Navamedic has today entered into a long term agreement with the leading Norwegian seafood company Nergård Group and will establish a chitin production facility at Senjahopen. This marks a first and important step towards becoming a vertically integrated player in the European glucosamine industry.
(Lysaker, Norway, 23 January, 2006). Navamedic will rent facilities adjacent to Nergård Reker, which will supply shrimp shells for the extraction of chitin. This is the starting material for production of glucosamine, an active pharmaceutical ingredient for osteoarthritis symptom treatment. Navamedic's glucosamine product was recently approved for medicinal use in 20 European countries, and the company is currently building a network of marketing and distribution partners across Europe.
- We aim to become a leading player in the glucosamine market, and believe we need to be vertically integrated to build long term cost advantages. The supply agreement with Nergård Reker ensures long term access to raw materials for our base volumes. Renting facilities that are already available will both lower the investment requirements and mean that we can be up and running towards the end of this year, says CEO Øyvind Brekke in Navamedic ASA.
Brekke estimates that total investments will be more than halved compared with greenfield alternatives the company has reviewed.
The Nergård Group welcomes Navamedic to its compound in Senjahopen, and looks forward to seeing the shrimp shells be utilised for medicinal purposes.
-The shrimp peeling industry has in many ways been the backbone of Nergård Group, and we are very pleased to see Navamedic establish a chitin factory that will utilize the shrimp shell resource, says Owner and President Ole Arvid Nergård of the Nergård Group.
About Navamedic ASA:
Navamedic is a Norwegian speciality pharmaceutical company focusing on the development and production of glucosamine HCl based medicines. Glucosamine is a generic active ingredient against osteoarthritis with a favourable safety profile. Osteoarthritis is a chronic disease which affects a large and growing share of the world's population. Navamedic aims to become a leading company in the glucosamine industry by capitalising on proprietary production technology. The company's products will be sold through a network of sales, marketing and distribution partners in each country. Navamedic's product Glucomed® was approved as a medicine against osteoarthritis by the Swedish Medical Products Agency in August 2005.
About Nergård Group:
The Nergård Group is a privately held company and one of the biggest Norwegian seafood exporters. Headquartered in Senjahopen, Northern Norway, Nergård has in total 11 processing plants all located in Northern Norway, 3 large and several smaller cold stores, 7 ocean going trawlers with 11 fish licenses/prawn licenses. The Group employs more than 500 people and has total revenues of approximately 150 million euro per year.