The two will form a Polish joint-stock company, Verisante Technology Europe S.A., to develop a detection system for the upper gastrointestinal system, including everything from the esophagus to the stomach and first section of the small intestine.
The companies hope the new technology will be able to identify lesions at pre-cancerous stages, helping detect cancers earlier and manage pre-malignant conditions such as Barrett’s esophagus.
Under the letter of intent, still pending a definitive agreement, VTE will get exclusive worldwide rights to develop Verisante’s technology for use in the upper gastrointestinal system. VTE will pay 3% royalties on instrument sales as well as dish out a $1 million lump payment upon European regulatory approval.
The newly formed VTE is also on the hook to dig up its own financing up to $2.5 million dollars, after which Astoria will help raise capital. VTE plans to seek E.U. grant funding, and the company is also planning on opening on the Warsaw Stock Exchange at some point, yet to be determined, according to a press release.
Astoria will own 70% of the total equity in the new company and Verisante will hold 25%. The remaining 5% of the new firm is reserved for managers and board members to be assigned by Verisante.