Medtronic Actively Checks Diabetes - Analyst Blog
June 27 2011 - 10:06AM
Zacks
In a positive development, research findings presented at a
recent conference mirrors the effectiveness of
Medtronic’s (MDT) insulin pump therapy for
improved glucose control in type 1 diabetic patients. The company
offers sensor-augmented insulin pump therapy that integrates
continuous glucose monitoring (CGM) into one device.
In the fourth quarter of fiscal 2011, revenues from Medtronic’s
Diabetes segment increased 11% year over year (9% at CER) to $368
million driven by 20% growth in CGM sales and robust growth in
global insulin pumps. Both its Veo and Revel pumps continued to
perform well.
During the last reported quarter, Medtronic launched the Enlite
Sensor in more than 35 countries outside the US and expects it to
drive growth in the CGM business in fiscal 2012. The product is an
advanced glucose sensor for CGM and helps type I diabetic patients
to predict and detect hypoglycemia (low blood sugar).
The Enlite Sensor can be used with MiniMed Paradigm Real-Time
system, MiniMed Paradigm Veo system, Guardian Real-Time CGM system,
and the iPro2. Medtronic is working with the US Food and Drug
Administration (FDA) for approval of the Enlite Sensor in the
US.
Results from the STAR 3 trial revealed that patients with
diabetes could monitor glucose level better when sensors are
integrated with insulin pump therapy. Recent studies also suggest
that patients can achieve better glucose control without increasing
hypoglycemia by using the CGM system more often. In this
scenario, the Enlite Sensor should witness greater acceptance as
its improved design makes it more comfortable and increases its
ease of use.
Medtronic’s two largest segments – Cardiac Rhythm Disease
Management (CRDM) and Spinal have been witnessing several
challenges over the past few quarters. As a result, the company is
now focusing on its other segments such as CardioVascular, Diabetes
and Neuromodulation to increase its top line.
Meanwhile, Medtronic is increasing its focus on emerging markets
and emerging therapies and expects these to be major growth drivers
going ahead. Besides, acquisitions should enable the company to
record higher revenues in the forthcoming period. However, the
company faces stiff competition from players such as Boston
Scientific Corporation (BSX), St Jude
Medical (STJ) among others.
Weare currently Neutral on Medtronic, which also corresponds to
the Zacks #3 Rank (hold) in the short term.
BOSTON SCIENTIF (BSX): Free Stock Analysis Report
MEDTRONIC (MDT): Free Stock Analysis Report
ST JUDE MEDICAL (STJ): Free Stock Analysis Report
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