Miraculins has executed a term sheet with Cachet Pharmaceutical to appoint Cachet as the exclusive Chinese distributor for the Scout DS non-invasive diabetes screening test. The Scout DS is claimed to be the world's first non-invasive and highly sensitive test designed to measure diabetes related biomarkers in the skin. It does not require a blood draw or fasting and generates a result in as little as 80 seconds. The Scout DS uses visible light to measure the optical signature of fluorescent biomarkers in the skin, the accumulation of which are accelerated by abnormal blood glucose levels and oxidative stress.
The term sheet has now established the principal terms and conditions of the proposed distribution agreement between Miraculins and Cachet for China, including Scout DS device unit pricing, up-front and milestone payments, product ordering and diligence requirements, and ongoing responsibilities of the parties. Specifically, the term sheet provides that Miraculins would receive up to US$500,000 in up-front and milestone payments, staged between signing the agreement and the successful conclusion of the Chinese State Food and Drug Administration (SFDA) regulatory clearance process. In addition, Cachet would place a first order for Scout DS devices valued at US$15mn on signing of the agreement, which would be supported by the issuance of a banking guarantee and activated upon Chinese SFDA regulatory clearance.
The term of the agreement would extend for five years from the date of SFDA clearance, subject to minimum annual order quantities by Cachet. If minimum orders were met, this would represent an additional order value of US$75mn in Scout DS device orders over the length of the term. Miraculins would be responsible for leading the SFDA clearance process and its related costs. Cachet would provide guidance and support for the process as necessary.
Upon clearance of the Scout DS in China, Cachet would be responsible for all sales and marketing costs. Miraculins would provide sales and marketing guidance and support as required, and would provide a limited number of not-for-sale devices to Cachet for use in market development activities. Miraculins would retain the right to establish programmes for ongoing device servicing and maintenance once the Scout DS devices are sold into the field. The term sheet provides Cachet with an exclusive period of 90 days within which to finalise definitive documentation for the agreement.
Scout DS has received regulatory clearance in Canada and throughout the EU, and Miraculins has recently filed pre-submission documentation with the FDA towards securing Scout DS marketing clearance in the US.