Biosensors   

Is Biosensors a good buy?

it feels like something has changed.  Fri BIG traded almost 2X more volume than Microport.  BIG also traded up Microport traded down.  There is still a substantial difference between market cap with Microport twice BIG.  But if trading action changes BIG price could accelerate to close the gap. 

 

no chiong liao :(

 

10/04/2010

Microport Vs BIG

Price      Microport S$1.49    BIG S1.01

Mk Val   Microport S$2.1B   BIG S$1.0

Volume   Microport  27.4M   BIG  16.1M

I hope Investor is correct.  I would think the more sophisticated Hong Kong investors would want to "arb" the discrepancy.

 

I think that there is cause for optimism in the way Biosensors is trading recently.

About a mth ago, nobody would think that Biosensors can trade at 0.90 cents, let alone $1.00 !

Why are HK investors so bullish on Microport ?

A Frost & Sullivan report (in Microport's prospectus) states that the DES mkt in China will grow from 3.76 Billion Rmb (approx US$578 million, taking ex rate of 6.5) in 2007  to 16.92 Billion Rmb ( US$2.6 Billion) by 2014, a compounded growth rate of 24 % !.

Also, the Shanghai Pudong New Area People's Govt owns approx 19 % state in Microport, and Otsuka Pharmaceutical (Japanese Company) owns approx 33.4 %.

THe Chinese govt is promoting and supporting hi-tech medical industries in China, and that is why, Microport, Lepu and JW Medical (50 % owned by Biosensor) controls approx 28.9 %, 23.5 % and 22 % respectively of the Chinese DES mkt, making a total of 74.4 % ! ( Data based on the number of stents implanted in 2009 - report by Frost and Sullivan).

Once Microport's share price stabilise (maybe a mth or so), and HK analysts start coverage, then we can get a sense of the mkt value for DES companies operating in China.

BUT given the huge mkt size and growth rate, it should be an optimistic scenario.

We should be CONFIDENT that Biosensors share price should trade at a different level going forward, now that there is a peer comparison and the DES mkt undergoes more analyst's coverage, unless there is some unforseen situation that happens.

By the way, Lepu is trading in the Shenzen mkt (type Lepu under CBS.marketwatch.com) and you can see that its mkt cap is appprox 20 Billion Rmb or approx 3.8 Billion Sing ! (But then Shenzhen mkt is probably a closed mkt to foreign investors nad it is more like a cowboy town - my own opinion)

Some inferences on my part - Not a call to buy/sell.

 

continue of the NHC Care II trial and the Prof comment which is not pasted to my previous update.

The centre estimates that 10% - 30% of the patients requiring percutaneous coronary interventions (PCI) may benefit from this revolutionary stent. The Sparrow Stent is currently being evaluated in a clinical trial known as the CARE II Study.

This multi-site randomised trial will test both the drug-eluting and bare-metal versions of the Sparrow, plus a competitive stent in 220 patients. The National Heart Centre Singapore is currently the only Asian site to have started in the CARE II Study. Four patients have been treated since the trial started here in September 2008.

"All four patients had uncomplicated procedural and hospital outcomes. I see a great potential for this stent since many of our diabetic patients have small vessels." said Associate Professor Koh Tian Hai, Medical Director, National Heart Centre Singapore and also the Principal Investigator of CARE II in Singapore.

The Sparrow Stent implantation procedure will be showcased at the centre's annual cardiology conference, the Singapore LIVE 2009 (Live Interventions in Vascular Endotherapy) in a live telecast from the NHC catheterisation laboratory to an estimated audience of 1,000 delegates at the Suntec Singapore International Convention and Exhibition Centre.

