A Medical-Device Maker Attracts More Fund Buying

According to filings with the Securities and Exchange Commission, Deerfield Management now owns 5.8 million shares of NxStage Medical (NXTM), a medical-device company whose primary product, the NxStage System One, is used for hemodialysis treatment. Along with a number of warrants, Deerfield controls 5.9 million shares, giving it just under 10% of the shares outstanding. Deerfield is a health-care-focused fund managed by James Flynn; it had owned 5.3 million shares of the stock at the beginning of October.

NxStage's revenue climbed 9% in the third quarter of 2012, compared with the same period in 2011, roughly in line with its growth rate on the top line in the first half of the year. Net losses, which had been slightly lower earlier in the year than in the same periods last year, were cut in half in the most recent quarter. For what it's worth, NxStage lost $2.6 million ($0.04 per share), compared with $4.3 million invested in research and development (and R&D was up 26% from the third quarter of 2011). The company also reported that its cash flow from operations had been positive for the first nine months of 2012 (unlike a year ago), meaning that it should not need to dip into its balance sheet cash of $100 million to keep the company going....395 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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