07.20.23
Rank: #23 (Last year: #23)
$5.38 Billion
Prior Fiscal: $5.23 Billion
Percentage Change: +2.87%
R&D Expenditure: $945.2 Million
Best FY21 Quarter: Q4 $1.35 Billion
Latest Quarter: Q1 $1.46 Billion
No. of Employees: 17,300
Global Headquarters: Irvine, Calif.
KEY EXECUTIVES:
Bernard J. Zovighian, CEO
Daveen Chopra, Corporate VP, Transcatheter
Mitral & Tricuspid Therapies
Katie M. Szyman, Corporate VP, Critical Care
Larry L. Wood, Corporate VP and Group President, Transcatheter Aortic Valve Replacement & Surgical Structural Heart
Todd J. Brinton, MD, F.A.C.C., Corporate VP, Advanced Technology and Chief Scientific Officer
Joseph Nuzzolese, Corporate VP, Global Supply Chain & Quality
Donald E. Bobo Jr., Corporate VP, Strategy & Corporate Development
Jean-Luc Lemercier, Corporate VP, EMEA, Canada, Latin America and JAPAC
Sarah Sue Morbitzer and her new friend Valerie have been inseparable since the day they met.
The pair is so close, in fact, that it’s often difficult to distinguish between them: Both like the same sport. Both share the same dreams. Both exude confidence yet maintain their modesty and approachability. And neither wallows in self-pity.
Sarah Sue and Valerie first bonded several years ago during Morbitzer’s freshman year at the Ohio State University. Having achieved her dream of making the Buckeyes women’s volleyball roster, Morbitzer began summer workouts with the 15-member team in 2020 but had trouble completing the workout regimen. “I just thought I was a freshman, out of shape and just not acclimated yet,” Sarah Sue recalled in a video posted to the Big Ten Network last summer. “I had shortness of breath, a very tight chest...I just could not complete all the reps...”
Sarah Sue’s inability to keep up with teammates, however, had little to do with her acclimation to university sports. It was her heart—specifically, a leaky valve—that was the issue. Morbitzer needed a new valve.
The diagnosis was not surprising to Sarah Sue, considering she underwent open heart surgery as a 4-month-old to build the wall between two cardiac chambers (ventricles) and repair two valves. The renovations were necessary to correct Tetralogy of Fallot, a rare birth defect (affecting one in 2,518 infants) that causes oxygen-poor blood to flow from the heart to the rest of the body. The defect is usually diagnosed soon after birth and can only be corrected through surgery.
Sarah Sue had two options: She could undergo traditional open-heart surgery (invasive, long recovery period) or receive a transcatheter pulmonary valve replacement (considerably less invasive, short recovery). Not surprisingly, Morbitzer chose the latter solution.
“I was just like, kind of sitting patiently, sitting quietly in the corner, I was like, ‘why are we even talking about this? This is happening now,’” Sarah Sue said. “I got this valve—transcatheter—so not open-heart surgery”
Morbitzer underwent transcatheter pulmonary valve replacement (TPVR) surgery in December 2020 and played in her first volleyball match for the Buckeyes just one month later (Ohio State beat Maryland, 3-2).
“It’s definitely hard at times, knowing that I’m a little different than everybody. Everyone obviously loves and supports me but it’s definitely hard sometimes,” Sarah Sue noted. “My new valve that I had inserted, her name is Valerie. We gave her a name, just to have some fun with it.”
More than some fun, actually—Valerie has been a steady source of amusement amongst Sarah Sue’s teammates in the past two-and-a-half years. “We’ll just come up to her, or we’re running, we’re running practice or anything like that and we’re like, ‘How’s Val doing? How’s Sarah Sue doing?’” Mac Podraza, a former Buckeyes setter, told Big Ten Network. “And then it’s always, ‘How’s Val doing?’ because we just want to check up on her [Morbitzer] and make sure that every part of her is doing well.”
Sarah Sue is doing very well these days, thank you. After two successful volleyball seasons, she earned an athletic scholarship at Ohio State University, and is set to begin her senior year there this fall. Morbitzer intends to enroll in medical school after she graduates to pursue a career in pediatric cardiology.
With Valerie by her (in)side, of course.
