Here's What's Driving Dextera Surgical Inc (NASDAQ:DXTR) Right Now

Mid January, we took a look at a tiny biotech play called Dextera Surgical Inc (NASDAQ:DXTR). The company had run up on the back of a business update put out by management a day or so ahead of the run, and looked as though it might be one to keep an eye on as we moved into the latter half of the first quarter of this year. Well, since we first looked at it, the stock ran pretty steady, and has just spiked once again. This time, the volume/price spike comes on the back of a presentation relating to Dextera's lead asset, and the subsequent reporting of said presentation by way of this press release.Here's our take on what the release says about the company, and what we are looking for going forward.Before we get going, here's a quick introduction to the company.It's a medical device play with a lead asset called the MicroCutter 5/80. The company markets the device as the smallest-profile and most maneuverable articulating surgical stapling platform on the market for minimally invasive surgery, and as far as we can tell, this billing is justified. The concept builds on an already widely used surgical device – something called an articulating stapler. It's basically a cutting too, that – post incision – can be used to staple a cut closed using (as the name suggests) an articulating head. The only way in which the MicroCutter builds on this concept is in size, but that's enough of a difference to give this product a real chance of making a splash in the market. The 5/80 element of the name refers to the profile size (5mm) of the device, and the articulation capability (80 degrees). The 80 degrees falls in line with industry standard. The 5mm improves on said standard.So what did the latest presentation tell us?It was given in Middleborough, UK, at a site called the James Cook University Hospital. It's rooted in a study that compared the traditional post operative progress of patients that underwent surgery using the standard of care cutting and stapling procedures for what's called a lobectomy (this is the removal of an organ or a gland) to patients that underwent the same surgery but with a Microlobectomy, which is the type of surgery that the MicroCutter allows. Same surgery, different device, different incision sizes and closing procedures.And here's the important part: the data showed that the median hospital stay for patients undergoing Microlobectomy surgery is reduced by at least two days when compared to traditional open lobectomy procedures, with over 20 percent of patients going home the day after surgery. Looking at the underlying numbers, for the 82 patients undergoing a Microlobectomy, the median length of hospital stay was three days, with 17 patients (20.7%) discharged the day after surgery and an additional 14 patients (17%) discharged two days after surgery.This is a big deal. Why? Because reduced post-operative stay directly correlates with reduced cost, which means that uptake should be simply a case of physician and surgeon education, as opposed to anything else. Sure, educating the medical space is costly, but with the clear advantages of the sort of surgery that MicroCutter allows, the capital spent on said education is very likely to be effective in its target aim.As we said last time dilution is an issue. Forced adoption in this space is expensive, as we've said, and the $3 million that the company reported as cash on hand as of last September 30 is likely diminished almost entirely. As such, we're going to see a raise, and said raise is not going to be easy on shareholders that picked up an early exposure.With that said, there's real long term potential here, rooted both in the company driving adoption itself, and the potential for a takeover (as we often see in the medical device space) by a large instrument company.Fiscal Q3 earnings, and the insight they offer into MicroCutter driven topline growth, will be key in pushing this one forward.We will be updating our subscribers as soon as we know more. For the latest updates on DXTR, sign up below!Disclosure: We have no position in DXTR and have not been compensated for this article.