Australian x-ray products manufacturer Micro-X Ltd [ASX:MX1] has had its share price open higher today thanks to record time FDA approval for its ‘Rover’ device.
MX1 designs and develops lightweight x-ray products for global healthcare and security markets.
The company filed its 510(k) submission for the Rover to the FDA just over a month ago and today has announced it has received clearance for the product.
The FDA advises it usually takes about 90 days to review submissions, with MX1 claiming receiving clearance in just five weeks is recognition of its quality.
The MX1 share price was 3.3 cents or 22.45% higher at time of writing to trade at 18 cents per share.
Rover cleared but will it meet demand?
FDA approval is a big leap forward for MX1 has it seeks to meet demand for light-weight x-ray devices.
The Rover, weighing 95kg, is said to offer the higher power needed for trauma imaging previously only available from conventional technology more than five times that weight.
The concept was developed under the Australian Defence Force.
Under the contract MX1 set out to develop a full-performance, digital, medical x-ray imager, light enough to be used in deployed medical facilities.
The problem MX1 have moved closer to solving is that many defence forces are limited in the x-ray equipment they can deploy.
This is because of a weight and size factor.
Consequently, low-powered x-ray units intended for small animals are used in substitute.
FDA approval now means the Rover can be sold in the US.
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Having the world’s largest defence budget, the US represents the single largest market for the Rover.
Micro-X said it has been engaged in active discussions with the US Army Medical Materiel Agency about the Rover.
The Rover marks MX1’s second commercial product to enter the US.
COVID-19 spurs on global health stocks
Health care stocks on the ASX have outperformed the broader index this year as worries around the impact of coronavirus continue.
MX1 is not exception.
The company posted stronger than expected quarterly results in April.
Orders for its mobile x-ray system grew substantially in response to coronavirus-stimulated demand.
Purchase orders for the units amounted to $3 million in the first quarter of 2020.
Which was ‘significantly higher than the company’s expectations’.
The company had $800,000 in orders for the December 2019 quarter.
Sales could improve throughout 2020 and into next year as MX1 seeks to expand its sales across the US, Australia, the United Kingdom and other NATO countries.
Combined, the regions have an addressable market size exceeding $170 million.
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For Money Morning