AngioDynamics Inc. ANGO recently announced that Health Canada has approved the company’s Celerity PICC Tip Confirmation System with Navigation to assist in the positioning of Peripherally Inserted Central Catheters (PICCs) in adult patients. The company expects to commercialize the new product in the fourth quarter of fiscal 2016.

The new technology is an upgraded version of the existing tip location system with new features like real-time catheter tracking, which aids physicians to determine the PICC tip location. This is notably the first regulatory approval for Celerity with Navigation. AngioDynamics has filed for FDA approval in Nov 2015, and the clearance is expected before the end of fiscal 2016.

Per management, the new technology will help more physicians and patients clinically benefit from BioFlo. Notably, the Celerity system when combined with the company’s BioFlo technology provides unique clinical and economic advantages. The combined offering helps generate significant cost savings, which in turn, is boosting demand from the company’s clients and hospitals.

We believe the new approval will help AngioDynamics gain better market traction in Canada. Given that the company’s PICC business in the region is noteworthy, we believe introduction of the technology will boost the customer base, which in turn, will drive revenues.

We also believe that the new technology might help make a turnaround in the fortunes of AngioDynamics’ Vascular Access (VA) business, which is not currently doing well. In the recently reported second quarter of fiscal 2016, the company’s VA business revenues declined almost 11% owing to lower sales of PICC (down 13%).

Zacks Rank and Key Picks

Currently, AngioDynamics has a Zacks Rank #3 (Hold). Better-ranked stocks in the medical sector are Abiomed ABMD, Exactech EXAC and Luminex LMNX. All the stocks sport a Zacks Rank #1 (Strong Buy).

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