OMEGA Diagnostics Group could create up to 40 jobs in Scotland after receiving £150,000 funding to develop its new test for monitoring patients with HIV.
The posts will be added over the next three years at the medical diagnostics and allergy testing firm's headquarters in Alva, Clackmannanshire.
Scottish Enterprise is providing the money through a Regional Selective Assistance grant which will be paid out in three tranches dependent on Omega meeting employment and capital expenditure targets.
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Omega, headed by founder and chief executive Andrew Shepherd, said: "It is expected a first instalment of £32,000 will be received in the current financial year."
Omega intends to scale up manufacturing facilities for the CD4 test with plans to produce commercial quantities before the end of the financial year.
The first phase involves converting part of its existing facility to meet the initial requests from customer with a second phase to expand the site further if demand increases as projected.
The CD4 test was developed by the Burnet Institute in Melbourne, Australia, and was exclusively licensed by Omega earlier this year.
The portable kit costs up to $8 and determines whether an HIV patient's white blood cell count has fallen to a level where retroviral drug treatment is needed.
Tests currently have to be carried out centrally in laboratories because of the processes involved.
Omega believes there is great potential to sell CD4 into developing countries, where there are estimated to be more than 25 million HIV-positive individuals.
The instant results allow treatment to begin straight away, with Omega hoping to attract interest from inter-national aid organisations.
Omega's nominated adviser Seymour Pierce hailed the "positive news".
In a note it said: "CD4 testing is a bottleneck in starting anti-HIV drug therapy, particularly in emerging economies with low-resource healthcare systems.
"A convenient, low-cost point-of-care (POC) test would be a boon for healthcare workers in helping identify HIV-positive sufferers with declining CD4 counts.
"[Omega's] test is set to be the only lower cost, low complexity POC test on the market."
Omega employs 32 of its 120 staff at Alva.
Last month it warned half-year revenues were likely to be flat due to difficult trading conditions in Germany.
Shares in Omega ended the day up 0.12p at 14.12p.