Unilife closer to syringe deal

Syringe maker Unilife Medical Solutions Ltd has moved closer to supplying its retractable, ready-to-fill syringes (RTFS) to global pharmaceutical firm sanofi-aventis, under an agreement that Unilife says is Australia's largest known medical device deal.

Sanofi-aventis is the world's largest consumer of ready-to-fill syringes.

Unilife will manufacture the ready-to-fill retractable syringes when it completes its manufacturing plant in Pennsylvania, in the United States.

It expects to supply the syringes to sanofi-aventis, which will fill them to sell to customers.

Sanofi-aventis also will bear the remaining cost of Unilife "industrialising" the retractable ready-to-fill syringe.

Unilife chief executive Alan Shortall said the market for ready-to-fill syringes was growing rapidly and was worth more than $US1.5 billion a year.

Unilife holds a patent for a ready-to-fill syringe where the needle can be retracted into the glass vial of the syringe after use, which the company says is much safer and less bulky than other syringes which require clip-on devices to cover the needle.

Mr Shortall said pre-filled syringes were increasingly in demand in medicine because they eliminated the possibility of medical staff administering the wrong dosage to patients and were more time-efficient.

A retractable syringe also reduces the chance of needle-stick injuries.

Retractable, pre-filled syringes also could be used by patients at home.

Unilife expects to complete the manufacturing facilities for the ready-to-fill retractable syringes by the end of the fourth quarter of 2010, ahead of the original scheduled completion at the end of 2011.

Sanofi-aventis already had agreed under a deal last year to pay Unilife $16.4 million for the exclusive right to negotiate for the purchase of the syringes and bear the costs of the industrialisation process.

Sanofi-aventis now has committed to complete the funding of $30.4 million "industrialisation" program for the syringes and agreed to a pricing structure under which it will purchase the syringes subject to a supply agreement.

Unilife will have right to supply the syringes to other pharmaceutical companies in certain therapeutic drug classes.

Unilife expects to have a production capacity of 40 million units a year by 2010, rising to 400 million units from 2014.

Mr Shortall said the agreement with sanofi-aventis was "a company-making deal", placing Unilife in a strong position to complete the industrialisation of the syringe and become a global leader in the market for pre-filled safety syringes.

"Whilst sanofi-aventis is the world's largest consumer of pre-filled syringes, Unilife has also received significant levels of interest in the RTFS from many other major pharmaceutical companies," he said.

"With the signing of this agreement, Unilife can now move forward in its discussions with these other potential customers which are all major pre-filled syringe consumers in their own right."

Mr Shortall said Unilife was seeking to list on the United States market by the end of 2009.

Unilife shares were two cents higher at 33 cents at 1210 AEST on Wednesday.