Access Pharmaceuticals, Inc. (OTC Bulletin Board: ACCP), a biopharmaceutical company specializing in products for cancer and supportive care signed a $30 million supply agreement for MuGard with RHEI Pharmaceuticals, Inc. ("RHEI"), a specialty pharmaceutical company focused on bringing proprietary medicines to the China market. Access will ensure manufacturing capacity of up to a minimum of $30 million of product in the licensed territories. Coinciding with the signing of the above agreement, Access also approved a sub-license agreement between RHEI Pharmaceuticals and Jian An Pharmaceuticals ("Jian An") Limited in Shenzhen, China in an effort to leverage Jian An's extensive sales, marketing and regulatory infrastructure for the launch of MuGard in China and Taiwan.
Jian An is headquartered in Shenzhen, China and has a 25-year history of selling pharmaceutical and other medical products in the China market. Jian An has 1400 sales representatives covering all majors centers in China through 169 sales offices. With Jian An's sales and marketing infrastructure and the supply agreement which will provide up to $30 million of MuGard to the territory, Access Pharmaceuticals' commercialization efforts remain on track in China and its other South East Asian territories. Access retains its existing milestone and royalty structure for the territory. In addition, Access and RHEI have also filed a new patent application in China covering MuGard for the relief and reduction of erythema. This new application is expected to provide additional IP protection as well as the potential for a new indication for MuGard.
"We are excited about the new relationship with Jian An in China, as it greatly expands our reach throughout the region with significant sales representative presence," said Sven de Backer, CFO of RHEI Pharmaceuticals. He continued, "We believe Jian An's local expertise will expedite the ongoing marketing approval process allowing us to begin providing patients with an effective treatment for oral mucositis. We are thankful to Access for ensuring adequate MuGard supply for the commercial launch."
"We look forward to working with Access and RHEI and bringing MuGard to market in China," said Zhan Zhangyi, CEO of Jian An Pharmaceuticals. He continued, "We believe MuGard is the right product to help us continue increasing our pharmaceutical market penetration in China. MuGard is an important addition to our growing product portfolio and we look forward to its commercial launch."
"Oral mucositis is a growing problem in the greater China region and we are confident that RHEI's marketing capabilities, with the addition of Jain An's established product-promotion experience, will greatly enhance our effort to bring MuGard to the many patients that may otherwise suffer from the debilitating side effect of anticancer treatments," said Jeffrey Davis, CEO of Access Pharmaceuticals, Inc. He continued, "The recent news surrounding MuGard, including this agreement and the initial product purchase order received in the US, underscores the significant revenue potential we believe MuGard will provide our company."
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