Edwards Lifesciences reports first quarter results

Edwards Lifesciences reported financial results for the quarter ended March 31, 2024.

“Edwards is positioned to extend our leadership and deliver sustainable growth as a result of the strategic investments we have made across our transcatheter platforms to address the large and growing needs of patients impacted by aortic, mitral and tricuspid disease. We are pleased with our total company performance with first quarter sales growth of 10% as more patients were treated with our innovative therapies,” said Bernard Zovighian, CEO. “This encouraging start to the year supports our increased 2024 sales guidance. Looking beyond 2024, we remain confident in Edwards’ innovation-driven strategy, led by new indications, differentiated technologies and strategic adjacencies for addressing the significant unmet needs of structural heart disease patients.”

Transcatheter Aortic Valve Replacement (TAVR)
For the quarter, the company reported TAVR sales of $1.0 billion, which grew 6%, or 8% on a constant currency basis adjusted for billing days. Performance was driven by growth in the U.S. and Japan. Edwards’ global competitive position and selling prices were both stable. Procedure trends increased as the quarter progressed. The company expects higher year-over-year second-half growth rates than in the first and second quarters.

Edwards remains pleased with the performance of its SAPIEN 3 Ultra RESILIA platform, which is the leading platform in the U.S. and Japan, and the company looks forward to its launch in the second quarter in Europe.

Edwards is positioned for healthy and sustainable TAVR growth well into the future driven by the company’s development of differentiated TAVR technologies, a deep commitment to advancing patient care through high-quality clinical evidence, and its investment in patient activation initiatives. Importantly, Edwards’ groundbreaking research into the treatment of aortic stenosis through its EARLY TAVR and PROGRESS trials could fundamentally change how AS patients are treated.

Transcatheter Mitral and Tricuspid Therapies (TMTT)
In the first quarter, the company drove positive momentum around its unique and broad portfolio strategy of both repair and replacement technologies for mitral and tricuspid patients. The company made significant progress advancing important therapies, including the PASCAL repair system, EVOQUE tricuspid replacement system, and SAPIEN M3 mitral replacement system.

First quarter sales were $73 million, driven by expanded adoption and new site activation of PASCAL, supported by continued double digit TEER market growth in the U.S. and Europe.

In February, EVOQUE became the first transcatheter therapy to receive U.S. FDA approval for the treatment of patients with tricuspid regurgitation. With this replacement technology, the company sees the unique elimination of tricuspid regurgitation, significant quality of life improvements for patients, and favorable trends in all-cause mortality and heart failure hospitalization.

Surgical structural heart and critical care
Surgical structural heart sales for the quarter were $266 million, which grew 7%, or 8% on a constant currency basis. Growth was driven by strong global adoption of Edwards’ premium surgical technologies, INSPIRIS, MITRIS and KONECT. The company continues to see positive procedure growth globally for the many patients best treated surgically, including those undergoing complex procedures. The company continues to expand the overall body of RESILIA technology evidence, and now expects U.S. and Canada enrollment of its MOMENTIS clinical study to be completed in the second quarter of 2024, one year ahead of previous expectations. The study will continue to open new sites in Europe and Latin America, with global enrollment continuing into 2025.

Critical care sales were $251 million for the quarter, which grew 13%, or 14% on a constant currency basis, driven by contributions from all product lines. Growth was led by Edwards’ Smart Recovery technologies, including the Acumen IQ sensor. Demand was also strong for the company’s Swan-Ganz catheters and pressure monitoring devices used in the ICU. Preparations for the spin-off of Critical Care by year end are ongoing.

Additional financial results
For the quarter, the adjusted gross profit margin was 76.0%, compared to 77.5% in the same period last year. This year-over-year reduction was driven by a more favorable impact from foreign exchange in the prior year.

Selling, general and administrative expenses in the first quarter were $490 million, or 30.6% of sales, compared to $436 million in the prior year. This increase was driven by investments in transcatheter field-based personnel in support of the company’s growth strategy.

Research and development expenses in the first quarter were $285 million, or 17.8% of sales, compared to $261 million in the prior year. The increase was driven by continued investments in transcatheter valve innovations, including clinical trial activity.

Cash, cash equivalents and short-term investments totaled $1.7 billion as of March 31, 2024. Total debt was approximately $600 million. Adjusted free cash flow was $206 million.

Outlook
Overall, given the strong first quarter performance, the company now expects full-year 2024 sales growth to be at the high end of the prior guidance of 8 to 10% and $6.3 to $6.6 billion. The company remains confident in TAVR sales growth of 8 to 10% on a constant currency basis. The company now expects full-year Surgical Structural Heart sales growth of 6 to 8% and Critical Care sales growth of 8 to 10%, versus previous expectations of mid-single digit growth. Full-year TMTT sales are now expected to be in a range of $320 to $340 million, versus previous guidance which was the higher end of a $280 to $320 million range.

The company is maintaining its full-year 2024 adjusted earnings per share guidance of $2.70 to $2.80.

For the second quarter of 2024, the company projects total sales to be between $1.62 and $1.70 billion, and adjusted EPS of $0.67 to $0.71.
MB Bureau