UNS 0.00% 0.5¢ unilife corporation

Another old article well worth a read if you missed it:"Nice...

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    Another old article well worth a read if you missed it:
    "Nice Shot" for Unilife - The Scientist 2010

    A well-articulated article in a January 2010 issue of "The Scientist" magazine, entitled "Nice Shot," discusses a number of factors that have led to a dramatic wind shift favoring the vaccine segment of the pharmaceutical industry. The wind shift has caused the vaccine sector to go from unwanted orphan to beloved golden child. Increasing safety regulations imposed by the FDA, improving technologies, generic competition and eroding drug pipelines are the dynamics that are at the crux of vaccines' growing market appeal.

    With an expected growth rate of 14% over the next 4 years, the vaccine market is poised to be the fastest growing therapeutic area in the pharmaceutical industry. Worldwide sales of vaccines in 2007 were $18.5 billion and are expected to $35 billion by 2012. We are reminded of 2009, when governments around the world purchased $ 7 billion of H1N1 swine flu vaccines. The 5 pharmaceutical companies that serendipitously benefited from the flu epidemic included GlaxoSmithKline (NYSE: GSK), Novartis (NYSE: NVE), Sanofi-Aventis (SNY), AstraZeneca's Medimmune (AZN), and CSL Limited, an Australian biopharmaceutical company.

    The vaccine industry is dominated by Merck, GSK, Wyeth (purchased by Pfizer), Novartis and Sanofi-Aventis. In 2008, for example, vaccine sales exceeded pharmaceutical sales by a factor of more than three. At GlaxoSmithKline, specifically, vaccines have become the single greatest contributor to growth.

    For a number of years, the drug pipeline well has been drying up. Traditional drug discovery programs have yielded few new products, and even fewer blockbuster drugs. Historically, pharmaceutical companies were able to bring new products to market whose innovative qualities led to commercial success. This has become exceedingly difficult. And then we have the proverbial "patent cliff." By 2012, the pharmaceutical industry will have lost $67 billion in annual revenues to patent expiration of blockbuster drugs. Vaccines often circumvent the issue of generics as they are complex biological products requiring multimillion-dollar manufacturing facilities and in-depth manufacturing expertise. This is a major differentiating factor. Generic drug manufacturers tend to avoid knocking off vaccines due to these inherent difficulties. A dearth of generic competition equates to greater market longevity.

    Unilife Corp (NASDAQ: UNIS) is a company that is poised to benefit from this seismic paradigm shift. The York, Pennsylvania-based company is the creator of the Unifill ready-to-fill prefilled syringe. Simply stated, a prefilled syringe is a single-dose packet of vaccine to which a needle has been fixed by the manufacturer. Addressing the $1.5 - $2 billion prefilled syringe market, the Unifill prefilled syringe offers distinct benefits over competitive prefilled syringes as they have safety features integrated within the glass barrel.

    Prefilled syringes offer profound benefits which increases their appeal to pharmaceutical companies. For example, prefilled syringes can eliminate wastage during the filling process. Moreover, when compared to vials, they offer a simpler, faster and more reliable method of dose administration.

    Growing at a significant rate, more than 2.5 billion prefilled syringes were used in 2010. Pharmaceutical manufacturers that need to comply with needlestick prevention laws in the U.S. and Europe must retrofit ancillary safety devices onto a standard syringe after dose filling and prior to packaging. In addition to the incremental steps and costs to the manufacturing process, the added bulk of these ancillary devices can add to packaging, transport and storage volumes by as much as 70%. By contrast, the Unifill syringe is similar in size to an equivalent standard prefilled syringe and is significantly smaller than those supplied with an ancillary safety device.

    The Unifill ready-to-fill (prefilled) syringe is itself the primary drug container. However, as indicated above, unlike other prefilled syringes on the market, the Unifill includes passive (automatic) safety features that are fully integrated within the glass barrel. The product is ideal for use by healthcare workers or by patients who self-administer prescription medication while offering optimum protection from needlestick injuries.

    One of the key benefits enjoyed by Unilife is their ability to help pharmaceutical companies optimize the lifecycle of new drugs. They are able to help bolster the competitive brand differentiation of drugs mid-way through their lifecycle by having them upgrade to the Unifill device. Unilife has commercial opportunities for several blockbuster drugs that are approaching patent expiration or that are coming under the threat of competition from biosimilar or generic drugs. Conversion of such blockbusters to Unifill products, which can be controlled within a particular therapeutic class and thus restricted to competitors, can provide a unique opportunity to enhance and even extend the lifecycle of the drug product. Potentially, the competitive advantages of the Unilife device within the drug-device combination product could even obstruct generic or biosimilar competition.

    A major emerging trend within the pharmaceutical industry is the convergence of therapeutic drugs and innovative delivery devices. Unilife is uniquely positioned to capitalize upon this trend within the pharmaceutical market for prefilled syringes. This trend elevates Unilife to a new level beyond being a mere syringe story. By being able to offer pharmaceutical companies something more broad and enticing than a commoditized dose delivery mechanism, Unilife will effectively position itself to be produce a larger footprint in the healthcare industry. Their devices are unique and fully patented.

    As testament to the commercial potential of the Unifill syringe, Unilife has a long-standing $40 million partnership with Sanofi-Aventis. Sanofi-Aventis is the world's largest consumer of prefilled syringes. The $40 million that Unilife has received thus far was in exchange for certain exclusivities and industrialization milestones. That said, Unilife has openly stated on that they are in active discussions with a number of additional pharmaceutical companies interested in using the Unifill product in therapeutic areas outside of those retained by Sanofi-Aventis.

    There are more than 20 pharmaceutical companies that utilize prefilled syringes as their device of choice for the administration of injectable drugs and vaccines. Furthermore, Unilife is tracking more than 80 marketed and pipeline drugs and vaccines that are considered potential candidates for the Unifill syringe. While most are pipeline drugs scheduled for launch between 2012 and 2015, many are already approved in a prefilled syringe format. One company in particular, for example, has advised Unilife that they have 13 drugs in the pipeline targeted for use with a prefilled syringe.
 
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