This industry’s far from dead, however, and Medtronic, Inc. (NYSE:MDT) has targeted what could be tomorrow’s best-selling niche: high blood pressure. Renal denervation therapies, used to treat hypertension by affecting renal nerves near and in the kidneys, are becoming a hot topic among device makers, and Medtronic, Inc. (NYSE:MDT)’s at the forefront of this revolution. But does this promising future of cardiac companies deserve your investment?
The future of high blood pressure?
It’ll be a while before Medtronic gets its renal denervation devices approved by the Food and Drug Administration, but the company has tried hard to win over Europe. Detailed in a recent report released by Reuters, Medtronic, Inc. (NYSE:MDT) claimed that tough conditions across the Atlantic — such as budget-conscious hospitals — have been affecting the spread of its renal denervation technology. Still, Europe provides one foothold for the technology to catch on — and it’s servicing a big market.
Renal denervation is used to treat certain cases of hypertension, and there are plenty of patients to go around. The Center for Disease Control estimated that more than 28% of U.S. adults had hypertension between 2009 and 2010; that’s tens of millions of potential patients. While renal denervation technology hasn’t made much of a dent yet in the U.S. market and still has a long way to go to being widely accepted, even a fraction of that number is a huge potential customer base for Medtronic, Inc. (NYSE:MDT) and its rivals in the space.
It helps that renal denervation is an attractive option for health-wary patients. Hypertension can lead to serious complications such as stroke and even death, and a small percentage of patients don’t respond to medication. Renal denervation offers a drug-free alternative that, while still gaining acceptance, could provide a life-saving measure for many afflicted individuals. That’s a potential blockbuster market in the making for forward-thinking companies.
So just who are the firms looking to take advantage of this next-generation therapy, and who’s set to take the first round in the rush to capitalize on renal denervation’s promise?
Sorting out the early leaders
Medtronic has made the first move in the renal denervation market, but the company said in its most recent quarterly filing that it’s on the path for U.S. approval by 2015. Its Simplicity catheter has already gained CE Mark approval in Europe and grabbed a foothold in Australia and Canada recently. That’s a good sign going forward. Expect Medtronic, Inc. (NYSE:MDT) to be one of the first movers in the powerful American market with its experience in hand.
St. Jude Medical, Inc. (NYSE:STJ) has been under fire recently from sales losses in its cardiology divisions, but renal denervation could be a life-saver for this beleaguered company. The firm earned CE Mark approval for its EnligHTN renal denervation system back in 2012, and it launched a clinical study in February to study the system’s benefits in preventing conditions such as heart attack or stroke. The EnligHTN isn’t approved in the U.S. yet, but St. Jude Medical, Inc. (NYSE:STJ)’s European approval puts this company on the fast track to becoming a major player in renal denervation.
Boston Scientific Corporation (NYSE:BSX) hasn’t been as quick to jump on the bandwagon as St. Jude and Medtronic have, but this cardiovascular-focused firm won’t be left behind. Facing struggling sales from its CRM and interventional cardiology businesses, Boston Scientific Corporation (NYSE:BSX) pushed into renal denervation with its purchase of Vessix Vascular late last year. While Vessix’s V2 renal denervation system has a long way to go before being approved in the U.S., it has already earned European and Australian regulatory approval.
Finally, Covidien plc (NYSE:COV) has also entered the renal denervation race, although this company looks to be behind St. Jude and Medtronic as the leaders. Covidien plc (NYSE:COV) purchased small-time renal denervation player Maya Medical last year for up to $170 million including milestone payouts, and it also received European approval for its OneShot renal denervation system last year. However, Covidien plc (NYSE:COV) only launched the OneShot commercially in January, putting it back with Boston Scientific in racing to catch up with St. Jude and Medtronic’s advance.
One thing’s certain in this exciting new market: Renal denervation is not going away. In a time when cardiovascular device makers are struggling for sales growth, hypertension’s rise in advanced economies and developing markets like India provides a lucrative new niche to fight over. Medtronic, Inc. (NYSE:MDT)’s in the lead right now, but as the renal denervation market opens up, keep an eye on who can make land in the U.S. first. The American market offers up a huge opportunity — and the first mover could be the company that greatly rewards investors.
The article The Market That Could Save Cardiovascular Device Makers originally appeared on Fool.com and is written by Dan Carroll.
Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool recommends Covidien. The Motley Fool owns shares of Medtronic.
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