The announcement was made during trading hours today, 11 September 2012.
Meanwhile, the BSE Sensex was up 57.75 points, or 0.33%, to 17,824.53.
On BSE, 1.38 lakh shares were traded in the counter as against an average daily volume of 2,338 shares in the past one quarter.
The stock hit an intraday low of Rs 91 in early trade today. The stock had hit a 52-week high of Rs 145.95 on 13 September 2011. The stock had hit a 52-week low of Rs 63.50 on 4 June 2012.
The stock had outperformed the market over the past one month till 10 September 2012, rising 20.89% compared with the Sensex's 1.19% rise. The scrip had also outperformed the market in past one quarter, gaining 16.56% as against Sensex's 6.27% rise.
The small-cap company has an equity capital of Rs 6.12 crore. Face value per share is Re 1.
Panacea Biotec said that it entered into a strategic alliance with Osmotica Pharmaceutical for the research, development and commercialization of drug delivery based, high barrier to entry generic and branded pharmaceutical products in US and key strategic markets across the globe. The collaboration is designed to build upon each company's highly complementary strengths and quality assets. Osmotica is a global pharmaceutical company specialising in drug delivery technologies.
Under the collaboration, Panacea Biotec would lead product identification, research, development and manufacturing while Osmotica would lead product registration, legal matters, marketing, sales and distribution. The collaboration products are expected to be sold under an Osmotica and Panacea Biotec label. This collaboration is based on 50:50 risk, investment and profit sharing by both companies and starts with a portfolio of 18 products across a broad range of therapeutic categories, with a provision to add new products by the Joint Steering Committee represented by both companies.
Dr Rajesh Jain, joint managing director, Panacea Biotec, said, We are pleased with this unique opportunity to collaborate with Osmotica to meet the never-ending demand for high barrier to entry and high-quality pharmaceuticals in United States. We believe this collaboration will enable both partners to complimentarily build upon each others core competencies and capabilities to help meet the needs of more patients in United States than ever before.
As per the agreement, Panacea Biotec will receive initial research fee from Osmotica. Moving forward, Panacea will receive agreed amounts of milestone payments representative of 50% share of development costs from Osmotica upon achievement of development milestones. For each new product added to the collaboration and for each new market thereof, Panacea shall receive a fixed research fee besides receiving the 50% share of development costs. Post commercialisation of the products in USA and other markets as may be added from time to time, both shall share the profits equally.
Commenting on the development Forrest Waldon, CEO, Osmotica, said, “Osmotica is pleased to join hands with Panacea Biotec to jointly bring high quality pharmaceutical products to patients in medical need. We believe this opportunity affords patients and our shareholders, employees and other stakeholder's significant value.”
Panacea Biotec said that this collaboration reflects the shared belief that the development and commercialization of drug delivery based, high barrier to entry products will not follow a typecast brand or generic model, and will require significant innovation, technical expertise, infrastructure and investment to achieve the desired ends.
Panacea Biotec's existing business and products would continue to function outside of this agreement and maintain their current unique structure and character. Both companies believe that this alliance is based on a unique hybrid business model which crystallizes the positive aspects of a traditional 'strategic partnership' and 'joint venture' relationships between two corporate entities.
Panacea Biotec reported net loss to Rs 65.97 crore in Q1 June 2012 as against net profit of Rs 16.72 crore in Q1 June 2011. Net sales declined 62.40% to Rs 83.10 crore in Q1 June 2012 over Q1 June 2011.
Panacea Biotec is a research-based health management company with research, manufacturing and marketing capabilities. It is the second largest vaccine manufacturing company in India.
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