Kensey Nash Corporation F2Q09 (Qtr End 12/31/08) - Edited

..........Our Angio-Seal royalties were $5.4 million. These royalties were adversely impacted by approximately $200,000 in the quarter due to the unfavorable foreign exchange impact. If we were to exclude the negative impact of the foreign exchange, our total royalties would have been in line or at the high range of our guidance and our total revenue would have exceeded the high end of our guidance. Our total revenue of $20.8 million came in at $200,000 below the high end of our guidance of $20.9 million with the $200,000 impact we would have actually have exceeded total revenue guidance.
Biomaterial sales of $13.1 million increased 14% year-over-year and 3% sequentially. Cardiology products, which primarily are Angio-Seal components that we sell to St. Jude, increased 48% year-over-year. This was anticipated in our quarterly results based on the ordering patterns that we have received or appeals that we have received from St. Jude. Now, it also reflects two things; one, the ordering pattern, but also again the good unit growth that we are seeing in the Angio-Seal product line...........
Sean Bevick – SIG
Good morning, guys. I got a couple questions about St. Jude. Can you describe a little bit your relationship with them? And I believe they are locked up through 2010 with you guys. Is there any way that they can get out of that contract for the Angio-Seal component?
Joe Kaufmann
No, there is a – we do have a contract for a supply contract with St. Jude that expires in December 2010, and that’s for an exclusive arrangement for 100% of the collagen and for a smaller portion of the anchors. And no, we are not aware of any reason or certainly there aren’t any provisions that allow for that contract to be terminated other than non-performance by Kensey Nash. But we have been a great vendor, a great partner. We have supplied – the only person – only company that supplied collagen for this particular device since its existence. So we’re feeling pretty good about the contract and we certainly are aware of the fact that St. Jude made an acquisition this past summer. But again, with our technology and our position in the collagen world, we feel pretty good about our capabilities and hopefully that contract will continue beyond 2010.......
James Sidoti – Sidoti and Company
Could you remind me when you (inaudible) got the approval for the Angio-Seal collagen, what was the product that fills, your PMA or 510(k)?
Joe Kaufmann
That’s PMA product.
James Sidoti – Sidoti and Company
And how long was the follow-up on that? Would you do the initial studies?
Joe Kaufmann
On the follow-up on the patients for the PMA, I am looking at Doug right now. It’s a long time ago, but not quite sure, Jim, how long the follow-up was on those patients.
James Sidoti – Sidoti and Company
But you would think for St. Jude that if they were to find a replacement source, it would require a similar type of group of process and a considerable amount of time to get to their process.
Joe Kaufmann
Well, I don’t know what their expectations are or how they – how if they plan to, what they plan to do on that aspect of the business at this time. So I really can’t comment on what their thought process is or the amount of time they think it would take in order to, number one, develop a collagen that would work with an Angio-Seal type product and also the regulatory path and deal any potential performance issues. So, again, we are very well known I think in the biomaterials world as one of the leading experts in collagen, and I feel that we’re very confident that we state that obviously with our history, with the Angio-Seal and with collagen and developing that collagen specifically for that project – or that product that I don’t think anybody knows more about that type of collage and the collagen that’s in that product and the people here at Kensey Nash.
James Sidoti – Sidoti and Company
And I just want to clarify. You said unit growth for Angio-Seal in the quarter was around 5%, is that right?
Joe Kaufmann
I said that our royalty dollars would have been up 5% if we added back the impact of the foreign exchange, which was $200,000. I would comment and say that if you look at the unit growth, which we typically don’t disclose, but I would say it’s in the mid-single digit, that sort of thing, which I think is very good in terms of the overall market and actually has been doing very well in the marketplace overall. So we don’t actually disclose the unit numbers because St. Jude doesn’t disclose those.......

