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ots Ad hoc-Service: Eckert & Ziegler AG <DE0005659700> Sales Concept for Prostate Cancer Products Altered as a Result of the Possible Elimination of Milestone Payments

Berlin (ots Ad hoc-Service) -

Ad hoc-announcement edited and sent by DGAP. The sender is solely
responsible for the contents of this announcement.
Sales Concept for Prostate Cancer
Products Altered as a Result of the Possible Elimination of Milestone
Payments
Potential Delay in Profits Offset for the Most Part by the Good
Business Development
In December Eckert & Ziegler Strahlen- und Medizintechnik AG will,
for the first time, commence the direct supply of products for the
treatment of prostate cancer to European hospitals for its own
account. As such the company is relinquishing its traditional stance
within the European Union as a supplier of components only, and has
implemented its own sales force to ap- proach clinics and doctors
directly with the offer of an integrated range of products and
services. The decision to cut out the former middleman became
necessary following the failure to resolve a disagreement concerning
the settlement of a major project that raised serious doubts about
the current sales concept.
As the Chief Executive Officer of the company, Dr. Andreas Eck-
ert, explains: "Commencing direct sales of prostate cancer products
was foreseeable, anyway, given the attractive margins and the
strategic importance of staying in close contact with the clinics.
The decision was, however, accelerated by the disagreement, which
arose when our middleman used milestone payments for the suc- cessful
completion of a product line as a means of exerting pres- sure to
sign a distribution agreement, by coupling a due final pay- ment of
USD 2.5 million with unacceptable price and delivery terms. As a
result the Board had no other choice but to protect its earnings
potential and manoeuvrability by pushing ahead with es- tablishing
its own sales force and approaching end users directly. We are also
willing to fight for the due milestone payments in court."
If no agreement is reached during the fourth calendar quarter, a
settlement of some 3 million Euro will not be included as profits
until a decision has been reached by the courts. In view of the good
business development in other fields, however, this would still mean
that annual profits for the year 2000 (after taxes) would only
decline by 0.7 million Euro to 1.4 million Euro.
In addition to radioactive implants, Eckert & Ziegler will in
future also sell accessories and positioning systems directly. The
market for these products is growing at an extraordinary rate and
should exceed 100 million Euro in Europe alone by the year 2004. Cur-
rently Eckert & Ziegler AG holds a market share in this field of
about one-third.
The Board of Directors
For further information please contact:
Dr. Andreas Eckert CEO and President Eckert & Ziegler AG
Robert-Rössle-Str. 10 13125 Berlin Tel.: (+49 30) 94 10 84 0 Fax.:
(+49 30) 94 10 84 112
End
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