From the Borefolio recap:
The big Borefolio event today was a 13% surge in shares of PRIME
MEDICAL SERVICES (Nasdaq: PMSI) (N) (S). The bid on PMSI rose
$1 3/8 to $12 1/8 on volume exceeding 450,000 shares. That's a typical
week's worth of trading action for PMSI.
What news accounts for this, you ask? None that I could locate.
Recall that PMSI sold off yesterday as shares of UROLOGIX (Nasdaq:
ULGX) (N) (S) soared on news that Urologix had received FDA
approval of its Targis microwave device for treating benign prostate
hyperplasia (BPH).
Prime Medical is currently developing mobile routes to offer treatment
for BPH with a competing device, the Prostatron. Quite possibly, some
traders exited PMSI yesterday on concerns that the Urologix news
challenged Prime's strategy. As noted here last night, any such concern
may be unfounded, however.
The Borefolio team placed a call to Prime late yesterday, and the
company returned our call today. Their take on the situation is that the
Urologix development is decidedly good news for Prime.
As a spokesperson at Prime told the Borefolio's Mark Weaver, MD
(MWEAV@aol.com), increased public awareness of the availability of
microwave therapies for BPH will benefit all providers.
That makes sense to me. After all, it's unlikely that a guy will walk into
his doctor's office and say he wants "Targis brand microwave therapy"
or "Prostatron (TM) microwave therapy." A more likely scenario is that
as news disseminates (no pun intended) about the effective and
comparatively painless microwave thermotherapy alternative to surgery
or drugs, more middle-aged men with BPH will seek treatment.
In a way, this development reminds me of what folks at CISCO
SYSTEMS (Nasdaq: CSCO) (N) (S) told me some months ago when
Cisco stock sold off on news that INTEL (Nasdaq: INTC) (N) (S) was
introducing certain networking products of its own. Basically, Cisco
said that anything that increases interest in networking or traffic on
networks is ultimately good for the networking industry. And that
anything that's good for the networking industry is good for Cisco.
Getting back to Prime, an executive there reaffirmed today that the
company is open to using Urologix's device as well the Prostatron,
depending on whatever urologists in various regions of the country may
prefer.
Prime continues to develop its routes for thermotherapy treatment of
BPH and is finding a great deal of interest among urologists about
partnering with Prime in the new venture. The first such route, in North
Carolina, was announced recently, and two additional routes are on
track for finalization before the year is out. |
