Johnson & Johnson is confidently telling Wall Street the company will soon be first to market with a drug-coated stent, a next-generation cardiovascular device used to keep arteries open after angioplasty procedures.
The New Brunswick, N.J.-based health-care giant has been in a race with several rivals that include North Chicago-based Abbott Laboratories to develop a drug-coated stent.
Unlike existing stents, the new version is a drug-coated variety that attacks one of the biggest problems in heart treatment: the tendency for diseased coronary arteries to reclog.
Johnson & Johnson expects that its device, called Cypher, will be well ahead of its rivals’ once it is approved by the Food and Drug Administration by the end of the first quarter or the early part of the second quarter.
“This is really fundamentally a new technology,” Mike Dormer, Johnson & Johnson’s worldwide chairman of medical devices, told analysts and investors at the U.S. Bancorp Piper Jaffray Health Care Conference in New York. “Over time, we will see a majority of the market switch” to the drug-coated stents.
While analysts say the market for stents, which were introduced nine years ago, brings in about $2 billion in annual sales, they think the drug-coated versions could more than double that, to nearly $5 billion, in five years.
In part because of the new technology, Dormer says there will eventually be an “overall increase in the number of stents” used by physicians.
The expanding market should be good news for companies that will follow Johnson & Johnson. Analysts project Boston Scientific Corp. will be the next company on the market with a drug-coated stent, possibly by the end of this year or early next year.
That leaves Abbott in the race with other companies for third place. Abbott’s development hit a snag last year when clinical trials in humans were delayed in Australia and New Zealand during an audit of “study process issues.”
Abbott said its program is moving forward on several tracks in preclinical development, but the company admits that a marketed product is far behind Johnson & Johnson’s.
“It could be a significant market for us, but it’s probably a couple of years away,” said John Thomas, Abbott vice president of investor relations.
NeoPharm’s battle: Wall Street anxiously awaits the outcome of a tussle between tiny biotech firm NeoPharm Inc. and pharmaceutical giant Pharmacia Corp. over a pact to develop cancer drugs.
Lake Forest-based NeoPharm last year accused Pharmacia of breaching its 1999 licensing agreement, saying the Peapack, N.J.-based company held up the development of the compounds. Pharmacia, which was chosen to develop two of Neopharm’s drugs, has denied the allegations.
Earlier this week, NeoPharm assured analysts and investors meeting in New York that the rift is nearing a resolution. A hearing before three independent arbitrators is scheduled for May 28 and is expected to last until June 30.
NeoPharm is seeking unspecified damages regarding the two cancer compounds, which were entering the final stage of human trials.
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Wall Street analysts pressed NeoPharm Chief Executive James Hussey on the potential for licensing deals with other companies or whether the biotech firm would take any potential cash windfall from Pharmacia to pursue developing the drugs on its own.
Hussey would say only that “any cash” won in an arbitration would help decide how to execute future strategy. “Out of all that will flow a bunch of other decisions,” he said.