Plunging Sales Cause $1.96-Million Loss for Trimedyne

Trimedyne Inc., blaming “confusion” in the market over the effectiveness of one of its medical laser products, said Wednesday that it lost $1.96 million in its latest quarter as sales plunged by 70%.

The Tustin firm, which makes laser catheters designed to open clogged blood vessels, said sales for its fiscal 1990 second quarter ended March 31 fell to $2.85 million, from $9.37 million for the same period a year earlier. The company earned $448,000 in the 1989 quarter.

The company said its second-quarter loss included a $300,000 reserve for possible excess inventory due to sharply declining sales.

Trimedyne said it is reducing purchases of supplies and taking other steps to reduce expenses.

Howard K. Cooper, Trimedyne’s president, said doctors and hospitals are postponing purchases of laser catheters until they are certain whether a “hot-tip” laser that Trimedyne now markets or an alternative “cold laser” now under development by the firm will prove more effective in clearing plaque-clogged vessels.

“The confusion is unwarranted,” said Cooper, who contends that patient data collected by doctors using Trimedyne’s hot laser shows that it is superior to other methods for unclogging arteries in legs. Trimedyne’s hot laser is the only system approved by the U.S. Food and Drug Administration for sale in this country.

Cooper acknowledged, however, that it is debatable whether the hot or cold laser method will prove more effective for opening vessels in the heart--a market with much greater potential than the treatment of leg arteries.

Trimedyne and some of its competitors are racing to develop two types of cold lasers that have proven effective in human clinical trials for unclogging blood vessels without thermal damage to adjoining tissues.

For the first six months of fiscal 1990, Trimedyne lost $2.45 million, contrasted with earnings of $1.5 million a year earlier.

Sales dropped 62%, to $7.5 million from $19.5 million.