Staar Surgical Co said an independent advisory panel to the Food and Drug Administration recommended marketing approval for its implantable lens, bringing it closer to a long-awaited U.S. launch and sending the company's shares up 27 percent.
The lens — Visian Toric implantable lens — can correct both nearsightedness and blurry vision associated with astigmatism.
Analysts at Canaccord Genuity said they expect regulatory approval for the lens in the second half of 2014, adding that "the positive FDA panel is the first of several important milestones on the horizon for Staar."
Staar Surgical sought U.S. marketing approval for the lens in April 2006 but had to wait as the agency raised concerns about the integrity of the submitted data.
The agency later placed on hold the company's application for a two-year period starting 2007. The regulator removed the hold in 2009, but added questions related to the patient data.
The lens has been marketed outside the United States since 2001.
"We have always viewed the Food and Drug Administration panel as more of a wild card than the FDA, and we ultimately expect the FDA to approve the device," Benchmark analyst Jan Wald said, raising his price target on Staar's stock to $21 from $15.
Analysts at Canaccord Genuity raised their rating on the stock to "buy" from "hold" and the price target to $20 from $14.
Staar Surgical's Visian implantable lens has been approved to treat myopia since December 2005.
The Visian Toric implantable lens is placed in the posterior chamber of the eye between the iris and the natural crystalline lens to correct both myopia and astigmatism.
Astigmatism is caused when the cornea is oblong instead of being round, while myopia is caused when the cornea is too curved.
Staar's shares were up 17 percent at $17.91 in late morning trade on the Nasdaq on Monday.
(Reporting by Shailesh Kuber; Editing by Sriraj Kalluvila)