Though she is affectionately known as Valerie to Morbitzer and the Buckeyes women’s volleyball team, the official birth name of Sarah Sue’s new valve is Edwards SAPIEN 3 Transcatheter Pulmonary Valve (TPV) System with Alterra Adaptive Prestent. Approved by the U.S. Food and Drug Administration (FDA) in August 2020, the system combines Edwards Lifesciences’ SAPIEN 3 valve and the Alterra adaptive prestent to expand transcatheter therapy options for congenital heart valve disease patients. Irvine, Calif.-based Edwards designed Alterra to compensate for size and morphology variations of the right ventricular outflow tract in order to provide a stable landing zone for the SAPIEN 3 valve.
The SAPIEN 3 TPV System with Alterra Adaptive Prestent is one of the newest iterations of Edwards Lifesciences’ best-selling SAPIEN valve, which first won FDA approval in 2011.
The company’s SAPIEN 3 platform experienced a slight tweak last fall with the FDA approval and limited launch of a new pericardial bovine valve with anti-calcification technology. The SAPIEN 3 Ultra RESILIA valve combines Edwards Lifesciences’ existing SAPIEN 3 Ultra transcatheter aortic heart valve and its RESILIA tissue technology to create a dry storage-enabled product with improved durability.
That enhanced durability was facilitated by Edwards’ RESILIA tissue—bovine pericardial matter treated with anti-calcification technology (i.e., the elimination of free aldehydes). A preclinical juvenile sheep model study showed a 72% reduction in calcium content after eight months in RESILIA-treated valves compared to controls.
RESILIA’s longevity provides Edwards with a unique selling point for its SAPIEN valves as it competes with Medtronic for TAVR market share. The SAPIEN 3 Ultra valve, however, is just one of several products that incorporate Edwards’ anti-calcification technology. RESILIA also found its way into a valve replacement specifically designed for the heart’s mitral position.
The MITRIS RESILIA valve, which received FDA approval in late March 2022, has a saddle-shaped sewing cuff that mimics the mitral valve’s asymmetric shape. It also features a low-profile frame that helps avoid obstruction of the left ventricular outflow tract by stent posts and is visible under fluoroscopy, to facilitate potential future transcatheter interventions for patients.
The MITRIS RESILIA valve also is approved in Japan, Canada, and other countries worldwide. Earlier this year, Edwards began enrolling patients in a clinical study that will determine the durability of RESILIA tissue in the mitral position.
“Mitral valve disease is prevalent, and the patients impacted experience the disease in variable ways,” Daveen Chopra, corporate vice president, Surgical Structural Heart at Edwards, said upon the MITRIS RESILIA’s FDA approval. “It was important to design the MITRIS RESILIA valve to perform like the native mitral valve, handling the highest pressures in the heart and offering sustained hemodynamic performance, so surgeons and patients can have confidence in this new therapy option.”
Surgeons and patients quickly gained that confidence, according to Edwards’ 2022 annual report. The document identifies the quick adoption of both MITRIS RESILIA and the Edwards SAPIEN 3 Ultra RESILIA valve as a contributing factor to higher company sales last year. Total revenue grew 2.87% to $5.38 billion, with most of the proceeds (58.2%) generated in the United States. Gross profit swelled 8% to $4.3 billion, while operating income climbed 3% to $1.75 billion and net income rose 1.2% to $1.52 billion. Earnings per share increased 2% to $2.46.
“Our 2022 adjusted earnings per share grew 12 percent. Our results fell short of our expectations and were primarily impacted by hospital staffing shortages around the globe, and foreign currency rates that moved significantly during the year,” former Chairman and CEO Michael A. Mussallem said in his final shareholder letter (he retired in May 2023, handing the reigns to Bernard Zovighian, the former corporate vice president and general manager of Edwards’ Transcatheter Mitral and Tricuspid Therapies business).
“While many companies in our industry try to grow through diversification and acquisitions,” Mussallem said, “we have stayed committed to organic growth through innovation in structural heart and critical care.”
Innovations like the PASCAL Precision transcatheter valve repair system, which received the CE mark last August for treating mitral and tricuspid regurgitation (MR and TR), and FDA approval in September 2022 for treating degenerative mitral regurgitation. Utilized through a single delivery system, the PASCAL Precision device is designed to enable precise navigation and implant delivery. The system includes PASCAL and PASCAL Ace implants, which feature independent grasping, atraumatic clasp and closure, and implant versatility including the ability to elongate and navigate complex anatomy.
The PASCAL Precision system was largely responsible for the 35.1% sales spike in Edwards’ Transcatheter Mitral and Tricuspid Therapies (TMTT) product group last year. Though this group comprises the smallest percentage of total company revenue (2.1%) it posted the largest year-over-year increase, expanding proceeds to $116.1 million.
