Scott Power: ASX health stocks fall in roller coaster week; Monash falls on embryo mix-up

ASX health stocks fall with Morgans Scott Power noting Trump’s on-again, off-again Liberation Tariffs sending shock waves through markets.

Investors have been on a wild ride this week. Pic via Getty Images

• ASX heath sector falls 4%, while broader markets down 0.79% for the same period as US tariffs 

• Monash IVF falls after woman gives birth to a baby that was not hers after mistakenly transferred wrong embryo

• Imricor starts its European trial VISABL-VT trial, achieving several world-firsts and earning a Morgans' upgrade

Healthcare and life sciences expert Scott Power, who has been a senior analyst with Morgans Financial for 27 years, gives his take on the ASX healthcare sector for the week and his ‘Powerplay’ stock pick.

It has been a week of holding onto your seats for investors with global stocks on one wild rollercoaster ride. On Thursday morning Aussie investors awoke to news of a 90-day pause on the more punitive US President Donald Trump's so called "Liberation Day" tariffs.

The pause provides US trading partners the chance negotiate deals with the US in a bid to reduce their tariffs and avoid further escalation.

However, the Trump administration has not yet let up on China, lifting tariffs and confirming they now added up to 145% not the 125% widely reported.

At 1.10pm (AEST) on Friday, the S&P/ASX 200 Health Care index (ASX:XHJ) was down 4% for the past five days, while the benchmark S&P/ASX 200 (ASX:XJO) fell 0.79% for the same period.

"The main takeaway is a huge amount of uncertainty, which is unlikely to abate over the next couple of months," Power said.

"The 90-day reprieve on tariffs is just giving us more time and we are just in a period of uncertainty."

Monash falls after woman has baby not hers after embryo mix-up

Monash IVF Group (ASX:MVF) is down around 23% in Friday trade after confirming to investors late on Thursday afternoon a Herald Sun report in which a woman gave birth to a baby that was not hers after receiving the wrong embryo at a Brisbane clinic.

"Since becoming aware of the incident in February 2025, Monash IVF undertook an initial investigation into the incident and has found that it was the result of human error," the company said.

Monash said it had commissioned Fiona McLeod AO SC to conduct an independent investigation into the incident and was committed to implementing all recommendations from the independent investigation.

The company said it had also disclosed the incident to the relevant assisted reproductive technology (ART) regulators, had notified its insurers and does not currently consider the incident as material to FY25 financial performance.

The latest incident for Monash comes after the company last year agreed to a $56 million class action settlement after patients alleged the company destroyed healthy embryos. They claim Monash’s new non-invasive pre-implantation genetic test (NiPGT) wrongly identified embryos as abnormal.

Morgans on Friday downgraded Monash from an add to a hold and reduced its 12-month target price from $1.45 to $1.09.

"Whilst we don't think there will be an impact on FY25 earnings, we do however think it is likely that this will have a negative impact on the reputation of the business, particularly given the severity of the incident and the amount of media coverage," analyst Emily Porter wrote in a note to clients.

"We think it is possible that this will impact new patient registration, cycle volumes resulting in a loss of share as well as potential fallout from doctors who may choose not to be associated with the brand.

"We also expect legal action will be taken, but at this stage don't have enough information to determine the impact."

Power's Powerplay: Imricor achieves world first

Power's pick of the week is Imricor Medical Systems (ASX:IMR), which has kicked off the start of its European trial – known as VISABL-VT – and achieved some world firsts.

The company announced it had successful completed the first-in-human ventricular ablation guided by real-time interventional cardiac magnetic resonance (iCMR) with the company’s NorthStar Mapping System.

Imricor has developed the only MRI-compatible consumable devices, such as single-use ablation catheters, required to perform cardiac ablations in an iCMR lab.

The company said the procedure marked several world firsts. It was the first ventricular ablation to be guided real-time MRI, and it was the first left-sided ablation to be performed under real-time MRI guidance with the treated for right-sided and left-sided premature ventricular complexes (PVCs).

Completion of the procedure at Amsterdam University Medical Centre represents start of the VISABL-VT trial where 64 patients will be recruited over the next 12 months, with the goal of achieving approval for the indication of ventricular tachycardia (VT).

Morgans has also increased its 12-month target price for Imricor following a successful $70 million capital raising, in which the broker acted as lead manager and upcoming key catalysts, including the first VT procedure.

