Medical devices company Medigus Ltd. (TASE:MDGS), which develops non-invasive devices as an alternative to surgery for treatment of severe heartburn, has filed a prospectus with the US Securities and Exchange Commission (SEC) for listing its shares as American depository receipts (ADRs), a security traded on a US stock exchange that follows a share of a foreign company. Medigus, whose market cap is NIS 120 million, announced already in November 2014 its intention of registering such a security in the US.
After the prospectus is submitted and the process is completed, the company's security will be listed on Nasdaq, and it can conducted financing rounds in the US. Medigus, whose largest shareholder is OrbiMed Advisors LLC, had NIS 2.6 million revenue in 2014 from its product for treating heartburn, launched two years ago, and sales of a miniature camera for use in the devices of other companies, both medical and non-medical. This revenue is not significantly larger than in 2013, and the company's loss grew substantially to NIS 22.6 million.
Medigus CEO Christopher Rowland, a US citizen, has said in the past that the company's revenue up until now from marketing its product in the US was insignificant, and that a process of gathering information (among other things, from an additional clinical trial by the company for marketing purposes, not for obtaining approval), negotiations with insurers, and work with physicians who are medical opinion leaders is getting under way, with the aim of getting the product accepted in the market as an alternative to conventional surgery. Two months ago, the company reported that the American Medical Association (AMA) had recommended that the government insurance companies should include Medigus's procedure in their health baskets. This recommendation is not yet binding on the government, and it is not known what price can be charged for use of the product and when, but it is a step in the right direction.
Published by Globes [online], Israel business news - www.globes-online.com - on May 10, 2015
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