Source: Seekingalpha

St. Jude Medical Inc. Q4 2008 - Edited Highlights

Total sales of cardiovascular products for the fourth quarter of 2008 were $219 million, up 7% over the fourth quarter of 2007 including $3 million of unfavorable foreign currency translations. Total cardiovascular product sales for the full year 2008 were $862 million, up 9% over 2007, including $34 million of an increase due to favorable foreign currency translation.
Within this category of products, sales of vascular closure products in the fourth quarter of 2008 were $92 million, a 1% increase over the fourth quarter of 2007. Total vascular closure product sales for 2008 were $368 million, up 4% over 2007.
Sales of heart valve products in the fourth quarter of 2008 were $79 million, a 7% increase over the fourth quarter of 2007. Total sales of heart valve products for 2008 were $322 million, up 11% over 2007. For the first quarter of 2009, we expect cardiovascular product sales to be in the range of $230 million to $245 million.
We expect full year 2009 cardiovascular product sales to be in the range of $970 million to $1 billion. As a reminder, this guidance includes sales of Radi Medical Systems AB, which is being integrated into our Cardiovascular division........
The geographic breakdown of St. Jude Medical sales in the fourth quarter of 2008 was 54% US versus 46% outside the United States or OUS. This compares to 53% US and 47% OUS in the fourth quarter of 2007. A detailed geographic breakdown of this quarter's sales by product shows high-voltage at $249 million US; $138 million OUS; low-voltage at $133 million US; $160 million OUS, atrial fibrillation products at $73 million US and $83 million OUS; and cardiovascular products at $88 million US and $131 million OUS; and finally neuromodulation products at $67 million US and $11 million OUS..........
With respect to our cardiovascular business, we expect that St. Jude Medical's cardiovascular program will return to sustainable double digit sales growth in 2009 and beyond. We look forward to presenting you with more on this topic next week. This presentation will include a review of the four new product lines we acquired with Radi Medical Systems, a new indication in our vascular closure program, the impact of our new Angio-Seal Evolution product line, details on the progress we are making with the Trifecta Stented tissue valve program together with the timing of our anticipated entry into the pericardial segment of the tissue valve market, and a discussion of other new initiatives........
Source: Seekingalpha

Baxter Q4 edited highlights re. Hemostasis

...........Also in the area of hemophilia, we’ve made progress in the development of a recombinant form of von Willebrand Factor, another protein critical to clotting for people with von Willebrand disease. Von Willebrand disease is the most common hereditary bleeding disorder involving men and women. And recently, we announced the initiation of a phase one clinical program.......
In regenerative medicine, we continue to augment our biosurgery portfolio with the launch of ARTISS, the first and only slow setting fibrin sealant indicated for use in adhering skin grafts in burn patients, and with the launch of the GELFOAM Plus, a hemostatic device for use in surgical procedures. We also advanced several programs with our partner, Kuros Biosurgery AG, focused on the development and commercialization of a portfolio of hard and soft tissue repair products, which if successful, will allow us to enter the fast growing Orthobiologics market.......
Recombinant sales in the quarter of $506 million increased 9% on a reported basis, and are up 14%, excluding the impact of foreign currency...........
Turning to the plasma business, in the quarter, plasma protein sales of $330 million increased 10%. Excluding the impact of foreign currency, plasma protein sales increased 12%. Performance continues to be driven by strong demand for plasma derived factor VIII, albumin, and ARALAST as well as improved pricing. US plasma protein sales increased 18%, while international sales increased 5% on a reported basis, or 9% on a constant currency basis.......

And from the Q&A

Bruce Nudell – UBS
Thank you. Lots of clients have expressed concerns to us regarding the fact that the economy is bringing more people into the plasma collection centers. Clearly, your ability to take price in plasma products, and whereas some any – almost 10% this year suggest to us that the supply-demand balances is just fine for IVIG in particular. Could you comment on that phenomena with regards to drawing people in the collection centers, and what the kind of relative rates of intrinsic demand versus supply might be for IVIG globally. Thank you.
Bob Parkinson
Bruce, this is Bob. Let me start, and then maybe Rob or Mary Kay could support my comments. First of all, I don’t believe that the number of people coming forward willing to donate plasma necessarily has any impact relative to the overall supply. I think the supply is a function of installed capacity which is, you pointed out, and we continue to believe this is well-balance with demand. And anything, I suppose, it might imply over time, cost of collecting plasma may go down, although we haven’t experienced that to date. But I don’t see that phenomenal which more people, presenting at the plasma centers to donate plasma and get paid for doing that as a really relevant variable in terms of the supply equation. Rob or Mary Kay?
Rob Davis
I would just add that it’s important that – we got this question a lot – it is important to understand that the bottle neck today in the supply side of the equation is the collection capacity in the industry. So you’re running your center at capacity, which we largely are, we’ve been able over 2008 to do a great job. Frankly, our bioscience seems to have done a great job squeezing additional yields from our existing footprints. But once you reach capacity in the center, the number of people presenting doesn’t change the capacity of the people you can live through. So that’s why we continue to believe this has not had any meaningful impact on total collections. I think to Bob’s point, it continues to cause you to rethink how you price the collections, how you market for collections. The other thing I would know to where you have seen some is there are at least anecdotally, report that there is a reduction and people donating plasma, free plasma, if you will full blood to the American Red Cross and some other organizations in hopes of trying to do it to a free base center. But then, if the capacity is limited, that won’t change the total numbers.
On the second part of your question, we continue long term to believe we’re going to see or promote total market perspective, growth, and volume of the highest single digits and growth in price of low to mid-single digits longer term. We did better than that in both categories in 2008. And we will see how it turns out in 2009. I think the important thing here, and we’ve talked a lot about this externally, is really to understand the demand side of this picture. We are increasingly confident in the robustness and sustainability of the demand. As you heard, we’re driving new indications; we’re seeing clear for demographics.
So all the factors are really driving the demand stronger. And to us, that’s the real key that gives us the confidence of sustainability. Now all we have to do as an industry is to make sure we keep supply up with demand, keep it in balance, and we’re confident we can do that. So no change in our view of stability, no change in what we see as collection growth. It’s (inaudible) gross.

