Biosensor

Biosensor: noting that there has been strong selling pressure in BIG share price recently and one of the reasons for the decline can be attributed to ongoing concerns over the impact of mandatory stent price cuts in several countries such as India, China and Japan. In addition, Terumo Corp (Terumo), which licenses BIG’s drug-eluting stent (DES) technology in exchange for a royalty fee, reported its results on Tue. Its Nobori DES sales in Japan was adversely affected by the National Health Insurance’s (NHI) official price cut (~15%) and increased competition from new product launches. Hence, house believe that this would impact BIG’s licensing revenues during its upcoming 2QFY13 results, which is due on 7 Nov (after market close). HOuse currently reviewing forecasts and $1.81 fair value estimate, but maintaining its BUY rating as believe that BIG will continue to capture market share from its competitors for its BioMatrix™ family of DES, while one of Terumo’s key 2HFY13 initiative is to regain its Nobori market share in Japan.