Symmetry Surgical Inc. (SSRG) recently announced that it has signed an exclusive distribution agreement with neoSurgical Ltd. in the U.S., for the latter’s neoClose Trocar Port Closure System. The company will start selling the product from the first quarter of 2015.
Notably, in 2013, neoSurgical had received the FDA go-ahead to market the product. The product is usually used for the closure of Trocar ports used in robotic and laparoscopic surgical procedures.
Ever since the product’s initial rollout, it has been getting positive reactions from surgeons and clinicians. The product has been touted as a user friendly one, which is able to close 5 mm to 15 mm trocar ports quickly.
Recently, Symmetry Surgical separated from Symmetry Medical and began trading independently on the NASDAQ. Symmetry Medical also completed the divestiture of its OEM solutions business unit to Tecomet Inc. The OEM business sale is expected to boost the growth potential of Symmetry Surgical.
The re-usable surgical instruments market is currently worth almost $1 billion and Symmetry Surgical is estimated to have an approximate 8–9% share of it. However, this is only a minuscule part of the general surgery devices segment, which is estimated to be worth $18 billion.
Symmetry Surgical, in its new capability as a stand-alone entity, is looking to penetrate this rapidly growing market buoyed by strengths like product development and potential distribution agreements from various companies.
However, sluggish hospital spending environment will continue to provide significant challenges to the Symmetry Surgical’s business. Moreover, intensifying competition from the likes of Synergetics USA (SURG), ABIOMED (ABMD) and AngioDynamics (ANGO) pose major headwinds.
While Synergetics USA sports a Zacks Rank #1 (Strong Buy), both ABIOMED and AngioDynamics holds a Zacks Rank #2 (Buy).
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