Cardiac Pacemakers

This report contains a detailed description about cardiac pacemakers, its working, market potential, growth drivers and an in depth competitor analysis.Government policies and reimbursement have also been covered comprehensively.The report contains a detailed company profile of Cardiac Science Corporation and also throws light on the recent trends and developments related to cardiac pacemakers.


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Contents

Introduction

A pacemaker (or artificial pacemaker, so as not to be confused with the heart's natural pacemaker) is a medical device that uses electrical impulses, delivered by electrodes contacting the heart muscles, to regulate the beating of the heart. The primary purpose of a pacemaker is to maintain an adequate heart rate, either because the heart's native pacemaker is not fast enough, or there is a block in the heart's electrical conduction system. Modern pacemakers are externally programmable and allow the cardiologist to select the optimum pacing modes for individual patients. Some combine a pacemaker and defibrillator in a single implantable device. Others have multiple electrodes stimulating differing positions within the heart to improve synchronisation of the lower chambers of the heart.

Functioning

Process

A pacemaker system consists of a battery, a computerized generator, and wires with sensors called electrodes on one end. The battery powers the generator, and both are surrounded by a thin metal box. The wires connect the generator to the heart.


Working.JPG

Market Research

Global Market Estimate and Forecast

The evolution of cardiac devices has opened new vistas in the health care industry. Growth rate exhibited by the cardiac devices industry, even during the recession years, confirms the positive growth prospects going ahead.The cardiovascular (CV) device industry is highly competitive and has reached maturity resulting in single digit growth rates of prominent devices such as pacemakers, defibrillators, and drug eluting stents (DES).


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Source

Growth Drivers

Challenges

The cost for Pace Maker treatment in US is around $100,00 whereas its around $10,000 in India.The CV device industry is highly regulated around the world with stringent guidelines defined by regulatory bodies. The medical device approvals by governing bodies such as the FDA in the US have become very meticulous and CV device manufacturers are launching products outside the US such as Europe and Canada. Since the prices are strictly regulated outside the US, manufacturers will be forced to launch their roducts in the US for a similar price. In the long run, the pricing pressures would continue to prevail and limit the profitability margins for CV device manufacturers.


The impact of economic recession since 2008 had forced hospitals to decrease their capital expenditure by almost 6%. This decline has impacted the medical devices industry across all sectors in the CV device division. Some segments of the CV device industry such as ICD, pacemakers, heart valves and stents will remain insulated from the economic impact given their non-elective nature of associated procedures. other low budget, high-frequency CV accessories that hospitals purchases on a regular basis will be affected due to decline of capital expenditures.

Key Statistics

Though the death rates from CVD have declined, yet the burden of the disease remains high.

Prevalence and Incidence

Prevalence


Prevalence rates according to age and gender Prev11.jpg

Source AHA-journal-report


Disease wise breakup of population

Disease Affected numbers (in millions)
High Blood Pressure 76.4
Coronary Heart Disease 16.3
Heart Fail 5.7
Stroke 7.0
Other problems 1.3

Source AHA-journal-report

Incidence


As per American Heart Association,the 7 metrics of cardiovascular diseases identified are:

Mortality rates

The graph below depicts the number of deaths(in thousands) due to cardiac problems.

Deaths.jpg

Source AHA-journal-report

The decline towards the end is due to advancement of medicine and science which has resulted in better healthcare facilities.

US Market Forecast

Us Estimate.Jpg

External Factors

Government Programs

Government programs directly cover 27.8% of the population (83 million), including the elderly, disabled, children, veterans, and some of the poor, and federal law mandates public access to emergency services regardless of ability to pay. Public spending accounts for between 45% and 56.1% of U.S. health care spending.As per Per-capita spending on health care by the U.S. government,it is among the top ten highest spenders among United Nations member countries in 2004.

Government funded programs include:

Reimbursement

Medicare covers cardiac pacemakers when provided by a hospital, skilled nursing facility, home health agency,comprehensive outpatient rehabilitation facility (CORP), or a rural health clinic.Most insurers provide coverage for device therapy, the insurance plan should be designed accordingly.It will, though, depend on age, medical condition or status, income or employer and where a person lives.

Type of Pacemaker Cost($) Reimbursement($)
Single Chamber 10,000 7748
Dual Chamber 11,000 8919
Rate Responsive 12,000 10,814(approx)


Medicare will not fund patients for a MRI scan in case of a MRI-safe pacemaker


Source:MD Buyline Paper

2.8 SWOT Analysis of Boston Scientific Corporation

Bostonswot.JPG

2.9 Competitors

2.9.1 Five major competitors


Company 2004 2007 2010
Medtronic 1823 1937 2115
St. Jude 898 1056 1356
Boston Scientific 720 578 635
Total 3441 3571 4106

Source Stjudereport

2004.Jpg

Source Stjudereport

2010.Jpg

This data tells that the market share of Boston Scientific has fallen in Pacemaker market from 2004 to 2010.

