Biohit Oyj June 25, 2013 at 11 A.M. local time (EET)
Finnish healthcare company Biohit Oyj has agreed to set up a Joint Venture company in China. The Chinese partner to the Joint Venture is Anhui Wisdom-Win Investment Co., Ltd. Official name of the Joint Venture is Biohit Biotech (Hefei) Co., Ltd., located in the city of Hefei in Anhui province, China. The objective of the partners in forming Biohit Biotech (Hefei) Co., Ltd is to manufacture and sell high quality GastroPanel kits to the Chinese market area. GastroPanel is a non-invasive blood test that reliably identifies both healthy and unhealthy stomachs as well as helps to prioritize patients for further examinations.
Mr. Liu Feng, the owner of Anhui Wisdom-Win Investment Co., Ltd. who is also General Manager of Hefei Medicine Co. Ltd. China, invests 20 million RMB (2.5 MEUR) in Biohit Biotech (Hefei) Co., Ltd. Immaterial investments made by Biohit is worth of 13 MRMB and includes know-how expertise as well as production technologies and related patents to Joint Venture.
Anhui Wisdom-Win Investment Co., Ltd. will own 60 % of Biohit Biotech (Hefei) Co., Ltd. Biohit will own 40 % of Biohit Biotech (Hefei) Co., Ltd. Mr. Liu Zhen has been appointed CEO of Biohit Biotech (Hefei) Co., Ltd.
The regulatory approvals are pending and are expected to be finalized during 2014. Biohit Biotech (Hefei) Co., Ltd shall aspire to meet recognized international quality standards by the end of 2014. During the approval process, ramp-up costs will be covered from 20 MRMB investment.
The joint venture is consolidated to the Biohit Group using the equity method. Biohit's 40% share of the joint venture shareholders' equity and profit or loss is respectively recognized in the consolidated balance sheet and income.
Foundation of the Joint Venture will create a deferred income worth around one million euros, thus the recognition of revenue is postponed until the new company has been authorized so start operations in the Chinese market. The deferred income is recognized to cover the license application process and the start-up phase. This method is based to conservatism principle, because the company does not yet have an official license.
CEO Semi Korpela, Biohit Oyj: "We are pleased to announce this Joint Venture agreement. Our local partners will provide excellent conditions for Biohit Biotech (Hefei) Co., Ltd."
General Manager Liu Feng, Hefei Medicine Co. Ltd. China: "We are glad to partner with Biohit. China has a massive market for the GastroPanel and its yet untapped potential. We anticipate a collaborative and successful team approach with Biohit."
Appendices: CV Liu Zheng
CV Liu Feng
CEO Semi Korpela, Biohit Oyj
tel. +358 9 773 861
Biohit in brief
Biohit Oyj is a globally operating Finnish biotechnology company established in 1988. Biohit's mission is "Innovating for Health". The purpose of the company is to take social responsibility and produce innovation, new technologies and analysis systems for use in medicine, research institutions and industry, helping to promote research and diagnostics and to improve the quality of life of people by means of preventing disease, human suffering and financial loss. We are committed to social responsibility and it is our duty to spread knowledge about the Group I human carcinogen, acetaldehyde, and innovate and develop the marketing and availability of our products and services. Biohit is headquartered in Helsinki, Finland and its subsidiaries are located in China, Italy and the United Kingdom. Since 1999, Biohit's Series B shares (BIOBV) have been listed in the NASDAQ OMX Helsinki Oy Small cap/Healthcare sector.
Hefei Medicine in brief
Hefei Medicine Co. is medicine business in trading with deep experience in medical distribution to Chinese hospitals. In 2012, company’s turnover was over 2 Billion RMB (250 million euro). Company is established in 1995 and the company employs today more than 300 people. More information: www.sinamedicine.com
Additional information about the GastroPanel examination:
GastroPanel developed by Biohit is a simple blood test for the diagnosis and screening of gastric disorders. GastroPanel test reliably detects H. pylori infection and damage or dysfunction of the stomach mucosa (atrophic gastritis), leading to acid-free stomach that is the most important risk factor for gastric cancer. Recent studies suggest that acid-free stomach is also a risk factor for esophageal cancer.
The April 2012 Maastricht IV consensus report of the European Helicobacter Pylori Study Group recommends blood sample biomarker tests as a reliable method to diagnosis of disorders in stomach mucosa and associated risk conditions. Researchers recommend biomarker tests for the diagnosis and follow-up of Helicobacter pylori infection and especially due to atrophic gastritis as well as for the screening of asymptomatic patients. (1)
16 gastroenterology experts of the international Healthy Stomach Initiative organization (www.hsinitiative.org) from 12 countries came to the same conclusion that blood biomarker tests are a reliable way to detect and screen for gastric diseases and their risk conditions. Biomarkers in GastroPanel detect reliably H. pylori infection and in addition, atrophic gastritis, which is the most important risk condition of gastric cancer. (2)
Microbes from the mouth can colonise an acid-free stomach and produce carcinogenic acetaldehyde from sugar and alcohol. In 2009, IARC (WHO agency on cancer research) classified acetaldehyde from alcoholic beverages (and naturally generated in alcohol) as group I carcinogen, being therefore as carcinogenic as asbestos, formaldehyde and benzene. (3). According to genetic studies this is one of the major risk factors of gastric and oesophageal cancer. The risk can be reduced with the help of another Finnish innovation – OTC product Acetium capsule, which are taken during meals and alcohol consumption, to bind (neutralise) carcinogenic acetaldehyde in the stomach.
GastroPanel provides an opportunity to direct the patients to correct examinations on time. GastroPanel reliably finds those patients whose stomach is "healthy" (patiens do not have H. pylori infection or acid-free stomach due to atrophic gastritis. GastroPanel blood test can therefore in most cases replace the expensive and uncomfortable gastroscopy. GastroPanel results in significant resource and cost savings in healthcare.
1. Malfertheiner P et al. Management of Helicobacter pylori infection--the Maastricht IV/ Florence Consensus Report. http://gut.bmj.com on May 18, 2012. European H. pylori Study Group, ESPSG.
2. Agréus L et al. Rationale in diagnosis and screening of atrophic gastritis with stomach-specific plasma biomarkers. Scand J Gastroenterol 2012;47:136-47.
3. World Health Organisation WHO, 2009. www.iarc.fr/en/media-centre/pr/2009/pdfs/pr196_E.pdf