CRVR - Traxxec
Investor update:
Investor Relations
“the day will come when RFID tags are not applied like a label, but are integrated into the material of packaging….The benefits to that is that it will cost less than sticking a label on, and that there is less risk that tags will be damaged, plus, there would be no delay in packaging line speed."
Manufacturing and Service Industries worldwide are on the cusp of a Radio Frequency Identification (RFID) transformation. Retailers, manufacturers, aerospace, defence, pharmaceutical and healthcare companies have found competitive advantage by intelligently moving the technology forward in to the business strategy playing field.
…………….a report from IC Insights that makes predictions for the worldwide market for RFID chips. The research firm projects the market will grow at an impressive annual rate of 63 percent through 2011, when revenues reach $2.3 billion and units 26.1 billion. Extract from RFID Update Feb 7th 2008
This clear trend led Traxxec Ltd to focus its resources on the application of this enabling technology in the field where they have considerable expertise, the provision of packaging solutions to the pharmaceutical industry, and to establish the best partnerships for the delivery of the best solutions. Challenges also faced the industry in using the tagged label approach……..
"The label technology is just not ready -- 10% to 12% of tags dead on arrival, and 5% to 10% more dying en route to Wal-Mart. These guys have an extra challenge in that the bottles are relatively small compared to large cases, and the FDA is very particular about labels, so they can't just cover anything on the bottle.
Computerworld April 05 2005
The principals of the company have more than twenty years of experience in the pharmaceutical packaging and auto-identification industries and to-day are retained as consultants in the commercial exploitation of their IP, assigned to the company and out-licensed to Rexam plc (www.rexam.com). This will be led by recently appointed CEO Mrs Amy Scopes (amy.scopes@traxxec.com).
Development Background
1998 the application of RFID was first presented to the pharmaceutical industry
1999 installed two successful pilot implementations in the UK for evaluation purposes
2001 the application received international recognition at the Barcelona Conference. In his summing-up the conference chairman, Dr Andreas Fischer of PriceWaterhouse Coopers Consulting, made the following statement;
“In our experience every single pharmaceutical company has identified clinical supply as a critical area for immediate process re-design. At the very least companies are establishing formal quarterly meetings between supply planners and clinical to have a view of likely demand over the next six months. At the other extreme companies are looking at ways of implementing modern supply chain concepts such as MRP II and JIT with associated IT support. We have seen at this conference an example of a technology which will be used to better manage inventory throughout the supply chain”
2004 feasibility study carried out for GlaxoSmithKline
2004 FDA directive on RFID
FDA released guidelines for the implementation of RFID as the major technology to combat counterfeit drugs (COMBATING COUNTERFEIT DRUGS A Report of the Food and Drug Administration, Feb 2004
“The adoption and common use of reliable track and trace technology is feasible in 2007, and would help secure the integrity of the drug supply chain by providing an accurate drug "pedigree," which is a secure record documenting the drug was manufactured and distributed under safe and secure conditions………….Radio frequency Identification (RFID) tagging of products by manufacturers, wholesalers, and retailers appears to be the most promising approach to reliable product tracking and tracing.
COMBATING COUNTERFEIT DRUGS A Report of the Food and Drug Administration (Extract)
The second significant development has been the move by Wal-Mart to require all of its suppliers to provide RFID tags at the unit level. (RFID Guidelines and Requirements for CII Pharmaceuticals)
“We have a strong belief that RFID (radio frequency identification) will transform the supply chain for both Wal-Mart/SAM’S and our suppliers. Due to that belief, Wal-Mart/SAM’S has stated our expectation to have our Pharmacy Class 2 Narcotic Suppliers utilize RFID on all products no later than March 2004. Your successful participation will spearhead our effort to fully leverage the benefits of RFID.
2005 Commercial product development concluded
Patent application made
First commercial product supplied
Started licence negotiations with Rexam
2006 Letter of Intent with Rexam
First US order placed and delivered
Traxxec Ltd incorporated to hold the Intellectual Property and to facilitate the out-licensing of its IP
2007 Licence agreement entered in to with Rexam
2008 Acquisition by Columbia River Resources Inc
“the day will come when RFID tags are not applied like a label, but are integrated into the material of packaging….The benefits to that is that it will cost less than sticking a label on, and that there is less risk that tags will be damaged, plus, there would be no delay in packaging line speed."
Rexam Plc
Rexam is one of the world’s leading consumer packaging groups
20,500 employees worldwide in more than 20 countries
Focused on two packaging sectors, beverage cans and plastic packaging
The Rexam RFID enabled pill jar is added to the product list in 2007
Rexam first publicly presented the commercial product 15th to 18th May 2007.
Rexam acquires Owens-Illinois to become the world’s biggest player
Latest http://www.rexam.com/files/reports/results/inter07/files/report07.pdf
On 25th January 2008 Rexam confirms its re-organisation and its intention to promote the Traxxec technology in line with the license agreement through the newly formed Healthcare division
Traxxec Ltd
Traxxec Ltd is a company incorporated in the UK on the 7th March 2006 specifically to capitalise on its expertise and intellectual property and promote the sales of Radio Frequency enabled products, globally.
The company’s small, focused management team has considerable expertise in providing packaging solutions and developing innovative products in a variety of industries, including pharmaceuticals, where strong relationships have been developed in both the global pharmaceutical industry and Radio Frequency Identification (RFID) component sectors over a period of more than twenty years.
