Alan Shortall-CEO at Unilife Corporation
Posted by Jeff Ramson on Mon, Jul 12, 2010 @ 02:03 PM
Alan Shortall-CEO at Unilife Corporation
Alan Shortall (CEO) is an experienced entrepreneur who has guided the growth and international development of Unilife since its inception.
Ever since Unilife was founded by CEO Alan Shortall in Australia in 2002, the Company has expanded rapidly to meet anticipated demand from pharmaceutical partners such as sanofi-aventis. Today, the U.S.-based and NASDAQ listed Company employs over 175 people. Since the Company relocated its core operational and commercial functions from the Australia to the US in 2009, Unilife’s engineering, quality and marketing capabilities have been significantly expanded to support core projects such as the Industrialization Program for its UnifillTM ready-to-fill Syringe.
Led by CEO Alan Shortall, Unilife recently bolstered its management team R. Richard Wieland II, a 30-year top executive for private and public life science companies, including CFO of Advanced Life Sciences Holdings, Inc., a NASDAQ-listed clinical-stage bio-pharmaceutical company.
The Company’s Board of Directors, which includes Alan Shortall and is led by Non-Executive Chairman, Jim Bosnjak, has also been significantly enhanced with the addition of Mary Kate Wold, former SVP of Wyeth (acquired by Pfizer for $68 Billion last year) as an independent director. The Board of Directors will continue to seek out additional members who will expand on the Board’s experience and knowledge base.The 'A' list team was assembled by Shortall shortly after Unilife became a U.S. FDA-registered and ISO 13485 certified medical device manufacturer of its proprietary and patented retractable syringes. Now Unilife is feverishly building out a state-of-the-art production facility near its new offices in central Pennsylvania. With a total size of three football fields, Shortall says that four shifts running 24/7 are on pace to finish the construct by year-end 2010. The giant push to production is being fueled by anticipated demand for Unilife's range of prefilled syringes from pharmaceutical industry leaders including sanofi-aventis (NYSE: SNY). In July 2009, sanofi-aventis (NYSE: SNY) entered into an industrialization agreement with Unilife, agreeing to approximately $40million in exclusivity fees and commercialization payments for the exclusive right to negotiate the purchase of the Unifill Ready-to-Fill Syringe (RTFS). The agreements give sanofi-aventis the exclusive right to negotiate the purchase of the Unifill syringe within the full therapeutic classes of antithrombotic agents and vaccines plus some other new smaller drug classes until June 30, 2014. Shortall is quick to remind fellow shareholders that Unilife retains the right to negotiate with other pharmaceutical companies seeking to utilize the Unifill syringe with drugs and vaccines marketed in therapeutic areas outside of those secured exclusively by sanofi-aventis.
The sanofi-aventis / Unilife relationship provides upside potential for Unilife shares and an added confidence in the management team created by Shortall. Even former critics like TheStreet.com's Jim Cramer, who panned Unilife shares back in April, have subsequently become fans. In a CNBC interview on Mad Money, Shortall addressed the concerns of Cramer, who said he “loves” sanofi-aventis but Unilife may be too dependent on this new alliance. Shortall began by demonstrating that the automatic, retractable, single use hypodermic needle does what it says it does and called the invention a 'disruptive' technology. Indeed, Unilife holds 26 issued patents in 14 countries, in addition to a number of patents pending, and Shortall underscored that markets are addressable beyond the $2.5 Billion pre-filled segment. Markets addressed by Unilife's products and services include its ready-to-fill safety syringes for pharmaceutical companies like sanofi-aventis; self-injectables of prescription medicine for individuals to control diabetes; harm reduction programs for IV drug users; safety, pre-filled, single-use syringes for healthcare facilities and humanitarian workers; and contract manufacturing of medical devices. Unilife is hardly dependent on any one company or market.
When Cramer asked Shortall about the price volatility in Unilife shares after it went public, Shortall said some of the shares did not transfer correctly from Australia (a delay of up to 3 days) to the NASDAQ, causing a short and then a spike in Unilife's share price. While Unilife shares have benefited from greater liquidity and market exposure in the U.S. (shares grew roughly 300% over the past 12-months), Wall Street gurus like Cramer add priceless value to a small-cap company such as Unilife. Cramer has since concluded that Unilife was a “great stock,” and gave his blessing on Unilife shares as a speculation. Post the interview, Unilife shares rose 20%.
Product sales from sanofi-aventis won't kick in on the income statement until late 2010 – early 2011 when production begins. However, Shortall said during Unilife's third fiscal quarter (ended March 31st) conference call that “significant proposals are being evaluated in U.S. and Europe.” The financials aren't reflecting this potential, as of yet. For the third fiscal quarter ended March 31, 2010, revenues were down to $2.4 million, compared to $4.1 million in March 31, 2009. Net loss of $12.1 million or $0.23 per diluted share, rose compared to a loss of $0.3 million or $0.01 per diluted share in the same period last year. Adjusted net loss for the quarter was $5.1 million or $0.10 per diluted share, compared to adjusted net income of $0.5 million or $0.01 per diluted share in the year-ago period. Unilife shares outstanding were 54,355,770 and 36,625,802 for the 2010 and 2009 periods, respectively.
