The US health regulator has issued a warning letter to Medtronic highlighting certain concerns related to the quality management of medical devices in its diabetes business, the company said on Wednesday.
Medtronic shares lost 6% in early trading to $ 104.95, their lowest level in over a year.
The Food and Drug Administration (FDA) letter focused on deficiencies in areas such as risk assessment, complaint handling and device recalls at Medtronic’s Northridge, Calif. Facility, the company said.
The company is quick to address FDA concerns and review its actions with the agency, it added.
Medtronic announced in a filing that it does not expect any impact on its previously published adjusted earnings outlook for the third quarter or full year of 2022.
However, an organic decline in sales is forecast for the Diabetes Unit, partly due to the uncertainty about the timing of US product approvals. The unit is expected to experience high-single-digit declines in the third quarter and mid-single-digit declines in FY 2022, compared to the previous forecast of mid- and low-single-digit declines, respectively.
“The impact on financial stocks is not much, but it is even worse, the impact on investor sentiment,” said Robbie Marcus, an analyst at JP Morgan.
Medtronic said the letter, received earlier this month, followed a July inspection related to recalls of MiniMed 600 insulin infusion pumps and a remote control for certain other pumps.
In 2019, the medical device maker initiated a recall of the MiniMed 600 pumps, which were used by diabetic patients to replace those with damaged or missing clear retaining rings that lock a cartridge with the insulin in the pump.
The company later announced that it would replace all pumps with clear retaining rings with a different design, whether or not they were damaged.
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Cite the following: U.S. Department of Health Reports Concerns in Medtronic’s Diabetes Business – Medscape – December 16, 2021.