As has been stated earlier benefits of the application of RFID technology to this industry sector were identified more than eight years ago and, when presented to the industry, was acknowledged as the best Auto-Id system commercially available. The potential of the technology was demonstrated with two successful pilot implementations in partnership with major multi-national companies. Following on from these pilots a project report was commissioned by a major pharmaceutical company to identify the issues affecting the practical application of RFID technology. The report’s findings highlighted the weaknesses of the current methods of tag application to packaging items and, as a consequence, the management team set out to develop, patent and commercialise fully integrated RFID enabled packing products.
The first such product – a HDPE pharmaceutical grade bottle – has been produced, its intellectual property protected by a patent and has already been sold to clients in the UK and USA.
The following quotation is taken from Pharmaceutical and Medical Packing News, April 2005:
"slap-and-ship" is merely the first of four phases of RFID implementation, and only the final two will bring any benefits to the manufacturers of pharmaceuticals and other products. Slap-and-ship is a problem because it's a process that the warehouse is not designed for, and because it's manual, it creates a bottleneck….. “the day will come when RFID tags are not applied like a label, but are integrated into the material of packaging. "The benefits to that is that it will cost less than sticking a label on, and that there is less risk that tags will be damaged, plus, there would be no delay in packaging line speed."
Pharmaceutical & Medical Packaging News, April 2005
With the advent of the Traxxec/Rexam RFID enabled pill jar, that day has arrived.
Mission Statement
Traxxec is an innovative development company with advocates in Europe and the United States.
Traxxec’s small focused team develops packaging components that leverage technologies, including RFID, in a variety of industries including pharmaceuticals, health and beauty and other luxury FMCG manufacturers.
Traxxec’s business model is to establish protection of the Intellectual Property of its product line that it then out-licenses to international manufacturing and marketing companies, in return for royalties, consultancy contracts and referrals to end users.
Traxxec’s core competencies, other than product development, include systems design and integration, and technology consultancy delivered to a select customer base that includes its licencees, on a fee for service basis.
Traxxec’s goal is to be recognised as a leader in innovation and integration of auto-id technologies in supply chain and packaging solutions.
Business Concept
Traxxec will provide Radio Frequency Identification (RFID) based systems and products to global markets, initially within the Pharmaceutical Industry.
The need for the rapid implementation of RFID by the pharmaceutical industry has been generated by recent initiatives by the Food and Drug Administration (COMBATING COUNTERFEIT DRUGS, Feb 2004) and Walmart (RFID Guidelines and Requirements for CII Pharmaceuticals).
Publication of these initiatives has obligated the pharmaceutical manufactures to deploy RFID based track and trace solutions at an expedited rate. This is therefore a new and emerging market and strong market positions established early by RFID providers will lead to significant earnings growth over the next 5 years, sustainable throughout and beyond the decade.
In addition to successfully piloted integrated systems, the current product range includes HDPE bottles, manufactured with an integral RFID transponder.
This product addresses the twin needs of pharmaceutical manufacturers, required to implement RFID, by providing a solution to ‘tagging of goods’ and the option of using existing packaging processes. Current solutions available to the market are limited to the application of tagged labels necessitating a modification to existing processes, a reduction in efficiency and an increase in cost.
The tagged bottle is a unique product that will be supported as required by the provision of RFID systems design and integration, although the product may be used in conjunction with customers’ existing legacy systems.
The Product has been developed in line with recent guidelines from the Food and Drug Administration (FDA), and Walmart, and other packaging presentations such as blister packs and medical devices are in development.
A strategy of rapid market penetration will be adopted leveraging the extensive knowledge, experience and current networks of the global pharmaceutical industry, using pharmaceutical conferences, journals and trade shows combined with direct marketing to key customer prospects. Advocates will also be sought from groups such as regulators, retailers, and existing vendors of synergistic or complimentary services and systems, in logistics, packaging, and automation.
The company, via its first licensee, aims to achieve at least 1% market share of the global pharmaceutical market for high-density polyethylene (HDPE) bottles, or approximately 800 million bottles per year, within 3-5 years
“the day will come when RFID tags are not applied like a label, but are integrated into the material of packaging….The benefits to that is that it will cost less than sticking a label on, and that there is less risk that tags will be damaged, plus, there would be no delay in packaging line speed."
Investor Notes
Traxxec has a cost effective, well proven business model
Traxxec has an excellent, robust product manufactured by a world leader
Traxxec has an experienced and proven management team and advocates
Traxxec has an established record that includes product development and commercial supply in both EU and US
Traxxec has secured its IP with an international patent application
Traxxec has global partners, global leaders in their field
Traxxec offers outstanding profit opportunities
Adopted Strategy
Remote management for financial and ecological considerations
Partnering for lowest development costs
Quickest cash revenues by licensing
Niche international market
Minimise costs
Maximise added value
Repeatable in other market sectors and with other product
The Market
The market is in excess of 20 billion US dollars per annum
Pharma bottles are 30% of the market
1% of market is in excess of 800 million bottles per annum
The Revenue
With a market of 800 million bottles per annum and…..
A royalty payment of $0.01 means
Revenue of $8M per annum from bottles
Other sources of revenue include systems integrations
Other product lines in healthcare, beauty, plastic packaging, beverages.
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