Given Imaging (Nasdaq:GIVN)
said today that its second-quarter sales beat most analyst forecasts, reaching about $7 million. Analysts had predicted sales of $6.2 million to $6.3 million for the second quarter. Given Imaging, which makes an ingestible diagnostic mini-videocam contained in a capsule, called M2A, will be publishing its results on July 31.
The company is working hard to increase medical insurance coverage for use of its unique diagnostic system, Gavriel Meron, the Yokneam, Israel-based company's CEO, told TheMarker today.
Meron sees insurance coverage enjoying a snowball effect: when one insurer starts reimbursing for the capsule's use, others follow suit, he told TheMarker.
In the last two weeks the company announced that two more American insurers will reimburse use of its capsule endoscopy method: Noridian Medicare, and Oxford Health Plans. The agreements bring reimbursable access to its device to 26 million people in the United States alone.
Given Imaging is not sitting on its laurels. Insurance coverage in the U.S. could potentially extend to ten times that number, Meron said. "We have a lot of work to do in the field of insurance reimbursement, and we're doing it," he said. "We hope to obtain additional approvals in the coming quarters."
Insurance coverage facilitates access to the non-invasive capsule endoscopy method for millions of people suffering from conditions of the intestinal tract. The capsule contains a mini-camera that sends real-time images to a monitor the patient wears on a belt. The camera passes through the digestive tract and is expelled in the normal way.
Articles and studies on the capsule's efficacy in helping diagnose small intestine conditions will shortly be published in medical journals, Meron added. These publications will further spur use of the company's device, he said.
As coverage for his ambitions, Meron points out that Given Imaging's market penetration was rapid compared with products of peer companies. It started marketing its capsules after receiving Food and Drug Administration approval in August 2001, and has reached 26 million people.
Medinol, a Jerusalem-based stent-maker, took two years to achieve that kind of penetration, Meron claimed. Moreover, Given Imaging achieved these sales before extensive coverage in the medical press, which attests to the device's efficacy, he said.
On sales in Israel, most hospitals now use the company's device to diagnose small-intestine conditions, Meron said. But its use is reimbursed only by a few extended-medical insurance programs. The cost of non-reimbursable treatment runs at about NIS 5,000, which is just over $1,000, he said.
The Israeli army recently approved use of the device for soldiers, Meron added.