Respiri finds cheaper production partner for asthma management device

Special Report: Respiri Limited (ASX:RSH) has struck a manufacturing partnership where its wheezo asthma management devices will be made in China for a fraction of the cost.

Devon Park, South Australia-based Entech Electronics has already begun production preparation activities for delivering 12,000 wheezo devices from February.

The asthma management tools will be made in Entech’s production facilities in Shenzhen, China, which has more than 200 staff.

The partnership will enable Respiri to scale production significantly and quickly to meet forecast global demand, the company says.

Wheezos will be able to be manufactured at less one-sixth of the cost that Respiri was paying before, the company says.

That’s due to design optimisation measures related to the device, its assembly, testing paramaters and the cost reductions associated with moving to a low-cost location.

The costs are forecast to fall further on the back of volume over time, Respiri says.

“We are delighted to partner with Entech Electronics as they are well placed to support our global product volume requirements at cost positions that support Respiri’s business model,” said Respiri chief executive and managing director Marjan Mikel.

Entech chief executive Wayne Hoffman says the 34-year-old company has both medical device experience and electronic manufacturing competence and will be able to accommodate monthly requirements “well in excess” of 10,000 devices.

Device validated

As previously reported, Resiri has clinical trials that back up the wheezo device, which detects “wheeze” and measures its severity.

The company also last month inked a deal with the Australian Patients Association to sell the device to its members and in July signed a sales and distribution deal with multinational corporation Cipla.

Mikel also says that the small-cap company has been benefiting from a trend towards prevention and monitoring as health insurers seek to keep members out of the increasingly expensive hospital system.

This article was developed in collaboration with Respiri, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.