Source Stjudereport

Company wise products and brands

Manufacturers Products
BIOTRONIK Pacemaker Cylos DR-T
  CCC Pacemaker
Sorin Group Reply DR
  Symphony DR 2550
Boston Scientific(Guidant Medical) ALTURA pacemaker family
Medico Pacemakers EASY
  MILLENNIUM
Medtronic Pacemekers Adapta
  EnRhythm
St. Jude Medical Pacemakers Affinity
  Victory
Shree Pacetronix Pacemakers Ventralite
  Pinnacle
Vitatron Pacemakers Vitatron T-series
  Vitatron C-series

For exhaustive list visit: Healthbase

2.9.2 Two Main Competitive Strategies

Medtronic

Medtronic found that the doctors in Inda and China saw some of the current state of art features as unecessary and too expensive.Instead, they wanted an affordable pace maker which was cheap and easy to implant.This led medtronic to develop a new pace maker, Champion aimed towards asian market segment.

For the five-year marketing plan of Medtronic,marketing mix activities include the following:

Source:Medtronic's market segmentation strategy

St. Jude

In 2004, St. Jude invited companies to be a part of the Thanks and GivingŪ campaign, an unprecedented union of celebrities, media retail and corporate partners that asked consumers to ?Give thanks for the healthy kids in your life, and give to those who are not.

In 2008, St. Jude Children?s Research Hospital received the Cause Marketing Forum?s Golden Halo Award, the industry?s top award.

Source:St Jude Cause related marketing

2.10 Strategic Activities in Industry

Activity Objectives
OPTO circuits purchased 77% of Cardiac Science?s shares * This transaction is expected to open many new global markets for Cardiac Science?s products and will greatly enhance Opto Circuits? product offering and presence in the United States.

* Cardiac science business will benefit greatly from Opto Circuits? financial resources, operational capabilities and global scale.
St. Jude Medical Inc. (STJ) bought 19% of CardioMEMS through a $60 million equity investment last year and has an exclusive right to buy the rest for $375 million * The deal could allow St. Jude access to CardioMEMS? wireless sensing and communication technology, used to assess cardiac performance.

* CardioMEMS? monitoring system involves a sensor being placed in a patient?s pulmonary artery and transmitting real-time data for clinicians to analyze.

* It can transmit from the patient?s home, reducing the burden on hospitals.

* A trial presented earlier this year found the device reduced the rate of heart failure-related hospitalizations by 30% at six months and 38% after a year. St. Jude has benefited from selling mostly life-saving devices.
CEA-Leti and five partners( :Heart-Beat Scavenger (HBS) Consortium) are combining their expertise to develop a self-powered cardiac pacemaker eight times smaller than current models The HBS Consortium project goals include:
* Developing a self-powering pacemaker by harvesting the mechanical energy produced by the movements of the heart and eliminating the need for batteries that must be replaced every six to 10 years.

* Reducing the size of a cardiac pacemaker by a factor of eight, from 8 cm3 to 1 cm3. This reduction will make it possible to attach the pacemaker directly to the epicardium, eliminating the need for intravenous introduction of cardiac probes.


2.10.1. Product launches and development


2.11 Cardiac Science Corporation

2.11.1 Company Overview

Cardiac Science is a global medical device company and a subsidiary of Opto Circuits (India) Ltd. Company employ more than 550 people worldwide. Global capabilities include direct and indirect sales personnel and distribution in more than 100 countries and an extensive worldwide service network. Cardiac Science Corporation was formerly known as Quinton Cardiology Systems, Inc., and changed its name in September 2005. The company was founded in 1913 and has operations in California, Wisconsin, China, Central Europe, Denmark, France, and the United Kingdom.

source

2.11.2 Key Executives

Name Designation
David L. Marver Chief Executive Officer and President
Michael K. Matysik Chief Financial Officer
Robert W. Odell Senior Vice President of Strategy Design & Operations
Todd T. Alberstone Vice President and General Counsel
Barbara J. Thompson Vice President of Human Resources

source

2.11.3 Business Overview

Cardiac Science is a global leader in the development, manufacture, and marketing of diagnostic and therapeutic cardiology products and services. Company provides a full spectrum of cardiology products and services that help protect hearts and save lives, including:

? Devices designed to identify the early stages of heart disease ? such as electrocardiographs,cardiac stress testing systems,diagnostic workstations and Holter monitors.