Source: Seeking Alpha

Haemacure more than doubles full-year loss to $8.8 million as revenue falls

Biotechnology developer Haemacure Corp. (TSX:HAE) said Wednesday it would need to seek additional financing after reporting a drop in revenue and a fiscal 2008 loss that doubled from year-earlier levels.
The Montreal-based company said its 2008 loss grew to $8.8 billion or five cents a share, up from $4 million or three cents a share recorded in 2007.
Haemacure said revenue slipped to $96,571 for the fiscal year ended Oct. 31, 2008. Revenue was down from the $119,704 reported the previous year.
"Haemacure is financing its current activities with the proceeds of the $7.8 million generated through the exercise in June 2008 of warrants issued as part of the private placement it completed in January 2007, and will require additional financing in the near term to support its operations," the company said in a statement.
The private placement was expected to allow Haemacure to get its fibrin sealant into clinical trials in the first quarter of 2009.

CryoLife, Inc. Receives Tissue From 100,000th Donor, Marking Industry Milestone

CryoLife, Inc. (NYSE: CRY), announced today that it achieved an industry milestone when it received tissue from its 100,000th individual donor. The tissue, received January 14, 2009 came from a Kansas-based organ and tissue procurement organization.
Since 1984, through the generosity of donor families and with the support of the organ and tissue procurement organizations, CryoLife has been able to provide more than 160,000 cryopreserved tissues for transplant.
More than 40 percent of the cardiac tissue preserved by CryoLife is implanted into children for whom the availability of cryopreserved allograft tissue can provide the best chance for a normal, active lifestyle. In addition, cryopreserved allograft vascular tissues have enabled patients with impaired circulatory systems to avoid lower limb amputations.
"It has been very gratifying to be able to provide life-saving and life-enhancing tissues to so many patients over the years," said Steven G. Anderson, president and CEO of CryoLife, "However, none of our work would be possible without the generosity of donors and their families who give so selflessly at a time of personal tragedy. We are grateful to the many people who register as organ and tissue donors. Their kindness is awe-inspiring."
CryoLife encourages everyone to support their local organ or tissue procurement organizations and health care professionals in their efforts to provide increased awareness of organ and tissue donation options. For additional information about organ donation, contact your local organ or tissue procurement organization or the American Association of Tissue Banks at www.aatb.org.

Biotech sector ponders potential 'bloodbath'

A large proportion of small public biotech companies now find themselves at serious risk of going out of business, with not enough cash to see them through the next 12 months and negligible prospects of refinancing. As banks have run out of lending money, as hedge funds and private equity investors have shut up shop and the public equity markets spiraled into a free fall, financing options for cash-hungry biotech companies have dwindled. By the end of November, total capital raised by the industry had fallen by 56% from the previous year, according to data from BioCentury. By the end of this year, the global biotech landscape could look vastly different from the past.
"The current crisis is unparalleled in its scope and severity," says Gautam Jaggi, senior manager at Ernst & Young Global Biotechnology, in New York, and it will lead to substantial consolidation, restructuring, layoffs and delistings (Box 1). According to the Biotechnology Industry Organization (BIO; Washington, DC), 180 quoted US biotech companies have less than a year's cash in hand—the level at which most CEOs, employees and investors find themselves swallowing hard and considering less palatable options for fueling a company. Of these, 120 have less than six months' breathing space.

Figure 1: Percentage of biotech firms operating with less than one year's cash.


Figure 2: Percentage of cash-poor microcaps in various regions.


