PolyMedica Falls After U.S. FDA Approves Rival's
Diabetes Test
By Catherine Dodge

Woburn, Massachusetts, March 23 (Bloomberg) --
PolyMedica Corp. shares fell
as much as 19 percent a day after the U.S. Food and
Drug Administration
approved a test kit for diabetics made by rival
Cygnus Inc.

Shares of the largest supplier of diabetes-testing
kits fell $4.50 to $29.19 in early
afternoon trading. Earlier, the shares touched
$27.19.

The Cygnus product is a wristwatch-like device that
lets diabetics measure blood
sugar without the traditional finger pricks to draw
blood. The FDA approved the
device for use along with needle-stick testing, and
said GlucoWatch shouldn't be
used as the sole method of testing for blood sugar.
PolyMedica makes strips
that signal glucose levels in blood.

``To be saying PolyMedica's business is going to be
eroded is ridiculous,'' said
Adams, Harkness & Hill analyst Ryan Rauch, who has a
``strong buy'' rating on
the stock. ``If anything, it could be helped.''

Before today, shares of PolyMedica were little
changed this year. Shares of
Redwood City, California-based Cygnus rose 53 cents,
or 9 percent, to $6.38,
after soaring 33 percent yesterday on news of the
FDA approval.