) has announced an eight-year agreement with Terumo Corporation
to co-brand, market and distribute the latter's SurFlash line of
safety peripheral IV catheters across the U.S. However, the
financial terms of the deal have not been disclosed.
The announcement triggered a 1.9% rise in CareFusion's share
price in the trading session.
The exclusive products of Terumo, namely SurFlash and SurFlash
Plus Safety IV Catheters, are part of this new contract. Terumo's
deal entails CareFusion to concentrate only in the U.S. acute
care hospital market. Per the agreement, CareFusion will initiate
commercialization of the products from the current month itself.
The SurFlash and SurFlash Plus Safety IV line of Catheters have
been integrated with a passive safety technology to minimize the
risk of needle stick injuries as well as exposure to blood borne
pathogens. These products are equipped with the unique
double-flash SurFlash feature which provides a visual
confirmation when both the needle and catheter enter a vessel,
thus, in turn, reducing risks of failed attempts.
Additionally, the SurFlash Plus Safety IV Catheter contains a
blood control safety valve which is meant to reduce the risk of
blood exposure between the removal of the needle and the
attachment of the IV set.
The above-mentioned products enhance results on catheter
placement by more than 20% in the first attempt itself. Higher
first-placement success rates induce better patient experience,
minimize wasted catheters and save clinicians' time, thus
increasing cost-effectiveness for hospitals.
A chance to distribute and market such technologically advanced
products of Terumo increases CareFusion's scope to widen exposure
for its range of products across the U.S. Further, CareFusion
also gains the opportunity to augment its vascular access
Clinically differentiated products like those under the SurFlash
line have strong potential to occupy a leadership position in
Terumo has chosen CareFusion as the expertise of the latter in
the acute care infusion market should aid growth of these safety
products in the U.S.
Revenues from CareFusion's Procedural Solutions business rose 7%
in the first quarter of fiscal 2014 (ended Sep 30, 2013). The
recent deal with Japanese medical technology company is likely to
further growth prospects of the business and help CareFusion
drive more revenues from the business.
For the fiscal year ending June 30, 2014, CareFusion continues to
expect organic revenues to rise 1% to 4% on a constant currency
basis compared with fiscal 2013 revenues of $3.55 billion.
Adjusted earnings per share from continuing operations are
expected to be in the range of $2.30 to $2.40, respectively.
Currently, CareFusion carries a Zacks Rank #3 (Hold).
Investors interested in the medical products industry can also
consider stocks like
) carrying a Zacks Rank #1(Strong Buy), and
Mead Johnson Nutrition Co.
), both carrying a Zacks Rank #2 (Buy).
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