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Thoratec Corporation (Exact Name of Registrant As Specified in Its Charter) 2009 Annual Report Thoratec is committed to delivering unparalleled innovation and treatment options for advanced heart failure. A world leader in proven technologies to address cardiovascular disease, Thoratec provides a new beginning for patients and their families. and their families. beginning for patients Thoratec provides a new cardiovascular disease, technologies to address A world leader in proven heart failure. options for advanced innovation and treatment delivering unparalleled Thoratec is committed to 2009 Annual Report Providing Dramatic and Sustained Improvements in Survival and Quality of Life for Advanced Heart Failure “Since I received the HeartMate II, my quality of life is much better. Before, I couldn’t walk 100 feet without stopping to rest. Now, I can do almost everything I used to do. Life is so much better.” R I C H A R D M U R P H Y, A G E 7 3 The prevalence of heart failure is rapidly increasing, with Our focus on delivering innovative treatment options and well over 5 million Americans experiencing heart failure our strong commitment to improving clinical outcomes today and more than 600,000 new cases diagnosed each has enabled us to achieve significant milestones. In 2008, year. While heart transplants are available to approximately Thoratec launched a new era in the treatment of advanced 2,000 U.S. patients annually, skyrocketing health care heart failure with the FDA approval of the HeartMate II for costs, ineffective drug therapies and declining quality of life Bridge-to-Transplantation (BTT) in April 2008, the first con- have made finding effective treatments critically important. tinuous flow device for this intended use in the United States. Thoratec builds on over 30 years of experience to continu- Today, Thoratec is accelerating our efforts to support long- ally be a leader in the treatment of cardiovascular disease, term patients that are ineligible for cardiac transplantation providing the broadest mechanical circulatory support due to age or other extenuating medical circumstances. portfolio available for the full range of clinical needs, from With the completion of the largest multicenter ventricular acute to chronic heart failure. We are driving the devel- assist device (VAD) trial in history, the FDA has now also opment of advanced technology—giving patients and the approved the HeartMate II for use as Destination Therapy. medical community that serves them treatment options Now, physicians have the potential to provide this technol- that not only improve patient survival, but also dramatically ogy to the sickest heart failure patients among the more enhance their quality of life. than 100,000 Americans each year who otherwise have no viable alternative for their debilitating disease. 2009 ANNUAL REPO R T / P A G E O N E To Our Shareholders: Driven by an excellent performance in 2009 and our recent Driving our record revenues in 2009 was a year-over-year FDA approval of our PMA (Pre-Market Approval) supple- increase of 30 percent in Cardiovascular Division revenues, ment allowing the use of the HeartMate II for Destination reflecting increased adoption of the HeartMate II in the Therapy (DT), Thoratec continued the positive momentum U.S. and Europe. Also contributing to our revenue growth in our mission to bring improved therapies to a broad was the rapid market acceptance of our new HeartMate II range of advanced heart failure patients, while laying the peripherals—which were placed at 105 centers within just foundation for a very promising 2010. several months of their launch. These new peripherals include enhanced batteries, charger and power module, We met or exceeded our key objectives for 2009, which and they are generating highly positive market feedback included achieving continued adoption of the HeartMate II, for offering patients increased freedom and mobility. realizing improved patient outcomes with the device and increasing both the number of HeartMate II centers and We ended 2009 with 120 HeartMate II centers in North those with certification for DT reimbursement. In addition, America, an increase of 19 during the year, and more than we were successful with our efforts to move forward the 160 percent increase over the past two years. We also HeartMate II DT approval process, broadly disseminate added significantly to the number of HeartMate II centers data from the device’s commercial and clinical trial experi- outside of North America, ending the year with 91, an ence, increase our presence in international markets increase of 14 during 2009, and growth of nearly 50 and achieve continued technology innovation. At the same percent over the past two years. Helping centers achieve time, we created the foundation for the commercial launch Medicare certification for DT reimbursement is an integral of the HeartMate II for DT, including a major