11 Dec 2012 07:00
Embargoed: 0700hrs, 11 December 2012
Akers Biosciences, Inc.
("ABI" or the "Company")
3.5 million unit Order for Breath Alcohol tubes
Part Receipt of Licence Fee
ABI, a leading designer and manufacturer of rapid diagnostic screening and testing products, is pleased to announce that it has received a purchase order to manufacture 3.5 million units of a custom breath alcohol detector, based on the Company's BreathScan product, for $1.05 million. The order will support the entrance of Sono International, Ltd. ("SONO"), a London-based multinational corporation, into the French disposable breath alcohol detector marketplace.
ABI had previously announced on 17 September 2012 that it had signed a multi-year supply agreement with SONO, granting them an exclusive licence to market private-labelled versions of the Company's breath alcohol detectors, outside of North America. Under the terms of the agreement, SONO agreed to pay an upfront licence fee of $1m for exclusive marketing rights of ABI breathalysers within the European market. Payment of the licence fee was conditional upon, inter alia, the Company's disposable breathalyser product being certified under the French Standard, NF X 20‐702 ("NF Mark"). In addition, the Company was also named SONO's sole producer of their disposable breathalysers and SONO agreed to minimum orders of $1.275 million over the next three years.
Testing of the Company's detectors by the national reference laboratory of France, Laboratoire National de Métrologie et d'Essais, has been proceeding for several months. Feedback on their assessment has so far been sufficiently positive for SONO to partially waive the conditions for payment of the licence fee. ABI has now received $550,000 of the $1 million licensing fee. The Company anticipates receiving the NF Mark in January 2013 which will trigger the payment of the remaining $450,000 of the licence fee.
As of 1 July 2012, French law mandates that every driver of a motorised land vehicle, excluding mopeds, must possess, at minimum, an unused, NF-Approved disposable breathalyser kit; two kits are recommended. As of 1 March 2013, the full enforcement of the law will take place, as failure to immediately produce an operational breathalyser kit when asked by police will result in a fine of 11 euros. The legislation impacts any and all drivers on French roads, including foreign passport holders and drivers of foreign vehicles.
With the current French population estimated to be 65.3 million and approximately 30 million people owning a car, the potential demand for NF-Marked breathalysers to satisfy the needs of French citizens alone is quite substantial. France is also the most popular tourist destination in the world, with approximately 81 million foreign visitors having traveled to France last year, meaning that the potential associated with satisfying the demand for breathalysers by rental car companies and tourists driving into France from surrounding EU countries represents an even larger market opportunity. Currently, there are only two disposable breathalyser brands that carry the NF-mark and by becoming the third, Akers believes that the private-labelled product has the potential to generate significant revenue.
Thomas A. Nicolette, President and CEO of ABI, commented: "We are excited that our FDA-cleared and Australian-compliant .05% detector technology is being assessed for certification to bear the prestigious NF Mark, which will allow our distribution partner, SONO, to aggressively enter the French disposable breathalyser market. Having streamlined our manufacturing processes in H1 2012, the Company is poised to deliver SONO's private-labelled detectors at a pace that can meet or exceed the ongoing requirements of the EU market opportunity. SONO's exclusivity payment and their initial purchase order immediately contribute to the Company's Q4 2012 bottom line and the potential revenue stream moving into 2013 and beyond, is one that should fortify our competitive positioning and improve shareholder value."
Enquiries:
Thomas A. Nicolette
President and CEO
Tel. +1 856 848 8698
Antony Legge or Emma Earl
Daniel Stewart & Company plc (Nomad and Broker)
Tel. +44 (0)20 7776 6550
Akers Biosciences develops, manufactures, and supplies rapid, point-of-care screening and testing products designed to bring health status information, both rapidly and directly, to the consumer or healthcare provider. The Company has advanced the science of diagnostics while responding to major shifts in healthcare through the development of proprietary platform technologies. The Company's state-of-the-art rapid diagnostic assays can be performed virtually anywhere, in minutes, since time is always of essence. ABI is aligned with high volume medical product distributors to help facilitate the Company's growth into a major, worldwide competitor in the field of rapid diagnostics. Additional information on the Company and its products can be found at www.akersbiosciences.com