The company is also expecting US Food and Drug Administration (FDA) approval for atrial flutter later this year.

"Each catalyst has the potential to re-rate the share price," analyst Derek Jellinek wrote in a note to clients.

Jellinek said disruption from proposed US tariffs was also not expected to have any material impact on Imricor with most of its operations and products being US-centric.

Morgans maintains a speculative buy on Imricor as "a key pick" and lifted its 12-month target price from $2.18 to $2.28.

"We're very excited by the technology and prospects for the company," Power said.

Record monthly sales for PolyNovo in March

Wound-care company PolyNovo (ASX:PNV) achieved record monthly sales of $11.9 million (unaudited) in March and YTD $84.4m up 31.1% on pcp.

Including revenue from US disaster preparedness agency BARDA, which is helping foot the bill for a pivotal trial of PolyNovo’s Novosorb BTM to treat full-thickness burns, revenue for the nine months of FY25 to March 31 was $91.6m.

For the full year Morgans forecast product sales of $123.2m and BARDA revenue of $6m, totalling $129.2m, with consensus $129.6m.

US YTD product revenue was $64.4m up 32.2% on pcp, with 54 new accounts added during the quarter and new product NovoSorb MTX generating $3.8m of sales.

UK YTD sales were $5.5m, up 62.4% on pcp, while  India YTD sales totalled $900,000 with 16 tenders won. Rest of world YTD sales were $20m,  up 27.2% on pcp.

"Their sales momentum is continuing and they're in a solid position," Power said.

PolyNovo finished the quarter with $22m in cash, down from $30.7m on December 31 but noted overdue – but not at risk – US debtors of $14.7m. The company still has $14.9m of capital expenditure on its new manufacturing facility and R&D innovation centre

"They also made comment that the US tariffs on medical devices were unlikely to have a material impact on their business and they have 10 months of inventory on hand in the US,"  Power said.

Morgans maintains a hold rating on PolyNovo and 12-month target price of $1.37.

"We will monitor the cash position closely given the level of US debtors outstanding and the ongoing capital expenditure requirement in relation to the new facilities," Power said.

"The recent departure of the CEO remains unresolved and we continue to monitor progress on this front."

Pro Medicus a top pick of equity strategist

Morgans equity strategist Andrew Tang has put out a buy list for investors facing uncertain time which includes health-imaging stock Pro Medicus (ASX:PME).

"These are emotional times for investors, but those with a long-term perspective should focus on fundamentals rather than reacting to short-term noise," Tang wrote in a note to clients.

"The current re-pricing of risk will undoubtedly uncover opportunities in some of the best market franchises such that investors may consider upgrading portfolio quality through volatility."

ProMedicus has felt the force of market volatility in 2025 falling from ~$300 in mid-February to an intra-day low of $161.64 on April 7, before rallying back to above $200 later in the week.

Morgans healthcare analyst Iain Wilkie recently upgraded ProMedicus to a buy from a hold with a 12-month target price of $250.

“We view PME as one of the highest quality businesses on the ASX with high margins and long contracted revenue base, providing significant baseline earnings support,” Wilkie said.

He noted that as a software provider it was providing a service rather than a physical product so potentially less likely to be subjected to US tariffs.

EBR expects FDA approval anytime now

An approval decision by the FDA for the EBR Systems (ASX:EBR) WiSE CRT (cardiac resynchronisation therapy) system, the world’s first leadless pacemaker device, is expected anytime now with the official timeline on or before April 13.

EBR’s WiSE technology uses proprietary wireless technology to deliver pacing stimulation directly inside the left ventricle of the heart.

WiSE has been accepted into the Transitional Coverage for Emerging Technologies (TCET) reimbursement pathway designed to expedite Medicare coverage for a highly selective subset of FDA-designated Breakthrough Devices.

The company is also beefing up manufacturing capacity by leasing a ~51,000 square feet (~4,751 sqm) facility to increase scale and capabilities for future growth.

"We see little risk to FDA approval for the company’s wireless cardiac pacing device WiSE on or before April 13, with commercial launch in the second half of CY25," Power said.

Morgans has a speculative buy rating on EBR and 12-month target price of $2.86.

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Originally published as Scott Power: ASX health stocks fall in roller coaster week; Monash falls on embryo mix-up