The recent FDA approval of Scimed's new Rally rapid-exchange percutaneous transluminal coronary angioplasty catheter translated into a 14-1/2 point increase for the issue in May, to 53. Market reaction to the approval was immediate: Scimed stock jumped 5-3/4 on May 13, the day after Scimed announced the approval. The device will replace Scimed's earlier-generation Express balloon catheter, which must exit the market by Nov. 30 under the terms of the company's 1991 patent infringement settlement with Lilly ("The Gray Sheet" May 17, p. 1). Scimed currently pays a 20% royalty to Lilly's Advanced Cardiovascular Systems on sales of Express catheters that are made or sold in the U.S., an outlay that is expected to decline rapidly as the firm phases in the Rally. Scimed also is beefing up European operations. The firm recently completed the acquisition of the Petit Rechain, Belgium manufacturing facility from American Home Products subsidiary Sherwood Medical S.A. Scimed announced the deal last June; since then, Sherwood has provided product on a contract manufacturing basis. In a June 1 release, Scimed says it "is currently manufacturing and shipping most of its international Express and Rally single operator exchange catheter orders from Petit Rechain, and has plans to begin European production of some of its over- the-wire catheter products." The May advance helped Scimed recoup some of the ground lost by the stock earlier this year. At 53, Scimed is 6-1/8 shy of its 1992 year-end close of 59-1/8. Scimed joined a broad advance among the 41 NASDAQ-traded medical device and diagnostic issues followed monthly by "The Gray Sheet." Thirty-two issues increased, seven declined and two were flat in May, for an overall advance of 8.4%. Favorable publicity about the value of uterine monitoring in at-risk pregnancies helped propel Tokos to a 40% advance in May, as the stock climbed 2-1/4 to 7-7/8. At a May 3 meeting of the American College of Obstetricians and Gynecologists, University of Mississippi researchers unveiled results from a five-year study of 17,186 women indicating that at-home monitoring significantly reduced incidence of pre-term labor in women having one or more risk factors. In the three days following the announcement, Tokos stock climbed as high as 8-7/8 before falling back slightly later in the month. The May advance marks Tokos' first monthly gain so far this year; however, at 7- 7/8, the issue is still trading at less than half its 1992 year- end valuation. Electro-therapy device manufacturer Empi continued to climb in May, advancing 9-3/4 points to 54-1/2. On May 19 the firm announced its agreement to acquire Fort Lauderdale, Florida-based Physical Health Devices and a letter of intent for marketing rights to MedAmicus' Lumax cystometry system ("The Gray Sheet" May 24, In Brief). The firm also announced a 2-for-1 stock split, effective June 11. Empi is one of only six firms on the O-T-C Index currently valued above its 1992 close.
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