7 Extreme FDA Medical Device Trades

by: Mike Havrilla

Below is a sample of extreme FDA trades on pending medical device decisions (510k or PMA filings) among companies with market caps below $200 million which are taken from the BioMedReports.com FDA Calendar database. The FDA does not issue PDUFA decision date deadlines for medical device applications, which consist of the 510(k) and pre-market notification application (PMA) routes. The review period for PMA filings is typically more involved and longer than 510(k) applications.

Nephros (OTCQB:NEPH) has surged by over five-fold in just two weeks from 14 cents to 82 cents from the time of my initial article on extreme FDA trades on pending medical device decisions. NEPH.OB still has three separate FDA 510(k) applications pending at the agency, which are outlined below.

The Nephros hemodiafiltration (HDF) system is designed to improve the quality of life for End-Stage Renal Disease (ESRD) patients while addressing the critical financial and clinical needs of the care provider. The HDF system removes a range of harmful substances more effectively, and with greater capacity, than existing ESRD treatment methods, according to the Company. On 11/14/08, Nephros submitted a 510(k) application to the FDA for approval of its HDF products for ESRD in the U.S. market. Following its review of the application, the FDA has requested additional information. Nephros replied to the FDA inquiries on 3/13/09. Per FDA guidelines, the FDA has 90 days to review the additional information provided by the Company for an estimated decision date of Friday 6/12/09 or Monday 6/15/09.

On 10/7/08, Nephros filed a 510(k) application for approval to market its Dual Stage Ultra-filter (DSU filters) to dialysis clinics for in-line purification of dialysate water. Following its review of the application, the FDA requested additional information, and Nephros provided a formal response to the agency on 2/24/09. Per FDA guidelines, the FDA has 90 days to review the additional information provided (5/26/09), but a response from the agency is still pending.

Bovie Medical (AMEX: BVX) currently has two pending medical device applications at the FDA, and the Company is working toward two additional 510(k) filings for its BOSS orthopedic tissue resection device and Polarian vessel sealing technology. While the two pending medical device applications outlined below do not have firm decision dates, my estimate for a possible FDA decision is currently some time during 3Q-4Q09 based on the review cycle for the Company’s previous medical device filings.

On 3/3/09, BVX announced the filing of a 510(k) pre-market notification application (PMA) for regulatory clearance of its ICON GS electrosurgical generator and handpiece (J-Plasma system). The technology utilizes a gas ionization process producing a stable thin focused beam of ionized gas that can be controlled in a wide range of temperatures and intensities for greater surgical precision which is minimally invasive.

On 5/19/09, BVX announced a 510(k) submission to the FDA seeking pre-market clearance for a laparoscopic SEER device for solid organ resection. The laparoscopic SEER is a line extension of the Saline Enhance Electrosurgical Resection (SEER) device that Bovie launched earlier this year and will address the growing market of minimally invasive liver resection. The laparoscopic SEER allows the surgeon to dissect and achieve hemostasis with a single device resulting in less instrument utilization and fewer instrument changes in a minimally invasive approach.

Nanosphere (NASDAQ: NSPH) has three 510(k) applications pending at the FDA with estimated decisions during 2H09, including diagnostic assays for cystic fibrosis and hemochromatosis (a disorder in which excessive amounts of iron are absorbed and accumulate in the body in tissues and organs such as the heart and liver), along with a second generation version of its Verigene System that incorporates automated sample processing.

In March 2009, BioForm Medical (NASDAQ: BFRM) announced the results of a clinical trial evaluating the mixing of lidocaine with RADIESSE dermal filler, which demonstrated an approximate 60% reduction of pain when RADIESSE dermal filler was mixed with lidocaine, and comparable safety and effectiveness of mixed and non-mixed RADIESSE dermal filler. The results were submitted to the FDA under a PMA supplement with an estimated decision during 3Q-4Q09 since the FDA does not issue decision date deadlines for medical device filings.

On 5/26/09, iCAD Inc. (NASDAQ: ICAD) announced that it submitted data to the FDA seeking 510(k) marketing clearance of its VeraLook computer-aided detection (CAD) technology for CT colonography (CTC), or “virtual” colonoscopy. iCAD’s VeraLook product uses advanced algorithms to detect and highlight potential polyps warranting closer review by a radiologist. VeraLook has the potential to reduce oversight errors that could occur during review of a virtual colonoscopy exam, due to the large number of images (approximately 1500) generated by the CT system.

On 6/4/09, Electro-Optical Sciences (NASDAQ: MELA) announced the submission to the FDA of its Premarket Approval (PMA) application for MelaFind, a non-invasive, point-of-care instrument to assist in the early diagnosis of melanoma. Positive top line data from the MelaFind pivotal study, the largest prospective clinical study ever conducted in melanoma detection, were announced in February 2009 and subsequently presented at several major international dermatology meetings in March and May. The Company's final analysis of the data demonstrated that for all subgroups analyzed, the sensitivity of MelaFind was greater than 95% (lower confidence bound) and MelaFind specificity was statistically significantly higher than that of study clinicians.

During 1Q09, Cardium (AMEX: CXM) submitted an application for FDA 510(k) clearance of the UroCool pelvic cooling catheter system. Cardium intends to advance InnerCool's therapeutic cooling and warming products into corresponding markets through the strategic sale of the business to a large and diversified medical device company or through various vertical partnering opportunities with established companies having existing sales and marketing organizations but with a continuing need for innovative, high-value content products.

Disclosure: No positions.