Financial Post Westaim snags British partner: US$72M marketing deal
Financial Post - Canada; May 10, 2001
BY CAROL HOWES
CALGARY - Westaim Corp., which calls itself a technology
accelerator, yesterday announced a US$72-million deal with a British
company to launch its infection- control dressings worldwide.
The patented silver-based dressings, developed at its biomedical
division in Fort Saskatchewan, Alta., will be sold and marketed by
Smith and Nephew PLC to the burn and chronic wound markets.
Smith and Nephew had US$1.2-billion in sales last year and is a
Johnson & Johnson's competitor.
The agreement is a major step for Westaim, which plans to develop
the anti-microbial coating technology in to a consumer bandage
within two years.
Kevin Jenkins, president and chief executive of Westaim, said the
company will continue to research, develop and manufacture the
product, looking for other ways to market it.
"We're moving forward with the over-the-counter product and then
there's some initial discussions going on with partners around
implants," he said.
Under the deal, Smith and Nephew acquires an exclusive global
licence and Westaim's U.S. and Canadian burns-dressing business.
In return, Smith and Nephew is paying Westaim US$16.5-million with
a further US$55.5-million after regulatory and sales milestones have
been met, as well as royalties.
Better known for development of its flat-panel display screen through
subsidiary iFire Technology Inc., Westaim's biomedical division is
gaining attention for its Acticoat dressing that attacks infection.
The product was launched in 1998 to treat burn wounds and is used
in more than 90 burn centres in North America, generating sales of
US$5.4-million last year. The US$1.7-billion chronic-wound market
offers a larger opportunity.
"What we want to do is position the product across the world and that
should take us into the US$10-million to US$20-million worth of sales
potential," said Chris O'Donnell, Smith & Nephew CEO. "Beyond that,
we want to seriously introduce the product into the field of chronic
wounds, wounds that are very difficult to heal. We think it's the best
silver technology product in the world."