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Source: OvaScience

What: After cutting guidance for the use of its in-vitro fertilization products, OvaScience (NASDAQ:OVAS) shares lost more than third of their value today.

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So what: Previously, OvaScience was guiding for investors to expect 1,000 Augment treatment cycles this year; however, the company now believes it's likely to fall short of that number.

OvaScience is blaming the shortfall on M&A activity within clinics offering Augment, which OvaScience believes will result in lower-than-hoped for fourth quarter demand. That's especially disappointing to investors because the fourth quarter was when the company expected Augment's use to rise sharply.

Now what: OvaScience's Augment is intriguing because it uses mitochondria from a patient's own precursor eggs, rather than donor mitochondria, to improve egg health and boost in-vitro success rates.

The potential to improve in-vitro success is important because most women's success rate is just 20% to 35% per-cycle and spending on in-vitro procedures can  run between $10,000 to $15,000 per cycle, or more.

However, OvaScience's Augment is only available outside the U.S., and while the company has additional in-vitro approaches under development, it's uncertain how big the commercial demand will ultimately be for OvaScience, or when its solutions will be ready for the financially-important U.S. market.

Overall, OvaScience is worth watching, but until it can translate that "intrigue" into dollars on the bottom line, investors ought to approach it cautiously.

 

Todd Campbell has no position in any stocks mentioned.  Todd owns E.B. Capital Markets, LLC. E.B. Capital's clients may have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.