Under the agreement, PositiveID will license its iglucose wireless diabetes management technology to Smart Glucose Meter for up to $2m, based on potential future revenues of glucose test strips sold by SGMC.

PositiveID said the revenues will range between $0.0025 and $0.005 per strip.

PositiveID chairman and CEO William Caragol said with the purchase of Microfluidic Systems in 2011, the company began a corporate realignment to focus on patented molecular diagnostic technologies for bio-threat detection and rapid medical testing.

"This was done in order to position the Company to target the current and significant market opportunities in these sectors and take advantage of the detection and cost advantages we believe our technology provides," Caragol added.

"To date, we have achieved real results as part of this restructuring, including the sale of our implantable microchip IP and related assets, a significant reduction of our cash burn, and now the license of our iglucose wireless diabetes management technology, which we believe is another important milestone in this process."