Non-GAAP net income was $13.8 million or $0.22 per share versus $4.5 million or $0.08 per share in the same period a year ago.
Thoratec continued its impressive performance of 2008 into the Q1 2009 with expanded market penetration of our HeartMate II LVAS (left ventricular assist system), particularly in North America. Our growth was driven by continued adoption for Bridge-to-Transplantation (BTT) and enrollment in our Destination Therapy (DT) trial under Continuous Access Protocols (CAPs). We also continued to expand the number of HeartMate II centers, adding four during the quarter, said Gary F. Burbach, president and chief executive officer.
Clearly a milestone event for the company was the recent filing of our PMA (Pre-Market Approval) supplement with the Food and Drug-Administration (FDA) seeking to add the intended use of DT for the HeartMate II, Burbach added. This PMA filing includes data on a pivotal study cohort of 200 randomized patients, including two-year data on the first 167 patients enrolled. As we indicated previously, we plan to file an amendment to the submission once we have complete two-year data on the primary patient cohort.
The data from the trial demonstrate that the HeartMate II is superior to the XVE, based on device performance and the primary patient endpoint of two-year survival free from stroke and reoperation for device replacement. The data also showed that key adverse events, such as infection.
Financial Highlights
Operating expenses on a GAAP basis for the Q1 2009 and 2008 were $44.5 million and $36.5 million, respectively.
On a GAAP basis, other expense totaled $1.9 million for the Q1 2009 versus $400,000 a year ago. On a non-GAAP basis, other expense totaled $20,000 versus other income of $1.3 million a year ago.
The company’s GAAP effective tax rate for the Q1 2009 was 26.7% versus a benefit of 33.7% a year ago. The non-GAAP tax rate, which is described later in this press release, was 32.6% in the Q1 2009, compared with 33.5% in the prior year.
On a non-GAAP basis, the company’s convertible debt was dilutive to the company’s fully diluted weighted average shares outstanding. The increase in shares was approximately 7.3 million.
Cash and investments at the end of the quarter were $275 million, including $20 million of restricted cash, related to a note we have made available to HeartWare and $30 million of Auction Rate Securities classified as long-term investments.
Management affirmed its earlier issued overall guidance for 2009. Within that guidance the company expects that ITC’s revenues will be flat to an increase in the low single digits in 2009, against its previous expectation of mid-single digit growth due to increased pressure on hospital and physician capital purchases and competition.
