Melbourne, Australia; Starpharma Holdings Limited (ASX:SPL, OTCQX:SPHRY) today announced two important
developments in relation to the commercialisation of its VivaGel^®-coated condom.

Starpharma terminates condom coating agreement with Reckitt Benckiser

The first of these is that, due to the failure to achieve satisfactory progress in relation to certain commercialisation milestones for the VivaGel^®-coated condom, Starpharma’s Board has taken the decision to terminate the Licence granted to Reckitt Benckiser (RB; formerly SSL International plc) to commercialise the VivaGel^®-coated condom and all of RB’s rights to the product, effective immediately. Starpharma is extremely disappointed to have to take this action but after full consideration of the situation, Directors and Management believe it to be the best course of action to ensure timely commercialisation and maximise returns for the VivaGel^®-coated condom.

Starpharma executes condom coating agreement with Ansell

The second development is that Starpharma has today executed a Licence Agreement with Ansell Limited (ASX:ANN) giving Ansell marketing rights to the VivaGel^®-coated condom.  The Agreement covers marketing rights to the coated condom in countries which exclude Japan and a number of Asian markets.

Under the agreement Ansell will pay Starpharma royalties on sales of VivaGel^®-coated condoms and will support registration and other commercialisation costs. Ansell is also responsible for manufacturing the VivaGel^®-coated condom and marketing of the product, which will include the VivaGel^® brand together with the respective Ansell brand.

In commenting on the deal with Ansell, Starpharma’s CEO, Jackie Fairley said:

“We are very pleased to be working with Ansell as a commercial partner for the VivaGel^®-coated condom. Ansell is ranked number two globally in terms of condom sales, marketing leading brands including Lifestyles^®, ZERO^® and the highly successful SKYN^® brand. It has a leading market position in the rapidly expanding Asia Pacific and South American markets and in Australia with around 70% market share.”

Whilst these developments mean that the first approval of VivaGel^®-coated condoms will not occur in 2011 as originally forecast, Starpharma’s Board is confident that the two commercial partnerships now in place - with Okamoto Industries and Ansell Limited will deliver timely commercialisation and maximise returns for the VivaGel^®-coated condom. Starpharma now expects first marketing approvals to occur in CY 2012.

Ansell’s total sales for the FY 2011 were US$1.2billion, up 11% over last year. The Sexual Wellness global business unit achieved sales growth of 18% globally. Recent innovations such as the polyisoprene condom, SKYN^® have underpinned strong sales growth, particularly in the US, China, India, Brazil, ANZ, and Poland.^[1]

In commenting on the deal Ansell’s President & General Manager - Sexual Wellness Global Business Unit, Peter Carroll said:

“Ansell is very excited about partnering with Starpharma on the application of their VivaGel^® product with our leading “lifestyles” products. The VivaGel^®-coated condom offers Ansell an innovative and differentiated product and it fits well with Ansell’s focus on new products as part of our growth strategy. Building on our success with the SKYN^® range we see VivaGel^® as fitting well within Ansell’s innovative product framework”.

Starpharma’s CEO Jackie Fairley added:

“Starpharma remains fully committed to the commercialisation of the VivaGel^®-coated condom and believe this is the right course of action for the product. We look forward to working with both of our partners Ansell and Okamoto to launch this innovative product into the branded condom market.”

The global branded condom market has been estimated to be worth US $1.1billion-$1.6billion and growing at around 4-5% annually.^[2]

Download ASX Announcement: Starpharma terminates Reckitt Agreement and signs with Ansell ( pdf file, 192kb)

About Ansell

Ansell Limited (ASX:ANN) is a world leader in providing superior health and safety protection solutions that enhance human well being. With operations in the North America, Latin America, EMEA and Asia, Ansell employs more than 10,000 people worldwide and holds leading positions in the industrial and medical gloves market, as well as in the sexual health and well being category worldwide. Ansell operates in four main business segments: Medical Solutions, Industrial Solutions, New Verticals, and Sexual Wellness. Information on Ansell and its products can be found at www.ansell.com.