Given the gangbusters growth and eye-watering outlook it's no surprise investors have to cough up for a slice of Sirtex Medical Limited (ASX: SRX).
Today the cancer treatment specialist posted a net profit of $17.1 million on revenues of $80.5 million for the six-month period ending December 31, 2014. The profit and revenues are up 58.1% and 37.3% over the prior corresponding period (pcp). The stocks has climbed 9.67% to $33.02 in afternoon trade.
Organic growth
The company sells doses of an innovative radiation therapy for the treatment of advanced liver cancer and growing global demand saw dose sales jump 26.3% over the pcp, with the additional tailwinds of product price rises and a tumbling Australian dollar.
Both North America and Europe the Middle East and Africa saw dose sales growth of around 28% over the pcp as willingness amongst oncologists to use the treatment continues to improve.
Sirtex continues to invest heavily to promote use of its SIR-Spheres microspheres as a treatment of last resort and given the large unmet global markets rapid sales growth should continue into the future.
Clinical investment
Investors though are eagerly awaiting the initial results of the company's SIRFLOX clinical trial which are due to be released in March 2015.
The goal of the SIRFLOX trial is to demonstrate the effectiveness of the company's radioactive spheres in giving cancer patients a longer progression free survival time period. If the study meets this primary endpoint sales of the treatment could go through the roof.
Given that the treatment is already proven as effective in treating late-stage cancer the question is whether the trial evidence will be sufficiently strong to persuade oncologists to use the treatment as a standard of care.
The company also has several other trials in progress due to report at later dates, all of which are designed to provide convincing clinical evidence to promote the product's use.
Selling for $33.03 in afternoon trade investors are already pricing in some great expectations, whether they're met remains to be seen.
Sirtex alongside stocks like Ramsay Health Care Limited (ASX: RHC) and CSL Limited (ASX: CSL) looks one of the best healthcare businesses on the ASX. But it's no secret!
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