A medical diagnostics start-up which is about to launch an HK$79 tooth decay risk detection kit has chosen to locate its global headquarters to Hong Kong in the hope of gaining better access to China’s growing healthcare market, according to a recent report.
The start-up was founded six years ago by Hong Kong-born its chairman who says that cross-border opportunities have played a role in its decision to choose Hong Kong, even as the city has yet to be internationally recognised as a major biotechnology hub.
Hong Kong is the company ’s base for developing the mainland market and the rest of the world outside the US. Applying US government-endorsed technology in China, the world’s most populous market is a compelling business opportunity.
The start-up has raised more than HK$78.5 million (US$10 million) from various backers that include two US governmental agencies, a major NGO as well as other leaders in biotech.
The company seeks to commercialise a patented sample preparation methodology that improves the accuracy of biological diagnostic tests by concentrating and purifying target molecules. It is about to release its first diagnostic product – a tooth decay risk detection kit that can be used “anytime, anywhere, without the need for trained personnel or power source”.
Although the US biotechnology scene is more mature, with a large pool of venture capital and sophisticated investors, the start-ups CEO said that the prospects for securing funding in China were a factor in deciding to headquarter in Hong Kong, where there’s less competition from rival biotechnology companies.
In China, the funding pool could potentially be even bigger but there is a shortage of quality projects; the company argues that it is in a more advantageous position for fundraising in Hong Kong.
The start-up aims to obtain European and Hong Kong regulatory approval to market by year-end a test kit that warns users of tooth decay risks, through the detection of the concentration of a bacteria that plays a key role in causing dental degeneration.
The company’s leadership said a US dental insurer had pushed for the development of the kit to help stem dental treatment costs.
With a suggested retail price of HK$79 (US$10.06) per test, the kit – with recommended usage frequency of two to four times a year – is expected to be sold in Hong Kong pharmacies.
The start-up is hoping to attract at least HK$100 million of new funding to support clinical efficacy and safety studies on similar test kits that screen for sexually-transmitted diseases, malaria and the flu.
The company aims to provide tests that are faster, cheaper, simpler than laboratory tests. The more widely-used and accessible they are, the more people can detect them and get treatment earlier, or change their behaviour to prevent getting diseases such as tooth decay.
It will cost approximately HK$23.5 million to HK$39.2 million to conduct clinical studies and obtain regulatory approval for test kits in each market, he added.
The company plans to double its headcount in Hong Kong to 40 within two years. It currently employs 20 staff in Orange County, California, half of which are involved in research and development.
The start-up is also looking to opportunities in the lab-based diagnostic market and has set up a unit in Suzhou, Jiangsu province for sampling and analysis of non-solid biological tissue, according to the company’s leadership.
The company is also seeking to collaborate with DNA sequencing and molecular diagnostic firms to deploy its sample preparation methodology and develop more accurate and cheaper cancer screening and non-invasive prenatal DNA tests.