Derma Sciences, Inc. (Nasdaq: DSCI), a medical device and pharmaceutical company focused on advanced wound care, and Quick-Med Technologies, Inc. (OTCQB: QMDT.PK), a life sciences company that is developing innovative technologies for the healthcare and consumer markets, announce the signing of an agreement whereby Quick-Med Technologies has granted Derma Sciences an exclusive global license to intellectual property related to the novel NIMBUS® antimicrobial technology, which is available in BIOGUARD® dressings.
“This exclusive global license strengthens Derma Sciences' ownership of our proprietary advanced wound care products, and will positively impact our BIOGUARD gross margin through a significantly lowered royalty rate”
Under the terms of the agreement, Derma Sciences will make a $1.3 million upfront payment to Quick-Med Technologies and future milestone payments based on sales of products incorporating the licensed technology. In addition, the royalty paid by Derma Sciences to Quick-Med Technologies on such products will be lowered from 20% currently, to a sliding scale starting at 8.5% and declining as sales milestones are achieved.
Sales by Derma Sciences of products covered by this agreement were approximately $1.5 million in 2011, and are expected to grow between 30% and 40% annually, in line with expectations for the Company's advanced wound care product portfolio. This agreement provides Derma Sciences with exclusive global rights through the life of the patents, excluding India as well as the OTC market.
"This exclusive global license strengthens Derma Sciences' ownership of our proprietary advanced wound care products, and will positively impact our BIOGUARD gross margin through a significantly lowered royalty rate," said Edward J. Quilty, chief executive officer of Derma Sciences. "The Quick-Med technology is the only commercial antimicrobial that is non-leaching. Because it does not interfere with the wound-healing process, it is an ideal dressing for infection prevention. With regard to the expanded opportunity afforded to us through the global nature of our new license, given the prevalence of gauze used around the world, we believe the demand outside of the U.S. will be very strong for these predominantly gauze-based, highly effective, yet inexpensive antimicrobial dressings. In addition, this new long-term agreement will allow us to use our recently expanded sales force in the U.S. to increase revenues, and to accelerate plans for product launch in Europe and the rest of the world," Mr. Quilty concluded.
According to Ladd Greeno, CEO of Quick-Med Technologies, "Derma Sciences has established a strong presence in the U.S. wound-care market and we look forward to having them serve as our long-term partner to maximize BIOGUARD product potential. We have spent considerable time and money building strong intellectual property for our NIMBUS technology worldwide, and this patent protection will allow Derma Sciences to leverage its growing presence in markets outside the U.S., as well."
NIMBUS is the only non-leaching antimicrobial technology cleared by the U.S. Food and Drug Administration for wound care; other antimicrobial dressings rely on the release of chemicals to the wound bed that can impede the wound healing process. NIMBUS is non-toxic, long-lasting and not blocked by organics such as blood, exudates, urine and perspiration. By design, NIMBUS poses no risk of bacteria developing resistance.
Quick-Med Technologies, Inc.