Guided Therapeutics Announces New Agreement and Purchase Orders from Shandong Yaohua Medical Instrument Corporation

Rhea-AI Summary

Guided Therapeutics (OTCQB: GTHP) has signed a new agreement with Shandong Yaohua Medical Instrument Corporation (SMI) in China, superseding a prior agreement from August 2021. The new deal includes two purchase orders totaling a minimum of $3,931,600 for goods and services. SMI commits to purchase approximately $40 million in the first year following approval by the National Medical Products Administration (NMPA). The clinical trial for NMPA approval is expected to complete mid-2023, with marketing approval anticipated by year-end. This agreement is expected to significantly boost revenue from China.

Positive

• New agreement with SMI could generate a minimum of $40 million over four years.
• Anticipated increase in sales revenue for the coming years due to new orders.
• Clinical trials reportedly progressing well, unaffected by prior Covid-19 lockdowns.

Negative

• None.

PEACHTREE CORNERS, Ga.--(BUSINESS WIRE)-- Guided Therapeutics, Inc. (the “Company”) (OTCQB: GTHP), the maker of the LuViva® Advanced Cervical Scan, announced today that it had signed a new agreement (the “Agreement”) with the Company’s Chinese co-manufacturing partner and distributor for China, Shandong Yaohua Medical Instrument Corporation (“SMI”). This Agreement supersedes the agreement between the Company and SMI previously signed on August 21, 2021.

The Agreement includes two purchase orders from SMI, one previously entered into on December 3, 2018, which has been amended in full, and a new purchase order which was entered into in March 2023 totaling a minimum of $3,931,600 for goods and services from the Company, including device components, license payments, and technical expertise. In the first full calendar year following approval by the National Medical Products Administration (the “NMPA”, formerly the China Food and Drug Administration), SMI will be committed to purchase from the Company, at minimum, license fees and component purchases of approximately $40 million over a four-year period.

SMI has informed the Company that it expects to complete the clinical trial required to obtain NMPA approval by the middle of this year. Further, SMI expects to receive final regulatory approval to market in China by the end of this year. Under the Agreement, approximately $2.1 million of the purchase orders must be fulfilled by the time SMI files its application with clinical data to the NMPA. Approximately $570,000 is due at the time NMPA approval is obtained, and another $1.24 million is due by March 31, 2024. SMI has an option to purchase an additional $1.24 million worth of single use components by October 31, 2024. These purchase orders, especially those involving single use components, are fueled by SMI’s ongoing negotiations involving government sponsored cervical cancer screening programs using LuViva’s novel biophotonic technology.

“We are pleased that the clinical trials are going well, no longer impacted by Covid-19 lockdowns and back on track, the result of which are increased orders from China. These orders are expected to result in a significant increase in sales revenue not only for this year, but also for many years to come,” said Mark Faupel, Chief Executive Officer of Guided Therapeutics. “We are gearing up to supply SMI with the parts and expertise it needs to be successful in the Chinese market.”

About Guided Therapeutics

Guided Therapeutics, Inc. (OTCQB: GTHP) is the maker of a rapid and painless testing platform based on its patented biophotonic technology that utilizes light for the early detection of disease at the cellular level. The Company’s first product is the LuViva® Advanced Cervical Scan, a non-invasive device used to detect cervical disease instantly and at the point of care. In a multi-center clinical trial with women at risk for cervical disease, the technology was able to detect cervical cancer up to two years earlier than conventional modalities, according to published reports. For more information, visit: www.guidedinc.com.

The Guided Therapeutics LuViva^® Advanced Cervical Scan is an investigational device and is limited by federal law to investigational use in the U.S. LuViva, the wave logo and “Early detection, better outcomes” are registered trademarks owned by Guided Therapeutics, Inc.

Forward-Looking Statements Disclaimer: A number of the matters and subject areas discussed in this news release that are not historical or current facts deal with potential future circumstances and developments. The discussion of such matters and subject areas is qualified by the inherent risks and uncertainties surrounding future expectations generally and also may materially differ from Guided Therapeutics’ actual future experience involving any of or more of such matters and subject areas. Such risks and uncertainties include those related to the early stage of commercialization of products, the uncertainty of market acceptance of products, the uncertainty of development or effectiveness of distribution channels, the intense competition in the medical device industry, the sufficiency of capital raised in prior financings and the ability to realize their expected benefits, the uncertainty of future capital to develop products or continue as a going concern, the uncertainty of regulatory approval of products, and the dependence on licensed intellectual property, as well as those that are more fully described from time to time under the heading “Risk Factors” in Guided Therapeutics’ reports filed with the SEC, including Guided Therapeutics’ Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and subsequent filings.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230315005140/en/

Mark Faupel

Guided Therapeutics

770-242-8723

Source: Guided Therapeutics, Inc.

FAQ

What is the significance of the new agreement between Guided Therapeutics and SMI?

The new agreement could lead to a minimum of $40 million in revenue, enhancing Guided Therapeutics' market presence in China.

When does Guided Therapeutics expect to receive NMPA approval for its product?

Guided Therapeutics expects to receive final regulatory approval from the NMPA by the end of 2023.

How much revenue is expected from the new purchase orders with SMI?

The purchase orders total a minimum of $3,931,600, with the potential for $40 million in the first year after NMPA approval.

What are the clinical trial expectations for Guided Therapeutics related to SMI?

The clinical trial is expected to be completed by mid-2023.