Wright Medical Group, Inc. CVR (WMGIZ)

[parker1073]

Friday 08/09/2013 10:51 AM ET - S&P Capital IQ's Research Notes
We cut our target price $2 to $28 on revised price/sales analysis. WMGI received a not approvable letter from the FDA for its Pre-Market Approval application for Augment Bone Graft as an alternative to the patient's own tissue in foot/ankle fusion. The FDA believes patient population in the trials was not at high enough risk. We view probability as low that WMGI will conduct a new trial, which is costly and market size may be too small, though WMGI can appeal. Still, we view extremities business as attractive, and WMGI's cash position as healthy, providing financial flexibility.