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Dec. 20 (NBD) -- Autobio Diagnostics Co., Ltd., a Chinese company which engages in the research and development, production and distribution of clinical diagnostic products, announced on Tuesday that the company has purchased 3,846,153 R-class shares from Finland's biotech company Mobidiag at the price of 2.6 euros (3.0 U.S. dollars) per share. 

After the transaction, Autobio has owned 12.67 percent of R-class shares in Mobidiag, increasing its stake to 10.12 percent and becoming the third largest shareholder of the Finnish firm.

At the same time, the two companies planned to invest altogether 12.3 million euros (14.0 million U.S. dollars) to build a joint venture in China. Autobio will pay 8 million euros (9.1 million U.S. dollars) in currency and hold a stake of 65 percent in the joint venture.

Based on their agreement, Mobidiag will grant to the joint venture an exclusive license for human infectious disease assays, except for sepsis assays, and a limited exclusive license for human non-infectious disease assays based on a technical platform called Novodiag in China.

Director of board secretary at Autobio told news outlet the 21st Century Business Herald Novodiag boasts cutting-edge technologies in the point-of-care testing related to nucleic acids-based molecular diagnostics, and the Zhengzhou-based company aims at taking advantage of Novodiag-based products in the molecular diagnostics industry.

Autobio's investment in the molecular diagnostics sector is also thought to be attributed to its desire of occupying the market beforehand since the company once took a hit with bioactive materials, a crucial part for the research and development of in vitro diagnostic products, a territory monopolized by international giants.

According to a research report released by Huatai Securities, Autobio was given a buy rating and the company's new move was deemed as a signal that the company enters the sector of point-of-care testing in molecular diagnostics and brings in overseas advanced technologies to consolidate its leading position in the in vitro diagnostic device (IVD) segment.

The report also pointed out the bilateral tie focuses on Mobidiag's core product which shows the direction for innovation and investment of IVD. With the help of the synergy effects brought by the products of both companies and the cost advantage of production in China, the core product is expected to become a new growth pole of Autobio in the future.

Currently the development of molecular diagnosis is still at an early stage. With technical breakthroughs, the decrease of costs and support from policies and capitals, the molecular diagnosis market will expand rapidly.

Statistics from market research company MarketsandMarkets indicated the market size of the global molecular diagnosis sector is expected to reach 9.3 billion U.S. dollars by 2020.

Email: wenqiao@nbd.com.cn