Surmodics has completed enrollment in a pivotal trial of its drug-coated balloon, triggering a milestone payment from Abbott.
The news, disclosed Wednesday, comes ahead of schedule, reflecting Surmodics' success in accelerating enrollment after worries about the safety of paclitaxel-coated devices forced it to suspend recruitment earlier this year.
- Abbott licensed the global rights to Surmodics’ SurVeil drug-coated balloon in early 2018, setting it up to potentially compete with devices including Medtronic’s IN.PACT Admiral.
Growing concerns about the safety of paclitaxel-coated devices led Surmodics to halt enrollment in its SurVeil clinical trial March. When the trial resumed the next month with updated informed consent forms and processes for long-term patient follow up, the company said it was approximately three-quarters of the way to its 446-participant enrollment goal. Surmodics warned in the update it would take time to recruit the remaining subjects.
"This comes earlier than we had expected given the paclitaxel-related delays in the early summer and prior management comments that August is a seasonally slower enrollment month," analysts at Needham wrote in a note to investors.
Surmodics primed investors to expect it to complete enrollment after the end of its fiscal year when it shared its third quarter results late last month. At that time, Surmodics opted against including a milestone tied to the completion of enrollment in its full-year revenue guidance.
The deal with Abbott features a $10 million milestone tied to the completion of patient enrollment. Having recruited all 446 patients before the end of its fiscal year, Surmodics expects to recognize $5 million related to the milestone in the fourth quarter, leading it to increase the upper end of its full-year revenue forecast to $99 million. The company may earn an additional $57 million for other various product development milestones, it said.
That split reflects Surmodics’ belief that its spending on the trial will be fairly evenly divided between the periods before and after the completion of enrollment. The trial’s co-primary endpoints require Surmodics to track patients for 12 months after they are treated.
Those endpoints will compare the 12-month primary lesion patency and rate of safety events such as death and amputation among patients treated with SurVeil and Medtronic’s IN.PACT Admiral. Going head to head with Medtronic’s device gives Surmodics and Abbott the chance to show SurVeil beats or matches one of the lead incumbent products in the drug-coated balloon market.
Surmodics’ belief that SurView can win market share rests on an approach to coating that resulted in more drug getting to the target tissue in preclinical tests, according to the company. Surmodics hopes to obtain a CE mark for the device by the end of the year.