BUY !!! Hologic (HOLX)

Hologic (HOLX), a leading player which caters to the healthcare needs of women, is seeking marketing approval for its three dimensional (3D) breast imaging platform, Selenia Dimensions system. Selenia has been developed on the Dimensions platform utilizing tomosynthesis technology to produce both 3D and the conventional two dimensional (2D) full field digital mammography (FFDM) images. The images can be used for screening and diagnosis of breast cancer.

While Selenia has received an approval from the US Food and Drug Administration (FDA) for providing 2D images, it is yet to receive approval for the 3D configuration. As a part of the pre-market approval (PMA) application, Hologic is awaiting recommendation from the FDA’s Radiological Devices Panel, scheduled for September 24, 2010. Selenia had received CE mark approval in Europe in fiscal 2008 and Canadian registration in March 2009, both for 2D and 3D modes of imaging.

Although the FDA is not bound to accept the panel’s recommendations, it generally does so. A favorable panel recommendation will increase the probability of Selenia receiving marketing approval in the US.
The FDA is seeking advice from the panel regarding the potential risk-benefit analysis of using the 3D platform. The panel will consider whether the potential advantage of 3D tomosynthesis outweighs the risk from additional radiation exposure. The panel will consider results of the pivotal Reader Study 1 and the two supplemental Reader studies. Hologic had submitted Reader Study 2 and the Pittsburgh study in response to deficiencies noted by the FDA.

Breast Health is the largest segment at Hologic which accounted for 45% of sales during the third quarter of fiscal 2010. This segment generated revenues of $189.3 million, 8.2% higher than the year-ago period primarily driven by the increased installed base of Selenia. Of the total revenues, about 54% came from capital equipment while the rest was contributed by disposables and services. We expect this segment to generate robust growth in revenues if the 3D version of Selenia receives approval in the US.
http://www.hologic.com/en/

Analysts' Targets
Argus Research	$24
Hold
Wednesday, February 09, 2011
Brigantine Advisors LLC	$24
Hold
Tuesday, February 01, 2011
Barclays Capital	$20
Overweight
Tuesday, January 25, 2011
RBC Capital Markets	$25
Outperform
Monday, December 20, 2010