Shares in France's Carmat surge 34% after regulators approve sale of first artificial heart

The medical device company will ramp up manufacturing the device in January and sell it in the second quarter of 2021

A Carmat employee shows a bio-prosthetic artificial heart at the company headquarters in Paris. AFP

Shares in Carmat posted their biggest gain in more than seven years after the company got approval to sell the first-ever total artificial heart in Europe, the culmination of a 27-year effort that began with a pitch from a French cardiac surgeon to an aerospace company.

The stock climbed 34 per cent to €32.05 ($39.04) at 11.29am in Paris on Friday after rising as much as 50 per cent, its steepest intraday gain since May 2013. Carmat shares have advanced 66 per cent this year, giving the company a market value of about €407 million ($496m).

Carmat this week obtained a CE mark for the device, meaning the company can now sell it in the European Union as a bridge to a heart transplant for patients suffering from irreversible end-stage heart failure.

The CE mark is crucial for patients and the French company probably got approval for a blockbuster, given how large the medical need is and how rare and ineffective other solutions are

Surgeon and heart-valve inventor Alain Carpentier proposed development of an artificial heart to French industrialist Jean-Luc Lagardere in 1993. Mr Lagardere put a few labs and engineers from his Matra missile company at Mr Carpentier’s disposal and the project expanded over the years, including through the mergers that led to Matra becoming part of what is now Airbus. The planemaker is Carmat’s biggest shareholder, with a 13 per cent stake, while Mr Carpentier owns about 5.3 per cent.

It took 10 years for Carmat to obtain the CE mark, and “it’s a record, given the complexity of such a device”, Carmat chief executive Stephane Piat said. “We’ll have to work with doctors and medical centres now to offer our therapy and we’ll have to look for patients. The production phase will be a delicate one.”

Carmat plans to ramp up manufacturing of the device in January with a second shift, said the chief executive, who took the helm four years ago.

Carmat’s artificial heart has blockbuster potential and could reap €700m in annual sales in Europe by 2030, Portzamparc analyst Mohamed Kaabouni wrote in a note.

“Everyone was waiting for it, and it’s here now,” Mr Kaabouni wrote about the Carmat heart. “The CE mark is crucial for patients and the French company probably got approval for a blockbuster, given how large the medical need is and how rare and ineffective other solutions are.”

Carmat will start selling the device in the second quarter, the company said.