Shares in Compumedics have soared after the company said it plans to form a joint venture with a China-based health check organisation that will purchase one million of its sleep monitoring devices.
The proposed joint venture with Meinian Onehealth Healthcare Holdings, known as Health 100, will commercialise Compumedics' Somfit device - a wearable system for monitoring sleep.
The medical device company will be paid $11.3 million as part of the joint venture deal, mostly for intellectual property and technology rights for Somfit.
The two companies will work together over the next 90 days to finalise the proposed joint venture, and Health 100 has committed to purchasing one million Somfit devices for the China market over two years, once the product receives regulatory approval.
Health 100 offers professional medical examinations across a range of healthcare areas and has 400 medical and physical examination centres in provinces and cities throughout China.
Compumedics chairman and chief executive David Burton said the company had been in discussions with Health 100 for some time, and the signing of the framework agreement was the first formal step to commercialising the Somfit technology.
The product allows consumers to access personalised management of sleep measures based on sleep analytics.
"Getting to this point has taken Compumedics 30 years of product and technology innovation and development, and together with Health 100, we will make history transforming health and leading the way of the future for primary, secondary and tertiary community-wide healthcare," said Dr Burton, who is the company's major shareholder.
Compumedics shares soared 76 per cent to hit a one year high of 72 cents on Thursday, and at 1345 AEST were up 26 cents, or 63.4 per cent, at 67 cents.
The lift bumped has added more than $40 million to the company's market value, which was $72.6 million on Wednesday.
