Medtronic gets FDA approval for Web monitoring of heart
devices
Terry Fiedler
Star Tribune
Published Jan 3 2002
Patients with some implanted heart devices can now get a
checkup without leaving their homes.
Fridley-based Medtronic Inc. said Wednesday it has received
Food and Drug Administration (FDA) approval to market a
new Internet-based network. The network allows data to be
sent from patients' implanted defibrillators to doctors' offices.
"There is nothing out there with this type of Web
connectivity," said U.S. Bancorp Piper Jaffray analyst Thomas
Gunderson.
"Medtronic has been focused as a product company," said
Christopher O'Connell, vice president and general manager of
Medtronic's patient-management division. "Now we are going
into a whole new era of post-implant services."
Although two million people have implanted Medtronic heart
devices, the FDA approval will affect only about 23,000 of
them immediately. Those patients have Medtronic's GEM II
DR/VR defibrillator, which can now be monitored by the
company's fee-based patient management network, called
CareLink.
Analysts said the FDA is likely to approve other defibrillator
models and some other heart devices for Web monitoring in
the next year. The CareLink network can support other heart
devices -- pacemakers, heart-failure devices and diagnostic
devices -- as the FDA approves the network's use with them.
The devices don't need any special adjustments in order for
heart-related data to be transmitted through the Internet.
Gunderson expects the network to help Medtronic defend and
expand its leading market-share in cardiac-rhythm
management devices. In fiscal 2001, Medtronic had $2.3 billion
in cardiac-rhythm management sales -- 42 percent of total
company revenue..
UBS Warburg analyst David Lothson has estimated that by
2006 the Medtronic remote-monitoring network will be used
by 150,000 patients and generate $250 million a year in
revenue.
But more important than the fees, in his view, are the
market-share implications.
Lothson wrote in a recent report that Medtronic has "a major
jump" in the remote monitoring area over its chief
competitors: Guidant Corp., which has its cardiac-rhythm
management group in Arden Hills, and Little Canada-based
St. Jude Medical Inc.
Medtronic made the convergence of medical and information
technology a central element of its 10-year plan outlined last
year. In the past two years, the company has invested about $30
million in the CareLink network, which will be marketed to
cardiology clinics and academic medical centers. Those clinics
will pay an as-yet-undetermined annual fee to Medtronic for
each patient. The patients, in turn, will be asked to pay a fee to
the clinics.
Dr. George Crossley III, director of electrophysiology at Baptist
Hospital in Nashville, Tenn., who worked on benchmark
testing of the network, said it "allows us to extend patient care
beyond clinic walls. We get the data we need for follow-up
when and where we need it."
-- Terry Fiedler is at tfiedler@startribune.com .
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