Response Biomedical Corp. and Hangzhou Joinstar Biomedical Technology Co., Ltd., signed an agreement to collaborate on the development of testing assays under a $720,000 Technology Development Agreement, Response said Monday.
Both companies are working to develop components of testing equipment that will work with Joinstar's newly developed immunoassay analyzer.
"This is an important collaboration, as it allows Response to use its core capabilities in research and technical development to create an additional revenue stream from facilities that require a higher throughput than our RAMP platform and therefore complement our sales from our current distributors in China," Dr. Anthony Holler, interim CEO of Response, said.
Under the agreement, Response can receive cash totaling $3.8 million over the 15-month term of the contract. In addition, the revenue from the first five years of commercialization of the assays would grant the company a guaranteed $2.13 million.
Both companies specialize in clinical diagnostic testing devices. Response technology can detect antigens of the West Nile Virus and can be utilized to detect potential biological threats, including anthrax, botulinum toxin, smallpox and ricin.
Joinstar is based in Hangzhou, in the Zheijiang province of China.
Response said 1.8 million of its common shares were purchased by Joinstar-related corporate entities. "We are pleased to have reached this second milestone as an indication of the smooth progress we are making on collaboration in this project," Joinstar General Manager Xuyi Zhou said.