infancybird      ( Date: 01-Oct-2010 17:10) Posted: Just some update on BIG newly acquired company Cadiomind ( CARE II trial). This Trial  is also being conducted in our renowned Spore National Heart Center since 2008 and all the patients are doing well. Read what the Prof of NHC has to say about the Sparrow stent and its future potential. The large number of overeating and smoking Chinese polution will yield a large number of heart patients(bigger than US ) requiring stent treatment in the next years. So my view is BIG should get closer to China/HongKong Market (ie HK Ex or Shenzhen Ex) to be appreciated and rewarded.     by National Heart Centre Singapore Heart patients with small, difficult to treat vessels requiring stenting procedures may soon have another viable option to treat coronary artery disease. Known as the CardioMind SparrowTM Drug-Eluting Coronary Stent System, this stent is 70% smaller in diameter than any other currently approved stent and targets at blood vessels smaller than 2.75mm in diameter. The Sparrow Stent System is an improved version of the current stents in the market. Conventional balloon-expandable stents travel over guidewires to the lesion in the artery. The Sparrow Stent is incorporated into the distal end of the guidewire itself, therefore having the same outer diameter and flexibility as the guidewire. The stent travels as part of the guidewire to the site of the lesion. The cardiologist then releases the stent and allows it to self-expand and support the vessel wall. The tightness of fit of conventional stents, as well as their inflexibility and the forces delivered by the balloon expansion, may contribute to increased vessel trauma, which in turn leads to less favourable long-term results. The Sparrow Stent also offers more flexibility than the current stents, making it especially adaptable to the treatment of small, tortuous blood vessels often associated with diabetes, which represent 40% of the patients who require a stenting procedure. Over time, the polymer of the Sparrow Stent will gradually biodegrade away and return the stent to a bare metal state. Biodegradable polymers for drug-eluting coronary stents are thought to contribute to a reduction in late stent thrombosis rate. The centre estimates that 10% - 30% of the patients requiring percutaneous coronary interventions (PCI) may benefit from this revolutionary stent. The Sparrow Stent is currently being evaluated in a clinical trial known as the CARE II Study. Laulan      ( Date: 01-Oct-2010 10:52) Posted: Listing in the right location is very important.  You know stock market is a place for "playing with money".  People in business and investments have no time to "dilly dally" like what we normally do in Singapore, businesswise and privatewise.  So there is a difference.  Just also take a look between players/investors treating Oceanus..it is the same treatment like Biosensors getting.  So I don't really touch both.  But they are very good couters, to say the truth.. Cheers

 

Just some update on BIG newly acquired company Cadiomind ( CARE II trial). This Trial  is also being conducted in our renowned Spore National Heart Center since 2008 and all the patients are doing well. Read what the Prof of NHC has to say about the Sparrow stent and its future potential. The large number of overeating and smoking Chinese polution will yield a large number of heart patients(bigger than US ) requiring stent treatment in the next years. So my view is BIG should get closer to China/HongKong Market (ie HK Ex or Shenzhen Ex) to be appreciated and rewarded.    

by National Heart Centre Singapore

Heart patients with small, difficult to treat vessels requiring stenting procedures may soon have another viable option to treat coronary artery disease. Known as the CardioMind SparrowTM Drug-Eluting Coronary Stent System, this stent is 70% smaller in diameter than any other currently approved stent and targets at blood vessels smaller than 2.75mm in diameter.

The Sparrow Stent System is an improved version of the current stents in the market. Conventional balloon-expandable stents travel over guidewires to the lesion in the artery. The Sparrow Stent is incorporated into the distal end of the guidewire itself, therefore having the same outer diameter and flexibility as the guidewire. The stent travels as part of the guidewire to the site of the lesion. The cardiologist then releases the stent and allows it to self-expand and support the vessel wall. The tightness of fit of conventional stents, as well as their inflexibility and the forces delivered by the balloon expansion, may contribute to increased vessel trauma, which in turn leads to less favourable long-term results. The Sparrow Stent also offers more flexibility than the current stents, making it especially adaptable to the treatment of small, tortuous blood vessels often associated with diabetes, which represent 40% of the patients who require a stenting procedure. Over time, the polymer of the Sparrow Stent will gradually biodegrade away and return the stent to a bare metal state. Biodegradable polymers for drug-eluting coronary stents are thought to contribute to a reduction in late stent thrombosis rate.

The centre estimates that 10% - 30% of the patients requiring percutaneous coronary interventions (PCI) may benefit from this revolutionary stent. The Sparrow Stent is currently being evaluated in a clinical trial known as the CARE II Study.

Laulan      ( Date: 01-Oct-2010 10:52) Posted: Listing in the right location is very important.  You know stock market is a place for "playing with money".  People in business and investments have no time to "dilly dally" like what we normally do in Singapore, businesswise and privatewise.  So there is a difference.  Just also take a look between players/investors treating Oceanus..it is the same treatment like Biosensors getting.  So I don't really touch both.  But they are very good couters, to say the truth.. Cheers. infancybird      ( Date: 30-Sep-2010 18:27) Posted: Microport HK beat or K.O.  Biosensor SG in term of trading volume and price appreciation since its debut listing in HK Ex.    Just wonder why Biosensor has not considered going to Hongkong for secondary listing. Midas has done it and its share value has gone up considerably. Biosensor has greater marketing and technological advantage than Microport HK but the latter`s listing on HK Ex produces far greater trading volume and price appreciation than the former .It is therefore logical to seek secondary listing in Hong Kong as the HK investor seems to appreciate the value of stent industry far better than our Spore counterpart.

