Biohit Oyj (BIOBV), the Finnish health-care company whose shares gained 32 percent this year through yesterday, set up a joint venture in China to manufacture and sell its Gastropanel test used for screening gastric disorders.
Biohit will provide expertise, related intellectual property and production technologies valued at about 13 million yuan ($2.1 million) and will own 40 percent of the shares of Biohit Biotech (Hefei) Co. in China’s Anhui province. Anhui Wisdom-Win Investment Co. will own 60 percent with an initial investment of 20 million yuan, Helsinki-based Biohit said in a statement.
Biohit is expanding in China after identifying the country as a key market. A genetic mutation common among east Asian people inhibits their ability to process acetaldehyde, which is present in food such as fruits and is also a byproduct of consuming alcohol. Half the world’s stomach cancer cases occur in eastern Asia, mainly in China, according to the World Health Organization’s International Agency for Research on Cancer.
“This investment is enough to get business going in China and to get production going,” Biohit Chief Executive Officer Semi Korpela said today to journalists in Helsinki, where the company is based. “China is our most important market at the moment.”
Gastropanel is a test used to diagnose infections with Helicobacter pylori, a bacterium that causes low stomach acid levels and exposes patients to acetaldehyde. H. pylori infection has been linked to stomach cancer.
Biohit shares rose 8.9 percent to 5.75 euros as of 11:02 a.m. in Helsinki.
To contact the reporter on this story: Kati Pohjanpalo in Helsinki at email@example.com