Medical Developments International (ASX:MVP) share price on watch after trading update

The Medical Developments International Ltd (ASX:MVP) share price will be one to watch on Friday after the release of a trading update…

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Medical Developments International Ltd (ASX: MVP) share price will be on watch on Friday following the release of an update after the market close.

ASX share price on watch represented by surprised man with binoculars

Image source: Getty Images

What did Medical Developments International announce?

This afternoon Medical Developments International provided an update in relation to its Penthrox European Union (EU) transition activities and current trading conditions.

In respect to the former, the transition arrangements for taking back the distribution rights from Mundipharma in the EU are progressing to plan.

According to the release, progress to date includes the establishment of an EU based legal and corporate structure, contracting of pharmacovigilance and regulatory related service providers, and securing operational infrastructure in-market. The latter includes importation and logistics capability.

In addition, the marketing authorisations previously held by Mundipharma are being transferred concurrently to allow the company to assume control of sales and distribution activities on 1 March 2021.

The company's CEO, Brent MacGregor, commented: "The opportunity in the EU remains strong and we're revisiting our execution strategy, assessing and building on the foundation work done by Mundipharma, including determining where we can deploy a direct or hybrid selling model which brings enhanced control and margin. Europe will be the primary focus of MVP over the coming year."

Trading update.

The first half has been softer for Medical Developments International due to COVID-19 headwinds.

Management notes that following an early COVID pandemic surge in sales, the mild cold and flu season, along with improved community hygiene practices, has depressed demand for respiratory products.

Furthermore, reduced community activity is resulting in fewer ambulance movements and lower demand for Penthrox, which is better known as the green whistle.

Finally, Penthrox Australia sales have been impacted by timing differences associated with the transition from the exiting distribution partner, Mundipharma Australia.

However, overall reported revenue is showing growth. This is the result of accelerated milestone income amortisation from the hand-back of the EU distribution rights from Mundipharma.

Mr MacGregor concluded: "We are looking past these challenges. We expect to see a recovery in Australian sales in the coming months and will build infrastructure for the global growth of Penthrox. The transition arrangements in the EU are progressing well and additional rollouts into unlaunched markets will occur in 2021."

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Medical Developments International Limited. The Motley Fool Australia has recommended Medical Developments International Limited. 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.

More on Share Gainers

a young woman raises her hands in joyful celebration as she sits at her computer in a home environment.
Share Gainers

Why Kingsgate, Neuren, Newcrest, and Pushpay shares are rising today

These ASX shares are avoiding the market selloff on Tuesday.

Read more »

A young woman wearing overalls and a yellow t-shirt kicks one leg in the air showing excitement over the latest ASX 200 shares to hit 52-week highs
Share Gainers

Why Neuren, Northern Star, Race Oncology, and Westgold shares are storming higher

These ASX shares are starting the week in a positive fashion.

Read more »

A woman wearing yellow smiles and drinks coffee while on laptop.
Share Gainers

Why APM, Macquarie Telecom, Northern Star, and Origin shares are rising today

These ASX shares are having a strong session despite the market selloff.

Read more »

Two boys with cardboard rockets strapped to their backs, indicating two ASX companies with rocketing share prices
Share Gainers

Catch these fast-rising 2 ASX shares before it's too late: Celeste

This pair of stocks rocketed up in February during reporting season, but are still great value for those willing to…

Read more »

three businessmen high five each other outside an office building with graphic images of graphs and metrics superimposed on the shot.
Share Gainers

Why Arafura, Myer, Volpara, and Xero shares are zooming higher

These ASX shares are making their shareholders smile on Thursday.

Read more »

medical asx share price represented by doctor giving thumbs up
Healthcare Shares

Guess which ASX biotech stock just rocketed 29% on big FDA news

The ASX healthcare share is attracting investor interest following FDA approval for its targeted cancer therapy compound.

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Share Gainers

Why Mesoblast, PolyNovo, Pushpay, and Weebit Nano shares are charging higher

These ASX shares are having a strong session despite the market selloff.

Read more »

a young woman raises her hands in joyful celebration as she sits at her computer in a home environment.
Share Gainers

Why InvoCare, Pentanet, Sayona Mining, and Weebit Nano shares are storming higher

These ASX shares are having a strong session on Tuesday.

Read more »