Opsens Inc.
FDA approval of SavvyWire received slightly ahead of expected timelines
TSX: OPS | CAD 2.79 | Outperform | Speculative Risk | Price Target CAD 4.00
Sentiment: Positive
Our view: Following approval from Health Canada in Apr-22 (here), OpSens today announced that its new TAVR guidewire, SavvyWire has received approval from the FDA. We view this approval as positive for the shares. The approval was slightly ahead of the company's guidance of approval timeline in the early Q4/22 timeframe. The company noted that it will introduce SavvyWire to physicians at the upcoming TCT meeting in Boston later this week and will initiate a limited market release during the coming weeks.
OPS received 510(k) regulatory clearance from the US FDA for SavvyWire: OPS received FDA clearance for its new guidewire, SavvyWire. SavvyWire provides a 3-in-1 solution for stable aortic valve delivery and positioning, continuous accurate hemodynamic measurement during the procedure, and left ventricular pacing without the need for adjunct devices or venous access, making it a first in class TAVR guidewire to carry out all three procedures simultaneously. The company noted that it will introduce SavvyWire to physicians at the TCT conference in Boston later this week and initiate a limited market release to a select number of physician thought-leaders during the coming weeks.
SavvyWire launch well-received in Canada; full commercial launch in Canada expected later this month: OPS received Health Canada approval for SavvyWire in Apr-22 and started the commercialization as a limited release. Management has noted the SavvyWire launch has been well-received by leading heart centres in Canada. On the last earnings call (14-Jul), OPS noted that ~40 CDN procedures had been completed since the limited rollout launch with no technical or safety issues. The company is planning a full commercial launch in Canada later this month.
Significant opportunity with the new guidewire: We see a strong opportunity related to OPS’s new TAVR guidewire (SavvyWire). In our view, SavvyWire could potentially become a new standard of care as part of the TAVR procedure. Today, the TAVR procedure typically requires the use of an echocardiogram and pacemaker in addition to a guidewire. SavvyWire can deliver the valve, perform continuous pressure measurement, and also conduct rapid pacing simultaneously. We believe time/cost savings and efficacy benefits could allow OPS to ultimately command a meaningful share of TAVR guidewire supply in its current markets (US, Canada, EMEA, and Japan). Management has noted that the global TAVR market is currently estimated at ~200,000+ procedures and is expected to reach ~400,000 procedures by 2027. See our in-depth note here for more details on our positive outlook for SavvyWire.
Potential takeout candidate: We believe that OpSens could be a takeout candidate given the merits of its SavvyWire and OptoWire products. We think that commercialization of the SavvyWire could benefit from the marketing and distribution capabilities of a larger player, which could possibly support market share above our base case current assumptions for OpSens and lead to improved margins for the product.