Biosensors International’s BioFreedom finally gets CE Mark

All is set for next year’s full commercial launch.

According to CIMB, BioFreedom’s receipt of the CE Mark is a major step forward, potentially allowing BIG grab market shares in the European Union market first. Management anticipates full commercial launch in 2014, it said.

Here's more:

BIG announced it received the CE Mark approval for its polymer-free drug-coated stent (DCS), BioFreedom. BIG recently announced the initiation of enrolment in LEADERS FREE. 

This trial will provide additional data to support the launch of BioFreedom in select markets during 2013. The full commercial launch is currently anticipated by the company to come about during 2014.

The approval was long awaited, and a subject often brought up by investors. As a reference, the BioMatrix approval in 2008 was transformational for BIG, turning into profitability over FY03/13. While it is still early days to assess the revenue and earnings outcome at this stage, we believe this would have a material impact, lifting FY14-15 numbers, similar to Biomatrix’s market shares grabbing phenomenon.

Apart from this good news, we expect BIG to make accretive acquisitions. Depending on how substantial an acquisition is, there should be potential consolidation of earnings, which we have not factored into our numbers. BIG has lagged in this market rally, now trading at 14.1x CY13 P/E, lower than most of its peers and below its three-year average forward valuations, since entering the black in FY10.

Our SOP-based target price of S$1.75 implies an above 30% upside, supported by three-year earnings CAGR of 17%. We reiterate Outperform.