Zacks_Analysts' Blog : New Co-marketing Agreement May Boost PBIO's Sales Immediately - Analyst Blog

New Co-marketing Agreement May Boost PBIO's Sales Immediately  

Grant Zeng, CFA



On January 11, Pressure BioSciences, Inc. (PBIO) and Digilab, Inc. announced that they have entered into a co-marketing/selling and research and development agreement. The companies intend to co-market and sell their respective product lines worldwide, including in industry publications, at scientific meetings, on each company's website, through common collaborator studies, at key industry trade shows, and in visits to customer sites. PBIO and Digilab also intend to explore ways to co-develop new instrumentation, accessories/modules for existing instrumentation, and consumables that combine the robotics and high throughput capabilities of Digilab products with the extraction, protein digestion, and other advantages of PBIO’s Pressure Cycling Technology (PCT) Platform.



Both Digilab and PBIO believe that a combination of their respective proprietary technology platforms will provide scientists with an improved, more reproducible, integrated workflow to better address important sample preparation issues that are routinely encountered by scientists in the estimated 80,000 biological research laboratories worldwide.



We think the synergy between the two companies come from two major factors:



???    Both PBIO and Digilab target the same sample preparation market.



•    The two companies routinely attend many of the same scientific meetings, advertise in many of the same media outlets, and collaborate with many of the same thought leaders in the field.



•    Digilab's suite of sample preparation, liquid handling, and identification products, coupled with PBIO’s unique PCT products, will offer the research scientist greatly enhanced sample preparation tools with a higher degree of reproducibility, versatility, throughput, and overall quality than currently available.



???    Marketing efforts will be greatly enhanced with each other.



•    PBIO's sales and marketing activities are currently performed with four dedicated staff members and three distribution partners. These efforts will be greatly enhanced by the Digilab’s sales and marketing team of five staff members and their broad distribution network of over twenty distributors worldwide. Similarly, PBIO’s sales and marketing team will assist Digilab in broadening the reach of their sales activities.



•    Consequently, this alliance will greatly facilitate the introduction of the two company’s respective sample preparation product lines to research laboratories worldwide, but without the need to increase sales staff, marketing budgets, and time at scientific meetings.





We think PBIO is making great progress in pushing its marketing and sales efforts.



In December 2011, PBIO also entered into a distribution agreement with Germany-based life sciences company IUL Instruments GmbH. Under the terms of the agreement, IUL will have the exclusive right to market and sell PBIO's Pressure Cycling Technology (PCT) sample preparation instruments (Barocycler NEP2320 and NEP3229) and consumables in Germany and Switzerland. In addition, IUL will have the non-exclusive right to market and sell PBIO's recently released, patent-pending, mechanical homogenization device, the Shredder SG3, and its associated consumables, in the same two countries.



We think the two agreements is great news to PBIO investors. We believe this is a cost-effective way to significantly increase PBIO’s market penetration and increase sales. We expect to see incremental sales results during the first half of 2012.



Things are looking much better at PBIO now than they have been in over a year. We have a price target of $5 per share.

 

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