




Healthcare Industry News: ICD
News Release - March 21, 2007
Cambridge Heart Announces Co-Marketing Agreement with St. Jude Medical and a $12.5 Million Equity Investment
Cambridge Heart Raises Revenue GuidanceConference Call to be held on March 22, 2007, at 8:30 AM ET
BEDFORD, Mass.--(HSMN NewsFeed)--Cambridge Heart, Inc. (OTCBB:CAMH ), today announced a three-year exclusive sales and marketing agreement with St. Jude Medical, Inc. (NYSE:STJ ), under which St. Jude Medical will be responsible for marketing Cambridge Heart's HearTwave II® Microvolt T-Wave Alternans System and sensors to cardiologists and electrophysiologists in North America. Cambridge Heart's sales force will continue to market the HearTwave II to internal medicine and primary care practices. Alternans testing is designed to allow physicians to identify patients who are at increased risk of Sudden Cardiac Death (SCD).
"Our partnership with St. Jude Medical is a landmark event for Cambridge Heart, our employees, and our shareholders," stated Robert P. Khederian, Chairman and Interim CEO of Cambridge Heart, Inc. "Our entire organization should be commended for their hard work and achievements leading up to this co-marketing partnership."
"Industry reports estimate 10 million to 12 million individuals in the U.S. have underlying heart disease and are at significantly higher risk for Sudden Cardiac Death than the general population. Unfortunately, there are many high-risk patients who are not receiving the therapy they need, and our HearTwave II System allows physicians to identify, non-invasively, those who will most likely benefit from ICD therapy," commented Laurence Blumberg, M.D., Vice President of Business Development, a founder, and a Director of the Company. "Our alliance with St. Jude Medical, a leader in the $10 billion cardiac rhythm management market, is a critical step in expanding patient and physician awareness and the need for alternans testing."
St. Jude Medical has purchased $12.5 million of preferred stock in Cambridge Heart, which is convertible into common stock at $2.99 per share. St. Jude Medical will market and sell the system to cardiologists and electrophysiologists in North America, and Cambridge Heart will manage the installation of systems, the training of new customers, and the servicing of the equipment. Additional agreement details were not disclosed. Banc of America Securities LLC acted as financial advisor to Cambridge Heart.
"We are excited about the opportunity this partnership offers our physician customers and the patients they serve," stated Michael T. Rousseau, president of St. Jude Medical's U.S. Division. "The ability to provide physicians with a non-invasive, cost-effective test to help identify patients that will benefit from ICD therapy is very appealing."
Financial Guidance
As a result of the agreement, Cambridge Heart today is raising its 2007 revenue guidance to $14 million to $16 million from the prior guidance of $12 million to $14 million. Cambridge Heart's net loss for 2007 is expected to increase as compared to the Company's prior plan. Clinical support, manufacturing, general, and administration costs are expected to increase as Cambridge Heart builds its infrastructure to support St. Jude Medical's sales efforts. Additionally, there will be a material impact on the Cambridge Heart's balance sheet, as the Company will carry much higher inventory levels than it has historically.
Based upon the $12.5 million investment from St. Jude Medical, Cambridge Heart does not foresee a need to raise additional capital in the near-term. Therefore, Cambridge Heart intends to withdraw its universal shelf registration statement currently on file with the Securities and Exchange Commission.
Conference Call Information
Cambridge Heart will hold a conference call at 8:30 AM ET on Thursday, March 22, 2007, to discuss the sales and marketing agreement with St. Jude Medical. The call will be hosted by Mr. Robert Khederian, the Company's Chairman and Interim CEO, Dr. Ali Haghighi-Mood, Chief Operating and Chief Technology Officer, and Dr. Laurence Blumberg, Vice President of Business Development. Interested parties may participate by dialing (800) 299-8538 (outside the U.S. (617) 786-2902), passcode 70539889. Interested parties may listen to a recording of the conference call at any time during the 48 hours immediately following the call by dialing (888) 286-8010 (outside the U.S. (617) 801-6888) and enter the passcode 27449450. This playback will begin approximately two hours after the call ends. The conference call also will be available by webcast on the Company's web site at www.cambridgeheart.com.
