Has Abiomed's Impella Heart Pump Been Unfairly Targeted?
Abiomed is the maker of a heart catheter called the Impella. Based outside of Boston, their research and development is considered to be among the leaders in the cardiac field. Cardiologists rely on catheters to help patients who have failing hearts or problems with their heart’s pumping mechanisms. The proper flow of a patient’s bloodstream is critical.
Catheters are medical devices that save lives on a daily basis. However, the failure of these devices to perform their desired function can lead to the death of their patients.
Recently, two studies were presented at an American Heart Association conference that cast a negative light on Impella. The studies pointed to a higher failure and death rate in patients using the Impella catheter vs peers. This contradicts the idea that the Impella was the leading catheter of choice for a patient in a dire cardiac situation.
The data that was presented in these two studies has been refuted by both the company and a number of cardiologists and academics in the healthcare community.
Defenders of Impella point to significant flaws in the data used in these two studies. Specifically, Abiomed released bullet points defending themselves from the two American Heart Association Studies:
The data source had significant limitations, according to Abiomed. For example, it contained just a fraction of Impella patients and was unable to delineate between common adverse events.
The Impella patients in the research were much sicker and had greater baseline and procedural risks.
The analysis excluded the costliest intra-aortic balloon pump patients who were escalated to other therapies.
Abiomed now trades at 11x its trailing operating income, a multiple more in line with its mature peers, Thermo Fisher and Stryker, despite an almost 30% revenue growth from 2018 to 2019. Even if unfounded, this recent negative press will slow growth in the near term. But in the long term might this be nothing but a bump in the road?