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Cyberonics Posts Positive Epilepsy Device Data, Shares Up

Shares of TX-based medical device manufacturer Cyberonics Inc. (CYBX) rallied 2.5% to eventually close at $55.25 yesterday, following the company's recently reported positive results from two multi-site clinical trials on AspireSR generator – the new sixth generation VNS therapy generator.

Cyberonics presented data from studies – E-36 and E-37 – at the AES Annual Meeting held from Dec 5 to 9 in Seattle, Washington.

Both these clinical trials assessed the AspireSR generator's capabilities in reducing seizure duration or entirely terminating it, in drug-resistant epilepsy patients. These trials also evaluated the long-term safety and quality of life offered by the generator, while also accessing the clinical benefit of its automatic stimulation feature.

As per management, patients in both studies experienced termination of seizures as well as reduced seizure duration during automatic stimulation compared to historical control monotherapy design. Moreover, post follow-ups of three and six-months, patients under both trials experienced significant reduction in seizures, largely demonstrating the safety and efficacy of the Aspire VNS Therapy system.

Cyberonics' VNS Therapy system offers FDA-approved treatment to patients suffering from refractory epilepsy and treatment-resistant depression. The AspireSR generator delivers programmed VNS therapy, along with the benefits of a new feature – Automatic Stimulation – which identifies seizures.

In Feb 2014, Cyberonics received CE Mark approval for its AspireSR generator. Since then an accelerating adoption rate for this device has been observed in most European countries. However, in the U.S., the AspireSR generator is currently under investigational use, and is yet to receive commercial approval.

In the last reported second quarter of fiscal 2015, AspireSR accounted for more than 30% of unit sales in countries where this device has a limited commercial release. In the quarter, Cyberonics experienced accelerating adoption rates for the AspireSR system and also introduced the system in several Middle East countries, despite the ongoing turmoil observed in that part of the world.

We believe the favorable study result announcement will encourage more nations to allow the commercial release of the AspireSR generator, which in turn should drive profits for Cyberonics.

Zacks Rank

Currently, Cyberonics carries a Zacks Rank #3 (Hold). Other medical instruments stocks worth considering are Edwards Lifesciences Corp. (EW), EnteroMedics Inc. (ETRM) and Fluidigm Corporation (FLDM). All these stocks hold a Zacks Rank #2 (Buy).

Read the Full Research Report on EW
Read the Full Research Report on CYBX
Read the Full Research Report on FLDM
Read the Full Research Report on ETRM


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