Shortall explained that third quarter 2010 revenues were exclusively milestone payments, and not actual product sales. When Unilife signed the industrialization agreement with sanofi-aventis last year, and subsequently moved production 12-months ahead of schedule, sanofi-aventis accelerated its milestone payments, which created an artificial year-over-year loss on this year's quarter. Shortall pointed out that Unilife's net loss included $7 million in non-cash items, including share compensation, interest, depreciation, and one-time charges associated with relocation of Unilife to the U.S. Compensation in Unilife shares included $4.3 million paid to the inventors of Unilife's patents. Shortall said these payments were required by sanofi-aventis under the industrialization agreement, and protect Unilife's most important, revenue-generating assets (even though they don't show up on the balance sheet, added Shortall).
Another push to market is Unilife's FDA 510(k) market clearance for its Unitract™ 1mL safety syringe manufactured at its Lewisberry, PA facility, which can open up substantial opportunities to existing 'big pharma' as well as other healthcare distributors and government healthcare departments. Shortall says Unilife's unique selling proposition enables drug makers to expand the lifecycle of their blockbuster drugs, which currently generate about $80 Billion per year in revenues. With patents running out on today's top sellers, Shortall says Unilife's 501(k) clearance provides an opportunity to re-package and re-sell refillables as new products with an intra-muscular indication (until the 501 (k), the Unilife ready-to-fill product was for IV use only).
In light of legislation from Washington (the 2000 Needlestick Prevention Act), and emerging protocols in Europe and Asia that support the adoption of safe 'non-stick' needles, Unilife sees demand escalating worldwide. In developing economies like India, the need for one-use, safety syringes are great as healthcare risks run rampant without proper government guidelines. In addition to establishing a relationship with Mumbai-based Clinicare, Unilife has entered into a five-year agreement with Taiwan-based Stason Pharmaceuticals and its affiliate to be its exclusive Unitract sales partner covering Japan, China and Taiwan. The deal requires Stason to purchase a minimum of one million units of the Unitract™ 1mL syringe per year (an immediate annual order was placed at signing). Other countries within South-East Asia may be added to the list of designated territories given additional agreements on minimum orders for those countries, according to Shortall.
Shortall continues to ship out Unitract 1mL safety syringes to Haiti and will continue to support the safety of healthcare workers worldwide. Shortall said he is also accelerating discussions with major pharmaceutical companies for the Unifill™ syringe.
In the medical device industry, Unilife is rising up in the ranks. Medical Device & Diagnostic Industry Magazine (MD+DI) put Unilife as one of its “Top 50 Companies to Watch in 2010.” Shortall was previously named one of the “Top 100 Notable People in the Medical Device Industry.”
Shortall stays on point for the remainder of 2010, saying, “Unilife is focused on the delivery of four key goals: the on-time completion of the ready-to-fill syringe industrialization program; the successful production and commercial release of Unitract 1mL syringes; the continued expansion of Unilife operational capabilities; and the implementation of the Unlife corporate investment strategy that will build shareholder value.”
In other Unilife news:
On July 2nd, Unilife announced its resale Form S-1 registration statement became effective, permitting certain option holders to resell shares underlying their options. As previously advised, the Registration Statement simply removes restrictions which apply under US federal securities laws to the sale of shares underlying certain options previously issued by the Company.
The Registration Statement, while effective, allows the option holders to freely trade the shares issued or issuable upon exercise of their options (other than affiliates of Unilife to whom certain re-sale restrictions will still apply). The Company is not issuing any new share capital and will not receive any proceeds from the issue of the shares (other than the exercise price payable by option holders on exercise of their options).
On June 25th, Unilife was added to the Russell 3000®, Russell Microcap® and Russell Global® indexes. That was just another giant push in the right direction for a company that has seen record growth since its shares began trading on NASDAQ on February 16, 2010. Shares trade on the Australian Stock Exchange under UNS.
CEO of Unilife Corp., Alan Shortall, said in a press release, “Being included in the Russell indexes so soon after completing Unilife's listing on the NASDAQ Global Market is a significant validation of our redomiciliation from Australia to the U.S. Membership in these widely followed indexes will help increase Unilife's visibility among investors in the U.S. equity market." Nearly seven million Unilife shares traded the day the news broke, which is the equivalent of 41.7 million CHESS depositary interests (CDIs) with a value of approximately US$50 million. “We expect much of the increase in Unilife trading volume on (June 25th) represented the inflow of U.S. investors that track the Russell indexes.”
About Unilife Corporation
Unilife Corporation is a U.S.-based medical device company focused on the design, development, manufacture and supply of a proprietary range of retractable syringes. Primary target customers for Unilife products include pharmaceutical manufacturers, suppliers of medical equipment to healthcare facilities and patients who self-administer prescription medication. These patent-protected syringes incorporate automatic and fully-integrated safety features which are designed to protect those at risk of needlestick injuries and unsafe injection practices. Unilife is ISO 13485 certified and has FDA-registered medical device manufacturing facilities in Pennsylvania.
The information herein contains forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to our management. Our management believes that these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in "Item 1A. Risk Factors" and elsewhere in our registration statement on Form 10 and those described from time to time in our periodic reports which we file with the Securities and Exchange Commission.