I know a couple of things about this company. First, they make products designed for an emerging area in interventional cardiology, namely the treatment of atrial fibrillation. This is a non-life-threatening condition which is associated with a high incidence of stroke and gradual worsening of heart function. The Company is IMO very undervalued, having fallen off the radar screen since their late-96 IPO at $5.50.
The first new product, undergoing clinical trials now, is called the ALERT system, which uses a disposable catheter to shock the heart internally into normal sinus rhythm from Atrial Fib. Since one-third of open heart (CABG) patients have AF in the hospital and the condition adds days to their recovery, this is a big potential market. Imagine using external paddles on a patient with a cracked chest. No.
The second new product, which was introduced at the Am College of Cardiology conference two weeks ago, is an ultrasound catheter allowing a cardiologist to see into the heart. This will greatly aid in ablation therapy (a technique which cures AF by creating small amounts of scar tissue on the heart muscle, preventing abnormal electrical signals from forming. It has not been used much since the doc can't presently see what he/she is doing.) The ultrasound catheter is an enabling technology for ablation.
The third new product is a mapping catheter also to be used for ablation therapy, which gives a physician an idea of where the problem is coming from.
From what I understand, each of these product lines has $100 million revenue potential. EPMD's market cap is under $25 million.
Finally, last week the Co placed 2.25 million shares with three institutional investors, led by H&Q Life Sciences (a NYSE-listed closed end fund). This will give EPMD the cash they need to achieve profitability, which is expected 1Q99. |
