Unilife Realigns Operations to Drive Sales and Support Commercial Production of Unifill Syringes
Company Expects to Reduce 2011 Expenditures by $12 million
Unilife Corporation (“Unilife” or the “Company”) (NASDAQ: UNIS; ASX: UNS) today announced it has commenced a scheduled realignment of its operating infrastructure in preparation for the upcoming full commercial production and sale of its innovative drug delivery devices to healthcare and pharmaceutical customers. This realignment is being led by Unilife’s Chief Operating Officer, Dr. Ramin Mojdeh.
The adoption of these business efficiencies is expected to improve Unilife’s cash flow and extend cash reserves by over $12 million during calendar year 2011. Through the elimination or deferral of expenditures no longer required at this time, Unilife expects to reduce operating expenses by approximately $5 million during calendar year 2011, and streamline capital spending programs to further improve cash reserves by approximately $7 million during calendar year 2011. These adopted changes will better enable Unilife to efficiently focus cash resources on the production and sale of the Unifill® prefilled syringe, the Unitract® 1mL syringe, and the commercialization of other pipeline products.
Over the last two years, Unilife significantly expanded its operational capabilities in order to meet the anticipated production requirements and stringent quality assurance expectations of current and prospective pharmaceutical customers. This operational surge by Unilife included the rapid expansion of its workforce to 150 staff, significant investment in new capital equipment, and the development of a state-of-the-art manufacturing facility in York, PA. As a result of this upfront investment, Unilife has successfully completed all quarterly milestones under the industrialization program for the Unifill syringe since July 2008, culminating in initial production of the product commencing last week, approximately nine months ahead of the original schedule.
Having met this key business milestone, the scheduled realignment now taking place will reduce operational expenditures, better position the Company to initiate the sale of the Unifill syringe to its existing pharmaceutical customer, and help finalize discussions with additional interested parties.
In addition to the elimination of a number of redundant positions across various levels of the organization, Unilife is strengthening and expanding its sales and marketing team to support the more rapid development of commercial relationships with a wider range of healthcare and pharmaceutical companies. A portion of the operational savings will also be redirected to support the continued development of an expanding device portfolio. Unilife expects that as a result of this realignment, it could be in a position to secure development, industrialization or exclusivity agreements with interested pharmaceutical parties that can support the commercialization of some of these pipeline products during the second half of 2011.
Dr. Mojdeh, said, “Having completed the key industrial milestone of initial Unifill syringe production well ahead of schedule, Unilife can implement a planned realignment of its business structure to better service the needs of pharmaceutical customers and deliver value to shareholders. In addition to strengthening our sales and marketing team and increasing our investments in R&D, we are streamlining other areas of our Company to improve cash flow and operational efficiencies. Unilife is uniquely positioned to service the acute needs of pharmaceutical companies that are seeking innovative, customized device solutions for their therapeutic drugs from a full-service partner that is agile, responsive and efficient in its business practices. By introducing these measures, we will accelerate our go-to-market strategy while strengthening our financial profile.”
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