American CryoStem (OTC:CRYO) has expanded its relationship with Health Innovative Technology (HIT) of Hong Kong.
After more than two years as CryoStem's licensee in Hong Kong, HIT has licensed the patent rights to distribute the company's ATGRAFT and CELLECT platform in mainland China.
To facilitate the expansion, CryoStem has extended the licensing and distribution agreement with HIT to establish two additional entities: Health Innovative Technology Shenzhen and Baoxin Asia Pacific Biotechnology, which will develop, own and operate multiple laboratory/treatment/training facilities in China.
CRYO has received an upfront fee of $300,000 and a five-year minimum annual guarantee of $500,000 a year. In addition, CryoStem will obtain a minority equity stake in Baoxin, (China) and up to a 20% equity stake in the regenerative medicine center in Hong Kong.
In a statement, John Arnone, CEO of CryoStem, said the Hong Kong laboratory/treatment center would take full advantage of CryoStem's regenerative medicine platform, including ATGRAFT, ATCELL, and CELLECT, and synergistic products, including its ACSelerate Max cell culture mediums.
"Our long-term relationship with Health Innovative Technology of Hong Kong has provided us with a reliable partner to expand the business within China," he added.
Matthew Fan, CEO of HIT, said the company’s short-term goals are to set up two more GMP-grade adipose tissue processing and storage facilitates in Beijing and Shanghai to cover the need of the whole China region, and a proper education facility in China to promote the use of ATGRAFT as a better more natural filler, compared with artificial fillers.