A share of Sonoma Pharmaceuticals, Inc. (NASDAQ: SNOA) concluded at $8.80 at the close of the previous trading session, increasing 18.44%. The volume of the Sonoma stock in the last session reached 15.27 million, which compares to its average daily volume of 57,000 shares. Based on SNOA stock having 2.08M shares outstanding, its market cap is currently $18.28M. As a result of signing an agreement for U.S. marketing and distribution rights for its eye care products and prescription dermatology, the SNOA stock surged.
What was the agreement?
As one of the world’s leading pharmaceutical companies, Sonoma Pharmaceuticals develops and produces hypochlorous acid (HOCl) products used for a wide range of illnesses and conditions. In addition to its use in wound care, dermatological conditions and disinfectant products, SNOA products are also used for eye care, oral care, nasal care, and animal health care. By reducing infections, itching, pain, scarring, harmful inflammatory responses and scarring, SNOA products are widely used by dermatologists in the United States.
Sonoma announced on Thursday that it entered into an agreement with EMC Pharma, LLC. SNOA has sold the exclusive right for a term of five years for the distribution of its HOCl-based prescription dermatology and eye care products within the United States to EMC Pharma.
EMC Pharma will also have an agreement with Microcyn to distribute some products in government channels without an exclusive deal. In the healthcare industry, EMC Pharma is in the business of producing and distributing FDA-approved prescription products, as well as prescribing and fulfilling specialty pharmaceutical needs.
How the agreement will execute?
Within the partnership agreement, the EMC Pharma will pay Sonoma (SNOA) for its entire inventory on a five-year basis, and will also pay a royalty and transfer price to SNOA. To ensure the exclusive distribution rights, the SNOA and EMC Pharma agreed on certain minimum purchase requirements.