Supplier of Intravenous Products Strikes Licensing Pact

McGaw Inc., a supplier of intravenous products, announced Tuesday that it has sold licensing rights to a Swedish medical supply company to manufacture and distribute an environmentally safe IV solution bag in Europe.

The licensing deal with Kabi Pharmacia AB of Stockholm is expected to generate $10 million in income for the Irvine-based company over the next five years, McGaw officials said.

Kabi Pharmacia paid $5 million in cash as part of the licensing agreement, McGaw spokeswoman Terri Mehrguth said. Another $5 million is expected to be generated through royalties earned by Kabi Pharmacia sales.

The patented EXCEL IV solution bag, developed by McGaw at a cost of $40 million, is manufactured without the substance PVC, or polyvinyl chloride, spokesman Larry Watts said.

Older-model IV solution bags made with PVCs contain the chemical diethylhexyl phthalate, a minute amount of which may enter the bloodstream. The chemical is considered cancerous when exposed to blood, fats or certain drugs.