Perrigo Company (Nasdaq:PRGO; TASE:PRGO) is continuing to expand its business, entering the blood sugar monitoring field on Thursday.
On Thursday, Perrigo signing an exclusive distribution agreement in the US for blood glucose monitors and test strips made by AgaMatrix Inc. Perrigo will sell and distribute certain products in the current AgaMatrix portfolio as well as certain future new products. The company did not disclose the terms of the deal.
Perrigo cites a report by US Diabetes Care Device Market Analysis, which estimates that $2.8 billion is spent annually on glucose monitoring meters and test strips in the US. Perrigo will use its existing store brand retail channels to expand distribution of the new blood glucose meters and testing strips to consumers in early 2011. It will also continue to explore a full range of diabetes care products that extends beyond blood glucose monitoring.
Perrigo chairman and CEO Joseph Papa said, "Entering this adjacent product category has been high on our strategic priority list due to the fact that the growing diabetic community has an increasing demand for more quality, affordable healthcare options. It is well known that regular blood glucose testing is critical to effective diabetes management. What is also well known is that the cost of testing strips and supplies often prevents many diabetics from testing as often as they should." He added, "The Center for Disease control estimates that one in three Americans will develop diabetes in their lifetime."
Perrigo's share price has risen 19.5% since the beginning of the year. Moshe (Mori) Arkin, who owns 7.4%, is a beneficiary. Arkin sold 288,000 share on Friday for $21.6 million. He became a shareholder when he sold Agis Pharmaceuticals to Perrigo, receiving 10.7% of Perrigo as part of the deal. He received 0.8 Perrigo shares for each Agis share, plus $14.93 per share in cash. Perrigo was traded at under $18 at the time; the share price closed at $75.70 on Nasdaq on Friday, giving a market cap of $7 billion. The share price rose 2% by early afternoon on the TASE today to NIS 275.60.
Published by Globes [online], Israel business news - www.globes-online.com - on February 20, 2011
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