European pharmaceutical company selects DATATRAK eClinical(TM) and signs a
three year subscription license agreement
CLEVELAND, Feb. 19 /PRNewswire-FirstCall/ -- DATATRAK International, Inc. (Nasdaq: DATA), a technology and services company focused on global eClinical solutions for the clinical trials industry, today reported that it has signed its second global Enterprise Agreement within the past two months. This Enterprise Agreement is a three-year subscription license with a European pharmaceutical company encompassing a fixed volume of data items with an overall contract value worth a minimum of $800,000 to DATATRAK.
The total contract amount is a minimum value as DATATRAK will be providing all associated services for this client's global clinical trials utilizing DATATRAK eClinical throughout the life of the subscription agreement. Additionally, optional components of the DATATRAK eClinical(TM) Platform outside of the EDC (electronic data capture) or reporting (Data Genie(TM)) functionalities are contracted separately on an as needed basis for each project.
When DATATRAK provides full support for eClinical implementations, its revenue composition has been approximately 25% technology (data item) based and 75% has come from associated services.
As detailed on the Company's recent quarterly conference calls, the subscription license model is an optional contracting mechanism for the DATATRAK eClinical Platform that is separate and in addition to the traditional trial-by-trial approach. This option offers greater flexibility and leverage to clients performing a larger number of annual clinical trials. The prices and payments in this model relate solely to the technology portion of the budgets and are contractually fixed and guaranteed by DATATRAK and the client, respectively, for a given volume of data transmission. Delays or cancellations of clinical trials have no impact on the contractual commitments for the technology portion of the contract. Clinical trials and data items are fungible; being able to be substituted at any time and from any source in order to consume the available contracted volumes. Clients who use more than the contracted volume of data items have the option to either pay retail rates for the overage or they can elect to renew the license agreement for another term.
Since this structure represents a contractually-bound and guaranteed monetary value, all of these technology-associated fees enter the Company's backlog upon signing and revenue is recognized over the life of the contract. The services' components will have their backlog and revenue recognized at the time they are contracted for and delivered; similar to the Company's traditional trial-by-trial model.
"We are very pleased to be able to close our second Enterprise Subscription License Agreement for our eClinical Platform," stated Dr. Jeffrey A. Green, President and Chief Executive Officer of DATATRAK International, Inc. "The consummation of two Enterprise Relationships within approximately the past two months indicates that there are companies looking at the benefits of a longer-term commitment for a standardized information platform to best serve their clinical trial needs. It also has been advantageous to continue to broaden DATATRAK's global presence and to have existing Enterprise clients in the two significant marketplaces of Japan and Europe."
Green concluded, "We believe that we will always have the trial-by-trial business model, because this is more appropriate for clients with smaller pipelines. However, for clients with more predictable and larger pipelines, this model provides very predictable research and development costs and eliminates wasted time involved with negotiation and contracting under the trial-by-trial mode. This model has tremendous advantages to DATATRAK with rock solid visibility of revenues over a multi-year period of time and a greatly diminished cost of sales at these clients. DATATRAK is currently in various stages of negotiation with several other clients -- sponsors and contract research organizations (CROs) -- regarding similarly structured agreements."
About DATATRAK International
DATATRAK International, Inc. is a worldwide technology company focused on the provision of multi-component eClinical solutions and related services for the clinical trials industry. The Company delivers a complete portfolio of software products that were created in order to accelerate clinical research data from investigative sites to clinical trial sponsors and ultimately the FDA, faster and more efficiently than manual methods or loosely integrated technologies. DATATRAK's eClinical software suite can be deployed worldwide through an ASP offering or in a licensed Enterprise Transfer model that fully empowers its clients. The DATATRAK software suite and its earlier versions have successfully supported hundreds of international clinical trials involving thousands of clinical research sites and encompassing tens of thousands of patients in 59 countries. DATATRAK International, Inc.'s product suite has been utilized in some aspect of the clinical development of 16 drugs and one device that have received regulatory approval from either the United States Food and Drug Administration or counterpart European bodies. DATATRAK International, Inc. has offices located in Cleveland, Ohio, Bonn, Germany, and Bryan, Texas. Its common stock is listed on the NASDAQ stock Market under the ticker symbol "DATA." Visit the DATATRAK International, Inc. web site at http://www.datatrak.net.
Except for the historical information contained in this press release, the statements made in this release are forward-looking statements. These forward-looking statements are made based on management's expectations and beliefs concerning future events impacting the Company and are subject to uncertainties and factors (including those specified below) which are difficult to predict and, in many instances, are beyond the control of the Company. Factors that may cause actual results to differ materially from those in the forward-looking statements include the limited operating history on which the Company's performance can be evaluated; the ability of the Company to continue to enhance its software products to meet customer and market needs; fluctuations in the Company's quarterly results; the viability of the Company's business strategy and its early stage of development; the timing of clinical trial sponsor decisions to conduct new clinical trials or cancel or delay ongoing trials; the Company's dependence on major customers; government regulation associated with clinical trials and the approval of new drugs; the ability of the Company to compete in the emerging EDC market; losses that potentially could be incurred from breaches of contracts or loss of customer data; the inability to protect intellectual property rights or the infringement upon other's intellectual property rights; the Company's success in integrating its acquisition's operations into its own operations and the costs associated with maintaining and/or developing two product suites; and general economic conditions such as the rate of employment, inflation, interest rates and the condition of capital markets. This list of factors is not all inclusive. In addition, the Company's success depends on the outcome of various strategic initiatives it has undertaken, all of which are based on assumptions made by the Company concerning trends in the clinical research market and the health care industry. The Company undertakes no obligation to update publicly or revise any forward-looking statement.
|SOURCE DATATRAK International, Inc.|
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