In mitral replacement, Edwards continued to treat patients in FY22 through the ENCIRCLE trial for SAPIEN M3 and completed enrollment in the MISCEND early feasibility study for EVOQUE Eos. The company also made progress in enrolling patients in the TRISCEND II trial for the EVOQUE replacement system, and the CLASP IITR trial with the PASCAL repair system in patients with symptomatic, severe tricuspid regurgitation.
The sales growth in Edwards’ TMTT product group far outpaced its brethren. Case in point: The Transcatheter Aortic Valve Replacement (TAVR) group, which posted the second-highest revenue gain, boosted proceeds only 2.8% to $3.51 billion (a 32.3% difference, for those keeping score). The increase primarily was driven by higher sales of the Edwards SAPIEN 3 Ultra valve in the United States, Europe and Rest of World, the SAPIEN 3 Ultra RESILIA valve in the United States, and the SAPIEN 3 in Japan. Growth was offset, however, by foreign currency exchange rate fluctuations, which decreased net sales outside the United States by $140.2 million, due primarily to weakening of the Euro and Japanese yen against the U.S. dollar.
Edwards continued to advance its EARLY TAVR trial last year, studying the treatment of severe aortic stenosis patients before symptoms develop, as well as its PROGRESS trial, studying moderate aortic stenosis patients. During Q2, the company began treating patients in the ALLIANCE trial, which is analyzing its next-generation TAVR technology, SAPIEN X4.
Critical Care product sales gains followed closely behind TAVR’s increases with a 2.4% augmentation driven by robust demand for capital products, primarily Edwards’ HemoSphere monitoring platform in the United States and Japan; higher U.S. sales of pressure monitoring products; and strong U.S. demand for enhanced surgical recovery devices. Like TAVR, though, Critical Care sacrificed some growth to fluctuating foreign exchange rates, losing $39.5 million to a weak Euro and Japanese yen.
The Surgical Heart Valve Therapy product group was the least profitable last year, as revenue remained relatively flat. Its meager $4 million increase (to $893.1 million, a 0.4% year-over-year change) was largely attributable to strong U.S. and European adoption of the INSPIRIS RESILIA aortic valve, and U.S. uptake of the MITRIS RESILIA valve. Not surprisingly, fluctuating foreign exchange rates hampered net sales outside the United States by $46.5 million.
$5.38 Billion
Prior Fiscal: $5.23 Billion
Percentage Change: +2.87%
R&D Expenditure: $945.2 Million
Best FY21 Quarter: Q4 $1.35 Billion
Latest Quarter: Q1 $1.46 Billion
No. of Employees: 17,300
Global Headquarters: Irvine, Calif.
KEY EXECUTIVES:
Bernard J. Zovighian, CEO
Daveen Chopra, Corporate VP, Transcatheter
Mitral & Tricuspid Therapies
Katie M. Szyman, Corporate VP, Critical Care
Larry L. Wood, Corporate VP and Group President, Transcatheter Aortic Valve Replacement & Surgical Structural Heart
Todd J. Brinton, MD, F.A.C.C., Corporate VP, Advanced Technology and Chief Scientific Officer
Joseph Nuzzolese, Corporate VP, Global Supply Chain & Quality
Donald E. Bobo Jr., Corporate VP, Strategy & Corporate Development
Jean-Luc Lemercier, Corporate VP, EMEA, Canada, Latin America and JAPAC
Sarah Sue Morbitzer and her new friend Valerie have been inseparable since the day they met.
The pair is so close, in fact, that it’s often difficult to distinguish between them: Both like the same sport. Both share the same dreams. Both exude confidence yet maintain their modesty and approachability. And neither wallows in self-pity.
Sarah Sue and Valerie first bonded several years ago during Morbitzer’s freshman year at the Ohio State University. Having achieved her dream of making the Buckeyes women’s volleyball roster, Morbitzer began summer workouts with the 15-member team in 2020 but had trouble completing the workout regimen. “I just thought I was a freshman, out of shape and just not acclimated yet,” Sarah Sue recalled in a video posted to the Big Ten Network last summer. “I had shortness of breath, a very tight chest...I just could not complete all the reps...”
Sarah Sue’s inability to keep up with teammates, however, had little to do with her acclimation to university sports. It was her heart—specifically, a leaky valve—that was the issue. Morbitzer needed a new valve.
