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MTRONIC (0043) Metronic sees RM180 mil profit from Covid-19 vaccine distribution

KUALA LUMPUR (Nov 20): Engineering company Metronic Global Bhd expects to secure a profit of RM180 million, following a Memorandum of Agreement (MOA) inked between its subsidiary Metronic Medicare Sdn Bhd and Taiwan-based Medigen Vaccine Biologics Corporation (MVC).

Metronic chief executive officer cum executive director Hoo Wai Keong said the MOA established the basis for negotiation between the parties, prior to a distribution agreement in which Metronic Medicare would be the distributor of MVC-made Covid-19 vaccine in Malaysia and potentially other countries.

In a statement today, he said MVC agreed to sell the finished product to Metronic Medicare for not more than the equivalent of US$50 (US$1=RM4.09) per dose.

At US$50 per dose, the estimated total order book is RM600 million for Metronic with an estimated industry-wide gross margin of 20% to 30% or estimated gross profit of RM120 million to RM180 million, Hoo said.

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

Meanwhile, MVC chief executive officer Charles Chen Chien Jen said his company would be supplying an estimated three million doses of the finished product in 2021.

He said there will be a minimum three-month lead time between MVC’s receipt of each binding purchase order and delivery.

The Taiwanese international pharmaceutical manufacturer recently announced that it has won a 470 million yuan (100 yuan=RM62.27) clinical subsidy contract from the Taiwan Centres for Disease Control (CDC), and is the first company to receive Taiwan government subsidies among four domestic companies approved by the CDC to conduct human clinical trials.

http://www.theedgemarkets.com/article/metronic-sees-rm180-mil-profit-covid19-vaccine-distribution

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