Cryomedical gets big order for its surgery systems

June 30, 1993|By Dow Jones News Service

ROCKVILLE -- Cryomedical Sciences Inc. yesterday announced that it had received an $8.5 million order for 36 of its cryosurgery medical systems, which use low temperatures to destroy cancerous tissue.

J.J. Finkelstein, Cryomedical's president and chief executive, said the order from U.S. Medical Corp. of Cincinnati would exceed the company's estimated revenue for the 1993 fiscal year.

For the fiscal year that ends today, the company expects revenue of between $5 million and $6 million. Mr. Finkelstein estimated fourth-quarter revenue at $2.7 million to $2.9 million.

In the fiscal year that ended June 30, 1992, Cryomedical had a net loss of $4.7 million, or 26 cents a share,on revenue of $277,304. The company did not break out fiscal 1992 fourth-quarter numbers.

The company's product, the CMS AccuProbe system, allows for minimally invasive surgery by freezing cancerous tissue in the prostate or liver area. The process, which uses liquid nitrogen at 190 degrees below zero Celsius, has been performed about 500 times in the United States with the Cryomedical system.

The system does not require large incisions or the removal of tissue, Mr. Finkelstein said.

In fiscal 1993, U.S. Medical ordered five of the systems and sold eight. The fiscal 1994 order for 36 systems includes 10,000 disposable probes.

"This is a significant purchase order of our product -- the largest we've ever had," Mr. Finkelstein said. "I can't speculate if we'll get more orders of this size, but demand for the product is picking up quite rapidly."

Cryomedical's stock rose sharply on the news yesterday, rising $1.125, to close at $5.625. It had taken a dive starting June 11, from $7 a share to a low on Friday of $3.125. The company said it knew of no adverse news that might have accounted for the fall.

Mr. Finkelstein expressed optimism about expanding the use of the company's cryosurgery system, which he says costs about half as much as traditional radical prostate or liver surgeries. He said the company was exploring cryosurgery applications for kidney, lung and pancreatic cancers.

The cryosurgery system is the company's only product, but Mr. Finkelstein said Cryomedical is developing some other medical products, primarily solutions to help preserve organs for transplant and help facilitate bloodless surgeries.

Mr. Finkelstein says that the organ solutions are 18 to 24 months from market, while the blood-like solutions remain "a number of years away." But business plans center on the CMS AccuProbe cryosurgery system.

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