In an Aug. 30 research note, analyst Jeffrey Cohen reported that Ladenburg Thalmann initiated coverage on medical device company Motus GI Holdings Inc. (MOTS:NASDAQ), with a Buy rating and a $14.50 per share target price. The current share price is about $6.68.
Motus plans to globally commercialize Pure-Vu, a system used to clear poorly prepared colons during colonoscopy. The device uses air and water to loosen contents from the colon walls while simultaneously vacuuming them out. "The Pure-Vu is compatible with standard colonoscopes and has proven to greatly enhance visibility," Cohen added.
An obvious market for Pure-Vu exists, Cohen points out in the report. The device would benefit patients who cannot properly follow the 24- to 48-hour preprocedure regimen, patients who cannot achieve an empty colon because of medication interactions, patients who prep inadequately and must try again and patients who require an emergency colonoscopy. "Providing an intraprocedural solution greatly reduces time and costs for patients and hospitals," the analyst noted.
Currently, about 15 million colonoscopies are done in the United States and "upwards of 30 million worldwide annually," Cohen indicated, citing Centers for Disease Control statistics.
That does not include the numbers of individuals who elect not to get the procedure done to avoid the required preparation. "The U.S. National Library of Medicine National Institutes of Health determined that more than 74% of people consider the preparation process the greatest barrier to screening," Cohen relayed.
Today, Motus continues to gather clinical and economic data related to Pure-Vu. "We anticipate the company will initiate a lower GI bleed inpatient study as well as additional studies related to high medical need individuals in an outpatient setting," wrote Cohen.
In mid-2019, the company is expected to start selling Pure-Vu to the inpatient market in the U.S. and subsequently internationally.
Ladenburg estimates yearly revenue generated from Pure-Vu systems and consumables sales between 2019 and 2022 to be $5.7 million ($5.7M), $40.8M, $82.7M and $125M, respectively.
It forecasts 2018 opex to be $16.4M and total annual opex between 2019 and 2022 to be $20.3M, $25.6M and $30.2M.
Lastly, the financial services firm projects Motus would need an additional $18–22M to become profitable.
[NLINSERT]
Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following company mentioned in this article is a billboard sponsor of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.
Disclosures from Ladenburg Thalmann, Motus GI Holdings Inc., August 30, 2018
ANALYST CERTIFICATION: I, Jeffrey S. Cohen, attest that the views expressed in this research report accurately reflect my personal views about the subject security and issuer. Furthermore, no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report, provided, however, that:
The research analyst primarily responsible for the preparation of this research report has or will receive compensation based upon various factors, including the volume of trading at the firm in the subject security, as well as the firm’s total revenues, a portion of which is generated by investment banking activities.
COMPANY SPECIFIC DISCLOSURES:
Ladenburg Thalmann & Co. Inc. makes a market in Motus GI Holdings, Inc.
