Last night, Sientra (SIEN) reported fourth quarter results that continue to be hampered by supply constraints.
Sientra is a micro-cap medical aesthetics company serves the high end of the breast implant market. The company sells to Board certified plastic surgeons only -- unlike its competitors Allergan (AGN) and J&J (JNJ).
Sientra came public in October of 2104, selling 5 million shares at $15.
Siena performed well for nearly a year before it ran in to some issues with its contract manufacturer Silimed. European and then Brazilian regulators suspended sales of Silimed products on fears of contamination. Silimed's primary manufacturing facility mysteriously had a fire soon after.
Sientra voluntarily placed its Silimed manufactured products on hold in October of 2015 and returned to the market in March of 2016 after ensuring all of its Silimed manufactured products were safe.
Sietnra remains on a controlled market re-entry designed to optimize the availability of inventory until its new contract manufacturer is up and running.
The company submitted the final premarket approval (PMA) Supplement to the FDA for its new U.S. based manufacturing facility yesterday after guiding for it to be a first quarter event. The new contract manufacturer is Vestas, a Lubrizol-Berkshire Hathaway company.
Yesterday, management reaffirmed guidance for approval by year end -- the FDA will respond within 180 days.
The company is confident it can recapture market share once its manufacturing is squared away. Management is encouraged by demand from loyal plastic surgeons.
Sientra has a ~$174 million market cap and an enterprise value just over $100 million with $67 million in cash. Meanwhile, the company is looking for acquisitions in aesthetic markets adjacent to breast augmentation.
Sientra acquired Specialty Surgery Products (breast reconstruction) and bioCorneum (scar management) last year. Those products accounted for for 17% of the $6.5 million in sales during the fourth quarter.
Sientra guided for breast implant sales similar to 2016 levels while the Specialty Surgery Products and bioCorneum sales should grow throughout 2017.