Merrion has just completed phase II trials on an oral treatment for the bone disorder. The company can now move on to Phase III clinical trials, under the guidelines of the US Food and Drug Administration (FDA).

Phase III trials are the last stage of trials before Merrion can seek approval from the FDA to bring the drug to market. There are over ten million osteoporosis sufferers in the US and the market for osteoporosis drugs is estimated at over $6bn by the company.

A spokesman for Merrion said the company would begin phase III trials later this year, that it "will be seeking a partner" to co-fund them and, if they prove successful, to bring the treatment to market.

An industry source said the most likely partners would be Merck, Eli Lilly and Sanofi Aventis, all of which have existing osteoporosis treatments on the market. Merrion uses a patented delivery technology to improve the safety and efficacy of existing treatments and make it easier for patients to take their medication. The technology can be used to produce orally administered versions of drugs that currently need to be injected.

In tests against a leading osteoporosis drug produced by Merck, patients using Merrion's MER 103 treatment absorbed the same amount of the active ingredient from a 6mg weekly dose as those taking Merck's Fosamax did from a 70mg dose.