About The Non-Invasive HearTwave® II Microvolt T-Wave Alternans System
Cambridge Heart's HearTwave II Microvolt T-Wave Alternans System measures a specific and extremely subtle pattern of beat-to-beat fluctuations in a person's electrocardiogram. This pattern of fluctuations is called T-wave Alternans. These tiny variations in the electrocardiogram, measured at one millionth of a volt accuracy, are measured most commonly during a sub-maximal exercise stress test in the doctor's office or hospital outpatient setting. Extensive clinical research has shown patients with a positive or non-negative microvolt T-wave Alternans test are at increased risk for sudden cardiac death, while those who test negative are at reduced risk.
Sudden Cardiac Death
According to the American Heart Association, sudden cardiac death (SCD), or cardiac arrest, is the sudden, abrupt loss of heart function in a person who may or may not have diagnosed heart disease. The time and mode of death are unexpected. It occurs instantly or shortly after symptoms appear. The most common reason for patients to die suddenly is cardiovascular disease, in particular, coronary heart disease. About half of all deaths from coronary heart disease are sudden and unexpected, regardless of the underlying disease. Thus, half of all deaths due to atherosclerosis (arteries lined with fatty deposits) are sudden. So are half of deaths due to degeneration of the heart muscle or to cardiac enlargement in patients with high blood pressure. Sudden cardiac death is a major health problem, causing about 330,000 deaths each year among U.S. adults before reaching a hospital or emergency room.
The term "massive heart attack" is often mistakenly used in the media to describe sudden death. The term "heart attack" or myocardial infarction refers to death of heart muscle tissue due to the loss of blood supply, not necessarily resulting in the death of the heart attack victim. While a heart attack may cause cardiac arrest and sudden cardiac death, the terms aren't synonymous.
About Cambridge Heart, Inc.
Cambridge Heart (www.cambridgeheart.com) is engaged in the development and commercialization of products for the non-invasive diagnosis of cardiac disease, particularly the identification of those at risk of sudden cardiac arrest, and can be used to stratify patients to ICD therapy, a $6 billion market. The Company believes 10 million to 12 million Americans with underlying heart disease are at risk and should receive Alternans measurement. The Company's products incorporate its proprietary Microvolt T-Wave Alternans measurement technologies, coupled with its patented Spectral Analytic Method and ultra-sensitive disposable electrode sensors. The Company, founded in 1990, is based in Bedford, Massachusetts, and is traded on the OTCBB under the symbol CAMH.
Only Spectral Analytic Method MTWA tests are reimbursed by Medicare under its National Coverage Policy that covers patients with a wide variety of cardiac symptoms. Other major insurers in the U.S. also have coverage policies for the test. The T-Wave Alternans test is included in the Guideline for Management of Patients with Ventricular Arrhythmias and the Prevention of Sudden Cardiac Death jointly developed by the American College of Cardiology (ACC), The American Heart Association (AHA), and the European Society of Cardiology (ESC).
Statements contained in this press release about the anticipated revenue growth and other effects of the Company's agreement with St. Jude Medical on Cambridge Heart's financial results, and all other statements that are not purely historical are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. In some cases, the Company uses words such as "believes", "expects", "anticipates", "plans", "estimates", "could", and similar expressions that convey uncertainty of future events or outcomes to identify these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements. Factors that may cause or contribute to such differences include failure to achieve broad market acceptance of the Company's MTWA technology, failure of our sales and marketing partner to market our products effectively, inability to hire and retain qualified clinical applications specialists in the Company's target markets, failure to obtain or maintain adequate levels of third-party reimbursement for use of the Company's MTWA test, customer delays in making final buying decisions, decreased demand for the Company's products, failure to obtain funding necessary to develop or enhance our technology, adverse results in future clinical studies of our technology, failure to obtain or maintain patent protection for our technology, and other factors identified in our most recent Annual Report on Form 10-K under "Factors Which May Affect Future Results", which is on file with the SEC and available at www.EDGAR.com. In addition, any forward-looking statements represent the Company's estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While the Company may elect to update forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so except as may be legally necessary, even if the Company's estimates should change.
Source: Cambridge Heart
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