Here's What's Important In The Upcoming Neovasc Inc (US) (NASDAQ:NVCN) Call

Neovasc Inc (US) (NASDAQ:NVCN) ran up this week as management announced that it will be putting out fourth quarter and fiscal 2016 numbers on March 23 (next Tuesday) and that – alongside the numbers – we will get a conference call to provide an operational update. It is not unusual for biotech companies like this – and especially those at this end of the market – to pick up strength ahead of management communications, with the volume generally attributed to speculative trigger pulling on expectations that management will report some positive catalyst on the call. Not all of these plays turn out as these speculative operators hope they will, of course, and we saw a prime example of this last week, when EnteroMedics Inc (NASDAQ:ETRM) held its equivalent of the upcoming Neovasc event.In that scenario, markets expected something big, didn't get it, and sold off as the shorter-term speculators unloaded their positions.We covered it here. There is every chance this could happen this time around, but it doesn't really matter. We think this one is a longer-term runner, and that there is plenty of upside potential at its current price. If management can boost the stock further with a positive announcement next Tuesday, then that run is likely to get going quicker than first expected. If no such positive announcement comes, we will likely see a selloff (just as we did with EnteroMedics) and this selloff should provide an opportunity to get in at a discount ahead of a return to the upside momentum.Against this framework, the question becomes should we get in at current prices, or wait until the call fails to impress, and pick up an exposure at a cheaper average allocation strike?We're not going to answer that one – it's personal preference.What we will comment on, is what we want to see management address.For those new to this company, it is a healthcare company that is looking to market a transcatheter device that improves on the current standard of care in the space. For the last 12 months and more, however, it has been bogged down by legal concerns, with another company (one that it initially worked with on the development of said product) accusing Neovasc of stealing trade secrets to develop the device in question. As it turned out, it did steal trade secrets, and the legal outcome was a $91 million compensation liability.As we've said before, for many companies of this size, this could be terminal. In this instance, however, Neovasc had some cash on hand to allay immediate concerns, and then scored big with a $75 million cash infusion by way of a deal with medical device giant Boston Scientific Corporation (NYSE:BSX).Perhaps the most important element of the ruling was the decision by the courts to allow Neovasc to continue to market its products. In a nutshell, the outcome drained the company of its cash holdings, but left it with a quality product and one that – with the correct commercialization strategy – could be a real winner going forward.Our argument to date has been that markets are overlooking the commercial potential of the device, and basically pricing Neovasc as a cash-strapped developer with no commercial asset.As such, in the upcoming call, we are looking for two things.One, how much cash has Neovasc got to play with in the initial commercial rollout of its TIARA device? Too little, and shareholders are going to have to suffer some degree of dilution.Two, what does this commercial rollout involve, and when does Neovasc expect it to get underway?The ideal outcome would be cash on hand to fund rollout to the first stages of revenue collection, but that's overly optimistic. More likely is we will see a raise, with the on-hand figure dictating the severity of said raise's impact on current shareholders' positionsWhatever happens, we are probably going to see some volatile action around the call. We will be listening in.We will be updating our subscribers as soon as we know more. For the latest updates on NVCN, sign up below!Disclosure: We have no position in NVCN and have not been compensated for this article.