Johnson & Johnson on Monday said it will meet a prior 2007 earnings forecast despite the failure of a highly-anticipated heart device in a key study.
Although the company said it expects the impact from the failure of the so-called CoStar stent to be between 2 and 3 cents per share for 2007, it still sees itself meeting a prior forecast range for 2007 operating earnings per share of $4.02 to $4.07, company officials said on a conference call.
Johnson & Johnson said earlier that the experimental drug-coated stent failed to meet its primary goal in the study. J&J unit Conor Medical Systems also said it will discontinue sales of the CoStar stent in certain countries in Europe, Asia and Latin America -- where it is already approved.
A pivotal study compared J&J's investigational device with one already sold by Boston Scientific . Drug-coated stents are tiny wire mesh tubes used to prop open recently unclogged heart arteries and have until recently been reliable cash cows for device makers.
J&J, which said it is stopping all ongoing trials of the device, said it saw no signs of safety troubles with the CoStar stent, but it failed to prove "non-inferiority" against Boston Scientific's Taxus stent.
The company blamed the study's failure to meet its clinical goal on a problem with the dosing of paclitaxel, the drug that coats the stent. It said it will try to develop a new version of the device with a different drug, sirolimus, which is used on J&J's already marketed drug-coated stent called Cypher.
Overall rates of death, heart attack and other serious heart events were consistent with other drug-coated stents, J&J said.
The CoStar stent is one of several in a next generation of the drug-coated devices that companies and analysts hope will restart growth, which has been slumping amid safety worries.
Doctors have been switching back to cheaper bare-metal stents amid concerns of a small but serious risk of blood clots linked to the drug-coated varieties, depressing profits for device makers.