NEW YORK (AP) -- Shares of medical device maker Unilife Corp. climbed Wednesday after a Jefferies & Co. analyst said sales of the company's prefilled syringe and storage devices could grow to $500 million in the next five years.
THE SPARK: Analyst Raj Denhoy began covering shares of Unilife with a "Buy" rating and a price target of $7 per share. He said the company's Unifill device could appeal to many pharmaceutical companies because it could be used to extend the patent protection of some of their drugs. The company is in the development stage now, but Denhoy said he thinks commercialization of Unifill products could start in 2013, approach $500 million in annual sales in fiscal 2016, and reach $670 million in fiscal 2017.
THE BIG PICTURE: Unilife's main franchise is the Unifill syringe, which has a glass barrel and the needle retracts fully into the syringe. That makes it a combination drug storage, safety, and delivery device. The company's main partnership is with French drugmaker Sanofi. Unilife is developing a Unifill version of the company's injectable blood thinner Lovenox. Unilife has received about $40 million in revenue from that partnership, which began in July 2008.
Unilife has announced other development deals since then, although it has not named its other partners or the products it will research. Denhoy said he thinks the York, Pa., company will strike around 30 license and development deals, and he expects about half of those products to reach the market.
Unilife reported $6.7 million in revenue in the fiscal year ended June 30, 2011.
SHARE ACTION: Unilife stock rose 44 cents, or 13.6 percent, to $3.68 in afternoon trading. Shares of Unilife have traded between $2.82 and $6.04 in the last year. They are down 37 percent since the company reported its fiscal first-quarter results on Nov. 9.