Merck-Chimie to commercialize CardioGenics' proprietary paramagnetic beads

CardioGenics Holdings Inc. (OTCBB: CGNH), developer of the ultra-sensitive QL Care™ Point-Of-Care (POC) analyzer and products for the immunoassay segment of the In-Vitro Diagnostics market, announced that CardioGenics Inc. and Merck Chimie S.A.S. have agreed on a plan to commercialize CardioGenics' proprietary paramagnetic beads, with shipments to Merck-Chimie's customers scheduled to start mid-September 2010.

“Merck's product launch will make a strong revenue contribution and help bring us to cash flow positive.”

Merck-Chimie is one of the world's largest suppliers of paramagnetic diagnostic beads, a roughly $1 billion product category. The beads are a key component of virtually every immunoassay analyzer. CardioGenics' proprietary technology enhances the signaling properties of the beads, increasing the sensitivity of immunoassay analyzers by up to seven fold. This can allow more sophisticated data collection from patient samples being analyzed for the presence and progression of a disease- with no change to existing hardware or instrumentation.

"Commercialization of CardioGenics' beads with Merck-Chimie is a key milestone for us and an important validation of our technology," stated Yahia Gawad, MD, CEO of CardioGenics. "Merck's product launch will make a strong revenue contribution and help bring us to cash flow positive."

Under the terms of the first agreement between Merck-Chimie and CardioGenics, net revenue from the sale of CardioGenics' beads to Merck's customers will be split between the two companies, with 70 percent of such proceeds to Merck and 30 percent to CardioGenics.

Separately, CardioGenics said its clinical and commercial development program for its portable QL Care Analyzer remains on schedule.