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Medtronic's Reveal Heart Monitor Launch in Japan Bodes Well

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Medtronic plc (MDT - Free Report) is ardently strengthening its foothold internationally even amid severe macroeconomic pressure. The company’s recent launch of the Reveal LINQ Insertable Cardiac Monitor (ICM) System in Japan is one significant step forward under this initiative.

According to Medtronic, the Japanese Ministry of Health, Labor and Welfare (MHLW) recently approved this product launch along with its reimbursement. Reveal LINQ ICM will be available in Japan immediately after this release.

We note that Reveal LINQ ICM is currently the smallest insertable heart monitor available in the market. This system helps in detection and treatment of irregular heartbeats that may be related to unexplained fainting. The insertion of the system involves minimally invasive procedure.

The system claims to be MR conditional as patients inserted with this system can even undergo magnetic resonance imaging (MRI), if needed. According to Medtronic, this system will also be helpful in detecting cryptogenic stroke (stroke of unknown cause).

We believe that the launch of Reveal LINQ ICM in a country like Japan is a major development for Medtronic’s Cardiac Rhythm & Heart Failure (CRHF) business. Data show that nearly 200,000 patients suffer from episodes of syncope (unexplained fainting) in the country with 20% to 30% of these cases defying explanation. Further, 243,000 cases of ischemic strokes have been recorded annually out of which 20% to 40% are cryptogenic (as per modern stroke registries and databases). Taking this into consideration, Reveal LINQ ICM is likely to witness high uptake in the nation.

Reveal LINQ is present in the U.S. market and has demonstrated strong revenue growth over the recent past. The company's last reported financial results also reveal encouraging numbers for the Reveal LINQ monitor. In fact, the company’s Diagnostics business within CRHF grew in the low double digits during the first quarter of fiscal 2017, buoyed by strong market acceptance of the Reveal LINQ insertable loop recorder.

We also take a note that to tap into Japan’s broad population base, Medtronic is focusing on expanding in the country. This is clear from the company’s impending product launches in the nation. Apart from Reveal LINQ ICM, we also look forward to the launch of Claria MRI CRT-D system (along with CRT pacing) and Visia AF in Japan.

Currently, the stock carries a Zacks Rank #3 (Hold). Better-ranked medical products stocks worth considering instead over the short term are GW Pharmaceuticals plc , Lantheus Holdings, Inc. and NuVasive, Inc. . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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