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Surmodics Gets CE Mark for SurVeil Drug-Coated Balloon

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·3 min read
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Surmodics, Inc. SRDX recently received CE Mark in the European Union for its SurVeil drug-coated balloon (DCB).The SurVeil DCB is a next-generation device that utilizes best-in-class technology in the treatment of peripheral artery disease (PAD).

This regulatory approval is likely to boost Surmodics’ Medical Devices segment.

More About SurVeil DCB

The technology behind the SurVeil DCB comprises a proprietary drug-excipient formulation for a durable balloon coating and is developed using an innovative process to enhance coating uniformity. Pre-clinical data have demonstrated a more evenly distributed and durable drug effect and lower possibility of downstream drug particles compared to the control drug-coated balloon.

Drug-coated balloons have been widely utilized in Europe as a crucial treatment option for PAD.

In February 2018, Surmodics inked a deal with Abbott that provided the latter with exclusive global commercialization rights for the SurVeil DCB. Per the terms of the agreement, Surmodics received a $25-million upfront payment and a $10-million milestone payment for completing patient enrollment in the TRANSCEND clinical trial. As a result of CE Mark attainment, Surmodics will now receive an additional $10.8-million milestone payment. The company will generate around $6.5 million inrevenues in the fiscal third quarter and could earn up to an additional $45 million for future product development projects. The company’s SurVeil distribution and development agreement with Abbott Vascular generated revenues of $1.5 million in the second quarter of fiscal 2020.

 

Surmodics is not issuing any projection for revenues from the sale of SurVeil DCB over the rest of fiscal 2020.

For investors’ notice, the SurVeil DCB is used for investigational purposes only in the United States.

Another Key Development

In October 2019, Surmodics attained FDA approval for its Sundance sirolimus-coated balloon (SCB) catheter as a Breakthrough Device under the Agency’s Breakthrough Devices Program. This also served as a boost to the company’s Medical Devices segment.

Market Prospects

Per a report by Future Market Insights, the global balloon catheter market is expected to see a CAGR of 3.8% to reach a value of $4.19 billion during the 2016-2026 period. Hence, the CE Mark comes at an ideal time.

Price Performance

Shares of the company have gained 49.6% compared with the industry’s growth of 14.8% in the past three months.

Zacks Rank and Other Key Picks

Surmodics currently has a Zacks Rank #1 (Strong Buy).

A few other top-ranked stocks from the broader medical space are Aphria APHA, DaVita DVA and Biogen, Inc. BIIB.You can see the complete list of today’s Zacks #1 Rank stocks here.

Aphria’s long-term earnings growth rate is estimated at 24.6%. The company presently carries a Zacks Rank #2 (Buy).

DaVita’s long-term earnings growth rate is estimated at 9.1%. The company presently carries a Zacks Rank #2.

Biogen’ long-term earnings growth rate is estimated at 14%. It currently carries a Zacks Rank #2.

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