IPO Lockup Expiration Could Rock ShockWave

The 180-day IPO lockup period for ShockWave Medical Inc. (SWAV) will end on September 3, 2019.

When the lockup period ends for ShockWave Medical, its pre-IPO shareholders and company insiders will be able to sell their 20 million currently-restricted shares. This will be a huge increase over the 5.7 million shares offered in the IPO. The potential for a sudden increase in stock traded on the secondary could cause a sharp, short-term downturn in SWAV's share price.

(Source: SWAV S-1/A)

Currently, SWAV trades in the $39-40 range, a return from IPO of more than 132%.

Business Overview: Medical Device Company in California

ShockWave Medical is working on developing and marketing devices used to treat calcified cardiovascular disease. The company offers proprietary medical tools that deliver sonic pressure waves that break-up calcified plaque that accumulates due to atherosclerotic cardiovascular disease. The company calls this procedure intravascular lithotripsy (IVL), and its IVL system is based upon ShockWave Medical's IVL technology. In its SEC filings, ShockWave Medical notes that their system is easy-to-use, minimally invasive, and a safe method that greatly improves patient outcomes.

(Source: SWAV Website)

The U.S. Food and Drug Administration gave the ShockWave M5 IVL catheter a ce-mark in April 2018. The FDA cleared the M5 catheter for use in the company's system in July 2018 for treating peripheral artery disease.

ShockWave Medical currently markets its ShockWave C2 IVL catheter in Europe. It was ce-marked in June 2018. The company is conducting clinical programs for several of its products for a variety of indications. If the trials are successful, ShockWave Medical will expand its sales and marketing efforts into new areas and for treating additional health conditions. In particular, ShockWave Medical expects to expand across the U.S. and into Japan if their clinical trials result in supporting data for its FDA and Shonin applications. ShockWave Medical expects to launch the C2 catheter in the first six months of 2021 in the U.S. and in the second half of 2021 in Japan.

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Disclosure: I am/we are short SWAV.

Disclaimer: I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any ...

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