Bluechiip featured in a case study for the Australian R&D tax incentive programme

Smart chips, readers and software for low‑temperature environments prove a winning formula for Melbourne‑based manufacturing company

Bluechiip has been featured in a case study for the Australian R&D tax incentive programme. Read the full article below:

A 13 year‑long R&D journey has resulted in an innovative technology ripe to disrupt an “exploding market”.

Company Profile

Company: Bluechiip Ltd
Sector: Manufacturing
Location: Melbourne
Profile: Based on the early ideas of a Professor at RMIT, Bluechiip Ltd has developed an IT‑based temperature and identification tracking solution for biosamples in the health and life sciences industry.


Why R&D is Needed

Bluechiip® Ltd’s world‑first technology represents a generational change from current ways of labelling and monitoring vials in cold storage areas. Where handwritten and pre‑printed labels, barcodes and RFID (Radio Frequency Identification) have long been the norm for laboratories and storage facilities, they have not been without issues. Problems reading handwriting, label glues not working at cold temperatures and barcodes with frost on them have long been bugbears of these scientific environments.

In addition to solving these issues with their miniaturized smart chips, the Melbourne company’s technology has additional advantages over more traditional identification technologies.

For example, whereas a barcode requires a visible tag or line‑of‑sight optical scan, Bluechiip® technology does not; and unlike other tagging systems, the technology can sense the temperature and ID of each individual biosample a smart chip is attached to or embedded in.

Taken together, this means Bluechiip® provides more information, improves productivity, prevents mistakes and is more accurate than the status‑quo.

Managing Director of Bluechiip® Ltd Andrew McLellan says every time a smart chip is read, an instantaneous temperature is measured, time stamped and recorded.

This allows an accurate temperature history to be recorded to provide a more complete chain of custody. The smart chip will survive and operate in extreme temperature environments such as cryogenic storage, making it suitable for biobank applications. It is also not affected by gamma irradiation.

The company also provides the readers and software that facilitate the tracking of vials and their contents.

Designed, engineered and partially manufactured in Australia, Bluechiip’s chips, readers and software are now commercially available. The company recently signed a licensed Original Equipment Manufacturer (OEM) partnership with an American company, which recently placed orders for the company’s products and services valued at over A$1 million.

While it has been an intense R&D journey to get to this stage, Mr McLellan says the company is only about two‑thirds of the way into its R&D vision.

“Internationally this is a $2 billion market, but we believe our immediate market is $250‑$300 million.”


“So far we’ve had a huge focus on core chip technology that has taken a lot of investment. More than $20 million has been invested in the company since we listed in 2011. We know, however, that the market for our technology is enormous,” he explains.

“Approximately 300 million samples are put into ‑80°C freezers or a ‑196°C liquid nitrogen tank annually and as the market increases in genetics and gene work it will explode further.”

Going beyond initial applications in the healthcare industry, particularly those businesses which require cryogenic storage facilities (biobanks and biorepositories), untapped markets also include cold‑chain logistics/supply chains, security/defence, industrial/manufacturing and aerospace/aviation. Bluechiip® ltd is extremely well‑placed to step in to these markets.


How the Research and Development Tax Incentive Helps

Mr McLellan says the company’s participation in the RDTI has delivered a number of benefits, the most important being its financial survival.

“As a pre‑commercial company the RDTI allowed us to survive. Without it we wouldn’t be around…Knowing the RDTI is there allows us to manage our cash flow and it has allowed us to pinpoint the timing of our capital raises around events and critical milestones rather than when we’ve needed cash,” Mr McLellan says.

The RDTI program has also increased the company’s R&D activities by about 20%, provided salaries for eight critical staff members, enabled collaborations with the University of Melbourne and Swinburne University and helped facilitate entry into the US and European Union markets.

“[As a result of the RDTI] we’re now protected by 25 granted patents for the over $2 billion global preservation market.”

“It has allowed us to scale more readily into product development, which we wouldn’t otherwise have been able to do…We’ve some fantastic IP and we’ve got our foot on it. That IP is going to generate value and that value comes back to Australia.”


In addition to the financial returns the company is making, additional benefits include the customer benefits, employment of software engineers and mechatronics and engineering experts, knowledge expansion via two post‑doctoral projects and two PhDs, and subcontracting to Australian‑based manufacturing partners.


RDTI Impact Facts

  • Helped attract over $20 million of capital since listing in 2011
  • Facilitated a world‑first technology that is leading to millions of unit sales internationally
  • Employment growth of eight staff and external manufacturing/design projects
  • Collaborations with University of Melbourne and Swinburne University
  • Secured over 25 patents
  • Supported the company’s entry into a $2 billion market
  • Increased R&D budget by 20%