expansion of element of our DT launch program, and at year end 76 our manufacturing capacity to meet the anticipated U.S. centers had completed this process. increase in demand. We were particularly pleased with the continued positive Evidence of our success in 2009 was the Company’s HeartMate II patient experience, which we believe financial performance as revenues reached $374 million, demonstrates the value of our clinical education and a 19 percent increase over 2008. support programs. As data from both the DT trial and 1.00 .75 Continuous-flow LVAD (2009) 58%1 Probability .50 of Survival 2 .25 Pulsatile-flow LVAD (2001) 25% Pulsatile-flow LVAD (2009) 24%1 Medical therapy (2001) 8%2 0 0 MONTHS 6 MONTHS 12 MONThs 18 MONThs 24 MONThs Survival Rates in Two Trials of Left Ventricular Assist Devices (LVADs) as Destination Therapy.3 1Slaughter, MS, Rogers, JG: N Engl J Med 2009; 361:2241-51 2Rose, EA, Gelijns AC, Moskowitz AJ: N Engl J Med 2001; 345:1435-43 3Fang, JC: N Engl J Med 2009; 361:2282-5 P A G E T W O / Th O R A T E C C O R PO R AT I ON Gerhard F. Burbach—President, Chief Executive Officer bridge-to-transplantation (BTT) commercial experience In addition, INTERMACS, the agency gathering data on demonstrate, the HeartMate II is a proven therapy that the use of mechanical circulatory support devices in the significantly extends patients’ lives and provides them commercial setting, reported in its 2009 annual report a dramatically improved quality of life. These data, which that some 550 patients implanted with continuous flow have been well received by the clinical community, pumps—nearly all of which were the HeartMate II—dem- have been detailed in more than 65 peer-reviewed pub- onstrated compelling six-month survival of 88 percent.4 Its lished articles and numerous presentations at leading findings also noted that there were ongoing and continu- scientific meetings. ous improvements in outcomes. Foremost among these was publication of the data from With our recent FDA approval and the impetus provided the DT trial in the New England Journal of Medicine. by the positive outcomes from the trial, we immediately Major findings outlined in the article demonstrated that initiated our extensive DT launch strategy to establish the the HeartMate II achieved statistically superior results HeartMate II as the community and academic standard over the HeartMate XVE. As treated survival at two years of care for advanced heart failure patients who are was 58 percent for HeartMate II patients versus 24 not responding to other forms of therapy. We will be percent for those supported by the XVE. A similar popu- expanding the Company’s market development team to lation of patients undergoing optimal medical manage- implement our multi-pronged strategy, which includes ment in the REMATCH trial had survival of eight percent driving adoption in existing DT centers through increased at two years. The HeartMate II also demonstrated a referrals from cardiologists and helping new centers bring superior safety profile, based on major adverse events, on DT VAD programs. such as infection, renal, right heart and respiratory failure, and cardiovascular arrhythmia. HeartMate II patients also We will be using our market development sales force and experienced shorter hospital stays and lower rates of web-based programs to expand awareness of patient rehospitalization per year, as well as dramatic and sus- outcomes with the HeartMate II and help cardiologists tained improvements across all measures of functional identify patients who would benefit from this therapy. capacity and quality of life. During 2010, we expect to add more than 20 HeartMate II 80% 75% 77% 372 319 318 182 0% n=126 91 72 50 n=50 77 61 36 Baseline 3 mos. 12 mos. 24 mos. Baseline 3 mos. 12 mos. 24 mos. HeartMate II Provides Dramatic and Sustained 6-Minute Walk Test Improvement1 Improvements in Quality of Life for Advanced Stage (in meters) Heart Failure Patients (% NYHA Class I & Class II) • 75% of patients improved to NYHA Class I or II at 3 months.1 • 6-minute walk test results for HeartMate II patients in the • 80% of patients improved to NYHA Class I or II by 24 months.1 Destination Therapy trial showed sustained improvement and doubled from baseline to 372m (more than the length of four football fields) at 24 months. 4Kirklin, JC et al: J Heart Lung Transplant 2010; 29: 1-10 2009 ANNUAL REPO R T / P A G E T hr EE centers worldwide to the current base of 211 centers and To complement our internal technology development to expand the U.S. centers certified by the Centers for efforts, in early 2010 we acquired innovative catheter Medicare and Medicaid (CMS) to perform DT implants pump technology known as the Percutaneous Heart to 100. Pump, or PHP. This device will serve as the basis for the development of a percutaneously delivered pump to pro- Our market expansion efforts will be aided by what we vide acute cardiac support.
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