"Some companies have already gone under as a result of the credit crunch, while others have had to scale back their research," says BIO president and CEO Jim Greenwood. Five US biotech companies sought bankruptcy protection during November alone, after October's high-profile default and bankruptcy of inflammatory disease research firm Atherogenics, located in Atlanta. Twenty-four small public biotech firms laid off workers in the eight weeks between November 1 and December 5, Greenwood adds.
What's more, average market valuations have collapsed. BIO reports that, as of November 24, valuations of small caps (it defines small cap as a market capitalization of less than $1 billion) were down 53% from their January 1, 2008, values. In fact, BIO says about 35% of the 270 US small-caps were trading at below cash in early December, meaning stock markets valued the firm at less than their cash on hand.
These depressed valuations mean acquisition opportunities for the larger pharma firms, which are looking for products and companies to plump up pipelines at bargain prices. Johnson & Johnson's purchase of New York–based Omrix, which makes human plasma-derived surgical products such as fibrin sealants, and thrombin, as well as immunoglobulins to treat immune deficiencies and infections is a case in point. The $438 million paid in November by the New Brunswick, New Jersey–based pharma occurred after Omrix's shares had fallen about 40% over the course of 2008.
But sitting on their slush funds, pharma is likely to wait some time longer before it pounces. Dennis Purcell, senior partner of venture capital (VC) firm Aisling Capital of New York, agrees big pharma is circling, but he doesn't expect the mass consolidation that some are predicting. Pharma companies typically do one deal at a time, he says, and "they are all going through strategic reviews of their own, aimed at narrowing down their therapeutic areas." Purcell expects investors in many cash-starved biotech firms to insist on survival at all costs, by trimming activities to match cash reserves and thereby living to fight another day. "Companies are taking pretty drastic measures: delaying projects, cancelling early-stage projects, putting capital where they get most bang for the buck," says Purcell.
The European scene, with its historically weaker financing infrastructure, is suffering even more than the US. Willy de Greef, head of the trade organization EuropaBio in Brussels, says next year could be a "bloodbath."
"[2008] was already not the best of years for new financing rounds, with fewer deals being done," says de Greef. "As for 2009, some of these companies are now in deep trouble. If the banks are beginning to put down the phone on the General Electrics and General Motors of this world, with their huge cash flows, what chance do we have in the biotech industry?" He adds that biotech is "going to be punished with oblivion for reasons over which they have exactly zero control."
The British government has already announced fiscal measures to boost innovative industries, whereas countries like Germany are hesitating but at least making encouraging noises. Meanwhile, UK biotech firms are taking matters into their own hands. Twenty-two leaders from its biotech sector signed a dossier sent to the UK Prime Minister and the Business Secretary. Entitled The UK Biotechnology Sector—Recommendations To Transform the Industry, the dossier calls for the creation of a national biomedical public-private partnership, including a National BioMedical Consolidation Fund and a National Super Growth Biomedical Fund—each worth at least £500 ($742.7) million.
In the US, BIO is lobbying Congress for emergency measures to stimulate biotech investment. It wants capital gains tax on invested funds to be temporarily cut or suspended and emerging companies to be allowed to receive a refund of their net operating losses to set them against research expenses. It also wants more flexibility on the use of R&D tax credits. But Greenwood insists BIO is not asking for a capital infusion.
"Entrepreneurs who go into biotech are survivors, they knew going in it was a highly risky enterprise," he says. "For the most part companies will survive, they will skinny down through the lean times and wait for the recovery."

Even if most of the industry weathers the storm, the effects could ripple out for years. If investors aren't funding today's startups, it could mean a lack of innovation and a dearth of early-stage products five years down the line. Aisling Capital's Purcell notes that venture capitalists' main priority now is to keep their existing portfolios healthy. "There is not enough capital for everybody in the portfolio, so VC companies are triaging to decide where to spend it where it makes most difference," he says. And that doesn't mean startups.
If every downturn has a recovery, then the biotech sector must simply hold on. But it will not come tomorrow, as most estimates put any reversal at least six months if not more than a full year away. Those companies not already affected are anticipating the blade (Box 3 and Figs. 3 and 4). However, E&Y's Gautam Jaggi believes that when the turn does come, it will be big: "There will be a lot of pent-up demand and investors will ultimately return to the IPO [initial public offering] market in a big way," he says. "There will be fewer biotech companies, but the survivors will be the stronger for it."

