Healthcare Industry News: Patent Foramen Ovale
News Release - January 7, 2008
Cardica Receives $2 Million Payment From Cook Medical for Successful Completion of Multiple MilestonesCardica Attains Fourth Milestone in Vascular Closure Device Collaboration Agreement and Completes Initial Development Milestone for Device to Repair Heart Defects
REDWOOD CITY, Calif., Jan. 7 (HSMN NewsFeed) -- Cardica, Inc. (Nasdaq: CRDC ) today announced that it has received nearly $2 million in payments from Cook Medical (Cook) for the achievement of significant milestones pursuant to its development agreements with Cook. Cardica received the fourth and final milestone payment of $500,000 for the delivery of the Cook Vascular Closure Device (CVCD), an innovative automated system designed to close access openings in femoral arteries after interventional vascular procedures. Cook also paid $1.3 million to Cardica for the successful completion of the first phase of design and development of a specialized device designed to close holes in the heart known as Patent Foramen Ovales (PFO), genetic heart defects.
Cardica also received a payment of $180,000 from Cook for the initial purchase of parts to build a specific number of these vascular closure devices for commercial use.
"We believe the novel design and unique features of the Cook Vascular Access Closure Device address the large and growing market need for next-generation vascular closure devices. We expect to introduce the CVCD in a limited number of sites in Europe early this year," said Brian Bates, senior vice president of business development for Cook. "Moreover, Cardica has made excellent progress with the design of an innovative device to close PFOs. We are looking forward to working together with Cardica on the next phase of development and the initial pre-clinical testing of this ground-breaking device."
Under the agreement for the CVCD, Cardica has received a total of $2.0 million in milestone payments and has expanded this collaboration to include a second product in the vascular closure device product line. Similarly, under the agreement for the PFO closure device, Cardica has received to date $2.15 million in fees and milestone payments and may receive an additional approximately $1.4 million in development milestone payments beyond the $1.3 million announced today. With both products, Cardica is also entitled to receive royalties on any future worldwide sales by Cook, and Cook has exclusive worldwide commercialization and marketing rights.
"We are excited that our work with Cook is serving to advance new solutions for closure devices in the areas of vascular access and PFOs. The rapid advancement of both these programs is a testament to the excellent collaborative relationship we have developed with Cook and the true partnership we have together," said Bernard A. Hausen, M.D., Ph.D., president and chief executive officer of Cardica.
The CVCD Advantage for Interventional Procedures
An estimated 8.5 million diagnostic and interventional catheterization procedures were performed worldwide in 2006, all of which required access site closure either by manual compression or alternative vascular closure devices and techniques. In approximately 45 percent of these cases, a closure device was used, and that number is steadily increasing. The worldwide market for femoral artery closure devices alone is estimated to be more than $750 million in 2008.
The potential advantages of the closure devices developed by Cardica and Cook include a simple user interface, the ability to place it through the same introducer sheath used for the interventional procedure for greater convenience and speed, scalability and lower cost of goods.
About Patent Foramen Ovale
A Patent Foramen Ovale (PFO) is a congenital heart defect. During fetal development, the heart's two upper chambers are connected by a hole that allows blood to be diverted away from the lungs because they are not yet developed. This hole, called the foramen ovale, is necessary for healthy fetal development and closes naturally in approximately 80 percent of the general population by the age of two. When it remains open after this period, it is said to be patent, or open. PFO is believed to be present in approximately 15 to 20 percent of the general population.
People with a PFO often are asymptomatic, but are at greater risk for stroke and systemic embolism because of the potential formation of blood clots. With larger PFOs, patients may experience labored breathing, recurrent respiratory infections and even heart failure or death. Today, PFOs are treated by the use of a blood thinning medication (aspirin or warfarin) to prevent blood clots, or the PFO is closed through open heart surgery or transcatheter closure procedure.
About Cook Medical
Cook Medical was the first company to introduce interventional devices in the United States. Today, the company integrates device design, biopharma, gene and cell therapy and biotech to enhance patient safety and improve clinical outcomes in the fields of aortic intervention; cardiology; critical care medicine; gastroenterology; radiology, peripheral vascular, bone access and oncology; surgery and soft tissue repair; urology; and assisted reproductive technology, gynecology and high-risk obstetrics. Cook won the prestigious Medical Device Manufacturer of the Year Award for 2006 from Medical Device & Diagnostic Industry magazine. For more information, visit http://www.cookmedical.com.
Cardica is a leading provider of automated anastomosis systems for coronary artery bypass graft (CABG) surgery. By replacing hand-sewn sutures with easy-to-use automated systems, Cardica provides cardiovascular surgeons with rapid, reliable and consistently reproducible anastomoses, or connections of blood vessels, often considered the most critical aspect of the CABG procedure. Cardica's C-PortŪ Distal Anastomosis Systems are marketed in Europe and the United States. The PAS-PortŪ Proximal Anastomosis System is marketed in Europe and Japan and is being evaluated in a pivotal trial in the United States and Europe. Cardica also is developing additional devices with Cook Medical to facilitate vascular closure and other surgical procedures.
Forward Looking Statements
This press release contains "forward-looking" statements, including statements relating to the potential efficacy of the Cook Vascular Closure Device and the PFO device, Cardica's potential receipt of payments from Cook and the future market for vascular closure devices. Any statements contained in this press release that are not historical facts, may be deemed to be forward-looking statements. The words "believe," "expect," "estimate," and "may" or similar expressions are intended to identify forward-looking statements. There are a number of important factors that could cause Cardica's results to differ materially from those indicated by these forward- looking statements, including risks associated with the timing and success of pre-clinical studies and clinical trials and market acceptance of the closure devices and Cardica's dependence upon Cook for continued development of the devices, as well as other risks detailed from time to time in Cardica's SEC reports, including its Quarterly Report on Form 10-Q for the quarter ended September 30, 2007. Cardica does not undertake any obligation to update forward-looking statements. You are encouraged to read Cardica's reports filed with the U.S. Securities and Exchange Commission, available at http://www.sec.gov.
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