Covidien (NYSE:COV), a leading provider of medical products, recently announced that the Food and Drug Administration (“FDA”) approved usage of molybdenum-99, obtained from low-enriched uranium, to produce technetium-99m generators. A medical isotope, technetium-99m is used in more than 80% of nuclear medicine studies. Covidien’s Mallinckrodt unit supplies this product to nuclear pharmacies and hospitals.
Technetium-99m is formed when molybdenum-99 decays after uranium irradiation. The FDA’s approval permits use of low-enriched uranium-based molybdenum-99 (provided by South Africa-based NTP Radioisotopes, Ltd.; a subsidiary of the Nuclear Energy Corporation of South Africa) in Technetium-99m generator production, at Covidien’s manufacturing unit located in Maryland Heights, Missouri.
Technetium-99m, which is a vital medical isotope, is utilized for functional and diagnostic research of organs. Data from such studies is utilized by medical practitioners to correctly diagnose patients. Over 30 million nuclear medicine procedures are annually performed across the world, utilizing Technetium-99m, with over 50% based in the U.S.
In early 2009, Covidien initiated a project, with Babcock & Wilcox Technical Services Group (NYSE:BWC), to come up with solution-based reactor know-how for low-enriched uranium-based medical isotope production. This new methodology is designed to ensure an efficient local source. The joint effort utilizes both Covidien’s knowledge in radiopharmaceutical production and regulatory approvals and its partner’s patented liquid phase nuclear know-how. Covidien also has plans for converting its molybdenum-99 processing facility, based in Petten, Holland, to facilitate use of low-enriched uranium.
Covidien is a leading global healthcare products company and boasts of a well diversified product and technology portfolio. Its core medical devices business faces competition, in certain niches, from Johnson & Johnson (NYSE:JNJ), Becton Dickinson (NYSE:BDX) and C. R. Bard (NYSE:BCR). The acquisition of eV3 in July 2010 has bolstered Covidien’s foothold in the peripheral vascular and neurovascular markets.
Covidien remains committed to rolling out new products and technologies, focusing on fast-growing markets, and boosting market share in core segments through investments in sales and marketing infrastructure. Moreover, the divestiture of its specialty chemicals and sleep therapy product line has enabled the company to rationalize its product portfolio and reallocate resources to faster-growing, higher-margin businesses.