AngioDynamics Rises Following NanoKnife Shift

NEW YORK (AP) — Shares of AngioDynamics Inc. jumped Friday as Wall Street appeared to react positively to the medical device maker's plans to conduct more studies of its NanoKnife surgical device, even though that will hurt sales in the near future.

AngioDynamics reported its fiscal third-quarter results on Thursday, and reduced its full-year forecasts. The company said it will perform new clinical trails of NanoKnife, including testing the device in prostate cancer surgeries and at least one other indication, in order to prove its effectiveness and encourage more physicians to use it. As a result it will scale back marketing efforts for now.

AngioDynamics' adjusted third-quarter profit was also greater than analysts had expected.

In afternoon trading, the Queensbury, N.Y., company's stock rose $1.17, or 10 percent, to $12.87.

Stifel Nicolaus analyst Thomas Kouchoukos approved of the change in strategy, crediting Chief Executive Jan Keltjens, who joined the company March 1. He noted that sales expectations for the product had gotten too high.

"In our view, Keltjens' decision to scale back the company's IRE/NanoKnife commercial push in order to generate real clinical evidence to support the device on a longer term basis is a good one," he said. He said the new studies will take several years, with final Food and Drug Administration approval taking at least two or three years.