TORONTO, October 13, 2011 – Microbix Biosystems Inc. (TSX:MBX), a biotechnology company that produces a wide range of infectious disease antigens, in addition to developing its new product pipeline, updated investors today on its current business activities.
In spite of the challenging business climate, and the strong Canadian dollar, Microbix’ Virology and water-based businesses are continuing to build a solid foundation for growth in 2012. Microbix occupies a prominent position in the infectious disease diagnostic market for hospitals and laboratory based testing, research centers and point-of-sale test kits. Demand for one of Microbix’ products, Dengue virus antigens, has been increasing due to a broader outbreak of Dengue Fever in the southernmost part of the U.S. Microbix is one of the only suppliers of native Dengue virus for the diagnostic industry.
The Company’s partnership with Therapure Biopharma to contract-manufacture specialty water based products, has been expanded with a new product offering and greater capacity to increase access to these markets. Microbix expects strong growth for its water-based business in 2012.
William J. Gastle, Chief Executive Officer, said “If you take a snapshot of Microbix today and compare it to any time in our 20 year history, you’ll see a more diversified, global company that holds a high-probability of success for one or more of our three lucrative pipeline products. Unlike many others less diversified companies, our future success is not focused on one drug approval or landing one major account.” Mr. Gastle added, “I want to share my confidence with you on our continued success, along with the potential of turning one of our pipeline products into a major success.”
Pipeline Overview
For the past 15 years, cash flow generated from the Company’s Virology business has helped fund the development of the new product pipeline and has allowed Microbix to reduce its equity financing requirements for development activities.
VIRUSMAX and China Venture
Microbix is attempting to renegotiate key terms of the Joint Venture Agreement with its partner Hunan Biopharmaceutical Co. Ltd. (a state-owned enterprise). The original agreement was signed in 2008 to build and operate a large influenza vaccine production facility in Hunan Province utilizing Microbix’ vaccine production enhancement technology, VIRUSMAX. Microbix remains optimistic that this project will continue based on high-level talks with Chinese and Asian government entities that have expressed interest in locating the facility in their jurisdiction, as well as with Hunan officials.
The fundamental driver of this project remains the same - China has an extreme deficiency of flu vaccine supply. To reach standard rates of vaccination seen in the West, China needs to substantially increase capacity. The optimized manufacturing technology resulting from the use of VIRUSMAX will be a key element to closing the gap between supply and public health needs in Asia.
While Microbix continues to pursue its options in China and other locations in Asia, interested private investors remain committed to this venture. Meanwhile the risk of a pandemic remains elevated as recent influenza strains have emerged, that if recombined in the same individual, could precipitate a rapid dissemination of influenza infection worldwide.
LumiSort
Microbix is now in the process of raising funds to complete the development and commercialization of the LumiSort technology. Interest has been expressed by several different parties including potential strategic industry partners.
In the coming weeks Management is attending important 2011 AgriTech investor and industry meetings including, the Banff Investor Forum in October and the World Animal Health Congress in December.
LumiSort is expected to be ready to market within two years and become market leader by revolutionizing practices in the livestock artificial insemination industry. LumiSort is a proprietary technology that will improve the yield and quality of sexed semen by an order of magnitude over methods used in the livestock industry today. The technology incorporates a novel and innovative instrument design to address fundamental problems with existing commercial sex selection technologies, while providing Microbix with a strong and well differentiated benefit to farmers.
In August 2011, Microbix solidified its future potential market position for LumiSort when it received a patent for its technology from the U.S. Patent and Trademark Office. This latest development has resulted in significant interest being expressed by several parties concerning potential partnership opportunities. During these meetings, Microbix has confirmed a market for LumiSort in excess of $3 billion. Currently the sexed semen market is underserved.
Microbix has already established agreements for licensing the LumiSort technology to companies located in the United States, Canada, Australia, Europe, South America, and China representing more than 40 million straws of the dairy semen sold annually and a market of $ 900 million. These agreements include royalty payments to Microbix of 15% of sales of sexed semen and could represent over $ 100 million annually in revenues. The company is preparing to sign additional license agreements as more semen distribution companies have been approaching Microbix. Microbix is also in late stage discussions with cytometer companies to build the instrument.
Urokinase
The Company continues discussions to partner Urokinase, its blood clot therapy, with two large pharmaceutical companies. The Company has also extended its agreement with a pharmaceutical industry consulting group to identify other potential Urokinase partners based on their specialized experience in pharmaceutical licensing and acquisitions. Urokinase is already approved for use in the thrombolytic market, and it has a long history of successful treatment of thrombi and catheter clearing in the US and Canadian markets. The required investment is modest compared to development of a new drug with similar market potential. Urokinase has potential applications in oncology, ophthalmology, deep vein thrombosis, catheter clearing and stroke.
Microbix Website
After many years a new website was launched at the end of September. This refreshed web presence with easy-click navigation and faster access to updated development and product information will facilitate access to key information for customers and investors alike.
About Microbix Biosystems Inc.
Microbix Biosystems Inc. specializes in the development of the most advanced vaccine production technology and markets virology and biological products worldwide. The Company has intellectual property in large market biotherapeutic drugs, vaccine technologies and animal reproduction technologies. Microbix supplies customers in the U.S., Europe, and Asia. Established in 1988, Microbix is headquartered in Toronto.
Disclaimer
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 commercializing the technologies, including sales which 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 LumiSort to industry; risks associated with failure to develop and commercialize LumiSort; non-adoption of LumiSort; competition in the animal health and related markets; reliance by Microbix on third parties for the development and manufacture of LumiSort instrument; 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 countries with evolving legal and economic infrastructure; high rates of inflation; changes in taxation policies, 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.
For further information:
Visit www.microbix.com or contact: William J. Gastle, CEO, (416) 234-1624 x 230; or James Long, CFO, (416) 234-1624 x 265