Biotech developer Admedus (ASX: AHZ) has signed a purchasing agreement with a major US-based group purchasing organisation (GPO) through its US subsidiary, Admedus Corporation – and delivered on a shareholder promise made in November last year.
The 3-year agreement means Admedus will gain direct access to promote ADAPT, its flagship technology suite containing products such as CardioCel and VascuCel in the United States.
The deal comes just days after Admedus was granted permission to market its products in Canada thereby providing access to Canadian consumers.
Today’s deal with a major distributor means Admedus products will be provided to more than 1,500 hospitals that are members of the GPO’s purchasing network. According to Admedus, the GPO’s network has an estimated purchasing power of $US35 billion and therefore sees the deal as a major commercial coup for the emerging biotech company.
Admedus says that it is one of only two companies to be awarded a purchasing agreement to “share the estimated $US5.2 million per annum spend” that’s forecast from the GPO. Given the size and timeliness of the deal, this agreement demonstrates the increasing visibility and credibility of Admedus’ “clinically-superior” ADAPT products.
According to Admedus, its proprietary ADAPT technology is predominantly used to treat congenital heart defects and those in need of heart valve, vessel and cardiovascular repairs, and provides calcification resistance and delivers transformative repair with long-term durability that enables native cells to successfully grow and differentiate through the entire repair.
“This agreement is a significant opportunity for Admedus and delivers on a commitment that was made at our AGM in November 2017 to expand our market share in the US through a partnership with a major compliant GPO,” said Wayne Paterson, Chief Executive Officer of Admedus.
“In our most recent financial report we signalled aggressive US growth targets for 2018 and this agreement strengthens our ability to achieve that,” Mr Paterson added.
According to Admedus Chief Operating Officer David St Denis, this agreement is made even more encouraging by closely aligning market strategies with the GPO: “The GPO we have signed entered into agreement with is a leader in healthcare delivery and their patient-focused strategy closely aligns with our own, ensuring physicians have access to clinically-superior products that enable them to make a real difference in the lives of their patients.”
“Admedus welcomes this agreement and looks forward to moving up the supply chain and claiming a greater share of the cardiovascular surgery and tissue repair market in the US,” Mr St Denis said.
As a result of the today’s news, Admedus share price rose to around 7% to A$0.28 per share by the afternoon session.