Not so very long ago (two months to be precise) Echo Therapeutics, Inc. was on the end of a stinging critique from its major shareholder, Platinum Montaur. Things were not rosy in the garden of the continuous glucose monitoring specialist with the departure of its CEO and restructuring leading to a 33% workforce reduction. Now it seems its biggest shareholder at least is happier, the company having signed a strategic collaboration agreement with Medical Technologies Innovation Asia (MTIA), Ltd., Hong Kong, for a license arrangement and equity investment in Echo.
Echo Therapeutics is the developer behind the Symphony® CGM System, a non-invasive, wireless continuous glucose monitoring system, with a potential global market of $10Bn, according to estimates. The Symphony system has the potential to offer a non-invasive, continuous glucose monitoring solution for use in the emerging hospital market. This strategic partnership therefore offers Echo both the potential to accelerate Symphony’s commercialization in China and to access to the Chinese market, where MTIA has established sales channels in more than 1,000 hospitals spanning the country’s provinces.
The ten year deal is necessarily complex, but essentially Echo has granted MTIA rights to develop, manufacture, market and distribute the Symphony CGM System on an exclusive basis for the Chinese market, including the Peoples’ Republic of China, Hong Kong, Macau and Taiwan. MTIA will have responsibility for market specific development, manufacturing and marketing costs, relating to the Symphony CGM System for China, and for obtaining regulatory approval for the product in the licensed territories.
“This collaboration addresses a specific market need in China and we believe that, with our medical device expertise and extensive sales channels, the Symphony CGM System has the potential to revolutionize the standard of care for glucose monitoring in China,” said Bai Ge, Managing Director of MTIA. “We are exceptionally pleased to work together with Echo and look forward to a long and productive partnership.”
for Echo Therapeutics
“We are excited to be working with MTIA in this new relationship to meet the growing glucose monitoring needs in China. We believe MTIA’s expertise and relationships in China will enhance Echo’s success in this region and our overall value proposition,” said Robert F. Doman, Executive Chairman and Interim CEO of Echo Therapeutics, Inc. “In addition to strengthening the balance sheet, this $10 million cash infusion, following the recent positive clinical results for use of our Symphony CGM System, represents an important achievement for Echo as we progress toward regulatory clearance.”
“The Company is pleased to finally have the opportunity to arrange this constructive financing with Platinum and to partner with MTIA, who was introduced to us by Platinum, after extensive due diligence and product development analyses. Although this joint process took more time than all three parties initially anticipated, its comprehensive and cooperative nature has been highly beneficial to the alignment of our interests and that of all of our shareholders,” added Doman.
for Platinum Montaur
“Platinum’s decision to invest in Echo at this time reflects our view of the Company’s opportunity for future growth and confidence in the technology and we congratulate the new management and the Board of Directors for working diligently to close this deal which we are confident will create shareholder value and help deliver against the Company’s strategic goals. As a result of the MTIA collaboration, we believe that Echo can leverage MTIA’s manufacturing and clinical development skills and capitalize on the significant Chinese market,” said Michael M. Goldberg M.D., Principal of Platinum-Montaur Life Sciences, LLC. “This investment reinforces Platinum’s long-term commitment to Echo.”
Full release here
Source: Echo Therapeutics, Inc., PR Newswire