 

Listing in the right location is very important.  You know stock market is a place for "playing with money".  People in business and investments have no time to "dilly dally" like what we normally do in Singapore, businesswise and privatewise.  So there is a difference.  Just also take a look between players/investors treating Oceanus..it is the same treatment like Biosensors getting.  So I don't really touch both.  But they are very good couters, to say the truth.. Cheers.

infancybird      ( Date: 30-Sep-2010 18:27) Posted: Microport HK beat or K.O.  Biosensor SG in term of trading volume and price appreciation since its debut listing in HK Ex.    Just wonder why Biosensor has not considered going to Hongkong for secondary listing. Midas has done it and its share value has gone up considerably. Biosensor has greater marketing and technological advantage than Microport HK but the latter`s listing on HK Ex produces far greater trading volume and price appreciation than the former .It is therefore logical to seek secondary listing in Hong Kong as the HK investor seems to appreciate the value of stent industry far better than our Spore counterpart.

 

apologies, incorrect Microport closing price should be S$1.46

 

Based on increased daily volume it  appears that there are more followers of this stock and that overseas (HK) investors have noticed this counter.  But counter does not appear to have institutional following.   Efficient markets and knowledgable investors normally remove large market inefficiencies. 

The big question is:  if and when the value of BIG and Microport will converge???? . 

Trading Comparison

Microport V.  BIG

.1693 Xchng

Microport  Vol. 52.9M  Close S$1.38  Mkt Cap S$2.1B

BIG            Vol. 16.8M  Close S$0.99  Mkt Cap. S$1.B

 

 

Microport HK beat or K.O.  Biosensor SG in term of trading volume and price appreciation since its debut listing in HK Ex.   

Just wonder why Biosensor has not considered going to Hongkong for secondary listing. Midas has done it and its share value has gone up considerably.

Biosensor has greater marketing and technological advantage than Microport HK but the latter`s listing on HK Ex produces far greater trading volume and price appreciation than the former .It is therefore logical to seek secondary listing in Hong Kong as the HK investor seems to appreciate the value of stent industry far better than our Spore counterpart.    

 

Wow ....you're spot on... TA or news??

Laulan      ( Date: 30-Sep-2010 15:32) Posted: Be lert, it will cheong soon.

 

how come will chiong?

Laulan      ( Date: 30-Sep-2010 15:32) Posted: Be lert, it will cheong soon.

 

Be lert, it will cheong soon.

 

Back to the same-old, same-old..........

 

Trading Comparison

Microport V.  BIG

.1697 Xchng

Microport  Vol. 31.6M  Close S$1.38  Mkt Cap S$1.9B

BIG            Vol. 11.5M  Close S$0.99  Mkt Cap. S$1.B

 

MICROPORT  -  BIOSENSORS

HONG KONG  VS  SINGAPORE

 

Microport Goes into public arena at HK$6.10  S$1.07 providing an enterprise value of HK$8.5B  and S$1.5B

 

After trading several days Microport closes at HK$8.50  S$1.49 providing an enterprise value of HK$11.9B and S$2.1B.

 

Establishing Microport’s value between S$1.5 – $2.1B.

 

BIG is a direct comparable competing in China Market through JWMS who is second to Microport with 28% mkt share compared to Microport’s 32% mkt share (Forrester estimates) and directly in the rest of the world.

 

BIG owns proprietary clinically proven superior technology, Microport does NOT. 

BIG has robust product pipeline Microport does not.

BIG’s gross revenue and net profits are larger than Microport’s.

BIG’s EPS greater than Microport’s

 

BIG’s share price closed at S$0.975 Microport’s is S$1.49

BIG’s enterprise value is S$1.0B and Microport’s is S$2.1B                  .

 

Microport traded in Hong Kong, BIG traded in Singapore

Is this the valuation difference????

 

//sorry...the second page is as below// Good showing at TCT BioFreedom — strategic decisions to be made Given the promising 12-month results of BioFreedom’s FIM (First in-Man) trial, we believe Biosensors is now faced with several strategic decisions to bring the group to the next level: �� Head-to-head trial against XIENCE V? Groundbreaking clinical results move market share in this industry. To achieve significant market share, we believe a head-to-head trial against the current industry gold standard XIENCE V is necessary. On the flip side, it may be a risky move as potential inferiority would be detrimental for BioFreedom’s publicity, in our view. �� Entry into the US market via licensing agreement. The group has been exploring options to enter the US DES market and has previously mentioned BioFreedom as a potential product to launch in the world’s biggest market. Given its lack of marketing capabilities and the huge expense involved in the FDA approval process, BIG is likely to seek a Terumo-like licensing agreement in the US, in our view. In this regard, upfront royalty payments could be potential stock catalysts. �� Potential clinical trial collaboration with JWMS in China. We believe BIG could look to leverage on JWMS to launch BioFreedom clinical trials in China. We think BioFreedom could also catalyse the strategic discussions between Weigao and BIG on JWMS as the stent JV does not have a third-generation stent in the R&D pipeline. Assuming BioFreedom receives CE Mark and FDA approval by 2012 and 2014, we would value it at US$477mn as a base case, which would potentially add S$0.20/share to our PT (Exhibit 1). However, given that management has yet to articulate its BioFreedom strategy, we believe it is premature to revise our SOTP valuation at this stage. We will revisit our valuation once we have more clarity on approval timeline and licensing agreement, if any.