The diagnosis was not surprising to Sarah Sue, considering she underwent open heart surgery as a 4-month-old to build the wall between two cardiac chambers (ventricles) and repair two valves. The renovations were necessary to correct Tetralogy of Fallot, a rare birth defect (affecting one in 2,518 infants) that causes oxygen-poor blood to flow from the heart to the rest of the body. The defect is usually diagnosed soon after birth and can only be corrected through surgery.
Sarah Sue had two options: She could undergo traditional open-heart surgery (invasive, long recovery period) or receive a transcatheter pulmonary valve replacement (considerably less invasive, short recovery). Not surprisingly, Morbitzer chose the latter solution.
“I was just like, kind of sitting patiently, sitting quietly in the corner, I was like, ‘why are we even talking about this? This is happening now,’” Sarah Sue said. “I got this valve—transcatheter—so not open-heart surgery”
Morbitzer underwent transcatheter pulmonary valve replacement (TPVR) surgery in December 2020 and played in her first volleyball match for the Buckeyes just one month later (Ohio State beat Maryland, 3-2).
“It’s definitely hard at times, knowing that I’m a little different than everybody. Everyone obviously loves and supports me but it’s definitely hard sometimes,” Sarah Sue noted. “My new valve that I had inserted, her name is Valerie. We gave her a name, just to have some fun with it.”
More than some fun, actually—Valerie has been a steady source of amusement amongst Sarah Sue’s teammates in the past two-and-a-half years. “We’ll just come up to her, or we’re running, we’re running practice or anything like that and we’re like, ‘How’s Val doing? How’s Sarah Sue doing?’” Mac Podraza, a former Buckeyes setter, told Big Ten Network. “And then it’s always, ‘How’s Val doing?’ because we just want to check up on her [Morbitzer] and make sure that every part of her is doing well.”
Sarah Sue is doing very well these days, thank you. After two successful volleyball seasons, she earned an athletic scholarship at Ohio State University, and is set to begin her senior year there this fall. Morbitzer intends to enroll in medical school after she graduates to pursue a career in pediatric cardiology.
With Valerie by her (in)side, of course.
Though she is affectionately known as Valerie to Morbitzer and the Buckeyes women’s volleyball team, the official birth name of Sarah Sue’s new valve is Edwards SAPIEN 3 Transcatheter Pulmonary Valve (TPV) System with Alterra Adaptive Prestent. Approved by the U.S. Food and Drug Administration (FDA) in August 2020, the system combines Edwards Lifesciences’ SAPIEN 3 valve and the Alterra adaptive prestent to expand transcatheter therapy options for congenital heart valve disease patients. Irvine, Calif.-based Edwards designed Alterra to compensate for size and morphology variations of the right ventricular outflow tract in order to provide a stable landing zone for the SAPIEN 3 valve.
The SAPIEN 3 TPV System with Alterra Adaptive Prestent is one of the newest iterations of Edwards Lifesciences’ best-selling SAPIEN valve, which first won FDA approval in 2011.
The company’s SAPIEN 3 platform experienced a slight tweak last fall with the FDA approval and limited launch of a new pericardial bovine valve with anti-calcification technology. The SAPIEN 3 Ultra RESILIA valve combines Edwards Lifesciences’ existing SAPIEN 3 Ultra transcatheter aortic heart valve and its RESILIA tissue technology to create a dry storage-enabled product with improved durability.
That enhanced durability was facilitated by Edwards’ RESILIA tissue—bovine pericardial matter treated with anti-calcification technology (i.e., the elimination of free aldehydes). A preclinical juvenile sheep model study showed a 72% reduction in calcium content after eight months in RESILIA-treated valves compared to controls.
RESILIA’s longevity provides Edwards with a unique selling point for its SAPIEN valves as it competes with Medtronic for TAVR market share. The SAPIEN 3 Ultra valve, however, is just one of several products that incorporate Edwards’ anti-calcification technology. RESILIA also found its way into a valve replacement specifically designed for the heart’s mitral position.
The MITRIS RESILIA valve, which received FDA approval in late March 2022, has a saddle-shaped sewing cuff that mimics the mitral valve’s asymmetric shape. It also features a low-profile frame that helps avoid obstruction of the left ventricular outflow tract by stent posts and is visible under fluoroscopy, to facilitate potential future transcatheter interventions for patients.
The MITRIS RESILIA valve also is approved in Japan, Canada, and other countries worldwide. Earlier this year, Edwards began enrolling patients in a clinical study that will determine the durability of RESILIA tissue in the mitral position.
