DX&VX Signs MOU with China GuZhouTong for Development, Supply, and Distribution of Next-Generation In Vitro Diagnostic Medical Devices

[Asia Economy Reporter Jang Hyowon] Dx&Vx announced on the 24th that it has signed a business agreement with Guzhou Tong Medical Device Group Co., Ltd. (hereinafter Guzhou Tong), the largest pharmaceutical and medical device distribution company in China, to develop, supply, and distribute next-generation in vitro diagnostic medical devices applicable to early diagnosis, prevention, and treatment of diseases. The two companies plan to establish a continuous and organic strategic cooperation system over three phases during three years.

The signing ceremony was held online via video conference between the headquarters of both companies in Korea and China, attended by key officials including Dx&Vx CEO Park Sangtae and Guzhou Tong Vice General Manager (Vice President) Yeong Munhui. Through this agreement, Dx&Vx will be responsible for research and development, production, and supply of various in vitro diagnostic products tailored to the Chinese market based on its own technology, while Guzhou Tong will handle the approval, distribution, and sales of these products within China.

Additionally, both companies agreed to establish a foundation to jointly supply the developed products to international cooperative organizations and third countries outside China, and to prioritize cooperative responses in the event of emerging infectious diseases such as COVID-19.

Guangzhou Tong ranks 4th among Chinese pharmaceutical and medical device wholesale and retail supply chain companies and is the top private enterprise in this sector. It operates about 150 large-scale logistics centers across 34 provincial-level administrative regions in China and has secured a sales network of approximately 550,000 outlets, covering about 96% of nationwide franchise retail pharmacies and private medical institutions. The company is listed on the Shanghai Stock Exchange, with sales reaching 119 billion yuan (approximately 23 trillion KRW) in 2021.

Yeong Munhui, Vice General Manager of Guangzhou Tong, stated, “The combination of Dx&Vx’s in vitro diagnostic R&D capabilities and our strong clinic and pharmacy distribution network will elevate China’s medical services to a higher level. Through the synergy of both companies, we will also cooperate to jointly enter the global market, including the Third World.”

Park Sangtae, CEO of Dx&Vx, added, “We are pleased to collaborate with Guangzhou Tong, a leading pharmaceutical and medical device distribution group in China, and plan to expand into the Chinese market not only with diagnostic kits but also with genomic analysis services for newborns and mothers. We will also prepare to serve as a bridge to help excellent domestic companies enter the Chinese market.”

Meanwhile, according to the ‘China Medical Device White Paper 2022,’ which forecasts the future prospects of the Chinese medical device industry, the Chinese medical device market was approximately 908.1 billion yuan (about 181 trillion KRW) in 2021 and is expected to grow rapidly with an average annual growth rate of 11% over the next 10 years. In particular, the in vitro diagnostics market has surged in demand, accounting for 80% of the immunodiagnostics market after COVID-19, significantly increasing its market share within the Chinese medical market.