MVP 2.45% $5.44 medical developments international limited


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    Here is another small biotechnology company getting its acts
    together with the price showing value for investors.

    Yesterday, Medical Developments International Ltd (ASX:MVP)
    reported it intends to implement a share-buy back scheme in order to best
    utilise its strong cash flows.
    MVP chairman David Williams explained that "this scheme will
    enable us to take advantage of MVP's strong operating cash flows to the
    benefit of all shareholders.
    "In addition to the cash inflows, MVP is debt-free and currently
    maintains a $2 million facility, so the proposed buy-back will not affect
    our ability to support international marketing and registration
    activities or any capital expenditure required to meet higher demand."
    The on-market buy back will commence on November 26 and continue
    for up to six months or until the funds allocated to the buy-back are
    The maximum number of shares to be bought back will be the number
    that can be purchased with the allocated funds of $500,000.
    Medical Developments International is a leader in emergency pain
    relief and respiratory products.
    The company manufactures a fast-acting pre-hospital and emergency
    pain relief product called Penthrox.
    It is used in all Australian Ambulance services, the Australian
    Defence Forces, sports medicine, dentistry and for analgesia during short
    surgical procedures.
    On Wednesday, the company held its annual meeting which initially
    underlined that the board was conscious that the MVP share price had
    underperformed the market and its pharma/biotech peers.
    On the positive side, the company has a product in the market;
    has no debt; it is making profits with cash in the bank and the company
    offers have plenty of upside.
    Net profit for FY08 was below FY07 even though revenue was up,
    but MVP invested significantly in registrations, international market
    development, regulatory development, and marketing, which had an impact
    on profit.
    Some of the company's business development has been slower than
    hoped, due to the complexities of international markets; but all is still
    on track for significant business expansion and profit growth over the
    next few years.
    The company is on very sound footing operationally and
    financially and is cautiously optimistic that FY09 will see a significant
    improvement in revenue, profits and company growth.
    "We have already made public statements about the key drivers of
    future growth - Middle East sales, New Zealand sales, veterinary use, and
    including our products in doctors bags under the PBS," Mr Williams said.
    "All of these possibilities are well advanced."
    CEO Chris Rossidis said FY08 had been a watershed year for MVP as
    it made significant advances in many areas.
    The strategy in FY08 was to focus on activities that would
    deliver long-term sustainable growth, and this continues to be the
    motivation and direction for management in FY09.
    "Our business objectives for FY09 are for double-digit growth for
    our core business in Australia and NZ and the expansion in sales in
    Penthrox and Medical Devices overseas," Mr Rossidis said.
    "We expect that profit in FY09 will grow substantially from FY08
    as costs are expected to be stable as a proportion of revenue and no
    significant one off costs are expected as was experienced in the FY08."
    Highlights in FY08 include:
    * Sales growth - increase in sales (24 per cent) Penthrox growth
    of 36 per cent driven by aesthetics, dentistry and hospitals in
    Australia, ambulance and hospitals in New Zealand and launch and sales in
    the Middle East;
    * Registration program expansion - Penthrox submitted for
    registration in 11 new countries in FY08. It is currently under review in
    18 countries;
    * Continued development of the Penthrox clinical program -
    long-term safety study in WA, bone marrow biopsy study at the Peter Mac,
    emergency medicine study in Belgium;
    * Veterinary registration of Methoxyflurane in the US - audit of
    manufacturing facility in FY08 came at a significant cost - US FDA
    inspection of MVP manufacturing plant completed early in calendar 2008,
    approval expected very shortly;
    * Submission to the Pharmaceutical Benefits Authority (PBS) for
    Penthrox to be used in general practice through doctor's bag inclusion;
    * Successful three-year extension of the PHARMAC (NZ
    reimbursement authority) tender for MVPs range of asthma products; and
    * Growth of the MVP oxygen range of products by 28 per cent.
    The company's strategic direction for FY09 is to:
    * Maximize sales of Penthrox in Australia through local
    partnerships and PBS listing, in NZ to increase usage in the ambulance
    service and hospitals;
    * Middle East, through continued promotion;
    * Launch into new countries;
    * Registration program expansion - submit for Penthrox
    registration in new countries;
    * Asia, South America and Eastern Europe;
    * Western European strategy - continue the development of the
    Penthrox clinical program;
    * Maximize the sales of Methoxyflurane for veterinary use in the
    USA; and
    * Expansion of sales of the asthma range of products into new
    countries - European, South America and Asia.


    Shares of Medical Developments yesterday traded steady at 23c.
    Rolling high for the year was 47.5c and low 20c. No dividend is paid. EPS
    1.6c and p/e ratio is 14.38. The company has 56.9 million shares on issue
    with a market cap of $13.1 million.
    The 2008 financial year saw a 24 per cent increase in sales for
    Medical Developments International.
    Net profit was reduced to $891,000 on the back of significant
    activities around registration, marketing and other expenditure.
    The emphasis in FY08 has been a commitment to progress and
    deliver on important milestones that will create a solid platform for the
    further growth of the company.
    There was growth of sales in New Zealand with the integration of
    Penthrox into the treatment protocols in the ambulance service.
    Sales in the Devices division grew by 10 per cent, underpinned by
    our strong position in the asthma market in NZ and our strong marketing
    partnership in Australia.
    Further penetration into the Asian market was difficult in FY08;
    however sales grew in territories such as Singapore.
    In addition, the company experienced 28 per cent growth in our
    oxygen equipment business, driven mainly by its emergency services
    MDI expects further growth in FY09 following the recent
    appointment of an emergency services representative who is an expert in


    Medical Developments International Ltd was listed on the
    Australian Stock Exchange on December 15, 2003.
    The company's major activity is in the production and supply in
    emergency pain relief and respiratory products.
    MVP manufactures a pre-hospital and emergency pain relief product
    called Penthrox.
    It is used in all Australian ambulance services, the Australian
    Defence Forces, Sports Medicine, dentistry and for analgesia during short
    surgical procedures.
    Operations are focused on lead analgesic drug, methoxyflurane.
    The drug is delivered through the Penthrox inhaler and provides
    pain relief following five or six breaths. Benefits of the inhaler are
    cost advantages over gas-based products, minimal training is required, no
    cross infection risk and it is a simple hand-held device.
    The medical and veterinary equipment business designs and
    distributes equipment, products and devices for asthma management, oxygen
    delivery and anaesthetics.
    Products for asthma include the Space Chamber spacer,
    Breath-Alert Peak flow meters, oxygen resuscitation equipment, the Clare
    ventilator and the KAB Carbon Dioxide Absorber.
    The product range includes Komesaroff Anaesthetic machines used
    for providing oxygen, removing carbon dioxide and maintaining blood
    concentrations of anaesthetic agents.
    The breath alert breathing monitor, an audiovisual monitor of
    breathing rhythms for animal and biopsy punches used for removal of
    sample of tissue.
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