Now could be the time to pounce on the ASX biotech stock in this article according to analysts at Bell Potter.
That's because it believes the speculative stock could generate very big returns over the next 12 months if everything goes to plan.
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Which ASX biotech stock?
The stock in question is Anteris Technologies Global Corp (ASX: AVR).
It is developing the DurAVR device, a class III medical device in the class of transcatheter aortic heart valves used for the treatment of severe aortic stenosis.
Bell Potter notes that the condition affects ~12 million people globally with an estimated ~150,000 procedures completed each year via the minimally invasive TAVR (transarterial valve replacement) procedure.
What is the broker saying?
Bell Potter notes that the ASX biotech stock is making a lot of progress towards getting its DurAVR product approved. It said:
Anteris continues to make excellent progress towards approval of the DurAVR by virtue of the recent opening of the Investigative Device Exemption (IDE) in the US followed by the US$320m capital raise to fund the pivotal study.
Any suggestion that DurAVR is not a serious a threat to the market leaders in the TAVR space should now be extinguished. The opening of an IDE is a seriously impressive achievement for any company, let alone AVR with no significant history at the FDA and no previous product approval. Secondly, the $90m placement (included in the $320m) to Medtronic (MDT) provides it with an effective right of last refusal on future M&A. It also amounts to a validation of the multiple features with the DurAVR technology which make it an appealing alternative to both the Edwards Life Science SAPIEN or the Medtronic's Evolut and CoreValve TAVR devices. AVR represents Special Value for MDT, which is now well positioned for a potential acquisition.
Big potential returns
According to the release, the broker has retained its speculative buy rating with an improved price target of $13.00 (from $10.00).
Based on its current share price of $8.76, this implies potential upside of 48% for investors over the next 12 months.
Commenting on its recommendation, the broker said:
The opening on the IDE and completion of the funding round substantially de-risk the pathway to approval and subsequent revenue stream. The key risk now remains the not insignificant task of successful completion of the phase 3 trial. Being a medical device of a mechanical nature, the certainty of outcome from the trial is far higher than for a drug as evidenced by data from the ongoing clinical program. As the path to revenue is substantially de-risked, our valuation is increased from A$10 to A$13 and we maintain our Buy (Speculative) rating.
