Credit: Shutterstock photoWaters Corp.WAT recently announced that its indigenously built ACQUITY UPLC I-Class IVD/Xevo TQ-S micro IVD System has been classified as a U.S. FDA Class I medical device. Moreover, it has secured the CE mark as per European Directive 98/79/EC (IVDD). These developments will likely enhance the access of laboratories to liquid chromatography ("LC") and mass spectrometry ("MS") technology offerings, which in turn, will be conducive to Waters' top-line performance.
Waters has committed itself to enhance the number of LC-MS systems listed as medical devices in order to attract more clients. As "Class 1" mark from FDA serves as a proof that the product is low-risk and subject to minimum regulatory controls, Waters' offerings are expected to gain significant popularity with the classification. Similarly, the CE marking too guarantees smooth penetration of the company in the European markets.
As a result of this development, ACQUITY UPLC I-Class IVD/Xevo TQ-S micro IVD System will now be considered as LC-MS in vitro diagnostic medical devices. The company believes that rapid growth in the application of LC-MS in clinical environment holds tremendous commercial potential, going forward.
Market research reports indicate that global spectrometry market is likely to experience a modest compounded annual growth rate of 7.2% during 2014-2020, reaching $19,608.7 million. The qualitative and quantitative prowess of LC-MS technology, a segment of mass spectrometry market, has been propelling adoption by medical professionals for simplifying analyses of patient samples.
Waters' global pharmaceuticals business, its largest single market and major revenue driver, has been gaining traction over the last few quarters and fueling the growth of Waters Division. In third-quarter 2015, sales from the company's global pharmaceuticals business rose 10% on a year-over-year basis, reaping benefits from clinical labs, smaller specialty and generic customers.
Encouragingly, Waters is a global/regional? leader in high-performance liquid chromatography market and ranks among the top 5 franchises in mass spectrometry markets. We believe the company's strong position in the biopharma end-markets, solid sales in emerging markets, innovative product launches and healthy product traction history add to its strength.
However, headwinds like intensifying competition, currency fluctuations and high debt burden may prove to be a drag on the Zacks Rank #3 (Hold) stock's financials.
Better-ranked stocks in the industry include Bruker Corp. BRKR , Eagle Pharmaceuticals Inc. EGRX and INSYS Therapeutics, Inc. INSY . While Bruker sports a Zacks Rank #1 (Strong Buy), both Eagle Pharmaceuticals and INSYS Therapeutics hold a Zacks Rank #2 (Buy) each.
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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.
