Pharmaloz Manufacturing Accelerates Expansion, Improves Pricing, Boosts Profitability and Secures New Contracts

Pharmaloz Wins Two New Contracts in January that are Anticipated to Significantly Increase Lozenge Revenues and Profitability
Company in Late-Stage Discussions with Two Additional Large Global Brands Which, if Consummated, Could more than Triple Run-Rate of Revenues Before Year-End 2024

Garden City, NY, Jan. 23, 2024 (GLOBE NEWSWIRE) -- ProPhase Labs, Inc. (NASDAQ: PRPH) (“ProPhase” or the “Company”), a next generation biotech, genomics, therapeutics and diagnostics company, today announces significant progress at Pharmaloz Manufacturing, Inc. (PMI), its wholly owned subsidiary.

With the implementation of recent price increases across its entire product line, PMI has transitioned to significant projected 2024 profitability starting with Q1 2024. In view of favorable current market conditions and demand for PMI's services and products, PMI is optimistic that it will experience continued favorable pricing for the near to intermediate term.

PMI's operational enhancements have helped drive its current success. PMI recently acquired cutting-edge automation equipment and, with other operating efficiencies, is set to escalate plant capacity by over 50%, raising annual production capability from below $10 million to over $15 million.

In addition to the price increases, increased capacity and transition to profitability, PMI has signed deals with two top-tier lozenge brands. These new arrangements are projected to inject an additional $5 million in annual revenue and more than $1.25 million in additional yearly pre-tax net profits. One of these brands is also poised to leverage PMI's comprehensive blister packing capabilities, further diversifying its manufacturing portfolio.

In addition to the contract awards announced above, PMI has been working on bench samples for the past year for two major global brands. These brands represent two of the largest names in the global lozenge market.

PMI is not stopping there. The installation of a second lozenge production line and further automation in Q2 2024 are projected to approximately double capacity to a $30-$35 million potential run-rate. Additional equipment set to arrive by Q4 2024 could increase annual production capabilities to a range of $60-$80 million, based on a 3 ½ day workweek. This production capacity could be further increased, if demand warrants it, with additional staffing to extend the workweek.