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Miraculins Inc (2)
Symbol C : MOM
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Close 2014-08-13 C$ 0.265
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Miraculins to distribute Scout in China through Cachet

2014-08-14 07:48 ET - News Release

Mr. Christopher Moreau reports


Miraculins Inc. has executed a definitive agreement for the sale and distribution of Scout DS diabetes screening devices into China with Catalyn Medical Technologies Ltd., a privately owned medical device import company based in Hong Kong. Cachet Pharmaceutical Co. Ltd. has been co-appointed as the exclusive distributor of the Scout DS devices in mainland China by Miraculins and Catalyn.

The Scout DS device is the world's first non-invasive and highly sensitive testing device designed to measure diabetes-related biomarkers in the skin to help detect prediabetes and Type 2 diabetes. It does not require a blood draw or fasting, and generates a result in as little as 80 seconds. The Scout DS device uses visible light to measure the optical signature of fluorescent biomarkers in the skin, the accumulation of which is accelerated by abnormal blood sugar levels and oxidative stress.

Cachet is a four-billion-renminbi market cap (or about $655-million (U.S.)) wholesale/retail drug distribution and medical device distributor, with over 2.5 billion renminbi (or about $410-million (U.S.)) in annual sales in China. Cachet's largest shareholder, the China Youth Industrial Development Corp., is owned directly by the Central Committee of the Communist Youth League of China. Cachet is also listed on the Shenzhen Stock Exchange (stock name Cachet, stock code 002462).

"I am very pleased to confirm that Miraculins has now executed an agreement that allows for the sale and distribution of Scout DS devices into China, which represents a significant potential revenue stream for the company over the term of the agreement," said Christopher Moreau, president and chief executive officer of Miraculins. "With Cachet Pharmaceutical appointed as our exclusive distributor for mainland China, we are confident that we have the right partner in place to penetrate the marketplace and bring this new testing technology to millions of Chinese at risk and in need. This is truly a transformative agreement for Miraculins and for the Scout DS device as a groundbreaking disease-screening technology."

The agreement outlines the terms and conditions, including Scout DS device unit pricing, upfront and milestone payments, product ordering and diligence requirements, and continuing responsibilities of the parties.

Key terms of the agreement include:

  • The term of the agreement is to extend for five years from the date of procurement of CFDA (Chinese Food and Drug Administration) regulatory clearance of the Scout DSr device, subject to minimum Scout DSr device sales orders being met.
  • Miraculins will receive certain upfront and milestone payments.
  • An initial minimum guaranteed order is $15-million (U.S.) in Scout DSr devices for the first year of the term, confirmed on execution of the agreement, and to be activated on procurement of CFDA regulatory clearance of the Scout DSr device.
  • There will be subsequent minimum orders for $15-million (U.S.) in Scout DSr devices for each of years two, three and four of the term, totalling $45-million (U.S.).
  • There will be a subsequent minimum order for $30-million (U.S.) in Scout DSr devices in year five of the term.
  • Miraculins will be responsible for leading the CFDA regulatory clearance process and its related costs, with Cachet providing guidance and support as necessary.
  • Miraculins will retain the right to establish programs for continuing device servicing and maintenance once the Scout DSr devices are sold into the field.

The Scout DS device has received regulatory clearance in Canada and is CE marked throughout the European Union, and Miraculins has recently filed presubmission documentation with the United States Food and Drug Administration toward securing Scout DS device marketing clearance in the U.S.

About Cachet Pharmaceutical

Founded in 1998, Cachet Pharmaceutical is a majority-state-owned stock company with a market capitalization of four billion renminbi (or about $655-million (U.S.)). Cachet's largest shareholder, China Youth Industrial Development, is owned directly by the Central Committee of the Communist Youth League of China. On Aug. 18, 2010, Cachet went public on the Shenzhen Stock Exchange (stock name Cachet, stock code 002462). Cachet Pharmaceutical engages in the wholesale and retail sale of pharmaceutical products in China, including brands such as Bayer, Novartis, Johnson & Johnson and Medtronic. The company is involved in the supply of medicines to hospitals; wholesale of biological products, medical instruments and traditional Chinese medicines; and pharmaceutical logistics. It additionally owns 150 chain stores in Beijing that sell medicines, health care food, medical instruments, cosmetics, daily necessities and traditional Chinese medicines.

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