“Mitral valve disease is prevalent, and the patients impacted experience the disease in variable ways,” Daveen Chopra, corporate vice president, Surgical Structural Heart at Edwards, said upon the MITRIS RESILIA’s FDA approval. “It was important to design the MITRIS RESILIA valve to perform like the native mitral valve, handling the highest pressures in the heart and offering sustained hemodynamic performance, so surgeons and patients can have confidence in this new therapy option.”
Surgeons and patients quickly gained that confidence, according to Edwards’ 2022 annual report. The document identifies the quick adoption of both MITRIS RESILIA and the Edwards SAPIEN 3 Ultra RESILIA valve as a contributing factor to higher company sales last year. Total revenue grew 2.87% to $5.38 billion, with most of the proceeds (58.2%) generated in the United States. Gross profit swelled 8% to $4.3 billion, while operating income climbed 3% to $1.75 billion and net income rose 1.2% to $1.52 billion. Earnings per share increased 2% to $2.46.
“Our 2022 adjusted earnings per share grew 12 percent. Our results fell short of our expectations and were primarily impacted by hospital staffing shortages around the globe, and foreign currency rates that moved significantly during the year,” former Chairman and CEO Michael A. Mussallem said in his final shareholder letter (he retired in May 2023, handing the reigns to Bernard Zovighian, the former corporate vice president and general manager of Edwards’ Transcatheter Mitral and Tricuspid Therapies business).
“While many companies in our industry try to grow through diversification and acquisitions,” Mussallem said, “we have stayed committed to organic growth through innovation in structural heart and critical care.”
Innovations like the PASCAL Precision transcatheter valve repair system, which received the CE mark last August for treating mitral and tricuspid regurgitation (MR and TR), and FDA approval in September 2022 for treating degenerative mitral regurgitation. Utilized through a single delivery system, the PASCAL Precision device is designed to enable precise navigation and implant delivery. The system includes PASCAL and PASCAL Ace implants, which feature independent grasping, atraumatic clasp and closure, and implant versatility including the ability to elongate and navigate complex anatomy.
The PASCAL Precision system was largely responsible for the 35.1% sales spike in Edwards’ Transcatheter Mitral and Tricuspid Therapies (TMTT) product group last year. Though this group comprises the smallest percentage of total company revenue (2.1%) it posted the largest year-over-year increase, expanding proceeds to $116.1 million.
In mitral replacement, Edwards continued to treat patients in FY22 through the ENCIRCLE trial for SAPIEN M3 and completed enrollment in the MISCEND early feasibility study for EVOQUE Eos. The company also made progress in enrolling patients in the TRISCEND II trial for the EVOQUE replacement system, and the CLASP IITR trial with the PASCAL repair system in patients with symptomatic, severe tricuspid regurgitation.
The sales growth in Edwards’ TMTT product group far outpaced its brethren. Case in point: The Transcatheter Aortic Valve Replacement (TAVR) group, which posted the second-highest revenue gain, boosted proceeds only 2.8% to $3.51 billion (a 32.3% difference, for those keeping score). The increase primarily was driven by higher sales of the Edwards SAPIEN 3 Ultra valve in the United States, Europe and Rest of World, the SAPIEN 3 Ultra RESILIA valve in the United States, and the SAPIEN 3 in Japan. Growth was offset, however, by foreign currency exchange rate fluctuations, which decreased net sales outside the United States by $140.2 million, due primarily to weakening of the Euro and Japanese yen against the U.S. dollar.
Edwards continued to advance its EARLY TAVR trial last year, studying the treatment of severe aortic stenosis patients before symptoms develop, as well as its PROGRESS trial, studying moderate aortic stenosis patients. During Q2, the company began treating patients in the ALLIANCE trial, which is analyzing its next-generation TAVR technology, SAPIEN X4.
Critical Care product sales gains followed closely behind TAVR’s increases with a 2.4% augmentation driven by robust demand for capital products, primarily Edwards’ HemoSphere monitoring platform in the United States and Japan; higher U.S. sales of pressure monitoring products; and strong U.S. demand for enhanced surgical recovery devices. Like TAVR, though, Critical Care sacrificed some growth to fluctuating foreign exchange rates, losing $39.5 million to a weak Euro and Japanese yen.
The Surgical Heart Valve Therapy product group was the least profitable last year, as revenue remained relatively flat. Its meager $4 million increase (to $893.1 million, a 0.4% year-over-year change) was largely attributable to strong U.S. and European adoption of the INSPIRIS RESILIA aortic valve, and U.S. uptake of the MITRIS RESILIA valve. Not surprisingly, fluctuating foreign exchange rates hampered net sales outside the United States by $46.5 million.