Eastland moves to production phase of 'Retralok'

Perth, Mar 17, 2006 (ABN Newswire) - Eastland Medical Systems Ltd (ASX: EMS)(Eastland) is pleased to announce the completion of their newly designed tooling for the production of their speciality safety syringe Retralok.

The Retralok syringe is used for the administration of drugs or withdrawal of blood. The needle is an integral part of the syringe. Retralok has 2 significant advantages over other retractable syringes.

- There is no requirement to uncap the needle - an unsafe procedure common to all other hypodermic needles

- The safe withdrawal of the needle can be performed at any time during the procedure without the syringe having to be completely emptied

In a 'commercial in confidence' arrangement, Portland Surgical Products has concluded a contract with a WA consulting group to design manufacture and supply component parts for both the ClipOn and Retralok devices to Portland for assembly and packaging. This group is also developing the auto-assembly systems for mass production of the devices. These systems are now undergoing analytical computer testing. The company's consultants have made a significant investment in expanding their facility to accommodate the new equipment which has been supplied by Eastland.

As a result of innovative new production techniques and product redesign, the consulting group has successfully produced new tooling eliminating two component parts from each of these products. This reduces both unit cost and the capital investment required for the automated assembly systems now being designed.

Eastland is in the process of securing the additional plant and equipment to accommodate the scale up production of Retralok and ClipOn. Following successful component production test runs, first delivery of components to Portland is expected in early April 2006.

The introduction of Retralok enhances Eastland's portfolio of safer injection devices and moves forward the strategy of providing a complete "safer" solution to the medical market.

Eastland has just posted its first half yearly profit of $1.1 M with revenues of $5.5M placing it strongly ahead of its ASX listed competitors.