TORONTO, Oct. 29 /PRNewswire-FirstCall/ - Microbix Biosystems Inc. a virology and biological technology company with a near-term pipeline of proprietary products, today provided an update on its corporate activities.
For the fiscal year ended September 30, 2009, Microbix reported revenues of $6 million, a 23 percent increase over the previous year (unaudited), in its core business of providing biological products to the diagnostic and research industries. Continued growth in the core business will result in the Company becoming cash-flow positive in the very near future, reducing the need for other financings that dilute shareholder value.
William J Gastle, Microbix chairman and CEO, said, “In 2010, Microbix will be poised to take the largest step forward in its 20-year history. This growth will be fuelled by our announcement this week that the company has completed the initial financing for our joint venture with Hunan to build the world’s third largest influenza vaccine facility; the approval of KINLYTIC in Canada and other markets, and partnership agreements for our semen sexing technology (SST) for livestock management. We have strong opportunities for growth in new areas with a growing and profitable base business serving the medical diagnostic industry.”
Microbix continues to invest wisely in its core business such as its new Watline production facility which has improved efficiency, capacity, and capability and promises to lead it to profitability during 2010. In addition, management has made strong process improvements, launched a new virology production line, and plans to offer more products and container sizes to grow its water-for-injection business.
With a strong and profitable base, Microbix’ greatest opportunities to grow the Company and increase shareholder value are found in its pipeline programs with three near-term opportunities each of which could generate annual revenues of $50M to $100M.
Pandemic and Seasonal Influenza Manufacturing: VIRUSMAX
-------------------------------------------------------
Earlier this week, Microbix announced it signed a joint venture agreement with the Hunan Biopharmaceutical Co. Ltd. (a Hunan Province state-owned enterprise) for initial financing to construct Asia’s largest influenza vaccine production facility and the third largest vaccine plant in the world.
The facility, for which construction will begin in early 2010 and be fully operational by 2013, will be designed around Microbix VIRUSMAX(TM) vaccine technology. More than five years in development at Microbix, VIRUSMAX is designed to increase influenza vaccine yields and has demonstrated an average yield increase of two-fold over current production methods.
The agreement forms an equal partnership joint venture to build and operate a state-of-the-art influenza vaccine facility, located in Changsha National Biomedical Park near Changsha City, the capital of Hunan Province, which will have the capacity to produce more than 100 million doses of seasonal influenza vaccine annually, and up to 300 million doses of a pandemic influenza vaccine in the event of an outbreak to immunize against a single strain of influenza.
Commenting on this company milestone, William J. Gastle, Microbix Chairman and CEO, said, “We’re pleased that our innovative VIRUSMAX influenza vaccine technology will contribute significantly to seasonal and pandemic influenza preparedness in the future.”
Gastle added, “The Microbix-Hunan initiative will make China an important source of influenza vaccine in the Asia region as well as offering significant capacity for the Chinese market which is growing significantly. In five years, the China market is expected to demand up to 500 million influenza vaccine doses annually.”
A substantial investment is being made by Hunan in transferring the land to the joint venture and building the facility through the first phase of financing. As the project progresses, Hunan has agreed to provide additional funding through debt and has guaranteed the purchase of 100 million influenza vaccine doses. On all vaccine produced at the facility, Microbix will receive royalty payments. Microbix also holds exclusive marketing rights outside China.
Microbix expects other opportunities for VIRUSMAX licensing, partnerships and joint ventures will be forthcoming.
Thrombolytic Agent for Pulmonary Embolism: KINLYTIC
---------------------------------------------------
Microbix is actively pursuing Canadian regulatory approval of Kinlytic for pulmonary embolism. Discussions are also underway with other companies to license the new indications in ophthalmology, urology, and oncology. Microbix is also in discussions with potential regional partners to manufacture and market Kinlytic for markets beyond North America. The company’s Skyway production facility when fully operational would have the capacity to manufacture nearly $70 million worth of product per year.
