Parnell Pharmaceuticals Holdings, a fully integrated, commercial-stage pharmaceutical company focused on developing, manufacturing and marketing animal health solutions, has formed a contract manufacturing agreement with Merial, the animal health division of Sanofi.

Merial will purchase certain sterile injectable products, exclusively from Parnell, with minimum annual purchase commitments over the 10-year term of the agreement.  In addition, Merial will pay an upfront establishment fee in return for Parnell commencing immediate supply of product. Parnell estimates the total value of the agreement between $7-20 million depending on volume of product purchased by Merial over the 10-year term.

“We are very pleased to announce the commencement of our first contract manufacturing agreement with a major multinational,” said Robert Joseph, president and chief executive officer, Parnell. “Merial has a fantastic reputation in the industry and we are excited that Parnell will be supplying sterile injectable products from our state-of-the-art, FDA and EMA approved manufacturing facility. 

“Our business development team has been pursuing contract manufacturing opportunities to leverage the 75% available capacity we have in our facility, and this agreement with Merial generates cashflows that will contribute to our goal of seeing our manufacturing division become a profit center for us in the future. We hope to announce further contract manufacturing deals in 2016.”