Microbix Biosystems Inc. Announces Fiscal 2005 Results: Year Highlighted By Sales Growth, Profitability, Infrastructure Investment And Acquisition Of A High-Value Technology

TORONTO, Dec. 7 /PRNewswire-FirstCall/ - Microbix Biosystems Inc. today announced financial results for the year ended September 30, 2005.

Microbix recorded record sales - up 8% on the year - even though the fourth quarter was down compared to a very strong performance in the same period a year earlier. Sales growth came from a solid core business, development contracts, and fees related to the Company's Vaccine Yield Enhancement Technology. Net profit for fiscal 2005 was $125,526 compared to $9,146 in fiscal 2004.

The strong financial results allowed the Company to continue its significant investments in manufacturing infrastructure and research and development, and to fund the acquisition of Sequent Biotechnologies Inc. (Sequent), a private company.

Quarter ended Sept. 30 Year Ended Sept. 30 2005 2004 2005 2004 ------------------------------------------------------------------------- Revenue $ 964,326 $1,683,143 $4,376,579 $4,067,438 ------------------------------------------------------------------------- Net Profit (loss) $ (118,193) $ 490,896 $ 125,526 $ 9,146 ------------------------------------------------------------------------- Net Profit (loss) Per Share $ (0.00) $ 0.01 $ 0.00 $ 0.00 ------------------------------------------------------------------------- Cash flow $ (254,195) $ 483,993 $ (17,636) $ 745,758 -------------------------------------------------------------------------

Microbix' lead biotherapeutic product Urokinase was licensed to Genpharm Inc., an affiliate of the Merck Generics Group, in late 2002. Microbix continues to pursue this product opportunity, including assessing new market opportunities for the drug, and the two companies continue to dedicate resources on this product.

Continued strong industry interest resulted in a second agreement to evaluate the Company's proprietary Vaccine Technology by an international vaccine company. Despite results pointing to a successful evaluation, Microbix ceased negotiations on an exclusive license after an extension of the original agreement. Subsequent to year-end, the Company announced that an independent, influenza research laboratory would be evaluating the technology to confirm the stated viral yield enhancement.

Microbix' technology has the potential to significantly increase production yields of influenza vaccines. This would be an important breakthrough in combating a possible future flu pandemic since annual vaccine production capacity is currently only about 300 million doses worldwide. "With growing concerns about a coming pandemic, a vaccine capacity shortage, and increased demand funded by governments, our technology would be of huge benefit if adopted by the flu vaccine industry", said William J. Gastle President and CEO. Results of the independent evaluation are expected within six months.

A major development in fiscal 2005 was the completion of the evaluation of the non-therapeutic Sperm Sexing Technology (SST). The Company bought the worldwide rights to the technology from the University of Guelph through the acquisition of Sequent. This technology is another high value proprietary biological with a substantial market potential for shareholders. With an existing artificial insemination industry distribution network serving a $3 billion market and no regulatory constraints, this opportunity is seen as a potential blockbuster.

The core business grew by 47% in 2005, and this positive trend is expected to continue in fiscal 2006. "We are enjoying the results of continued investment in product development as the number of our large customers expands and the volume of product they are using increases year over year," said Mr. Gastle.

Microbix specializes in developing proprietary biological technologies and then commercializing those technologies through global partners. Its products include biotherapeutic drugs, vaccines, and infectious disease diagnostics. Its objective during the next decade is to develop a pipeline of products and technologies for what is expected to be a multi-billion dollar biologics market worldwide. Established in 1988, Microbix is headquartered in Toronto.

This press release contains forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in the forward-looking statements. These forward-looking statements represent the Company's judgment as of the date of this press release. The Company disclaims any intent or obligation to update these forward-looking statements.

Microbix Biosystems Inc.

CONTACT: visit www.microbix.com or contact: William Gastle, President andCEO, Microbix Biosystems Inc., (416) 234-1624 x 230