SINGAPORE: Biolidics Limited  entered into a distribution agreement with Aytu Bioscience, Inc. to appoint Aytu as an exclusive distributor for the Company’s rapid test kits for the Novel Coronavirus 2019 (“COVID-19 Rapid Test Kits”), in the United States of America (“USA”) for a duration of one year with an option for an additional one-year term.

Aytu will be tasked to handle all inbound logistics, sales and marketing operations and regulatory matters, and as such provide the infrastructure in the USA for the Company. The Company retains the right to sell the COVID-19 Rapid Test Kits directly to certain clinical partners in the USA.

Under the terms of the Agreement, Aytu has a binding commitment to purchase from the Company an initial 500,000 COVID-19 Rapid Test Kits within one business day from the date of the Agreement.

Aytu is required to purchase from the Company no less than 1,250,000 COVID-19 Rapid Test Kits within the first three months from the date of the Agreement in order to retain exclusivity (the “Minimum Exclusive Commitment”). All third party orders arising from Biolidics’ own referrals and sales will not be included in this Minimum Exclusive Commitment.

Further, Aytu shall pay for and lead the clinical trials processes, to complete and obtain regulatory clearance for the COVID-19 Rapid Test Kits from the U.S. Food and Drug Administration, a federal agency of the United States Department of Health and Human Services, during the term of the Agreement.

If Aytu completes the Clearance, Aytu shall maintain exclusivity for the remainder of the term of the Agreement. Completing the Clearance allows the Company to sell its COVID-19 Rapid Test Kits in the USA in addition to the current completed Section IV.D of the “Policy for Diagnostic Tests for Coronavirus Disease-2019 during the Public Health Emergency.

The Policy was implemented by the Secretary of Health and Human Services of the USA to help rapidly expand testing capacity by facilitating the development and use of SARS-CoV-2 diagnostic tests during the public health emergency, and may be terminated after the period of the public health emergency.

Listed on NASDAQ, Aytu is a specialty pharmaceutical company focused on global commercialization of novel products addressing significant medical needs such as hypogonadism (low testosterone), cough and upper respiratory symptoms, insomnia, and male infertility.

The Agreement is likely to contribute positively to the revenue of the Company for the current financial year ending 31 December 2020. However, the Company is unable to quantify the financial impact as there are no minimum purchase quantities beyond the first three months of the Agreement.