Medical devices major St. Jude Medical (STJ) recently revealed approval from the U.S. Food and Drug Administration (“FDA”) for its Ellipse implantable cardioverter defibrillator (“ICD”). ICDs are sophisticated implantable devices used to treat abnormal and lethal rapid heart beat, which may lead to unexpected death due to cardiac problems.
The Ellipse ICD was developed with input from over 200 doctors. It incorporates special design enhancements to yield a miniscule high energy device, which is the smallest in the world. This ICD was created to increase both comfort for patients and usability for doctors.
According to a doctor, the Ellipse ICD takes into account safety aspects with its latest algorithms designed to reduce shocks. Furthermore, this device offers the same cutting edge parameters incorporated in the company’s Fortify Assura ICD.
The Ellipse ICD is in compliance with International Standards Organization’s (“ISO”) specification for connector. Its DF4 connector cuts down the count of connections between the device and the defibrillation lead. It is noteworthy that St. Jude was the first company to offer DF4 know-how in 2009.
St. Jude is consistently producing revenue growth and positive earnings surprises over the past several quarters. We are impressed by its solid fundamentals, healthy growth trajectory, strong product mix, robust pipeline and cost management initiatives.
While a host of new growth drivers (including new products and emerging markets) are expected to boost results in 2012 and beyond, we remain cautious about increased competition, a still soft CRM market and the dilutive impact of acquisitions.
A still choppy CRM space overhangs on St. Jude and its peers Medtronic (MDT) and Boston Scientific (BSX). Our long-term Neutral recommendation on St. Jude is in agreement with a short-term Zacks #3 Rank (Hold).
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