(Alliance News) - OptiBiotix Health PLC on Wednesday said its subsidiary ProBiotix Health Ltd has signed a new global manufacturing and supply agreement with Italian biotechnology company Sacco SRL.
In 2017, the UK life sciences company said it entered into an agreement with Sacco, giving the biotechnology company an exclusive licence to manufacture and supply LPLDL in the US and Rest of World region for 50% of the profit.
LPLDL is OptiBiotix's probiotic strain intended to reduce cholesterol and blood pressure.
The new agreement will see Sacco - until the end of 2023 - manufacture LPLDL under a global non-exclusive licence for the dietary supplement and food and dairy markets, and under an exclusive licence for the drug and bio-therapeutic market.
The agreement will change the original profit-sharing agreement to a manufacture and supply agreement with pricing discounts for increasing sales volumes, OptiBiotix said. OptiBiotix will also receive commission payments from Sacco for LPLDL sold to dairy customers.
The modified agreement is expected to allow the company to benefit from reduced price of goods as sales volumes grow and to provide more evenly-distributed income throughout the year.
"We are pleased to announce this agreement with Sacco, which extends our relationship with them for the next four years. The changes to this agreement reflect the focus on building a profitable business as we renegotiate supply agreements with partners as sales volumes grow to increase margins," said ProBiotix Chief Executive Steve Prescott.
Shares in OptiBiotix Health were down 1.8% at 42.00 pence each on Wednesday morning in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
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OptiBiotix Health (OPTI)