Varian Medical Systems
) plans to launch its ProBeam Compact proton therapy system at the
annual meeting of the Particle Therapy Co-Operative Group (PTCOG
53). Proton therapy is used for irradiating diseased tissue, mainly
in the treatment of cancer.
The external beam Proton therapy is superior to other external beam
radiotherapies because it is capable of precisely locating the
radiation dosage causing lesser side-effects to surrounding tissues
unlike conventional radiotherapy.
However, Proton therapy is historically very expensive compared
with other forms of external beam radiotherapy. VAR's compact and
single-room ProBeam Compact proton therapy system mitigates the
cost issue and minimizes the space requirements, making it more
feasible and affordable to cancer treatment centers.
The installation of VAR's ProBeam Compact involves a
space-efficient cyclotron, Dynamic Peak scanning technology for
intensity-modulated proton therapy (IMPT), a fully rotational
gantry, robotic patient positioning tools, and a suite of motion
VAR's ProBeam Compact uses an integrated 2D and 3D imager for
real-time image guidance. It is also capable of planning and
managing treatments using VAR's Eclipse and ARIA software systems.
The new Proton therapy system uses the same interface used by VAR
in its TrueBeam platform. As a result, operators of VAR's other
radiotherapy systems will face no problem while upgrading to
VAR recently installed the new Proton therapy system at Scripps
Proton Therapy Center in San Diego, CA. Prior to that; the company
has installed the system at the Rinecker Proton Therapy Center in
Munich, Germany and the Paul Scherrer Institute in Switzerland.
VAR has several other contracts to install the new Proton therapy
systems at seven other centers. These centers include University of
Maryland in Baltimore; Emory University in Atlanta, GA; Cincinnati
Children's Hospital in OH; University of Texas Southwestern in
Dallas; KFMC-King Fahd Medical City in Saudi Arabia; PTC St.
Petersburg in Russia; and National Taiwan University in Taipei.
For the second quarter of fiscal 2014 ended Mar 28, 2014, VAR
posted flat adjusted earnings per share of $1.04 (including a 16
cents charge related to a previously announced settlement of patent
litigation) compared with the same quarter in the prior fiscal
However, second quarter earnings edged past the Zacks Consensus
Estimate by a couple of cents. With this, VAR also met its own
guidance of earnings per share for the quarter in the range of
$1.00 to $1.04.
Revenues in the quarter inched up 1.3% to $778.5 million, beating
the Zacks Consensus Estimate of $775 million. Thanks to the strong
gross orders in Imaging Components segment and proton business as
well as mid-single-digit growth in Oncology Systems segment.
For fiscal 2014, VAR reiterated its revenues growth in the range of
6 to 8%. The company also retained its earnings per share guidance
between $4.22 and $4.34 for the year, including the 16 cents charge
for the patent litigation settlement. The current Zacks Consensus
Estimate of $4.28 lies within the guided range.
Currently, VAR carries a Zacks Rank #3 (Hold). Some better-ranked
medical instrument stocks that currently worth a look include
Alphatec Holdings, Inc.
RTI Surgical Inc.
Edwards Lifesciences Corp.
). Alphatec Holdings and RTI Surgical sport a Zacks Rank #1 (Strong
Buy), while Edwards Lifesciences carries a Zacks Rank #2 (Buy).
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