Thursday, February 22, 2007

Calls of Note Part 1

- CIBC notes that On March 2, the FDA s Circulatory System Devices Panel will discuss and make recommendations regarding clinical trial designs for Patent Foreman Ovale (PFO) closure devices intended to prevent recurrent stroke. NMT Medical (NASDAQ:NMTI) and AGA (private) will be the main participants, as they have the clinical trials that are furthest along (see CLOSURE I below). In fact, NMTI is furthest along and thus stands to most greatly benefit from this discussion. It is firm's belief that this Panel discussion will be positive for NMTI common, resulting in possible recommendations for a more achievable trial design. This could entail either 1) a reduction in patient enrollment requirement from 1,600 to somewhere around 1,000 or less or 2) a change in randomization to 3:1 from 1:1.

While they currently expect approval for the stroke indication in late 2010/2011, a change in the protocol of the trial may allow the company to achieve approval sometime in 2009, a significant positive. Notably, the firm has been hearing that enrollment in AGA s RESPECT stroke trial has also progressed very slowly, and they believe that company is several hundred patients behind NMT Medical.

CIBC believes the first half of the day will be open to the public, while the second half will be closed door meetings with the companies. As usual, the FDA will make background material available a day before the meeting.

Maintains Sector Outperformer and $21 tgt on NMTI.

Notablecalls: Nice heads up CIBC. Expect to see some buy interest in NMTI.

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