NEW YORK (GenomeWeb News) – Rosetta Genomics said today it is terminating a licensing deal with Avatao Biotech, accusing the Chinese diagnostic firm of material breach of an agreement.
The Israel-based molecular diagnostics firm said in a document filed with the US Securities and Exchange Commission that it delivered notice to Avatao on June 12 of its decision to terminate an agreement reached by the two companies in October covering China.
Specifically, Rosetta said Avatao failed to make timely payments to Rosetta under the terms of the agreement; failed to "use commercially reasonable efforts to bring the licensed tests to market"; and failed to achieve diligence milestones.
Rosetta said the agreement allows it to terminate the agreement immediately if certain terms are not met, and upon termination all licenses to Avatao will be terminated and Avatao will have to transfer back to Rosetta ownership of any registered patents or patent applications and property that Avatao received from Rosetta.
The deal between the two companies gave Avatao exclusive rights to market Rosetta's miRview mets and miRview mets2 diagnostic tests in China. Avatao also had the rights to market an additional Rosetta product in China, to be chosen within one year. In addition to China, the deal covered Hong Kong, Macau, and Taiwan.
Avatao is supported by Kunshan microRNA Institute, which focuses on microRNA technologies.