Sharps Technology CEO says demand for products is increasing

Sharps Technology issued a shareholder update from Robert Hayes, CEO, which read in part, ” I want to share additional information about this week’s transformative announcement and give you more insight into why the current agreement improves the deal terms we originally negotiated last September. Earlier this week, Sharps Technology signed an enhanced Asset Purchase Agreement with Nephron Pharmaceuticals to acquire the InjectEZ specialty syringe manufacturing assets in West Columbia, South Carolina. We also signed an accompanying five-year, $200 million syringe Sales Agreement with Nephron. Through these agreements, expected to close in about 60 days, Sharps will become the first fully dedicated, specialized polymer prefillable syringe manufacturing plant in North America. The facility will be on track to begin product deliveries in the second quarter of 2025, and we expect that our projected revenue should exceed $35 million for the first 12 months of sales. The InjectEZ and Nephron agreements were reworked to better support all parties involved, and as compared to the agreements announced last September, the signed deal includes several important advantages. Sharps is acquiring, for a significantly reduced price, a new state-of-the-art facility equipped with fully automated prefillable syringe system manufacturing, packaging, and distribution capabilities. The acquisition price is $35 million and there will be an assumption of certain related liabilities of up to $4 million. The five-year sales agreement included in the deal provides for Nephron’s purchase of our next-generation copolymer PFS syringes manufactured at the SC plant as well as the qualification and future purchase of the 10mL SoloGard polypropylene disposable syringes produced at our Hungary facility. This assurance of supply is expected to support the planned expansion of the 503b operations at the Nephron site. Their minimum orders will include a range of Sharps products totaling over $200 million in sales during the five-year period. This gives Sharps a secure foundation to both support Nephron’s core business requirements and expand our PFS sales throughout the larger pharmaceutical industry. Sharps’ revenue is expected to exceed $35 million during the first 12 months of sales; the facility has sufficient additional capacity to generate revenue of more than $50 million in 2026, and has the capacity to potentially grow to over $100 million in revenue by 2028 within the currently standing facility. The recent FDA recalls and warnings as well as last week’s tariff announcements impacting Chinese-manufactured syringes have created increased levels of interest in the Sharps family of syringe products. Additionally, there is an industry trend to transition from glass syringes to polymer prefillable syringes for injectable therapies, that continues to grow at an accelerated pace. Sharps is actively pursuing these sales opportunities and has been collaborating with medical product distributors, healthcare industry leaders in both branded and generic pharmaceuticals, and companies working within the rapidly expanding GLP-1 market space. We are currently involved in meaningful negotiations with a new customer who is a prominent American-based multinational pharma company focusing on treatments for both acute and chronic diseases, multiple major retail pharmacy chains, and several Fortune 500 healthcare supply distributors. Once the asset acquisition is closed, which is expected in about 60 days, Sharps will immediately move forward with the first phase of our manufacturing implementation plan. This phase includes the final facility buildout and planned upgrades to support the manufacture of pharmaceutical grade COC prefillable syringes on three state-of-the-art production lines. These lines will produce the highly demanded 10mL, 50mL, and 0.5mL/1mL syringe sizes. Product from the 10mL line will be qualified to ship early in the second quarter of 2025, and all three lines are expected to make saleable product by the fourth quarter of 2025. The second phase will execute a $9 million capital plan to install additional equipment to produce small volume COC syringes for the pharma market on a high-speed production line, with planned completion by July 2027. The $9 million investment will create the potential to bring in more than $35 million of additional revenue to the Company. The third phase of the expansion plan is focused on a $4.75 million investment to build a flex line capable of both producing a 5mL syringe and increasing Sharps capacity for 10mL production. This final buildout phase is expected to be completed by October 2027, and the investment of $4.75 million will create the potential to add more than $30 million to Sharps’ annual revenue. These three manufacturing expansions will be completed within the facility as it exists today.”