Biohit Oyj - Company Announcement

Biohit to establish Joint Venture in China - Biohit Biotech (Hefei) Co., Ltd.

Biohit Oyj June 25, 2013 at 11 A.M. local time (EET)


Finnish healthcare company Biohit Oyj has agreed to set up a Joint Venture
company in China. The Chinese partner to the Joint Venture is Anhui Wisdom-Win
Investment Co., Ltd. Official name of the Joint Venture is Biohit Biotech
(Hefei) Co., Ltd., located in the city of Hefei in Anhui province, China. The
objective of the partners in forming Biohit Biotech (Hefei) Co., Ltd is to
manufacture and sell high quality GastroPanel kits to the Chinese market area.
GastroPanel is a non-invasive blood test that reliably identifies both healthy
and unhealthy stomachs as well as helps to prioritize patients for further
examinations. 

Mr. Liu Feng, the owner of Anhui Wisdom-Win Investment Co., Ltd. who is also
General Manager of Hefei Medicine Co. Ltd. China, invests 20 million RMB (2.5
MEUR) in Biohit Biotech (Hefei) Co., Ltd. Immaterial investments made by Biohit
is worth of 13 MRMB and includes know-how expertise as well as production
technologies and related patents to Joint Venture. 

Anhui Wisdom-Win Investment Co., Ltd. will own 60 % of Biohit Biotech (Hefei)
Co., Ltd. Biohit will own 40 % of Biohit Biotech (Hefei) Co., Ltd. Mr. Liu Zhen
has been appointed CEO of Biohit Biotech (Hefei) Co., Ltd. 

The regulatory approvals are pending and are expected to be finalized during
2014. Biohit Biotech (Hefei) Co., Ltd shall aspire to meet recognized
international quality standards by the end of 2014. During the approval
process, ramp-up costs will be covered from 20 MRMB investment. 

The joint venture is consolidated to the Biohit Group using the equity method.
Biohit's 40% share of the joint venture shareholders' equity and profit or loss
is respectively recognized in the consolidated balance sheet and income. 

Foundation of the Joint Venture will create a deferred income worth around one
million euros, thus the recognition of revenue is postponed until the new
company has been authorized so start operations in the Chinese market. The
deferred income is recognized to cover the license application process and the
start-up phase. This method is based to conservatism principle, because the
company does not yet have an official license. 

CEO Semi Korpela, Biohit Oyj: "We are pleased to announce this Joint Venture
agreement. Our local partners will provide excellent conditions for Biohit
Biotech (Hefei) Co., Ltd."

General Manager Liu Feng, Hefei Medicine Co. Ltd. China: "We are glad to
partner with Biohit. China has a massive market for the GastroPanel and its yet
untapped potential. We anticipate a collaborative and successful team approach
with Biohit."

Appendices:    CV Liu Zheng
                        CV Liu Feng


Additional information:

CEO Semi Korpela, Biohit Oyj
tel. +358 9 773 861
investor.relations@biohit.fi
www.biohithealthcare.com


Biohit in brief

Biohit Oyj is a globally operating Finnish biotechnology company established in
1988. Biohit's mission is "Innovating for Health". The purpose of the company
is to take social responsibility and produce innovation, new technologies and
analysis systems for use in medicine, research institutions and industry,
helping to promote research and diagnostics and to improve the quality of life
of people by means of preventing disease, human suffering and financial loss.
We are committed to social responsibility and it is our duty to spread
knowledge about the Group I human carcinogen, acetaldehyde, and innovate and
develop the marketing and availability of our products and services. Biohit is
headquartered in Helsinki, Finland and its subsidiaries are located in China,
Italy and the United Kingdom. Since 1999, Biohit's Series B shares (BIOBV) have
been listed in the NASDAQ OMX Helsinki Oy Small cap/Healthcare sector. 


Hefei Medicine in brief

Hefei Medicine Co. is medicine business in trading with deep experience in
medical distribution to Chinese hospitals. In 2012, company's turnover was over
2 Billion RMB (250 million euro). Company is established in 1995 and the
company employs today more than 300 people. More information:
www.sinamedicine.com 


Additional information about the GastroPanel examination:

GastroPanel developed by Biohit is a simple blood test for the diagnosis and
screening of gastric disorders. GastroPanel test reliably detects H. pylori
infection and damage or dysfunction of the stomach mucosa (atrophic gastritis),
leading to acid-free stomach that is the most important risk factor for gastric
cancer. Recent studies suggest that acid-free stomach is also a risk factor for
esophageal cancer. 

The April 2012 Maastricht IV consensus report of the European Helicobacter
Pylori Study Group recommends blood sample biomarker tests as a reliable method
to diagnosis of disorders in stomach mucosa and associated risk conditions.
Researchers recommend biomarker tests for the diagnosis and follow-up of
Helicobacter pylori infection and especially due to atrophic gastritis as well
as  for the screening of asymptomatic patients. (1) 

16 gastroenterology experts of the international Healthy Stomach Initiative
organization (www.hsinitiative.org) from 12 countries came to the same
conclusion that blood biomarker tests are a reliable way to detect and screen
for gastric diseases and their risk conditions. Biomarkers in GastroPanel
detect reliably H. pylori infection and in addition, atrophic gastritis, which
is the most important risk condition of gastric cancer. (2) 

Microbes from the mouth can colonise an acid-free stomach and produce
carcinogenic acetaldehyde from sugar and alcohol. In 2009, IARC (WHO agency on
cancer research) classified acetaldehyde from alcoholic beverages (and
naturally generated in alcohol) as group I carcinogen, being therefore as
carcinogenic as asbestos, formaldehyde and benzene. (3). According to genetic
studies this is one of the major risk factors of gastric and oesophageal
cancer. The risk can be reduced with the help of another Finnish innovation -
OTC product Acetium capsule, which are taken during meals and alcohol
consumption, to bind (neutralise) carcinogenic acetaldehyde in the stomach. 

GastroPanel provides an opportunity to direct the patients to correct
examinations on time. GastroPanel reliably finds those patients whose stomach
is "healthy" (patiens do not have H. pylori infection or acid-free stomach due
to atrophic gastritis. GastroPanel blood test can therefore in most cases
replace the expensive and uncomfortable gastroscopy. GastroPanel results in
significant resource and cost savings in healthcare. 

Literature:
1. Malfertheiner P et al. Management of Helicobacter pylori infection--the
Maastricht IV/ Florence Consensus Report. http://gut.bmj.com on May 18, 2012.
European H. pylori Study Group, ESPSG. 
2. Agréus L et al. Rationale in diagnosis and screening of atrophic gastritis
with stomach-specific plasma biomarkers. Scand J Gastroenterol 2012;47:136-47. 
3. World Health Organisation WHO, 2009.
www.iarc.fr/en/media-centre/pr/2009/pdfs/pr196_E.pdf

Attachments:

CV Liu Zhen.pdf

CV Liu Feng.pdf