The stateside deal with Organogenesis will allow AMS to recieve royalties on sales until 2026.
Companies: Advanced Medical Solutions Group
Advanced Medical Solutions (LON: AMS) has announced today it has entered into a patent out-licensing agreement with Organogenesis, who will have an exclusive license to the Patent in the US.
The 10-year deal for a "collagen-based wound dressing containing Polyhexamethylene Biguanide ("PHMB")" will allow AMS to receive an initial $2.5m payment plus royalties on the net sales of the licensed product until October 2026. AMS is also entitled to a minimum $1m royalty payment for FY18 and FY19 on top of any sales royalties.
PHMB is an antimicrobial which is effective against several bacteria including E Coli.
Shares in AMS jumped 3% with news of the agreement, bolstering the stock's strong performance this year with today's share price not far off its all-time high of 325p.
The stock has been on an upward trajectory for a number of years now, growing 900% from a December '09 price of c. 30p to be currently trading at 308p. The share price has followed the same upward trend as Revenues and Net Profit, which have grown an average of 19% and 27% YoY respectively.
AMS trades at a current PE ratio of 36x versus the industry median of 21x and has a Market Cap of £635m. Consensus forecasts a Net Profit of £18m from Revenues of £94m in FY17, growing to £20m and £102m in FY18 respectively.