Anika Therapeutics Receives FDA Approval for Cosmetic Tissue Enhacement Product

Anika Therapeutics (ANIK) announced last week that it had received final market approval from the FDA for its Cosmetic Tissue Augmentation [CTA] product.

The company jumped 20% back on November 28 after receiving an approvable letter from the FDA, and in that press release the company expected a final approval by year's end. They were right!

CTA is an injectable form of hyaluronic acid that fills in tissue underneath the outer skin surface, giving a tighter more youthful appearance.

Anika has been seeing a surge in its revenue and profit numbers over the last three years fro its currently approved products. These include, OrthoVisc, a treatment for osteoarthritis of the knee; Hyvisc, a treatment for equine osteoarthritis; and Amvisc and Amvisc Plus, HA viscoelastic products for ophthalmic surgery.

Adding CTA could bolster the company's sales significantly by 2008, as the marketing of the product is expected by mid 2007.

Shares of Anika Therapeutics were closed at $13.55 on Friday.

ANIK 1-yr chart:

Comments

[Alan Brochs...:]

I started a position this morning, having been watching for a while. They reported a pretty disappointing quarter, but no sellers emerged. Not a surprising reaction, given that the launch of Elevess is imminent.

I am buying for the following reasons: Orthovisc and Elevess cater to high growth markets, the stock is very reasonably priced in terms of PE, P/B and P/S, it is virtually uncovered by Wall Street and it has a stellar balance sheet. I am willing to ride the coattails of Royce, and there are some other smart guys too (DFA). I see this as a value stock today and a growth stock tomorrow (well, later this year!).

My concerns: Not sure about management (due to my lack of knowledge only), not sure about competitive landscape. Galderma is a great partner, but AGN and MRX are marketing machines.

I am not betting the ranch at 13.45, but there should be enough upside to get more exposure later after the launch happens. If this stock can get a 25 multiple on 2008 EPS, it is headed to 19 (or higher if the earnings come in ahead of projections).

2007 May 07 10:40 AM