Pro-Dex Inc. said it is selling its Oregon Micro Systems division to Beaverton, Ore.-based Oms Motion Inc. The Irvine, Calif.-based company's division designs embedded multiaxis motion controllers, which are sold to distributors or original equipment manufacturers in the automation and research industries. The transaction is about $640,000.

Oms Motion Inc. is being headed up by Phillip Brown, who once served as manager of Pro-Dex's OMS division.

"We are pleased that this sale was consummated so quickly, in part due to the knowledge that [Brown] has regarding the business and its prospects," said Richard Van Kirk, Pro-Dex CEO.

The divestiture of the OMS division marks Pro-Dex executive's plans to have the company focus on more research and development efforts in its medical device product portfolio. The company has surgical and instruments that are used primarily in the orthopedic, spine, maxocranial facial and dental markets.

Pro-Dex is primarily known for its battery-powered surgical driver used in small bone and spine procedures and its dental handpiece device.

The company is turning a page in its history and hitting high notes with analysts again after suffering declining sales in 2013 and 2014 due to the loss of a major product contract.

Company executives changed the firm's fortunes and the device maker experienced strong revenue growth of 24 percent in 2015 and about 51 percent in 2016.

In its most recent earnings report, the company said net sales for the three months ended Sept. 30, 2016 totaled $5.4 million, an increase of 32 percent from $4.1 million for the three months ended Sept. 30, 2015. Company executives said the increase in revenue was because of an expansion of its medical device customer base. Executives said the company was also focused on cost-reductions related to its newest medical device products and have invested in manufacturing equipment to increase the firm's operational efficiency.

"The management team has done a good job developing the Pro-Dex Design and Manufacturing Solutions, which has helped to reverse the declining sales by winning new product contracts and returning the company to strong growth," said Edward Woo, an analyst with Ascendiant Capital Markets. "Pro-Dex has had large share price appreciation of 94 percent in 2016, and we believe this momentum is likely to continue in 2017."

The company typically doesn't give specific quarterly guidance, but Woo said that he expected revenues of $24 million earnings per share of 22 cents, for fiscal year 2017.

But there are some strong headwinds that could derail Pro-Dex. The firm operates in a highly competitive environment and competes against a wide range of other medical device and motion control related companies. Its competition includes Arthrex Inc., Angioscore Inc., Quasar Engineering Ltd., U.S. Endoscopy and Operon Resource Management.

Also serving as a provider of outsourced services, the company competes with its customers' own internal development and manufacturing assets.

"By focusing on highly specialized medical and dental devices, we believe that the company is developing a proprietary niche in contract manufacturing," Woo said. "Due to high government regulations and the high value of medical products, we believe Pro-Dex is better able to compete and add value."