QUOTE AND NEWS
newratings.com  Dec 8  Comment 
WASHINGTON (dpa-AFX) - St. Jude Medical, Inc. (STJ) announced CE mark approval for full-body magnetic resonance conditional labeling of the Proclaim Elite Spinal Cord Stimulation System. With the latest approval, patients who receive the Proclaim...
Motley Fool  Nov 29  Comment 
HealthEquity, UnitedHealth Group, and St. Jude Medical stand out as winners from the unraveling of Obamacare.
newratings.com  Oct 31  Comment 
WESTON (dpa-AFX) - Biogen Inc.'s (BIIB) New Drug Application for Nusinersen, an investigational treatment for spinal muscular atrophy, has been accepted for priority review by the FDA. The companies have not revealed the decision date in the...
newratings.com  Oct 31  Comment 
WASHINGTON (dpa-AFX) - St. Jude Medical Inc. (STJ) announced the ILUMIEN III trial met its primary endpoint demonstrating percutaneous coronary intervention or PCI guided by optical coherence tomography or OCT to be superior to angiography in...
newratings.com  Oct 26  Comment 
NORTH CHICAGO (dpa-AFX) - St. Jude Medical, Inc. (STJ) announced that, based on the preliminary voting results, the company's shareholders approved the merger agreement under which Abbott (ABT) will acquire St. Jude Medical. Based on...
Benzinga  Oct 20  Comment 
Barclays believes investors are underestimating St. Jude Medical, Inc. (NYSE: STJ)’s pipeline and growth potential in future periods as it is working to close its merger with Abbott Laboratories (NYSE: ABT) in the fourth quarter. The...
MarketWatch  Oct 19  Comment 
The short seller says St. Jude devices can be hacked — but stands to gain from the claims.
Forbes  Oct 19  Comment 
In recent trading, shares of St Jude Medical Inc (NYSE: STJ) have crossed above the average analyst 12-month target price of $78.61, changing hands for $79.44/share. When a stock reaches the target an analyst has set, the analyst logically has two...
Reuters  Oct 19  Comment 
Abbott Laboratories, which is acquiring St. Jude Medical Inc for $25 billion, reported a quarterly profit that edged past estimates as strength in its medical devices business more than offset a decline in its nutrition unit.
Benzinga  Oct 19  Comment 
Think you know the markets? See if you can guess this stock by the chart and clues below.  This company reported Q3 EPS of $0.99 vs $1.01 est on revenue of $1.50B vs $1.50B est Monday morning. Two weeks ago it was reported that this...




 
TOP CONTRIBUTORS

St. Jude Medical (NYSE:STJ) makes devices for cardiovascular and neurological conditions, including mechanical heart valves, pacemakers, and catheters. The company generates the majority of its revenue from its Cardiac Rhythm Management (CRM) division, which makes implantable cardiac rhythm devices (ICDs) and pacemakers. The company earned $4.7 billion in revenue and $777 million in 2009.[1]

St. Jude is dependent on the market for implantable cardiac defibrillators; roughly one-third of the company's revenue came from its ICD business. Sales of ICDs have have stagnated in recent years. Several studies suggest that a majority of patients eligible to receive ICDs don't actually receive referrals for the devices from their doctors, implying that the market for ICDs may be smaller than initially estimated by ICD manufacturers.

Company Overview

Business Segments[2]

St. Jude has four main business segments: Cardiac Rhythm Management (CRM), Cardiovascular, Neuromodulation, and Atrial Fibrillation.

  • Cardiac Rhythm Management (59% of net sales) includes two main products -- Implantable Cardiac Rhythm Devices (ICDs) and pacemakers. ICDs treat patients with hearts that beat inappropriately fast and pacemakers treat patients with hearts that beat too slowly. These devices are in patients suffering from lethal heart conditions such as sudden cardiac arrest.
  • Cardiovascular (20% of net sales) focuses on both cardiology and cardiac surgery therapy areas. This segment includes products such as heart valves and heart valve repair products, which are used during heart valve surgeries. St. Jude mechanical heart valves have been implanted in over 1.8 million patients worldwide.
  • Atrial Fibrillation (AF) (14% of net sales) is a rapid and inconsistent heart rhythm that occurs in the heart. People suffering from AF may experience fatigue and shortness of breath, and AF has been shown to increase the risk of stroke. St. Jude has a line of AF products such as catheters and 3D hearth mapping system which help physicians diagnose and treat irregular heart rhythms.
  • Neuromodulation (7% of net sales) is generally used to manage sharp, intense and constant pain from nerve damage or nervous system disorders. It basically applies pacemaker-like technology to treat diseases such as chronic pain, Parkinson's, and epilepsy.

Business Growth

FY 2009 (ended January 2, 2010)[1]

  • Net sales increased 7.2% to $4.7 billion. Net sales increased in all of the company's business segments.
  • Net income more than doubled to $777 million.

Trends and Forces

Medicare approval drives neuromodulation segment

Health coverage is an important determining factor when patients and doctors choose among various treatment options. Medicare coverage is particularly significant in that it directly affects over forty million Americans, how much patients have to pay for St. Jude's products, and how much the company will receive in payments from Medicare. Medicare and other third party payors are emphasizing more cost-effective medical devices, by limiting the reimbursement they will cover. Furthermore, even if a new medical device is cleared by the FDA, St. Jude faces limited demand for the device until Medicare and other payors approve the device for reimbursement.

Saturation of Implantable Cardiac Rhythm Devices (ICD) Market

ICDs are stopwatch-sized devices that monitor the heart and deliver appropriate therapy when an abnormal heart rhythm is detected. St. Jude is the second largest producer of ICDs with 20% market share for ICDs and over $1.5 billion in ICD sales.[3] ICDs usage has grown substantially over the years, due to trial results which showed ICDs reduced death by 23% in people with moderate heart failure compared to those who did not receive ICDs. Analysts are concerned, however, that initial market estimates of market size may have been over stated. Growth has been well below industry projections and a study suggests that only one in four patients that are eligible for the device actually receive referrals from their primary care physicians .[4]


Competition

St. Jude faces competitors in each of its business segments:[5]

Cardiac Rhythm Management (CRM)

St. Jude is one of the three principal manufacturers and suppliers in the global Cardiac Rhythm Management (CRM) market. The company's two larger competitors in this market are:

Atrial Fibrillation Therapy

The atrial fibrillation therapy area is broadening to include multiple therapy methods that include drugs, delivery of diagnostic and ablation catheters, and implantable fibrillators among others. The company's primary competitors include:

Neuromodulation

In the neuromodulation market, St. Jude is one of three principal manufacturers of nerustimulation devices. The principal competitors are Boston Scientific (BSX) and Medtronic (MDT). The company also faces competition from smaller competitors:

References

  1. 1.0 1.1 STJ 2009 10-K "Consolidated Statements of Earnings" pg. 24
  2. STJ 2009 10-K "Principal Products" pg. 1-7
  3. STJ 2009 10-K Exhibit 13 "Cardiac Rhythm Management" pg. 7
  4. U.S. Department of Health and Human Services, Experts Debate Limits on Implanted Defibrillator Use
  5. STJ 2009 10-K "Competition" pg. 7-8
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