(Yicai) Oct. 13 -- MGI Tech’s stock price rose after the Chinese supplier of gene-sequencing gear agreed to license the regional marketing rights for its CoolMPS technology to Swiss Rockets for USD120 million.

After jumping by as much as 9 percent in morning trading, MGI [SHA: 688114] ended today 5 percent higher at CNY72.35 (USD10.14) per share, while the wider Shanghai market declined on concerns over a possible re-escalation of the China-US trade war. MGI’s stock is up 55 percent since the end of last year.

Two MGI subsidiaries signed the deal with Swiss Rockets granting it exclusive licensing rights to CoolMPS and related sequencing products and technologies for territories outside of China and the Asia-Pacific region, their Shenzhen-based parent company announced yesterday.

MGI said the deal will enable it to monetize CoolMPS without additional investment in research, development, and marketing, bringing in considerable immediate profit and long-term, stable cash flow, while also freeing resources to focus on other core technologies such as StandardMPS and other key markets.

Under the deal, Basel-based Swiss Rockets gets the exclusive rights to CoolMPS-related patents, technical know-how, and trademarks, and a non-exclusive licence for the broader sequencing platform technology limited to applications in the field of CoolMPS products.

It also has the right to choose to further expand the deal to cover all global regions at a mutually agreed price by the end of next year.

MGI’s two units will receive no less than USD120 million throughout the licensing term. That includes a one-time non-refundable upfront payment of USD20 million, a milestone payment of USD20 million, and royalties equal to a certain percentage on net sales on a tiered basis.

They will be responsible for the technology transfer, product R&D, and technical support for CoolMPS, while Swiss Rockets will take charge of the development and commercialization of CoolMPS sequencing products.

CoolMPS is one of MGI’s high-throughput sequencing technologies. Compared with the traditional fluorescent direct-labeled nucleotide technology, CoolMPS effectively improves the accuracy of sequencing data and extends the sequencing read length.

Founded in 2018, Swiss Rockets is a biotech incubator and accelerator that develops and commercializes new therapies for cancer, infectious diseases, and autoimmune disorders. Emergent BioSolutions, a New York-listed specialty biopharma company, invested in the firm this March.

Editor: Futura Costaglione