Semen Sexing Technology: SST
----------------------------
Microbix’ Semen Sexing Technology (SST) will enable producers of dairy, swine and beef animals to predetermine the sex of offspring prior to conception, thereby maximizing productivity, profitability, and genetic potential. In virtually every sector of commercial animal breeding, there is clear preference for one sex over the other. In addition, its SST technology does not involve genetic modification, is non-invasive, and will not require regulatory approval.
Its semen sexing program has emerged from Microbix’ initial research phase that led to patent applications designed to provide full intellectual property exclusivity. With SST, the Company expects to enter and garner a significant market share in the multi-billion dollar unregulated market for companies in the animal health field and livestock industries.
While discussions to finance completion of development of the semen sexing technology are ongoing, approximately 25 percent of the dairy semen collection centres are already under agreement with Microbix to implement this technology once ready. Microbix forecasts more than $140 million in SST revenues that would be shared with its partners within three years of launch.
Microbix is also advancing discussions for SST development partners with several global animal health companies.
Mark A. Cochran Added To Management
-----------------------------------
Mark A. Cochran, a director and consultant to Microbix, recently joined our management team to help us drive our pipeline products to commercialization and forge licensing agreements and joint ventures. Dr. Cochran, our Chief Business Officer, brings to us professional experience that spans all levels of the drug discovery and development value chain including operational and executive roles in venture capital, pharmaceutical and biotechnology industries. His previous experience includes Bayer Pharmaceuticals, where he last served as Vice President of Business Development for Biotechnology. Dr. Cochran also served as CEO and executive director of the Blanchette Rockefeller Neurosciences Institute; and was a senior member of MDS Capital, a Toronto-based Healthcare venture capital group, where he was responsible for their San Francisco venture business and several MDS invested companies. Dr. Cochran holds a doctorate in microbiology and immunology from Queen’s University, Kingston, Ontario; a master’s in microbiology from the University of Guelph, Ontario, and a bachelor’s degree from the University of Toronto.
Summary
-------
Microbix is on the threshold of significant growth powered by the following expected developments within the year:
Microbix has the people, the products and the pipeline to deliver on the goals of its business strategy and significantly build shareholder value. The Company thanks its employees for their efforts, its partners for their interest and its shareholders for their continued support.
About Microbix
--------------
Microbix specializes in the development of biological technologies and commercializing them through global partners. The Company has intellectual property in large market biotherapeutic drugs, vaccine technologies and animal reproduction technologies. 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 including the risks associated with failure to get regulatory approval, and release, of Kinlytic (TM)for distribution; inability to close financing for the Microbix-Hunan project; risks associated with commercializing the technologies including sales may not reach sales targets or be made at all, there is no guarantee that the Company will complete development of any technology and if it does that it will perform to commercially exploitable levels, other technologies may emerge before any technology developed by the Company enters the market, royalty rates may not be achievable, markets may not sustain demand for any product should world economies shift significantly, market utilization rates may not be reached, market value of products may vary, product launch dates and market utilization timetables may not be met; risks associated with the ability to license VIRUSMAX to industry; risks associated with failure to develop and commercialize SST; non-adoption of SST; competition in Microbix’ core business; general economic conditions; intellectual property risks including challenges to protecting the Company’s intellectual property rights, patents may not provide adequate protection of the Company’s intellectual property, may not be successfully prosecuted and may be subject to challenge and risks of infringement of third party rights; risks of operating in foreign jurisdictions, including operating in China with its evolving legal and economic infrastructure and the involvement of the Chinese government departments at national, state and local levels in business and economic matters; creating risks associated with various levels of political and economic conditions and other risks including but not limited to, currency exchange rates and restrictions on foreign exchange; high rates of inflation; renegotiation or nullification of existing licenses, permits and contracts; changes in taxation policies; risks associated with repatriation of profits and changing political conditions and governmental regulations; development of competing technologies in all of its business lines, and Microbix’ ability to attract and retain qualified employees and management. 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.
CONTACT: visit www.microbix.com or contact: William J. Gastle, CEO,
Microbix Biosystems Inc., (416) 234-1624 x 230; James Long, CFO, Microbix
Biosystems Inc., (416) 234-1624 x 265
