Exalenz Bioscience Ltd. (TASE:EXEN) has completed its distribution network in the US and added 1,000 sales reps for its products there, by signing distribution agreements with two nationwide medical devices distributors for the company's BreathID system for the detection of Helicobacter pylori (H. pylori) bacterium. The company did not disclose the distributors' names, but said that both companies were included in the Fortune 500.
H. pylori bacterium, found in the stomach and duodenum, has been linked to several health conditions, primarily gastric ulcers, and may also be a carcinogenic factor.
One of the distributors has already committed to buying five BreathID devices and 1,000 diagnostic kits for H. pylori.
Market sources believe that one of the distributors is medical devices distributor McKesson Corporation (NYSE: MCK), which has a market cap of $19 billion, and that the other is either Henry Schein Inc. (Nasdaq: HSIC) or PSS World Medical Inc. (Nasdaq: PSSI), which mainly sell to clinics.
Exalenz CEO Steven Eitan said, "We're proud to complete our nationwide distribution network in the US, which will promote the sale of our BreathID device for the diagnosis of the H. pylori bacterium in a market with a potential of $500 million." He added that, in view of the strategic deals, the company expects an increase in orders already in the coming quarters, and substantial sales in 2011.
Exalenz founder and chairman Dr. Uri Geiger said that the US was an important market for the h. pylori diagnostic kit, because of the regulatory hurdle there. "We had to complete five trials with 1,000 patients to get regulatory approval," he said.
Insurance indemnification is higher in the US than in Europe. As for Israel, Geiger said that Exalenz was only the company with an H. pylori diagnostic kit on the market, carrying out 120,000 diagnoses a year.
Exalenz's share price rose 29.6% by midday to NIS 1.19, giving a market cap of NIS 130 million.
Published by Globes [online], Israel business news - www.globes-online.com - on June 20, 2010
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