ReShape Lifesciences (RSLS) Stock Climbs On Lap-Band News

ReShape Lifesciences (NASDAQ: RSLS) is screaming for the top for yet another trading session. The gains started shortly after the company announced that it would be moving manufacturing of its Lap-Band product to the United States. Here’s what’s happening:

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RSLS Announces Lap-Band Manufacturing News

In the press release, ReShape Lifesciences said that it has completed its Lap-Band manufacturing transition from Apollo Endosurgery. 

Moving forward, manufacturing will take place with a Massachusetts-based manufacturer. In the release, RSLS explained that with the change in the manufacturer, the company should be able to reduce cost, improve margins, and directly control the manufacturing process.  

In the release, the company went on to explain that Lap-Band, which it is now in control of manufacturing, is the only FDA-approved, laparoscopic weight-loss device that’s specifically indicated for a BMI of 30 or higher in the United States. 

The procedure has been performed worldwide over one million times since 1993 and is reimbursed for eligible patients by most insurance companies. 

Moreover, RSLS explained that the Lap-Band is proven to be the safest bariatric procedure available on the market, backed by 20 years of clinical data demonstrating lower complication and mortality rates compared to other surgical weight-loss procedures. 

Management Commentary

In a statement, Bart Bandy, President and CEO at ReShape Lifesciences, had the following to offer:

Moving Lap-Band production under our direct operations allows us to have better control of the manufacturing process for significant cost reductions, anticipated scale and improved efficiencies. As we all emerge from the recent pandemic, we are proud to provide products that are able to help a growing population of people with weight-loss needs and to support the addition of new manufacturing and logistics jobs in the United States.

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The Bottom Line

All told, the news recently released by RSLS proved to be overwhelmingly positive. After all, the Lap-Band product is a popular one and likely to maintain its position as one of the number one weight loss procedures. Now, with the manufacturing update, the company has full control, giving it the ability to produce better margins. That’s great news that should have RSLS shareholders excited. 

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