FDA Panel Backs CSL Ltd Anti-Bleeding Drug Riastap

A Food and Drug Administration panel of outside medical experts Friday backed an anti-bleeding product from a subsidiary of Australia's CSL Ltd. (CSL.AU) to treat a rare blood disorder. The product, which would be sold in the U.S. under the brand name Riastap by CSL Behring, is designed to treat congenital fibrinogen deficiency, a rare bleeding disorder resulting from deficiency of fibrinogen. It's made from human plasma and would boost levels of fibrinogen. The panel unanimously said the product was safe and that it appeared to be effective at treating the blood condition. The panel's decision amounts to a recommendation that the FDA approve the product. The FDA usually follows its panels' advice but isn't required to. The agency has set a Jan. 16 deadline to act on Riastap, although it isn't clear if that deadline will be met given the proximity of the panel meeting. The company estimates only about 300 people in the U.S. have congenital fibrinogen deficiency. Fibrinogen, also known as Factor I, is a protein needed to form a blood clot. Earlier this week, the FDA released a review of Riastap, which said the product appeared to be safe and effective. The agency said clinical studies showed Riastap was effective at increasing clot firmness, but said it will require CSL to continue studying patients to see if it results in a reduction of actual bleeding events. Riastap is being considered under the FDA's accelerated review mechanism, which allows products to be approved on less data than typically required. Companies with products granted accelerated approval are required to continue studying the products and eventually submit the data to gain full or regular approval. Riastap is currently sold in 12 countries under the name Haemocomplettan P, according to the FDA.

ProFibrix Steps up Recombinant Fibrinogen Program With PER.C6(R) License From Crucell

ProFibrix B.V., today announced that it has concluded a commercial license agreement with Crucell N.V. (Euronext, NASDAQ: CRXL; Swiss Exchange: CRX) for PER.C6(R), a unique human protein production platform. The PER.C6(R) platform allows ProFibrix to manufacture recombinant human fibrinogen at levels that support the development and commercial roll-out of new products. Fibrinogen is at the heart of all ProFibrix products and is an essential part of nature's own injury-repair mechanism. The company's lead product Fibrocaps(TM) is based on fibrinogen derived from human blood plasma and is a unique dry powder topical hemostat that stops acute and severe bleeding during surgery or after trauma injury. Initially recombinant fibrinogen will be developed for systemic applications in hemostasis and later on for the development of tissue repair products.
Jaap Koopman, Ph.D., Chief Executive Officer, said: "The PER.C6(R) license gives us access to a manufacturing platform that has already been successfully tested by ProFibrix for high expression of biologically active recombinant fibrinogen. Our Chief Technology Officer Dr. Bram Bout was one of the inventors of PER.C6(R) while at Crucell. His intimate knowledge of the platform in combination with our substantial in-house expertise on the biology of fibrinogen provides us with a strong competitive position in the hemostasis market."
Jan Ohrstrom, MD, Chief Operational Officer, said: "We believe recombinant fibrinogen has the potential to become a breakthrough product in hemostasis and tissue repair. We intend to develop a systemic hemostat product based on recombinant fibrinogen to treat or prevent bleeding in patients with low fibrinogen levels."

Vivostat

The Danish medical device company Vivostat A/S (formerly known as Vivolution) announced the formation of a new management team to support the aggresive growth plans for the company’s Vivostat product lines.
During the last year the Alleroed-based company has completed a range of cross-organisational projects in order to prepare the company for the future. The outsourcing of the disposable production to a low-cost country, the re-branding of the Vivostat product lines and the establishment of direct sales organisations in major European markets, just to mention a few of the projects.
“The formation of the new management team is an important step in the process of preparing our company for the exciting challenges that lie ahead”, explains Tom Bjerg Laurizen, CEO at Vivostat.
Tom Bjerg Lauritzen continues: “During the last five years Vivostat has expanded from being a R&D focussed company into a significant commercial player in the surgical sealant and wound care markets. The establishment of the new management team reflects this change and lays a strong foundation for the company’s aggressive growth plans in the future”.
Together the new management team represents many years of medical device experience within sales, marketing and regulatory/medical affairs. Besides Tom Bjerg Lauritzen, the group consists of Anne Klitgård, VP of Regulatory and Medical Affairs, Henrik Vester-Andersen, VP of Sales, and Martin Poulsen, VP of Marketing.
Vivostat is already a well-established player in the European surgical sealant and wound care markets with sales of its products in 19 countries. To continue the expansion the company recently initiated the US approval process for the newest member of the Vivostat product family, Vivostat PRF - a second generation growth factor product used for the treatment of chronic wounds.
Chronic wounds are a serious problem for many diabetic patients and there is currently very little success with conventional treatment methods.

The Vivostat® System is an automated system for the on-site preparation and application of patient-derived fibrin sealant or platelet rich fibrin (PRF®). It incorporates a unique and patented biochemical process that produces an autologous sealant from 120 ml of the patient’s own blood in only 23 minutes. The sealant has biophysical properties that outperform most sealants on the market today and a delivery system that enables unparalleled control in the application during surgery.The system comprises three components: A Processor Unit for the preparation of fibrin sealant or PRF®, an Applicator Unit to control the delivery of fibrin sealant/PRF® and a disposable kit comprising all components required to collect blood and apply the sealant to the surgical site.