Johnson & Johnson stock skidded Wednesday after the company temporarily paused sales of its pulsed field ablation system. The news is a boon for rivals Boston Scientific and Medtronic.
Pulsed field ablation, or PFA, uses high-energy electrical pulses to treat abnormal heart rhythm. But the company says four patients experienced neurovascular events after receiving treatment with Varipulse, J&J's PFA system. Needham analyst Mike Matson says those incidents were strokes.
The news could help Boston Scientific and Medtronic, which sell rival PFA systems called Farapulse and PulseSelect.
"It is unclear how long the Varipulse sales will remain paused, but even if JNJ allows sales to be resumed, we believe that the product is now likely to be tainted and that electrophysiologists are likely to be wary of using it," Matson said in a client note.
J&J shares slipped 2.7%, closing at 142.27. Johnson & Johnson stock has mostly fallen since early September. Boston Scientific stock jumped 4.3% to close at 95.94, though that could be related to its acquisition of Bolt Medical, also announced Wednesday. Medtronic shares popped 3.5% to 82.68.
Johnson & Johnson Stock: Varipulse Under Pressure
The company's Varipulse news isn't surprising, Needham's Matson said.
In Johnson & Johnson's pivotal study — the one that helped clinch Food and Drug Administration approval — three patients out of 277 experienced cerebrovascular events. That included two strokes and one transient ischemic attack. The latter occurs when an artery in the brain is temporarily blocked.
Last September, a Mayo Clinic doctor said the issue could be related to Varipulse's waveform and/or its lasso-like design. These have "apparently exhibited high rates of silent cerebral embolic events with prior ablation modalities," Matson said.
He noted the products from Boston Scientific and Medtronic don't have similar issues.
"We believe that BSX's Farapulse is largely proven at this point given the large number of real-world procedures and no indications to date of elevated stroke rates," he said.
It's important to note, Boston Scientific paused enrollment in a study of its PFA system in October. The company was looking to test Farapulse in patients with persistent atrial fibrillation, a heart condition that causes the upper chambers to beat irregularly. Farapulse is already approved for patients with paroxysmal atrial fibrillation, which involves brief episodes of irregular heart rhythm.
Follow Allison Gatlin on X/Twitter at @IBD_AGatlin.
