Posted on January 23, 2006 | Red Herring
Drugs & Devices: Guidant Woes
Guidant's degraded seals; Medtronic settles suit; Neuroptix gets $500,000; outsourcing speeds drug research.
January 23, 2006
Guidant, the target of a fierce bidding war between Johnson & Johnson and Boston Scientific, said Monday that a seal on some of its older pacemakers could be susceptible to more failure than first reported to the federal government.
The company said the sealing component used on some of its pacemakers manufactured before 2000 may experience higher rates of gradual degradation.
The U.S. Food and Drug Administration first recalled the associated batch of products in July 2005. According to Guidant, the federal agency may consider the latest findings by the company an expansion of the original recall (see Guidant's Troubles Aren't Over).
These products have not been sold or implanted for the last four years.
The news comes as investors wait to see if J&J will increase its acquisition bid for Guidant. At last count Boston Scientific had raised its offer to about $27 billion, compared to J&J's last bid of $24.2 billion.
Guidant's stock rose $0.11 to $76.06 in recent trading.
Medtronic Pays $37.5M
Heart valve maker Edwards Lifesciences said Monday that Medtronic agreed to pay $37.5 million to Edwards and its partner in exchange for nonexclusive licenses as part of a patent infringement lawsuit settlement.
Edwards and privately held Australian-based Endogad Research Pty. filed the lawsuit in August 2003. The two alleged Medtronic had violated certain patents related to endovascular grafts for the treatment of various types of aneurysms.
Under the terms of the agreement, Medtronic will receive nonexclusive licenses for the patents involved in the lawsuit as well as other patents related to the grafts.
After taking into account its agreement with Endogad and legal expenses, Edwards expects to record a one-time gain in early 2006 of about $20 million.
Edwards Lifesciences' stock rose $0.19 to $42.39 in recent trading. Medtronic shares fell $0.08 to $58.74.
Neuroptix Grabs $500,000
Neuroptix, a Massachusetts-based neurological disease diagnostics company, said Monday it received $500,000 in funds to help further commercialize its products.
Funds will be used to support ongoing equipment trials and the development of Neuroptix products that aid in the diagnosis and management of Alzheimer's, and other degenerative neurological and eye disorders.
Neuroptix's target market includes biopharmaceutical, diagnostic, and imaging companies.
The investment was led by Launchpad Venture Group. Backers also included several angel groups and individuals.
Outsourcing drug development
The growing trend of shifting pharmaceutical product development to contract clinical research organizations from drug and biotechnology companies has resulted in faster and more efficient drug development, according to a study released Monday.
Clinical research organizations conduct studies on behalf of pharmaceutical, biotechnology, and medical device companies.
The survey was carried out by the Tufts Center for the Study of Drug Development, and commissioned by the industry group The Association of Clinical Research Organizations.
According to the study, spending by pharmaceutical and biotechnology companies on the outsourced clinical research organizations has grown 15 percent annually since 2001.
The study also found that drug company products with a high reliance on the outsourced researchers stayed closer to schedule than those with less dependency on the researchers.
According to the study, projects with heavy use of outsourced researchers typically delivered their data to regulators more than 30 days closer to the projected submission date than projects with less outsourced participation.
Contact an Experienced Guidant Lawyer
If you or your loved one uses Guidant brand Pacemakers and Defibrillators, you could be in serious danger. Consult your doctor immediately if you are experiencing any side effects and then contact our Guidant lawyers right away.
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