Neovasc Inc. (NASDAQ: NVCN) is a specialty medical device company that develops, manufactures, and markets cardiovascular devices.
Recent Events
On January 22, 2019, Neovasc announced that, pursuant to a settlement reached with Edwards Lifesciences PVT, Inc. and Edwards Lifesciences (Canada) Inc., the patent infringement action that Edwards had previously commenced in the Federal Court of Canada against Neovasc, Boston Scientific and Livanova, will be dismissed on a no-costs basis.
On November 14, 2018, the company released its Q3 2018 financial results. Q4 and FYE earnings could be released within a month.
On January 14, 2019 Neovasc announced that it has received written notification from The Nasdaq Stock Market LLC notifying the Company that it is not in compliance with the Nasdaq Listing Rule 5550(a)(2) that requires listed securities to maintain a minimum bid price of US$1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days.
The Company has until July 15, 2019, to regain compliance and the Company may be eligible for additional time to regain compliance or may face delisting. The Company is also listed on the Toronto Stock Exchange (TSX: NVCV) and the Notification Letter does not affect the Company’s compliance status with such listing.
Products
Tiara™ Mitral Valve replacement for minimally invasive treatment of mitral valve disease.
Tiara is a self-expanding mitral bioprosthesis specifically designed to treat mitral valve regurgitation (MR) by replacing the diseased valve. Conventional surgical treatments are only appropriate for about half of MR patients, who number an estimated four million in the U.S. with a similar number of patients affected throughout Europe. Tiara is implanted in the heart using a minimally invasive, transapical transcatheter approach without the need for open-heart surgery or use of a cardiac bypass machine.
Reducer ™ Device for minimally invasive treatment of Refractory Angina.
The Reducer is CE-marked in the European Union for the treatment of refractory angina, a painful and debilitating condition that occurs when the coronary arteries deliver an inadequate supply of blood to the heart muscle, despite treatment with standard revascularization or cardiac drug therapies. It affects millions of patients worldwide, who typically lead severely restricted lives as a result of their disabling symptoms, and its incidence is growing. The Reducer provides relief of angina symptoms by altering blood flow in the heart’s circulatory system, thereby increasing the perfusion of oxygenated blood to ischemic areas of the heart muscle. Placement of the Reducer is performed using a minimally invasive transvenous procedure that is similar to implanting a coronary stent and is completed in approximately 20 minutes.
About
Neovasc Inc., a specialty medical device company, develops, manufactures, and markets cardiovascular devices worldwide. Its products include the Tiara technology for the transcatheter treatment of mitral valve disease; and the Neovasc Reducer for the treatment of refractory angina. The company also provides Peripatch tissue products. The company was formerly known as Medical Ventures Corp. and changed its name to Neovasc Inc. in July 2008. Neovasc Inc. was incorporated in 2000 and is headquartered in Richmond, Canada.
Analysts
2 Wall Street analysts have issued ratings and price targets for Neovasc in the last 12 months. There are currently 2 buy ratings for the stock, resulting in a consensus rating of “Buy.”
Date Brokerage Action Rating
3/29/2018 Canaccord Genuity Lower Price Target Buy ➝ Buy
3/29/2018 Leerink Swann Lower Price Target Outperform ➝ Outperform
Source: marketbeat.com
Financial review
Results for the three months ended September 30, 2018 and 2017:
Revenues
Revenues decreased 65% to $480,540 for the three months ended September 30, 2018, compared to revenues of $1,374,893 for the same period in 2017.
Cost of Goods Sold
The cost of goods sold for the three months ended September 30, 2018 was $96,743 compared to $659,686 for the same period in 2017.
Expenses
Total expenses for the three months ended September 30, 2018 were $8,654,600, compared to $6,540,734 for the same period in 2017.
Selling expenses for the three months ended September 30, 2018 were $202,947, compared to $253,791 for the same period in 2017.
General and administrative expenses for the three months ended September 30, 2018 were $4,960,957, compared to $1,864,302 for the same period in 2017.
Other Income and Loss
The other loss for the three months ended September 30, 2018 was $4,932,151 compared to other income of $1,473,493 for the same period in 2017.
Losses
The operating losses and comprehensive losses for the nine months ended September 30, 2018 were $118,283,093 and $118,515,403 respectively, or $10.46 basic and diluted loss per share, as compared with losses of $17,882,255 and $19,832,651, respectively, or $22.68 basic and diluted loss per share, for the same period in 2017.
Discussion of Liquidity and Capital Resources
Neovasc finances its operations and capital expenditures with cash generated from operations and through equity and debt financings. As at September 30, 2018 the Company had cash and cash equivalents of $14,487,483 compared to cash and cash equivalents of $17,507,157 as at December 31, 2017.
Stock influences and risk factors
Continuing peer reviews and positive clinical results could act as a catalyst for the company’s shares.
The company may need for significant additional financing.
Future success depends on the clinical development of their products, including the results of current and future clinical trials and studies.
The company estimates of the size of the potential markets for their products including the anticipated market opportunities for the Reducer and the Tiara may be wrong.
Stock chart
On Tuesday, January 22nd, in mid-day trading, NVCN shares were at $.85 (+13.09%) on traded volume of 11 million shares. The current RSI (14) is 60.15
At $85 per share, NVCN shares are trading below their 50 DMA and 200 DMA of $.91 and $2.85 respectively.
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