Optos eyes ‘most important launch in its history’ after US green light
The “Daytona” machine, which is smaller and more portable than the Dunfermline-based firm’s current equipment, will open up new markets for and improve its profit margins.
Financial director Christine Soden told The Scotsman: “It’s good to get approval from the US Food & Drug Administration (FDA) because lately it’s been getting more strict about medical devices.
“This means we can carry on as planned and won’t be helped back by any regulatory problems in the US. We’ll be unveiling Daytona at a conference in October and so it’s always better to be able to show them the version that has been approved.”
Daytona will make its debut at the American Academy of Optometry, which Soden described as one of the biggest meetings of its kind. She said the company was also in the process of applying for “CE mark” approval so it can sell the new machine in Europe. The device remains on course to be launched commercially early next year.
Optos’s current machines are large and so the new device will be able to fit into smaller clinics. It will also require less maintenance because it will attract less dust into its working parts.
In July, Optos posted an 82 per cent rise in third-quarter sales to $44.1 million (£27.4m). The rise in revenue continued as the group shifted from renting out devices to selling them to customers. The company has already grown its headcount in Scotland by 32 per cent over the past nine months to 130 as it gears up for the new device.
Shore Capital analyst Brian White said: “Daytona represents a significant opportunity for Optos, by providing its market leading technology in a much more compact and convenient platform and represents probably the most important new product launch for the company as it seeks to capitalise on its existing installed base and to compete with cheaper, but less sophisticated, rivals.
“While there have been no indications yet with respect to pricing, our forecasts have assumed that Daytona will have a price of $60,000-$70,000, with a significantly lower cost of manufacture than its current devices.”
Charles Weston, at Numis Securities, said manufacturing costs will be under $10,000, compared with $50,000-$60,000 for current devices.
Paul Cuddon, an analyst at brokerage Peel Hunt, who has been sceptical about Optos’ prospects, upgraded his recommendation from “sell” to “hold” following recent falls in the firm’s share price.
He added: “Gaining approval in the US is the first step in Optos’s transformation. Proving its durability, lower cost of manufacture and commercial potential are the next steps, where success is far from guaranteed.”