For immediate release: January 25, 2017
Zecotek Signs LFS Scintillation Crystal Supply Agreement Worth $21 million Over the Next 3 Years
Singapore, January 25, 2017 - Zecotek Photonics Inc. (TSX-V: ZMS; Frankfurt: W1I, OTCPK: ZMSPF), a developer of leading-edge photonics technologies for healthcare, industrial and scientific markets, is pleased to announce that it has signed a LFS scintillation crystal supply agreement with the Shanghai based company EBO Optoelectronics, to supply over $21 million worth of scintillation crystals over the next three years. The agreement stipulates that the supply of the LFS crystals will continue on a yearly basis after the initial three year period, unless otherwise agreed to by both parties. Zecotek will become the main supplier of Lutetium silicate based scintillation crystals to EBO.
“The Shanghai EBO Optoelectronics Company is a strategic customer with strong network and access to the medical imaging industry in China,” said Dr. A.F. Zerrouk, Chairman, President, and CEO of Zecotek Photonics Inc. “Recent changes to the regulatory landscape in China, regarding medical equipment imports, has caused OEMs to manufacture medical scanning devices domestically. This initial contract is a starting point and we look forward to building an even more significant business with EBO to capture a significant portion of the PET medical scanner market in mainland China.”
EBO is the largest crystal array producer and supplier in China. Their arrays are used in the very fast growing domestic PET medical imaging market. Zecotek will be supplying elements of LFS to EBO as the customer. In order to meet the growing demand, Zecotek is working on the gradual expansion of its manufacturing base and capabilities, however it will be using its present facility to start the present agreement, while fulfilling, as a priority, existing orders from Zecotek’s OEM partner, as well as other current accounts.
Run-away medical costs from 2010 to 2014 has caused China to take measures to modify the regulatory controls covering medical equipment in its public and private hospitals. The Chinese government uses incentives to encourage domestic hospitals to use Chinese-made medical devices as it looks to stimulate the local market and reduce soaring healthcare costs.
China’s medical device market has been growing and is now ranked second largest in the world. The significant growth in the medical device market is due to both an increase in discretionary income and the world’s largest aging population. The annual growth of the medical device market has been 20 percent for the past six years and is expected to continue at this pace for the next five years. With the increase in the number of OEMs manufacturing PET scanning devices, Zecotek’s management team is focused on becoming a leading supplier of the key components in this market.
About Shanghai EBO Co.
Founded in 2007 and headquartered in Shanghai, EBO has more than 120 employees and 4,000 square meters of manufacturing space. Shanghai EBO fabricates and supplies crystal arrays to an extensive customer base which includes: Neusoft Medical Systems, Samsung Medical, Topgrade Healthcare, FMI Medical Systems, IHEP of CAS, Huazhong University of Science and Technology, and many domestic and foreign universities and research institutions. EBO has the highest standard processing production line and offers shaped crystal customization and crystal array assembly to end users.
Zecotek Photonics Inc (TSX-V: ZMS; Frankfurt: W1I) is a photonics technology company developing high-performance scintillation crystals, photo detectors, positron emission tomography scanning technologies, 3D auto-stereoscopic displays, 3D metal printing, and lasers for applications in medical, high-tech and industrial sectors. Founded in 2004, Zecotek operates three divisions: Imaging Systems, Optronics Systems and 3D Display Systems with labs located in Canada, Korea, Russia, Singapore and U.S.A. The management team is focused on building shareholder value by commercializing over 50 patented and patent pending novel photonic technologies directly and through strategic alliances with Hamamatsu Photonics (Japan), the European Organization for Nuclear Research (Switzerland), Beijing Opto-Electronics Technology Co. Ltd. (China), NuCare Medical Systems (South Korea), the University of Washington (United States), and National NanoFab Center (South Korea). For more information visit www.zecotek.com and follow @zecotek on Twitter.
This press release may contain forward-looking statements that are based on management’s expectations, estimates, projections and assumptions. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results and trends may differ materially from what may have been stated.
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Zecotek Photonics Inc.
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