ANGO Wins Twin Approval - Analyst Blog

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AngioDynamics ( ANGO ) has won regulatory approval for two of its port offerings, which came in as a major boost to its vascular access franchise. The U.S. Food and Drug Administration (FDA) have cleared the company's Xcela Plus Port family, with Pressure Activated Safety Valve (PASV) technology. Similarly, Health Canada provided the Medical Device License for its Smart Port CT family of power-injectable ports, featuring Vortex port technology.

About Xcela Plus Port

The Xcela Plus Ports, the only proximally valved CT port available in the market, provide a competitive advantage to the company. The PASV valve technology reduces nursing time and has been clinically proven to be superior to non-valved ports.

The Xcela Plus Ports was originally developed by Navilyst Medical, which was acquired by the company in 2012. The device is now a part of AngioDynamics' vascular access products portfolio, under its larger Vascular segment. AngioDynamics plans to sell the product line in the U.S. from fiscal 2014. The FDA clearance has also encouraged the company to develop new products by integrating its port and dialysis offerings with BioFlo technology.

About Smart Port

The Smart Port CT family of power-injectable ports, also a part of the vascular access product line, can be implanted under the skin to provide long-term medication delivery to a patient's vascular system. It can also be used in a Computed Tomography (CT) scan. These ports have been cleared by the U.S. FDA and have European CE Mark approval. The Vortex technology in the Smart Port further enhances its performance to improve patient outcome.

The launch of Smart Port in Canada is in accordance with AngioDynamics' existing contract with HealthPRO, Canada's national healthcare group purchasing organization (GPO). The Health Canada approval complements the company's long-term strategy to expand in international markets. It is going to help the company to expand in the rapidly growing Canadian market.

Our Take

Approvals from the U.S. FDA and Health Canada for the company's' technologically advanced ports will improve sales of the weak vascular access business in fiscal 2014. Revenues from this business declined 4% in the last reported quarter due to the lack of a tip location technology and sales force disruption, which adversely affected PICC sales. However, ports and dialysis revenues were within the company's expectations.

AngioDynamics should continue to benefit from the ongoing shift from open surgery to less invasive interventional procedures. Despite the near-term operational glitches, the company has the ability to grow in the long term on the back of higher international sales, new products, acquisitions, as well as operational synergies from its cost saving measures.

AngioDynamics currently carries a Zacks Rank #3 (Hold). While we remain on the sidelines for AngioDynamics, we believe that other medical instrument stocks such as Natus Medical ( BABY ), carrying a Zacks Rank #1 (Strong Buy), warrant a look. Heartware International ( HTWR ) and Cryolife ( CRY ), carrying a Zacks Rank #2 (Buy), are also worth considering.

ANGIODYNAMICS (ANGO): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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