FDA’s Nod Raises Stock of Premier Laser Systems : Market: The Irvine dental device maker sees its share price more than double, to analysts’ surprise.
To the puzzlement of analysts and company executives, the stock of Irvine-based Premier Laser Systems Inc. more than doubled Wednesday in heavy trading after the maker of dental devices said its speedy new system for filling and whitening teeth had received regulatory approval.
The company said its BluLaze product, which has been approved by the Food and Drug Administration, will sell for about $5,000 and will debut Sept. 16 at a dental conference.
By emitting light on a specific wavelength, BluLaze can harden fillings at least twice as fast as existing methods and complete whitening in a single, hour-long treatment, company executives said.
“It adds something we don’t have at a very low price,” said Jeff Anderson, Premier’s vice president of regulatory affairs and quality assurance. “It will open up the market to a lot of dentists who otherwise couldn’t afford it.”
Anderson declined to project how many BluLaze units the company expects to sell. Other laser systems cost at least $8,000 and take up twice as much space as BluLaze, which is about the size of a telephone, he said.
Premier’s stock surged $2.25 a share to $4 in trading of 9 million shares, making Premier the second-biggest percentage gainer as well as one of the most active issues in U.S. markets.
Anderson said he considered the market’s response unusual. Analysts expressed surprise at the big move, noting that the BluLaze system is more of an incremental improvement to existing technology than a breakthrough.
“These are improved products, but we’re talking about areas they’ve already been in,” said William Relyea, an analyst at Josephthal & Co. “The market wasn’t interested until now. Why today? I couldn’t tell you.”
Similarly, executives at San Clemente-based Biolase Technology Inc., a rival dental device manufacturer, suggested the market had reacted disproportionately to BluLaze’s arrival.
“It’s a variation of what’s out there, not a breakthrough,” Biolase Chief Executive Jeffrey Jones said. “I was shocked to see the market reaction.”
Premier first appeared in the market spotlight in May 1997, when it introduced a laser that could be used directly on teeth. The product received an avalanche of media attention and was hailed as a giant leap toward drill-free dentistry.
The company stumbled, however, in getting its watershed product into dentists’ hands.
A dispute with a major distributor interrupted sales and decimated the company’s revenue flow. Its auditor resigned and Nasdaq suspended its stock from trading for five months. In January, the company settled 19 class-action shareholder lawsuits for almost $14 million, though it continues to deny allegations of fraud and securities violations.
In the last two years, Premier has lost more than $67 million. Earlier this summer, founder Colette Cozean said Premier would seek a new chief executive and add other top managers to help the company do a better job in translating its technological advances into profits. Cozean will remain chairwoman of the board and chief technology officer.
The CEO search is ongoing, Anderson said.
“We’re moving from being a company that’s highly R&D; focused to one that’s more marketing focused,” he said.