? Sophisticated systems for cardiac rehabilitation and cardiology data management

? Innovative and patented automated external defibrillators(AEDs) that provide assistance to victims of sudden cardiac arrest for both medical and public markets.

2.11.4 Brands of Cardiac Science Corporation

Brand Name Product & Services
Burdick ECG Machines, Stress Testing, Holter System
HeartCentrix Data Management & Connectivity
Powerheart Defibrillators/AED Program
Quinton Cardiac Rehab, ECG Machines, Stress Testing


2.11.5 Products & Services

Product Services and Support
Defibrillator/AED (Automated External Defibrillator )Programs Professional Services
ECG Machines Technical Support
Stress Testing Education and training
Diagnostic Workstation Service Contracts
Holter Systems Announcement & Upgrades
Cardiac Rehab Product Registration
Data Management & Connectivity

2.11.6 Strategic Activity

The Company was very active in Corporate Development during 2009, forging a host of new partnerships and alliances that will contribute to future growth and profitability.

Patni specializes in the design and engineering of Class II and III medical devices and is a global leader in providing high-quality, reliable, and cost effective Product Engineering and IT Services. One of the company strategies is to increase the volume and frequency of new product introductions, particularly in Cardiac Monitoring. Company have great brands and distribution channels and want to better leverage. This agreement, dramatically increases companies engineering capacity and allows internal team members to focus on changing market dynamics, new customer solutions, and new revenue opportunities.

2.11.7 SWOT Analysis

SWOT CSCX.JPG

source

2.11.8 Market Overview

All figures in US$ (thousands)

CSCX1.jpg

2.12 Notes

This shows that other than USA, Japan is a big potential market for cardiac pace makers. Also it shows dependence of Cardiac science corporation on few markets like USA and Japan.

2.13 Recent Developments

2.13.1 Engineered Biological Pacemakers

The National Institute on Aging?s Cellular Biophysics Section is seeking statements of capability or interest from parties interested in collaborative research to further develop, evaluate, or commercialize biological pacemakers.
Technology:
A common symptom of many heart diseases is an abnormal heart rhythm or arrhythmia. While effectively improving the lives of many patients, implantable pacemakers have significant limitations such as limited power sources, risk of infections, potential for interference from other devices, and absence of autonomic rate modulation.
The technology consists of biological pacemakers engineered to generate normal heart rhythm. The biological pacemakers include cardiac cells or cardiac-like cells derived from embryonic stem cells or mesenchymal stem cells. The biological pacemakers naturally integrate into the heart. Their generation of rhythmic electric impulses involves coupling factors, such as cAMP-dependent PKA and Ca2+-dependent CaMK II, which are regulatory proteins capable of modulating/enhancing interactions (i.e. coupling) of the sarcoplasmic reticulum-based, intracellular Ca2+ clock and the surface membrane voltage clock, thereby converting irregularly or rarely spontaneously active cells into pacemakers generating rhythmic excitations.
Applications:
This technology can be utilized in heart disease characterized by arrhythmia or situations requiring an implantable cardiac pacemaker.
Advantages:
In contrast to current implantable cardiac pacemaker technology, this technology is not externally powered, has a lower risk of infection, has decreased potential for interference from other devices, and has full autonomic rate modulation.
Development Status:
Early stage.
Patent Status:
U.S. Provisional Application No. 61/180,491 filed 22 May 2009

3. Patient Experiences

Name of the Patient Experience Link
Patrick R. After the surgery, with his doctors approval Pat started playing tennis within weeks."I ended up playing competitive tennis." But, he struggled to walk up a hill?particularly a steep hill. It was also difficult to ride a bike,again especially uphill.He learned that his 1990s-era pacemaker did not yet have the technology to sense the subtle physical, muscular activity exerted when going up a hill. However, if he were to walk down a hill where his legs were pounding the pavement a little bit more, the pacemaker would be able to sense more measurable physical muscular activity. He went in for a new pace maker in 2002 with sensor technology.It would do a better job of adjusting his heart rate while going uphill or doing other activities by sensing the associated increase in his breathing. Two days after when patrick, tried climbing up the hill, he could do that without any difficulty. http://www.bostonscientific.com/lifebeat-online/assets/pdfs/resources/CRM9R-1080-0609_PacemakerBrochure.pdf
Sharon S. In fact, I was astonished at how much better I felt in the hospital. I really didnt know how sick I was until after getting the pacemaker, when I felt well again."For a while the pacemaker felt heavy, but that feeling went away in a matter of days http://www.bostonscientific.com/lifebeat-online/assets/pdfs/resources/CRM9R-1080-0609_PacemakerBrochure.pdf

4. References