 

 I directly quote from Nomura report.... ( i m q dis appointed with its performance today, though Nomura still rated BUY)

P.S> it's just for personal reference...no commercial related issue.Non representing any company..

Biosensors had a good showing at the annual TCT conference last week with three

sets of positive clinical results. Three-year LEADERS should drive incremental

market share gains for BioMatrix, while BioFreedom’s 12-month data could trigger

some corporate action, in our view. We estimate potential PT accretion of

S$0.20/share, pending further management guidance on BioFreedom strategy.

�� Catalysts

Continued momentum in its forthcoming results, potential value-unlocking of its

50% stake in domestic drug-eluting stent (DES) supplier in China, JWMS, and

Japan’s approval of Terumo’s Nobori, whose technology is licensed from BIG.

Anchor themes

The US$5bn DES industry is one of the most profitable segments in the medical

technology space, with market share changes driven by innovation. Start-ups like

Biosensors, with its leading-edge technology, could be M&A targets for incumbents

Good showing at TCT

�� BioFreedom: first polymer free DES

BioFreedom’s 12-month results showed that the polymer free stent is

safe and effective, meeting the primary end-point for efficacy and

proving statistical non-inferiority against Taxus, with a trend toward

superiority. With a reduced time frame of six months (as compared to

12 months) for dual anti-platelet therapy (DAPT), BioFreedom

addresses a major concern about the duration of DAPT for patients.

A larger trial involving head-to-head comparison with market leader

XIENCE V could be a game-changer, in our view.

�� BioMatrix: reaffirmative three-year LEADERS trial data

The divergence in MACE rate continues to favour BioMatrix over

Cypher, with a statistically significant reduction achieved in the highrisk

sub-group. We believe the positive three-year data is reaffirmative

and should drive incremental market share gains.

�� Sparrow: a step closer to portfolio diversification

The eight-month results from the CARE II study verified the safety and

efficacy of Sparrow DES in the treatment of small vessel lesions. This

supports BIG’s CardioMind acquisition and strategic intent to broaden

its product portfolio as the group intends to pursue it for various

clinical applications in small vessels throughout the body.

�� Maintain BUY — potential PT accretion of S$0.20/share

We believe BioFreedom’s preliminary success could trigger some

corporation action such as a licensing agreement in the US and

clinical trial collaborations in China via JWMS. A successful head-tohead

trial against XIENCE V could also be a possible M&A catalyst, in

our view. We estimate potential accretion of S$0.20/share to our PT

as a base case and will look to revise our valuation once there is more

clarity on management’s BioFreedom strategy. Reiterate BUY

BioFreedom — strategic decisions to be made

Given the promising 12-month results of BioFreedom’s FIM (First in-Man) trial, we

believe Biosensors is now faced with several strategic decisions to bring the group to

the next level:

��

market share in this industry. To achieve significant market share, we believe a

head-to-head trial against the current industry gold standard XIENCE V is

necessary. On the flip side, it may be a risky move as potential inferiority would be

detrimental for BioFreedom’s publicity, in our view.Head-to-head trial against XIENCE V? Groundbreaking clinical results move

��

exploring options to enter the US DES market and has previously mentioned

BioFreedom as a potential product to launch in the world’s biggest market. Given

its lack of marketing capabilities and the huge expense involved in the FDA

approval process, BIG is likely to seek a Terumo-like licensing agreement in the US,

in our view. In this regard, upfront royalty payments could be potential stock

catalysts.Entry into the US market via licensing agreement. The group has been

��

look to leverage on JWMS to launch BioFreedom clinical trials in China. We think

BioFreedom could also catalyse the strategic discussions between Weigao and

BIG on JWMS as the stent JV does not have a third-generation stent in the R&D

pipeline.

Assuming BioFreedom receives CE Mark and FDA approval by 2012 and 2014, we

would value it at

S$0.20/share to our PT

articulate its BioFreedom strategy, we believe it is premature to revise our SOTP

valuation at this stage. We will revisit our valuation once we have more clarity on

approval timeline and licensing agreement, if any.Potential clinical trial collaboration with JWMS in China. We believe BIG couldUS$477mn as a base case, which would potentially add(Exhibit 1). However, given that management has yet to

Exhibit 1. Potential valuation of BioFreedom (assuming CE Mark and FDA approval by 2012 and 2014)

 

Nomura reiterates BUY call on Biosensors. Anyone have their analyst's report?

 

think it will take a few dyas for Microport to settle and establish a range and then for analysts to re-evaluate BIG price target based on comparables