The payment is the first instalment of a $165m agreement struck with Pfizer in April 2007 for its Medidur technology. Pfizer is the largest shareholder in pSivida holding approximately 10 per cent of the outstanding shares. Medidur is a new second generation treatment for diabetic macular edema (DME), a leading cause of vision loss for people under the age of 65. Its method of administration involves an injectable non-erodible intravitreal device injected into the back of the eye. The implant releases a constant amount of drug to the back of the eye and is designed to have a duration of between 18 to 36 months. The product is currently in Phase III clinical trials. Over the last 10 months pSivida has received $12m from Pfizer, including equity investments, under the terms of the agreement and are set to receive up to an additional $153.5m in development and sales related milestones. There is currently no FDA approved drug therapy for DME, a condition of which there are approximately 500,000 treatable cases of DME in the United States every year. In 2002, the Centers for Disease Control and Prevention estimated the prevalence of diabetes in the US to be 18.2m persons. Research indicates that up to 10 per cent of all diabetes patients develop DME during their lifetimes. The only approved method for treating DME involves laser photocoagulation therapy, which can leave irreversible blind spots. As potentially the only viable treatment for this condition, Medidur has been granted a fast track passage by the FDA. European registration filing is expected in the first half of 2009 At the time of the agreement, Dr Paul Ashton, managing director of pSivida said: "We believe this collaboration is another significant validation of the drug delivery systems that pSivida has been developing since its founding." "pSivida plans to pursue development and additional collaborations exploiting our innovative drug delivery technologies in other parts of the body," he added. According to Datamonitor, the rapidly growing market for new drug delivery formulations, has seen the value of the global drug delivery market shoot up to $66bn. It is estimated to grow to $114bn by 2007. Improvement of drug delivery is important for better patient safety and drug bioavailability. Furthermore, the use of novel drug delivery systems is an increasingly important strategy for pharmaceutical and biotechnology companies as they recognize the opportunities in forging relationships with drug delivery companies, to enable the delivery of new drugs while also extending the commercial life of their current drugs.