What happened
Shares of Shockwave Medical (SWAV +0.00%) were up 10.69% early Tuesday afternoon after the Centers for Medicare and Medicaid Services (CMS) unveiled a proposed rule that detailed new payment codes for coronary intravascular lithotripsy (IVL), which is performed by a system that Shockwave manufactures. Shockwave's IVL uses sonic pressure waves to break up hardened plaque in arteries.
NASDAQ: SWAV
Key Data Points
So what
Not only do the proposed new codes mean more money for Shockwave -- an estimated $4,000 to $5,000 more per procedure -- but it also shows that the CMS is recognizing the value of the IVL. This will go a long way toward getting more physicians to use the system.
Shockwave has estimated the procedure's total addressable market could be worth $8.5 billion a year. The stock is up more than 21% so far this year.
NASDAQ: SWAV
Key Data Points
Now what
The news out of the CMS wasn't the only news that affected Shockwave recently. On Monday, the company announced it was completing its $75 million purchase of specialty medical-device company Neovasc.
Neovasc Reducer System has been approved in Europe to treat refractory angina, a chronic type of chest pain when the coronary arteries deliver an inadequate supply of blood to the heart muscle. Shockwave says this market is worth $5 billion a year.
Shockwave's financials have improved dramatically in the past year. Last year, it reported revenue of $489.7 million, up 107%, and net income of $216 million, compared to a loss of $9.1 million in 2021. Yearly earnings per share (EPS) in 2022 were $5.70, compared to an EPS loss of $0.26 in 2021. The company said it expects a rise of 35% to 39% this year in revenue, landing between $660 million to $680 million.