Teleflex Incorporated (TFX - Free Report) , a global leader in medical devices used in critical care and surgery, recently obtained the approval of the U.S. Food and Drug Administration (FDA) for its Arrow FlexBlock continuous peripheral nerve block catheter. The company’s latest offering will annex its market dominating line of Arrow StimuCath continuous peripheral nerve block catheters.
Arrow FlexBlock will help clinicians to better manage the spread of anesthetic due to its tip design. The product is expected to be preferred by clinicians who turn to ultrasound-guidance to ratify the placement of the catheter.
Teleflex’s Arrow FlexBlock will enhance its line of Anesthesia and Airway Management products in its largest segment - Critical Care (accounted for 66% of total revenues in 2011). The Anesthesia and Airway Management franchise contributed 22% to Critical Care revenues in 2011.
The Arrow FlexBlock along with the earlier launched Arrow SureBlock Kit and the twin acquisitions of Willemstad, Netherlands-based LMA International N.V. and LMA’s laryngeal mask supraglottic airway business from Intavent Direct Limited, provides the company an extensive anesthesia and airway management portfolio. Teleflex expects incremental revenues from the extended Anesthesia and Airway Management franchise.
Teleflex has embarked on enhancing its Arrow brand ever since the acquisition of Arrow International in 2007. However, the failure to protect its intellectual property and lower-than expected market adoption of the new products may hinder the company’s growth trajectory.
Limerick, Pennsylvania-based Teleflex’ focus on profitable and consistent growth is expected to yield results, helped by demographic trends and barriers to entry in the industry. The recent divestiture of its OEM Orthopedic division is expected to aid the company’s strategy of new product introduction, and investment in innovative technologies. This might accelerate Teleflex’ top-line in the years ahead.
However, Covidien , C.R. Bard (BCR - Free Report) and CareFusion , which operate in similar business segments, present a tough competitive landscape for Teleflex. Additionally, the company operates in a stringent regulatory environment. The demand for its products is susceptible to healthcare reimbursement systems in the domestic as well as the international market.
Teleflex currently retains a Zacks #4 Rank, which translates into a short-term Sell rating.