Varian Medical Systems, Inc. (VAR - Free Report) recently announced that its coveted Halcyon system has been approved by the China National Medical Product Administration (NMPA). Notably, this will allow Varian Medical to market this cancer treatment system in the country apart from expanding its global availability.
This is likely to strengthen Varian’s Oncology Systems unit, apart from fortifying its hold in China.
Following the announcement, shares of Varian Medical rose 1.8% to $121.72 at close.
The stock carries a Zacks Rank #3 (Hold).
Further, the company announced that it was selected by Medical Specialist Holdings (MSH) to equip seven of its centers in South Africa with Varian Medical’s linear accelerators and Eclipse treatment planning system.
Halcyon at a Glance
Varian Medical’s Halcyon radiotherapy treatment system, designed to offer cost-effective cancer care, streamlines every aspect of image-guided volumetric intensity modulated radiotherapy (IMRT).
In the recently reported fourth quarter of fiscal 2018, the Halcyon platform received 84 new orders. Moreover, during the quarter, the company had 510(k) clearance for Halcyon with kilovoltage cone-beam CT imaging.
Oncology System in Focus
Varian Medical’s Oncology System, the largest operating business unit, provides products for radiation treatment of cancer with conventional radiation therapy.
Oncology revenues in fiscal 2018 totaled $2.77 billion, up 13.7% year over year, accounting for a whopping 94.9% of net revenues. In the fiscal fourth quarter, the segment revenues grew 13% year over year.
Varian Medical has a strong presence in countries like Kenya, Brazil and India as well.
Last month, the company’s Advanced Radiotherapy Clinical School started running courses at India-based Reliance Group's flagship Kokilaben Dhirubhai Ambani Hospital (KDAH) in Mumbai. (Read More: Varian & Reliance Group Tie Up to Enhance Cancer Care)
In recent times, Varian Medical has collaborated with Kenya’s Mediheal Group of Hospitals to expand radiotherapy access in the country. (Read More: Varian Up on Tie-Up With Kenya's Mediheal Group of Hospitals)
Furthermore, the company announced a software technology training and education cooperation agreement with the Brazil Ministry of Health (MOH) and seven universities and science and technology institutions (ICTs) in Brazil. (Read More: Varian Medical Merges With Brazil MOH to Fight Cancer)
We believe positive developments such as these will boost Varian Medical’s shares, which have rallied 9.5% compared with the industry’s 13.4% rise. The current level is higher than the S&P 500 index’s 2.1% gain.
Some better-ranked stocks in the broader medical space are Integer Holdings Corp. (ITGR - Free Report) , Surmodics, Inc. (SRDX - Free Report) and Veeva Systems (VEEV - Free Report) .
Integer Holdings has an earnings growth rate of 31.2% for the next quarter and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Surmodics’ long-term earnings growth rate is projected at 10%. The stock carries a Zacks Rank of 2.
Veeva Systems’ long-term earnings growth rate is estimated at 19.3%. The stock carries a Zacks Rank #2.
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