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Sirtex: Best practice

Sirtex: Best practice

Longer-term followers of the blog would by now be aware that Sirtex Medical Ltd (ASX: SRX) is one of the largest positions in our funds.

We have been following the business closely for many years now, watching it go from strength to strength. In that time, we’ve been pleased to note the numerous key milestones they have hit along their journey in becoming a global leader in the treatment of metastatic colorectal cancer (mCRC).

Some of these milestones are well known to investors already, perhaps unlike the announcement made by Sirtex’s European operations just a few days ago.

In a media release, Europe’s leading medical oncology society, the European Society of Medical Oncology (ESMO), provided a formal recommendation that Sirtex’s core medical device SIR-Spheres, should be included into clinicians’ treatment guidelines for patients who become chemorefractory.

This essentially means that should chemotherapy fail to arrest tumour progression in the liver, treatment with SIR-Spheres should be now considered best practice.

Such inclusions into treatment guidelines are generally required prior to clinician acceptance and adoption en-masse; hence we anticipate that an increase in dose sales in Europe will now follow.

Of course, this all pertains to the ‘salvage setting’, not the ‘first-line setting’, for which we are awaiting the results in mid-2015. For those who missed them, two recent articles can be found here and here.

But for now, we present you with the press release from Sirtex Medical Europe. And whilst it’s under the radar, it is yet another significant milestone for this exciting Australian invention.

For those interested, the actual ESMO Clinical Practice Guidelines for diagnosis, treatment and follow-up release can be found here (warning: it’s a heavy read).

This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.

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5 Comments

  1. From a recent Sirtex job advert it appears that they only run 3 days a week currently. GW said same about the US a couple of years back – may have changed.

    I think they can run up to 5 days a week without too much of an issue from the radiation point of view – would appreciate any expert view on this.

    8k does was considered the go for one cell. In a few months they will have 5 cells operational, so your call of 36k is very reasonable. I think they can go to about 50k if pushed.

    Currently, I’d be more than happy with 30k PA :-)

    Rgds

    ‘QA Officer – Singapore’
    “This position requires flexibility as the core working days are Sunday, Monday and Tuesday. ‘

    • Hi Colin,

      I am a medical physicist working in the field of radiation oncology. Though the storage and transport of radioactive materials is relatively straightforward (assuming the appropriate protocols and facilities are in place), the work and care required for the ordering, QA, calibration and administration of high-activity, low half-life sources can be extensive. In particular, SIR-Spheres use Y-90 with a half-life of only 64 hours. As you can imagine, the implied time constraints require a degree of seamless organization. I have never overseen a SIRT treatment, but there do already exist fairly widespread forms of internal radiotherapy (called brachytherapy) that are analogous to SIRT. Depending on the treatment site, these procedures can be quite labour intensive.

      The above logistics might explain the three ‘core working days’ to which the advertisement refers. Certainly in my department, the brachytherapy facility is used no more than a few times per week, with major procedures performed on a single day each week.

      I hope this provides some insight.

      • Hi Matt – many thanks for your time, and experience. Not sure if we are talking apples and pears :-)

        The advert was for a QA at the Singapore manufacturing facility, using a hot cell. They may be restrictions on the number of days, or the number of hours any individual can work (assume the later can be overcome with a second shift).

        I assume from your reply that you may be discussing the centre where the treatment is administered? Albeit it is another restriction and may limit usage in the large interventional radiation centres.

        Please accept my apologies if I have misunderstood.
        Many thanks.

  2. Russell Muldoon
    :

    Hi Brian, they currently sell ~8,000 dose sales per annum. With their current installed base of ‘hot spots’, they have the ability to increase this to 36,000 dose sales should demand permit.

    Your comment on maximising profit should not be underplayed. A new hot spot costs only ~$3m. Hence the return on incremental investment is definitely impressive for this medical device business.

  3. brian lovelock
    :

    SRX has 3 manufacturing plants I believe. I was wondering at what capacity these are currently operating at. If the trials in 2015 are successful and sales increase substantially then if the current plants can increase production without the need to build or extend plant then this should greatly maximise profit. Any comments.

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