Exhibit 99.1
ABAXIS AND HENRY SCHEIN, INC. AGREE TO DISCONTINUE DISTRIBUTION AGREEMENT
ABAXIS EXPECTS MINIMAL FINANCIAL IMPACT ON THE QUARTER AND THE YEAR
UNION CITY, Calif., May 22 /PRNewswire-FirstCall/ -- ABAXIS, Inc.
(Nasdaq: ABAX), a medical products company manufacturing point-of-care blood
analysis systems, announced today that Henry Schein, Inc. and Abaxis have agreed
to discontinue their veterinary products distribution agreement effective
immediately. Henry Schein distribution of Abaxis veterinary products accounted
for approximately 14% of Abaxis' total business in fiscal year 2006.
Clint Severson, chairman and CEO of Abaxis commented, "This past March,
Henry Schein acquired a regional distributor of a competing company, creating a
level of uncertainty in the marketplace. In joint discussions it was determined
to be in the best interest of both Abaxis and Henry Schein to dissolve the
existing distribution agreement in order to clarify any misunderstanding that
might exist in the veterinary market. We are pleased to be able to move forward
with our plans to see to it that the Abaxis customer base continues to be served
at the highest level."
Mr. Severson continued, "We believe that the loss of sales from the Schein
organization will be principally offset with increased sales in our other
domestic sectors, as well as increased international sales. We expect to meet
our internal quarterly and annual financial targets. We were involved in a
similar situation in December of 2004 and were successful in keeping Abaxis
users appropriately stocked with product in order to keep their veterinary
practices operating seamlessly. With a growing distribution network, both
domestically and internationally, that is driving increased market acceptance we
are better positioned to manage this type of situation and to maintain our
quarterly and annual financial goals."
Martin Mulroy, Vice President Sales and Marketing for the Veterinary
Business, added, "With the recent successful introduction of our new VetScanVS2
analyzer we continue to have the leading-edge product for any veterinary
practice. Our existing distribution network is prepared to step right in and
service veterinary practices in order to ensure an orderly transition. We are
confident in our ability to keep potentially affected end- users stocked and
operating at their normal levels. Looking ahead, we remain steadfast in our
belief that we can continue to gain market share in the veterinary point-of-care
blood analysis market. We thank Henry Schein for all of their past efforts."
On the veterinary side of the business, Abaxis now has 16 distributor
agreements in place in North America, four of which have been added this past
year. More than 40% of Abaxis' new business (instrument placements) is now sold
direct from the Company, while local distribution typically supplies the
consumable component of the Abaxis product line to the end user.
Conference Call
Abaxis has scheduled a conference call to discuss its results at 6:00 p.m.
ET on May 22, 2006. Participants can dial 877-356-5706 or 706-643-0580 to access
the conference call, or can listen via a live Internet web cast, which can be
found at www.abaxis.com. A replay of the call is available by visiting
www.abaxis.com for the next 30 days or by calling 800-642-1687 or 706-645-9291,
access code 9729531, through May 25, 2006. This press release is also available
prior to and after the call via Abaxis' website or the Securities Exchange
Commission's website at www.sec.gov.
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About Abaxis
Abaxis develops, manufactures and markets portable blood analysis systems
for use in any veterinary or human patient-care setting to provide clinicians
with rapid blood constituent measurements. The system consists of a compact, 6.9
kilogram (15 pounds), portable analyzer and a series of single-use plastic
discs, called reagent discs that contain all the chemicals required to perform a
panel of up to 13 tests on veterinary patients and 14 tests on human patients.
The system can be operated with minimal training and performs multiple routine
tests on whole blood, serum or plasma samples. The system provides test results
in less than 14 minutes with the precision and accuracy equivalent to a clinical
laboratory analyzer.
This press release includes statements that constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 (the "Reform Act"). Abaxis claims the protection of the safe-harbor for
forward-looking statements contained in the Reform Act. These forward- looking
statements are often characterized by the terms "may," "believes," "projects,"
"expects," or "anticipates," and do not reflect historical facts. Specific
forward-looking statements contained in this press release include, but are not
limited to, risks and uncertainties related to fluctuations in the Company's
share price, the market acceptance of the Company's products and the continuing
development of its products, required United States Food and Drug Administration
("FDA") clearance and other government approvals, risks associated with
manufacturing and distributing its products on a commercial scale free of
defects, risks related to the introduction of new instruments manufactured by
third parties, risks associated with entering the human diagnostic market on a
larger scale, risks related to the protection of the Company's intellectual
property or claims of infringement of intellectual property asserted by third
parties, risks involved in carrying of inventory, risks associated with the
ability to attract, train and retain competent sales personnel, general market
conditions, competition and other risks detailed from time to time in Abaxis'
periodic reports filed with the United States Securities and Exchange
Commission. Forward-looking statements speak only as of the date the statement
was made. Abaxis does not undertake and specifically disclaims any obligation to
update any forward-looking statements.
SOURCE Abaxis, Inc.
-0- 05/22/2006
/CONTACT: Clint Severson, Chief Executive Officer of Abaxis, Inc.,
+1-510-675-6500; or Joe Dorame, Robert Blum, or Joe Diaz, all of Lytham
Partners, LLC, +1-602-889-9700, for Abaxis, Inc./
/Web site: http://www.abaxis.com/
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