Metronic joins vaccine distribution race with Taiwanese pharma

by RAHIMI YUNUS / pic by AFP

AS BIG pharma companies like Pfizer Inc and AstraZeneca plc edge closer to introducing potential Covid-19 vaccines, Bursa Malaysia’s pharma upstarts are positioning themselves for a piece of the Covid-19 vaccine market.

While local pharmaceutical companies, namely Pharmaniaga Bhd and Duopharma Biotech Bhd, are aiming at the “fill-and-finish” vaccine businesses for the Covid-19 vaccine, companies like Metronic Global Bhd, Ho Wah Genting Bhd, DKSH Holdings (M) Bhd, MSCM Holdings Bhd and Bintai Kinden Corp Bhd, among others, are seeking to benefit from the distribution opportunities.

Metronic’s subsidiary, Metronic Medicare Sdn Bhd, inked a memorandum of agreement (MoA) with Taiwan-listed company Medigen Vaccine Biologics Corp (MVC) to obtain exclusive distribution rights for MVC’s Covid-19 vaccine in Malaysia and potentially other areas.

Metronic Medicare will, at its own cost and expense, obtain all product registrations in Malaysia in its name or MVC’s name, as shall be separately agreed in the distribution agreement, and MVC will support required clinical development by supplying MVC vaccine at a discounted price.

In a release last Friday, Metronic stated that MVC agreed to sell the finished product to Metronic Medicare in 2021, at a price that is not more than the equivalent of US$50 (RM204.50) per dose, with the specific price to be negotiated.

At US$50 per dose, Metronic estimated a total orderbook of RM600 million, with an estimated industry-wide gross margin of 20% to 30% or an estimated gross profit of RM120 million to RM180 million.

“This MoA establishes the basis for negotiation between the parties with the view of entering into a distribution agreement pursuant to which Metronic Medicare will distribute the MVC vaccine in Malaysia and potentially other countries,” Metronic CEO and ED Hoo Wai Keong stated in the statement.

Hoo said in the forthcoming distribution agreement, MVC will supply Metronic Medicare with MVC vaccine in pre-filled syringes or multi-dose vials formulated for immediate vaccination into humans for distribution by Metronic Medicare.

Metronic said the parties may also consider an arrangement under which MVC will supply bulk antigen to a third-party manufacturer in Malaysia agreed to by the parties for fill-and-finish and packaging to produce the finished product for distribution by Metronic Medicare in Malaysia and potentially other countries.

To implement this MoA, the parties agree within one month after the signing of the MoA that Metronic Medicare shall deposit US$1.5 million into MVC and apply the refundable deposit to the purchase price of orders for the finished product.

MVC will produce and provide Metronic Medicare with a draft distribution agreement, whereupon the parties shall pursue negotiation to agree to the final terms and sign the distribution agreement. The final distribution agreement will be signed within three months from the effective date, Hoo added.

MVC is a vaccination company and a comprehensive biopharmaceutical manufacturer incorporated in Taiwan dedicated to preventing emerging infectious diseases with expertise in developing cell-based vaccines and biosimilar products.

The company, which is listed on the Taiwan Stock Exchange, develops flu vaccines, enterovirus vaccines and other related products.

On Nov 13, MVC announced it has won a T$470 million (RM67.42 million) clinical subsidy contract from Taiwan Central Disease Control (CDC).

MVC is the first company to receive subsidies from Taiwan’s government among the four domestic companies approved by the CDC to conduct human clinical trials.

In an exchange filing last Friday, Metronic said MVC will supply from one million to three million doses of finished product during the calendar year 2021, contingent upon the company’s notifying MVC on or before Dec 31, 2020, of its commitment to purchase such a number of doses.

The company said it is understood that there will be a minimum three-month lead time between MVC’s receipt of each binding purchase order and delivery and exact lead times, and purchase and supply terms will be separately agreed and included in the distribution agreement.