Marking, tracing and verification solutions specialist Dotz Nano Limited (ASX:DTZ) has entered into a distribution agreement with, and received an initial US$2.1 million (A$2.8 million) purchase order from, UAE-based Hygiene Links International General Trading LLC for its SARS-CoV-2 virus detection technology test kits.
Hygiene Links is a leading and reputable chemical, plastics and consumables manufacturer and distributor across the Middle East with a large customer base within the healthcare market.
The distribution agreement is for an initial two-year term and grants Hygiene Links the exclusive right to sell the Dotz Test Kits in the UAE, Egypt and Sudan, subject to Hygiene Links satisfying a minimum order of 50,000 units per month for a six-month period for each country (equating to at least US$2.1 million for the three countries over each six month period).
Under the distribution agreement, Hygiene Links may appoint sub-distributors subject to Dotz’s approval. Either party can terminate the distribution agreement on 90 days notice and the distribution agreement includes an option to extend the agreement for additional one-year terms, subject to the agreement of both parties.
The US$2.1 million purchase order is for the supply of Dotz’s saliva-based and nasopharyngeal swab Dotz Test Kits for the next six months for use in the UAE, Egypt and Sudan. Dotz Test Kits will be shipped monthly with 50% of each monthly shipment fee paid upfront and the remaining 50% on delivery.
Headquartered in Dubai, Hygiene Links is increasing its offering to include health care and personal protective equipment (PPE) products. The Dotz Test Kits are expected to be among the first of Hygiene Links’ new product offering.
Based on Hygiene Links’ reputation, Dotz’s due diligence and present business dealings with the company, Dotz is confident with the financial and other capacity of Hygiene Links to meet its obligations under the distribution agreement. As part of its due diligence, Dotz has obtained various references in relation to Hygiene Links, its management team and key shareholders and has also undertaken certain KYC verification requirements.
Dotz has also considered the sanctions in place for Sudan by Australia (and other relevant countries) and is satisfied that the sanctions do not impact the distribution agreement, noting Hygiene Links is UAE based.
The purchase order and distribution agreement follow a successful blind clinical trial of the nasopharyngeal swab Dotz Test Kits in the USA.
The Dotz Test Kits have obtained CE Mark authorisation for both nasopharyngeal swab and saliva-based samples, which clears it for sale in the European Union2 and to the private sector in the UAE, Egypt and Sudan (there being no other regulatory requirements or export permits required for Hygiene Links’ to permit the sale of the Dotz Test Kits to the private sector in the UAE, Egypt or Sudan). However, certain regulatory requirements still need to be satisfied before the Dotz Test Kits can be sold to the public sector in the UAE, Egypt and Sudan. As previously announced, Dotz has also applied for a FDA Emergency Use Application for its nasopharyngeal swab Dotz Test Kits. Dotz also updated its existing FDA EUA application in May 2021 to also cover its saliva-based Dotz Test Kits.
Dotz’s nasopharyngeal swab and saliva-based Test Kits are being manufacturered in Virginia, USA by Systaaq Diagnostic Products in accordance with a non-exclusive manufacturing agreement. The
manufacturing agreement has a five-year term and satisfies the manufacturing requirements of the FDA and EU for the Dotz Test Kits. As part of the manufacturing agreement, Systaaq will export the Dotz Test Kits to Hygiene Links in the UAE (noting Systaaq has the relevant export permits to do so). Under the manufacturing agreement, Systaaq has agreed to have capacity to manufacture at least three million Dotz Test Kits in the first 12 months to the extent required by Dotz.
Dotz Chairman and Interim CEO Bernie Brookes said, “Our first commercial order within the diagnostic domain is a significant achievement for Dotz. It reflects the versatility of our technology, which has applications within almost every industry. We believe our virus detection technology is truly industry-leading, providing a method to accurately identify the SARS-CoV-2 virus at scale and in a cost-effective and timely manner. While we are awaiting FDA regulatory approval for the nasopharyngeal swab and saliva-based Dotz Test Kits, our successful clinical trial of the nasopharyngeal swab Dotz Test Kits and CE Mark authorisation has enabled us to start toengage with a number of potential customers. At the same time we are continuing to commercilise our anticounterfeiting technology, and applying for regulatory approval for the Dotz Test Kits in other markets.”