Belluscura signs 10-year licensing deal in China, Asian markets

(Sharecast News) - Medical device developer Belluscura announced a 10-year exclusive licence, marketing and distribution agreement with InnoMax Medical Technology on Wednesday. The AIM-traded firm said the agreement would grant InnoMax exclusive rights to manufacture and distribute Belluscura's X-PLOR and upcoming DISCOV-R portable oxygen concentrators in China, Hong Kong, Macau, and Singapore.

It said InnoMax, a medical technology company based in Shenzhen, would acquire the exclusive manufacturing and distribution rights for Belluscura's X-PLOR portable oxygen concentrator and its next-generation ambulatory dual flow concentrator, DISCOV-R.

The latter would be included once it receives registration in the specified territories.

It said the agreement, effective from 1 October, would ensure a steady revenue stream for Belluscura through annually-increasing minimum cumulative royalties.

The company said it would also receive a share of net profits from sales of accessories, in addition to royalties on the licensed products.

It said the minimum cumulative royalties over the 10-year agreement would range between $27.5m and $55m, depending on whether the licence remained exclusive throughout the term.

If minimum sales quantities were not met, both Belluscura and InnoMax had the option to convert the licence to a non-exclusive one.

To further foster the penetration of Belluscura's technology in China and the other agreed-upon territories, both companies would jointly undertake sales and marketing activities.

Financial contributions for the marketing initiatives would be made by both parties.

The first product registration and initial sales were anticipated to start in the fourth quarter of this year.

Belluscura noted that the announcement came on the heels of recent news that it had received purchase orders for more than 6,500 units of its DISCOV-R portable device for the United States market.

The company said it had planned a controlled rollout of the device through the third quarter of 2023 and into 2024, to meet escalating demand.

It claimed the device had garnered considerable attention from medical device distributors, retailers, patients, and providers of durable medical equipment.

While InnoMax would handle sales and distribution in China, Hong Kong, Macau, and Singapore, Belluscura confirmed that it would continue to market and distribute its products in other parts of the world.

"I am very excited to build and strengthen our relationship with InnoMax," said chief executive officer Bob Rauker.

"An estimated 100 million people suffer from COPD in China alone, approximately six times the number of patients in the US, demonstrating the need for oxygen therapy in China and associated territories.

"This agreement provides the basis for an extremely financially beneficial partnership for both companies as we jointly broaden the reach of Belluscura's next-generation technology."

At 1321 BST, shares in Belluscura were up 14.68% at 47.02p.

Reporting by Josh White for Sharecast.com.