Thoratec Corp. (NSDQ:THOR) said it reached an agreement with one of its major institutional shareholders, Oracle Investment Management, over whether or not the heart pump maker should hire an investment bank to find a buyer.
Greenwich, Conn.-based Oracle, which holds a 5.2% stake in the heart pump maker, recommended that Thoratec retain an investment bank to explore strategic alternatives, including sale to a larger company.
“Although Thoratec management initiated development of the [left ventricular assist device] market, recent market growth has been unsatisfactory and Thoratec has not meaningfully expanded its market share in many of the most promising European markets,” Oracle founder Larry Feinberg wrote in a letter to Thoratec’s board of directors last December. “It is now clear that the market clout, deep capital resources, and relevant experience of a larger and more tenured med-tech company is required to accelerate the penetration of this burgeoning market opportunity.”
Now Thoratec says there’s been a meeting of the minds, according to a regulatory filing.
“The board of directors of the company has considered the proposal and representatives of the board and company management have had discussions with representatives of Oracle,” according to the filing. “During these discussions, the board affirmed to Oracle its commitment to acting in the best interests of the company’s shareholders and maximizing shareholder value including, when appropriate, consideration of strategic alternatives. Following these discussions, on January 25, 2012, Oracle withdrew the proposal.”
That sent NUVA shares up 25.1% yesterday in extremely heavy volume, to a high of $17.16, ahead of a $16.31 close. All told, investors traded nearly 3 million shares yesterday, more than 3½ times its average daily volume since late January 2011 of about 820,000 shares.
Share prices receded a bit today, closing at $15.55, down 4.7% on the day – but still 13.3% above yesterday’s opening price of $13.72.
The respiratory products maker, which was until recently barred by the FDA from importing its devices into the U.S., reported sales of about $64.5 million, up roughly 19.0% over 2010.
That includes a $1 million reserve “for inventory produced by a consumables subcontractor in Israel whose supply relationship was terminated by Oridion in the 4th quarter as a consequence of the FDA-related issues,” according to a press release.
The results also include a one-time charge of $500,000 for increased in transport costs of consumables during the 4th quarter, “primarily in emergency air transport rather than the normal shipping by sea, which is directly related to the FDA issues as well,” according to the release.
Oridion is slated to release its full results Feb. 27. Read more
AngioDynamics updates guidance
AngioDynamics updated its guidance for fiscal 2012, prompted by a software recall for its NanoKnife system that caused it to hold U.S. shipments of the device.
“AngioDynamics has initiated a voluntary recall in the U.S. of the NanoKnife System’s Ablation Zone Estimator (AZE) software, including the User’s Manual and Troubleshooting Guide,” according to a regulatory filing. “The FDA recently indicated that the AZE feature should be the subject of a 510(k) pre-market notification submission and clearance. AngioDynamics has decided to remove the AZE feature and expects to resume shipments of the system once this software modification has been completed.
“The company has halted U.S. NanoKnife System shipments and currently expects to resume U.S. shipments without the AZE software during the company’s fiscal fourth quarter, which ends on May 31, 2012. The company expects the NanoKnife system development to reduce NanoKnife system sales in the second half of fiscal year 2012 by approximately $3.6 million. In the fiscal second quarter ended November 30, 2011, the NanoKnife system contributed $3.2 million in worldwide sales, approximately half of which were outside the U.S.,” according to the filing.
AngioDynamics lowered its sales and earnings per share expectations for the 3rd and 4th quarters by $1.1 million and $0.02 and $1.4 million and $0.01, respectively. Read more
Cosmetic device market on the mend?
A Leerink Swann survey of 43 dermatologists and 40 plastic surgeons suggests that the U.S. market for cosmetic devices is “stable-to-improving,” according to analyst Rick Wise.
“In 4Q, as we would expect to see in a seasonally stronger period, the survey highlighted improved sequential demand trends for U.S. equipment purchases,” Wise wrote in a note to investors. “These generally positive survey results leave us feeling incrementally more confident in our high-single-digit 4Q:11 and 2012 U.S. cosmetic laser equipment sales growth forecast.”
Three factors indicate improved prospects for the sector, which hit hard times when procedure volumes and capital purchases plunged along with the economic downturn. More than ⅔ of the respondents said they’re planning to buy a cosmetic device this year, the analyst wrote, also noting that the credit crunch has eased, making capital equipment expenditures more palatable.
And laser procedure volumes are projected to grow this year, which is “a potential leading indicator of increased AED purchasing,” according to Wise.
- Cooper (NYSE:COO): UBS downgrades to “neutral” from “buy,” sets $62 price target.
- Hologic (NSDQ:HOLX): Stifel Nicolaus downgrades from “buy” to “hold.”
- St. Jude Medical (NYSE:STJ): Leerink Swann lowers 2012 EPS estimate to $3.46 from $3.57, reiterates “outperform” rating; Goldman Sachs raises estimates through 2015, sets “neutral” rating and new $40 price target; Canaccord Genuity upgrades from “hold” to “buy,” sets $50 price target.