MENU

Medical Developments International Ltd (ASX:MVP) shares plunge lower on FDA news

It hasn’t been a great day for the Medical Developments International Ltd (ASX: MVP) share price.

In late morning trade the healthcare company’s shares are down a sizeable 14.5% to $5.00.

Why are Medical Developments International shares plunging lower today?

The Medical Developments International share price has taken a hit after the company provided an update on its United States operation.

According to the release, management met with the U.S. Food and Drug Administration (FDA) overnight and was dealt a blow in relation to getting its Penthrox “green whistle” pain management product approved for sale.

The administration informed the company that the clinical program for Penthrox is to be put on hold pending a letter outlining outstanding issues and concerns. Unfortunately, this letter could take upwards of two months to be received.

CEO John Sharman was clearly disappointed. He has stated that:

“This setback in our timetable to have Penthrox approved for sale in the US is very disappointing. We must now wait and see what the FDA require us to do, in addition to the work we have already done.”

The company intends to update the market when further information is made available.

Should you buy the dip?

While I think that Medical Developments International is a quality healthcare company and that its Penthrox product has a bright future ahead of it, it might be prudent to wait for the FDA’s letter before deciding whether to invest.

There is still a huge opportunity for the product outside the United States, but I do think it could be worth hearing the FDA’s concerns first. Just in case its concerns influence regulators or potential buyers in other markets.

In the meantime, I think that fellow healthcare sector shares CSL Limited (ASX: CSL) and Cochlear Limited (ASX: COH) would be great buy and hold options for investors even after their stellar gains this year.

Or maybe this ASX healthcare small cap share which is up 285% with no sign of stopping...

One Australian company has developed a state of the art device that's revolutionizing hospitals all over the world. Even better, this device is so profitable that the company rakes in 90% margins. That's a lot of cash. So no wonder the stock's up 285% since 2008 – with no signs of stopping...

To discover the name and code, simply click the link below. You'll discover our expert's #1 medical technology pick... and you can decide for yourself whether to get invested today.

Click here to claim your free report.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Cochlear Ltd. 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. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!