FRISCO, Texas, April 2, 2014 (GLOBE NEWSWIRE) -- According to the World Health Organisation (WHO), 28% of European adults smoke – compared with 18% in the U.S. Tobacco-related illnesses cause 16% of deaths in Europe, compared with 12% globally. Approximately 250,000 people die each year in Europe because of asthma and other respiratory diseases.
The WHO further estimates that by 2030, respiratory diseases will account for about one in five deaths worldwide.
Each year in Europe, lung diseases create 6 million hospital admissions, accounting for over 43 million in-patient bed-days. An estimated 90 million Europeans currently suffer from life threatening respiratory diseases. Early administration of medical oxygen in respiratory emergencies can divert patients away from hospitalisation.
On April 2, 2014 OxySure Systems (OTCQB:OXYS) announced that its portable emergency oxygen device has achieved "CE Mark approval" - a critical step toward launching this low cost life-saving device in Europe.
"CE Marking in Europe is equivalent to the FDA approval in the U.S," states OxySure Chairman and CEO Julian Ross in an exclusive interview with Financial Press, "It is a rigorous 10 month process which we have successfully completed. This milestone is very significant for our company. We now have a green light to commercialize the OxySure Model 615 in all 30 countries belonging to the European Economic Area."
In Europe, 7% of hospital admissions result from respiratory causes, costing hundreds of billions of dollars. Many of these visits could've been avoided if the patients had early access to medical oxygen.
OxySure's $349 device delivers medically pure oxygen on demand from two dry powders. OxySure owns a portfolio of patents, creating a "moat" around its business.
"Now we have the ability to go ahead and tackle all the European countries," states Ross, "including Germany which is one of our predominant target markets. Basically we have 700 million new people we can sell to."
Sales of the OxySure Model 615 increased 10-fold in 2013 from the previous year to an estimated $1.6 million. OxySure's market is estimated to be ten times larger than the market for Automated External Defibrillators (AED) – which has already sold 2 million units in the U.S. alone. The OxySure Model 615 is one quarter the cost of an AED and 300 times more likely to be used.
"We already have two distributions agreements in place for Europe," states Ross, "One with Medizon for Netherlands, Belgium and Luxembourg and a second agreement with Aero Health for the United Kingdom, Australia and New Zealand. The CE Marking triggers a minimum combined purchase of 6,750 units of OxySure Model 615 to Medizon and Aero Health in the next two years."
The Model 615 requires no training, no compressed tanks, no maintenance, no batteries. You simply twist a dial and the two powders mix and generate oxygen at a steady flow, bridging the gap between the onset of a medical emergency and the arrival of first responders.
"Our international distribution model has been quite successful for us so far," states Ross, "Basically you go to the market leader and say, 'we'll give you exclusivity in exchange for a minimum sales commitment'. It creates a symbiotic relationship. We get a fully incentivised partner, and they get the opportunity to control all the sales in their market."
In the development stage, Ross raised $14 million of private capital for the company, including a $3 million personal investment.
"The timing of the CE Marking approval is excellent," states Ross. "While we've been dealing with the application process, our existing European distributors have been seeding the market, speaking to sub-distributors, working on pricing models and product definition. With new opportunities come new challenges. Even the labelling can be different in Europe, with some countries requiring two languages."
In the U.S. OxySure is targeting all public and private institutions, including 102,265 educational campuses, 350,735 manufacturing facilities, 350,000 churches, and 950,000 restaurants. Europe's population is about 710 million (almost double the U.S.) so the opportunities for institutional sales are significant.
"During 2014, I anticipate that we will be able to set up another four or five of those agreements," states Ross, "and each agreement will come with minimum sales commitments based on the size of the market. We expect rapid growth from Europe. And, the CE Marking gives us the opportunity to reliably forecast our baseline sales over the next 2-3 years."
"Our European distributors understand the market, and they are positioning the Model 615 as a companion product to the AED. Our oxygen-on-demand device is much cheaper than a defibrillator and used in a wider variety of medical emergencies – like asthma attacks, oxygen deprivation, dehydration, seizures, traumatic and shock related injuries."
"Of course it is gratifying to know that our technology saves lives," states Ross, "But there is also a financial dimension to this. Timely delivery of medical oxygen to distressed individuals delivers substantial savings to the medical system by reducing hospitalisations, or by improving medical outcomes. With a high level of respiratory-related health issues – Europe is an important market for our product which delivers medically pure oxygen on demand."
OxySure is currently trading at .68 with a market capitalisation of $16.8 million.
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