[Asia Economy Reporter Hyunseok Yoo] Digital Optic secured external growth and high profitability by signing a large-scale exclusive global distribution agreement with a specialized company for swabs used in specimen collection for COVID-19 testing.
Digital Optic announced on the 27th that it has signed an exclusive global distribution master contract with its largest shareholder, Noble Bio, for COVID-19 specimen transport kits, including South Korea. The company expects a significant performance improvement as the contract guarantees sales of over 720 billion KRW and confirmed operating profit of 72 billion KRW over three years.
Earlier, on the 13th, Digital Optic and Noble Bio signed a Memorandum of Understanding (MOU) to jointly promote the comprehensive sales rights of transport kits composed of specimen collection swabs and transport media. This current contract is an expanded master contract from the initial agreement, specifying the detailed contract scale, division of roles between the two companies, and contract conditions.
According to this master contract, Noble Bio will be responsible for the development and production of swabs for virus specimen collection such as COVID-19 and various in vitro diagnostic products, while Digital Optic will be granted exclusive global distribution rights for three years to handle the distribution, sales, and export of related products.
Additionally, based on Digital Optic’s technology for information recognition and processing, the two companies plan to jointly develop future diagnostic products and devices including ▲ rapid antigen and antibody test kit result interpretation ▲ patient information recognition and processing devices ▲ rapid on-site diagnostic service solutions for multi-use facilities. The company explained that by supplying these to airports, large shopping malls, performance and sports viewing facilities, and other multi-use venues, the synergy effect between the two companies can be maximized.
A company official stated, “This exclusive distribution contract directly links the supply performance of COVID-19 specimen transport kits to sales and profits, guaranteeing a minimum sales of 720 billion KRW and operating profit of 72 billion KRW over three years. The contract explicitly states exclusive rights that do not grant domestic or international sales rights to any third party other than Digital Optic, so we expect a significant improvement in performance starting this year.”
He added, “As global big pharma companies including Abbott and Roche, as well as domestic and international diagnostic kit companies, are knocking on Noble Bio’s door to secure transport kits, additional performance growth is expected. In particular, Noble Bio is currently expanding its production capacity of transport kits from 100 million units per month to 200 million units. Once the expansion is completed, not only will overseas expansion and supply volume increase, but through active collaboration, meaningful results can be achieved in future virus diagnostic businesses with new technologies.”
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