Correction: The FDA didn't approve the device yet, the panel recommended approval after they meet certain requirements for labeling, protocols for dosing, and a few other things - final approval/launch expected in late May.

Cyberonics shares soared Thursday after the FDA reversed an earlier decision and approved its experimental treatment for depression. The neurodevice company's pacemaker-like device, which is surgically implanted into a patient, has been available in the U.S. since 1997 as a treatment for epilepsy. The Vagus Nerve Stimulation Therapy System was approved as a long-term adjunctive treatment for patients over the age of 18 with chronic or recurrent treatment-resistant depression in a major depressive episode that has not responded to at least four adequate antidepressant treatments.

This highlights an important trend in the emerging neurotechnology industry: neurodevices and neuropharmaceutical companies will increasingly compete for market share as they strive towards developing for better tools to treat mental illnesses. Indeed, Cyberonics already has pilot studies underway to evaluate VNS Therapy as a potential treatment for anxiety disorders, Alzheimer’s disease and chronic headache/migraine.