Baxter International Hiding in Plain Sight
Credit Suisse analyst Kristen Stewart tells clients that the Colleague infusion pump has been plagued with problems for several years -- two recalls in 2005 and an FDA seizure of pumps in 2005. Baxter signed a consent decree in 2006 but had another recall last year, Stewart adds. It continues to talk to the FDA, and it continues to try fixing software problems with the pump.
"Baxter no longer expects the re-commercialization of Colleague in the second half of 2008," she told clients in mid-April research report. "While the delay is disappointing ... we are not that surprised given the history of delays."
Some pumps have been upgraded and remain on the market, says Stewart, adding that the product has lost only 3% to 4% of its market share in the past two years. Stewart, who doesn't own shares, is neutral on the stock. Her firm has had a recent investment banking relationship.
"They need to fix this
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