Carmat shares slump after France halts firm’s heart implants

By Reed

By Matthias Blamont

PARIS, Dec 1 (Reuters) – Shares in artificial heart maker Carmat fell more than 13 percent on Thursday after France’s national drugs agency ordered it to suspend further implants in a second test phase following the death of a patient in October.

Carmat shares were down by 13.19 percent at 29.01 euros in end-session trading, wiping some 26 million euros ($28 million) off the company’s stock market value.

Carmat Chief Executive Stephane Piat said in a statement on Wednesday that the artificial heart was not involved in the patient’s death, and that the company’s last three implantations had functioned normally.

The French drugs agency has requested further information from Carmat following the patient’s death. A spokeswoman for the agency could not say when implants could restart.

The patient who died last month had Carmat’s artificial heart implanted at the end of August and was its fifth patient with an artificial heart to die.

He was the first of 20 patients in a second so-called ‘pivotal’ phase of tests, which is a prerequisite to market the product in the European Union.

The drugs agency suspended a first-phase testing process after a patient died in 2014, less than 80 days after his operation, the agency spokeswoman said on Thursday. That patient was aged 76.

The second, larger testing phase was to further assess the technology.

BREAKTHROUGH

Carmat shares are down by around 30 percent since the start of 2016, underperforming a 15 percent decline in the broader STOXX Europe 600 Healthcare index.

“As a reminder, it took two years to get the greenlight to start human implantation and two and a half more years to validate the feasibility study on only four patients,” Romain Zana, an analyst with Exane BNP Paribas, told clients in a note.

“The mid-2017 target set to finish the pivotal trial looks, accordingly, completely unrealistic and the likelihood of bringing the device on the market is further declining,” he added.

Carmat has yet to generate any significant revenue but its products could represent a major medical breakthrough if proven reliable as heart diseases are a leading cause of death worldwide.

In 2014, Carmat said around 100,000 patients in the United States and Europe could benefit from its artificial heart, a market worth more than 16 billion euros.

They are designed for people with end-stage heart failure, a deadly condition where the heart is unable to pump blood adequately around the body, and therefore are an alternative to heart transplants given the shortage of donor organs.

Among Carmat’s competitors are privately-held SynCardia Systems and Abiomed, both U.S. companies.

SynCardia’s artificial heart is the only one approved both in the United States, Canada and the European Union, and has been implanted in more than 1,625 patients as they wait for hearts from matching donors. The longest a patient has lived with the device is just under four years prior to a transplant.

Carmat’s heart is designed to serve not as a bridge to transplant but as a permanent implant, extending life for terminally ill patients who cannot hope for a real organ, generally because they are too old and donors too scarce.

($1 = 0.9414 euros) (Additional reporting by Sudip Kar-Gupta and Dominique Vidalon; Editing by Ingrid Melander and Susan Thomas)

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