The Medical Developments International Ltd (ASX: MVP) share price will be on watch on Tuesday following the release of a positive announcement.
What did Medical Developments International announce?
This morning Medical Developments International announced that it has signed an extension to its 2017 agreement with national science agency, the Commonwealth Scientific and Industrial Research Organisation (CSIRO).
The agreement is for the development of new manufacturing technologies for pharmaceutical products.
According to the release, the two parties are aiming to develop the next generation of manufacturing technologies to make small molecule pharmaceutical products at a significantly reduced cost and improved quality, compared with traditional processes.
Medical Developments International will invest up to $5 million in the project over five years. This will be funded through a combination of 60% shares or cash and 40% share options. If the company elects to pay 60% of the fees in shares, they will be issued at the 7-day volume weighted average price (VWAP).
The share options will have a term of 10 years and may only be exercised or vested when a developed technology has been proven to be commercially viable. They will be issued at a 10% discount to the 7-day VWAP at the date of invoice.
The company's chief executive officer, John Sharman, said: "We have seen good progress in the development of multiple continuous flow technologies. Our Lidocaine continuous flow process is in the final stages of development after which it could be ready to go to market. There are several other technologies in various stages of completion. This extension will underwrite MVP as a world leader in continuous flow technology."
CSIRO Manufacturing's Science Director, Dr. Paul Savage, also spoke positively on the agreement.
He said: "CSIRO is delighted to extend our partnership with Medical Developments International to develop this new technology. By introducing transformative processing technologies, CSIRO aims to further assist the global competitiveness and growth of the Australian pharmaceutical manufacturing industry."
