We’re All Heart: Best in Show at TCT

It is that time of year again when the interventional cardiology and vascular communities reflect on the recent Transcatheter Cardiovascular Therapeutics (TCT) meeting which took place in Denver and finished late last week.  We take pause to remember that TCT is one of our industry’s most important educational and scientific meetings and brings together a diverse global audience of physicians, companies, C-level executives, investors, and other interested parties.  Most equity analysts will issue their post-TCT reports (many already have) and the news wires have been abuzz with word from TCT of the end of the bare metal stent.  In other words, it is time for some post-TCT commentary.

Interventional cardiovascular medicine continues to be one of the most interesting and dynamic sectors of the medical technology space.  As we have all heard the days of the bare metal stent seem numbered if not finished, though Cardinal’s Cordis division is currently marketing a bare metal stent.  Cordis is also signaling their intent to launch a drug eluting stent (DES).   The stent market has been in and out of favor since then with the evolution of the DES market and its promise, much of which has been limited by regulatory and reimbursement challenges as well as demand constraints related to long-term efficacy.  But as is often the case, where there is a medical need there are smart people who develop products and solutions to meet the need.

The above trend is no more apparent than in the world of transcatheter aortic valve replacement (TAVR) and transcatheter mitral valve replacement (TMVR) which gets our vote for best of show.   These are large markets (TAVR is estimated to be a $3 billion market in the US; TMVR could reach more than 3x that with some estimates approaching $10 billion) with TMVR representing one the largest medical device segments of all time.  While there was plenty of excitement at the recent TCT from new stents (novel biomaterials, placement in difficult to navigate locations, etc.), LAA closure devices (BSC’s PREVAIL study for the Watchman), and mitral valve repair options (TMVr devices notably from Abbott and Edwards), the TAVR/TMVR news seemed the most exciting and promising to us.

Why do we like this market so much and why did we award it best of show at TCT?  First, the sheer number of TAVR/TMVR sessions at TCT outnumbered any other segment.  Second, Medtronic made a splash with interesting pilot data from their self-expanding TMVR Intrepid trial, having previously announced the initiation of a pivotal trial for Intrepid on October 23rd.    While it remains to be seen how quickly the major TMVR players can transition from a transapical to a transeptal delivery approach.  Finally, we are excited by this market given the tremendous amount of M&A activity in both the TAVR and TMVR sectors, but especially in TMVR where recent transactions have ranged from $400-700 million for companies that were pre-revenue at the time of the acquisition and had limited human data.

Target Buyer Date Deal Value ($M) Comments
Symetis Boston Scientific 3/2017 435 TAVR – $38MM EU revenue
Valtech Edwards 11/2016 690 TMVR – CE Mark
Twelve Medtronic 8/2015 458 TMVR – First in Man
Tendyne Abbott 6/2015 385 TMVR – First in Man
CardiAQ Edwards 6/2015 400 TMVR – First in Man
Sadra Boston Scientific 11/2010 450 TAVR – First in Man
Corevalve Medtronic 2/2009 850 TAVR – CE Mark

In addition to the substantial TAVR/TMVR news flow before, during and after TCT, as the above table demonstrates, the TAVR/TMVT sector in not just making news but is also delivering real exits for investors and demonstrating the power of developing novel solutions to real health challenges.

Members of the Locust Walk medical technology team have been involved as company builders in the cardiovascular device world (investor, advisor, founder and marketing executive).  We would be delighted to discuss our capabilities in this sector and others in the medical technology space, and will continue to monitor major market trends that influence investment and strategic decisions.

  Written by Hunt Henrie