which was recently bought up by St. Jude (St. Paul, Minnesota) (MDD, Nov. 22, 2010), Ev3 (also Plymouth) and Coherex Medical (Salt Lake City).

"In terms of endocardio devices, Atritech is the only company to have run a large-scale controlled, randomized trial," Dumoulin told MDD in an email Thursday following the call. "As such, Atritech is the only company that could launch an endocardio device (LAA occlusion device) in the U.S. market. We don't believe that the AMPLATZER feasibility trial that AGA is running will be sufficient for them to apply for PMA or 510(k) in the U.S. In that sense, Atritech will be well ahead of the game in terms of having the clinical data to launch their product in the U.S., and the fact that they are already testing their second generation device could mean that they're launching a second generation device in the U.S. when AGA and Coherex are only launching their first generation device in the U.S."

Between Atritech's strong clinical data and strong position with the FDA, combined with Boston Scientific's cardiac rhythm management portfolio and strong position for this market are among the benefits of this deal, according to Dumoulin.

"Boston Scientific's purchase of Atritech has got them a device with strong clinical evidence supporting its use, a foot into Europe where the [Boston Scientific] presence and relationships will surely increase Watchman penetration, and a product that will almost certainly be the first to market in the U.S.," she told MDD in the email.

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