Pharmaceutical Firm Gets the Right to Make Drug

Hoping to expand its share of the eye-care market, International Pharmaceutical Products Inc., a Costa Mesa drug manufacturer, has signed an agreement with Pharmadam Ltd., an Israeli company, which will allow International Pharmaceutical to manufacture and market Hyaluronic Acid--a substance used in cataract surgery.

Dr. Lionel N. Simon, International Pharmaceutical’s president and co-founder, said that the manufacturing process will decrease the cost of creating doses of the drug by 50%. The drug is a generic version of a product designed by a Swedish company, Simon said, and doses of that drug sell currently for $50 to $80.

International Pharmaceutical, which until last December marketed no products under its own label, supported Pharmadam Ltd.’s research and development of the cheaper manufacturing process and will pay the Israeli company an undisclosed royalty for use of the process. As part of the deal, International Pharmaceutical also gave Pharmadam manufacturing and distribution rights for the drug in Israel and Africa.

In September, 1984, International Pharmaceutical acquired Maurry Biological Inc. of Los Angeles for $3 million to “vertically integrate” the company, Simon said. Maurry has become the manufacturing arm for International’s line of sterile products. International showed a loss of $1.9 million last fiscal year on sales of slightly more than $2 million, due to “heavy” research and development costs, said Simon. In the first six months of this fiscal year, International posted an operating loss of $1.13 million on sales of $1.4 million but, because of a $1.3-million settlement of a court case, the company reported a net profit for the six-month period of $165,000.

Simon said he expects no impact on International’s earnings this year from the new product, but he said the company hopes to finish testing of the drug and receive FDA approval within the next year.