Medtronic stock rises as CMS proposes favorable coverage for RDN therapy

Investing.com - Medtronic , Inc. (NYSE:MDT) stock is gaining after the Centers for Medicare & Medicaid Services (CMS) posted a proposed National Coverage Determination (NCD) for renal denervation (RDN) therapy that analysts describe as a "best case scenario."

The proposed coverage, posted ahead of the expected July 13 decision date, broadly includes patients with uncontrolled hypertension without requiring multiple drug criteria. Coverage would apply to patients diagnosed with uncontrolled hypertension (>140/90 mm Hg) who have been on stable doses of maximally tolerated guideline-directed medical therapy for at least three months before referral for RDN.

BofA Securities maintained its Buy rating and $100 price target on Medtronic, noting that CMS appeared responsive to public comments that advocated for broader, less restrictive coverage. The proposed coverage aligns closely with the FDA label for Medtronic’s Symplicity device, which is indicated for patients whose blood pressure is not adequately controlled through lifestyle modifications and medications. InvestingPro data shows analyst targets ranging from $78 to $112.45, with the overall consensus remaining bullish. The company maintains strong financial health with an InvestingPro Overall Score of "GOOD."

The final coverage decision is expected on or before October 8, 2025. BofA Securities estimates the uncontrolled hypertension patient population includes approximately 6 million patients in the U.S. and 37 million patients globally who are aware of their condition, with a broader potential market of over 18 million U.S. patients and more than 100 million globally.

BofA Securities projects RDN therapy could add $100-150 million in annual revenue growth to Medtronic, representing 30-40 basis points of growth. The favorable coverage decision is also considered positive for Boston Scientific (NYSE:BSX), which is expected to launch its SoniVie ultrasound RDN device around 2027. With current revenue of $33.5 billion and a projected 5% growth rate for fiscal year 2026, Medtronic continues to demonstrate solid fundamentals. The company has maintained dividend payments for 49 consecutive years, offering a current yield of 3.18%. For deeper insights into Medtronic’s financial health and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro, which includes detailed analysis of the company’s valuation metrics and growth potential.

In other recent news, Medtronic, Inc. has received a proposed National Coverage Decision from the Centers for Medicare & Medicaid Services (CMS) for its renal denervation therapy aimed at treating uncontrolled hypertension. This proposal could significantly benefit Medtronic by opening access to a large patient pool, as CMS noted that a substantial percentage of Medicare claims involved hypertension diagnoses. The coverage criteria include specific requirements for patient eligibility and facility capabilities, which may initially limit the therapy’s uptake. Analysts from BTIG have maintained a Neutral rating on Medtronic’s stock, while Citi reiterated a Buy rating with a $99 price target, citing the proposal as aligning with investor expectations. Leerink Partners also reiterated an Outperform rating with a $110 price target, noting the broader-than-anticipated coverage as a positive catalyst for investors. Furthermore, Evercore has added Medtronic to its TAP Outperform list, reflecting a favorable outlook for MedTech companies in the current environment. The CMS decision, expected to be finalized in October 2025, could create a significant market opportunity, potentially worth $5-10 billion in the United States. Additionally, Medtronic is awaiting FDA approval for other products, including its Hugo surgical robot and Minimed 780G system, which could further enhance its market position.

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