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Medtronic's Pacemaker Business Wins CMS Coverage Approval
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Marking a major milestone, Medtronic plc (MDT - Free Report) recently won the U.S. Centers for Medicare & Medicaid Services’ (CMS) coverage approval for its Micra Transcatheter Pacing System (TPS).
Notably, the CMS approval, which is effective immediately, follows the approval of two studies that were required to enable reimbursement through Medicare`s policy of Coverage with Evidence Development (CED).
In Jan 2017, CMS issued a final National Coverage Determination (NCD) that covered leadless pacemakers under CED when used in accordance with FDA-approved labeling in FDA-approved studies. The two CMS-approved Micra studies approved are the Micra Post-Approval Study (PAS) and a new Micra CED Study, the "Longitudinal Coverage with Evidence Development Study on Micra Leadless Pacemakers”.
The Micra PAS Study will enroll a subset of Medicare Micra patients through a traditional clinical research design. The Micra CED Study will encompass all Medicare beneficiaries who receive Micra under an innovative new approach to CED, linking information from Medtronic`s device registration system to Medicare health insurance claims and enrollment data.
The Micra TPS is the smallest available leadless pacemaker and has already achieved marketing approval in the U.S. as well as overseas. In Apr 2016, the company won FDA premarket approval for this device. This is the first and only leadless pacemaker approved for use in the U.S. for patients who need a single-chamber pacemaker.
With increasing prevalence of pacemaker implementation worldwide and the less invasive alternative that Medtronic’s Micra TPS offers compared to the conventional systems, it is reasonable to expect that the CMS coverage will induce a surge in global demand for pacemakers manufactured by the company.
We are hopeful that the device will get a strong market acceptance post the coverage approval, especially given that it has been recently named at the top of U.S. News & World Report`s list of "2016`s Biggest Achievements in Medicine".
At present, the global pacemaker market is expected to reach $12.85 billion by 2023. Given the aforementioned developments, we expect Medtronic to capture a larger share of this market, going forward.
Share Price Movement
For the last one month, Medtronic has been trading above the Zacks categorized Medical - Products industry. The stock increased 6.71%, higher than the 2.6% gain of the broader industry. The company’s better-than-expected results in the fiscal third-quarter are expected to boost share price. This uptrend is expected to continue with the latest CMS coverage for Micra TPS.
Zacks Rank &Key Picks
Medtronic currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the medical product sector include Inogen, Inc. (INGN - Free Report) , Bovie Medical Corporation and Cardiovascular Systems, Inc. . Inogen sports a Zacks Rank #1 (Strong Buy) while the other two companies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Inogen gained 82.9% in the last one year compared with the S&P 500’s gain of 17.7%. The company has a stellar four-quarter average earnings surprise of over 49.08%.
Bovie Medical surged 51.4% in the last one year compared with the S&P 500. It has a four-quarter average earnings surprise of 28.7%.
Cardiovascular Systems gained over 100% in the past one year, better than the S&P 500 mark. The stock has an impressive long-term earnings growth rate of 16.7% for the next five years compared with the industry average of 15.2%.
Zacks' 2017 IPO Watch List
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One has driven from 0 to a $68 billion valuation in 8 years. Four others are a little less obvious but already show jaw-dropping growth. Download this IPO Watch List today for free >>
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Medtronic's Pacemaker Business Wins CMS Coverage Approval
Marking a major milestone, Medtronic plc (MDT - Free Report) recently won the U.S. Centers for Medicare & Medicaid Services’ (CMS) coverage approval for its Micra Transcatheter Pacing System (TPS).
Notably, the CMS approval, which is effective immediately, follows the approval of two studies that were required to enable reimbursement through Medicare`s policy of Coverage with Evidence Development (CED).
In Jan 2017, CMS issued a final National Coverage Determination (NCD) that covered leadless pacemakers under CED when used in accordance with FDA-approved labeling in FDA-approved studies. The two CMS-approved Micra studies approved are the Micra Post-Approval Study (PAS) and a new Micra CED Study, the "Longitudinal Coverage with Evidence Development Study on Micra Leadless Pacemakers”.
The Micra PAS Study will enroll a subset of Medicare Micra patients through a traditional clinical research design. The Micra CED Study will encompass all Medicare beneficiaries who receive Micra under an innovative new approach to CED, linking information from Medtronic`s device registration system to Medicare health insurance claims and enrollment data.
The Micra TPS is the smallest available leadless pacemaker and has already achieved marketing approval in the U.S. as well as overseas. In Apr 2016, the company won FDA premarket approval for this device. This is the first and only leadless pacemaker approved for use in the U.S. for patients who need a single-chamber pacemaker.
With increasing prevalence of pacemaker implementation worldwide and the less invasive alternative that Medtronic’s Micra TPS offers compared to the conventional systems, it is reasonable to expect that the CMS coverage will induce a surge in global demand for pacemakers manufactured by the company.
We are hopeful that the device will get a strong market acceptance post the coverage approval, especially given that it has been recently named at the top of U.S. News & World Report`s list of "2016`s Biggest Achievements in Medicine".
At present, the global pacemaker market is expected to reach $12.85 billion by 2023. Given the aforementioned developments, we expect Medtronic to capture a larger share of this market, going forward.
Share Price Movement
For the last one month, Medtronic has been trading above the Zacks categorized Medical - Products industry. The stock increased 6.71%, higher than the 2.6% gain of the broader industry. The company’s better-than-expected results in the fiscal third-quarter are expected to boost share price. This uptrend is expected to continue with the latest CMS coverage for Micra TPS.
Zacks Rank & Key Picks
Medtronic currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the medical product sector include Inogen, Inc. (INGN - Free Report) , Bovie Medical Corporation and Cardiovascular Systems, Inc. . Inogen sports a Zacks Rank #1 (Strong Buy) while the other two companies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Inogen gained 82.9% in the last one year compared with the S&P 500’s gain of 17.7%. The company has a stellar four-quarter average earnings surprise of over 49.08%.
Bovie Medical surged 51.4% in the last one year compared with the S&P 500. It has a four-quarter average earnings surprise of 28.7%.
Cardiovascular Systems gained over 100% in the past one year, better than the S&P 500 mark. The stock has an impressive long-term earnings growth rate of 16.7% for the next five years compared with the industry average of 15.2%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
One has driven from 0 to a $68 billion valuation in 8 years. Four others are a little less obvious but already show jaw-dropping growth. Download this IPO Watch List today for free >>