Riding high on an approval to sell a major new product in the United States, AtriCure Inc. (NASDAQ: ATRC) posted its smallest net loss ever during the second quarter — $764,506, or 5 cents a diluted share.
A consensus of securities analysts surveyed by Thomson Reuters believed the company would lose 12 cents a share during the quarter ended June. 30.
The West Chester, Ohio, company that develops ablation technologies to scar the heart to disrupt bad electrical signals lost $1.4 million, or 10 cents a diluted share, in the year-ago quarter. Cash from operations was $1.1 million in the recent quarter. Revenue rose 3 percent to $14.2 million from $13.8 million from the year-ago quarter.
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The company’s president and chief executive expects sales and market share to continue strengthening in the second half of the year despite hospital cost-cutting and other economic uncertainties.
“In terms of our outlook, we believe that the men and women of AtriCure are well positioned to capitalize on our current momentum,” David Drachman told securities analysts during a Wednesday conference call.
In June, AtriCure got Food and Drug Administration approval to sell its AtriClip device, which is a clip used during heart surgery to exclude the left atrial appendage. This exclusion helps protect atrial fibrillation patients from strokes.
The U.S. market for using AtriClip during open-heart surgeries is likely to be $150 million a year, Drachman said. AtriClip was invented by Cleveland Clinic CEO Dr. Delos “Toby” Cosgrove and his colleague Dr. Marc Gillinov. As the clip is adapted for minimally invasive and hybrid heart surgeries, its market could grow significantly.
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AtriCure shares have risen 68 percent in the last 12 months to $6.65 partly on anticipation of U.S. approval for AtriClip.
The company also said it plans to move ahead — after productive meetings with the FDA — with the final clinical pre-market approval module for its ABLATE clinical trial. ABLATE is a pivotal trial to support an atrial fibrillation indication for patients undergoing cardiac procedures.
The FDA has not approved cardiac ablation as a treatment for atrial fibrillation, an increasingly common arrhythmia that can cause heart attacks or strokes. AtriCure has been at the forefront of clinical trials to convince the federal regulator to give its approval, which would be a huge boost for its business.
AtriCure also is running a clinical trial called RESTORE, which is a study of using a minimally invasive ablation procedure to help people who have failed other atrial fibrillation treatments.
In addition to running two major clinical trials, AtriCure also plans to launch five products within the next 12 months, including refinements of its cryoablation system (to give surgeons more control) and its cryoprobe (to make it compatible with robotic systems used during minimally invasive surgeries). And it’s ironing out sales distribution problems in Europe.
“The U.S. launch of our AtriClip system, the further cryo and open-heart market share gains, new product introductions and the continued expansion of our international markets combined with further investments in sales and marketing, are expected to fuel momentum during the second half of 2010 and throughout 2011,” Drachman said during the conference call.
“Further, we believe that the growing demand for effective alternative procedures for persistent and failed catheter ablation patients will fuel the demand for a minimally invasive product. We believe that our commitment and strategic investments in clinical science, atrial fibrillation approvals and innovation will provide the foundation for long-term, sustained, high growth.”
Are there risks in all this busyness? Increasing financial performance during such a time could prove a challenge, Drachman said.
