Bioniche Receives $10 Million of Provincial Government Support to Scale-up Vaccine Production in Ontario



    - funding from the Advanced Manufacturing Investment Strategy program -

    BELLEVILLE, ON, Dec. 18 /CNW/ - Bioniche Life Sciences Inc. (TSX: BNC), a
research-based, technology-driven Canadian biopharmaceutical company, today
announced that it has received $10 million in Ontario government financing in
support of its vaccine production facility scale-up in Belleville, Ontario.
The $10 million repayable loan has been provided through the Ministry of
Economic Development and Trade (MEDT)'s Advanced Manufacturing Investment
Strategy (AMIS). MEDT Minister Sandra Pupatello, in conjunction with Ontario
Minister of Agriculture, Food and Rural Affairs, Leona Dombrowsky, made the
announcement at Bioniche's Belleville headquarters this morning.
    "With the support of our AMIS program, Bioniche will become the first
company to bring innovation-driven animal vaccine expertise to Ontario," said
Minister Pupatello. "The McGuinty government is investing in this kind of
advanced manufacturing across key sectors to spur major investment and create
high value jobs for hard working Ontarians, including 73 right here at
Bioniche."
    Added Minister Dombrowsky, "Our government is helping to position Ontario
as a leader in animal and food safety technology and expertise. This funding
support is good news for the community of Belleville and for our province's
agri-food sector."
    Bioniche has developed the world's first and only cattle vaccine that may
be used as an on-farm intervention to reduce the amount of E. coli O157:H7
shed by cattle. This will be the first product manufactured in the scaled-up
production facility in Belleville. The vaccine is unique in that it helps to
reduce shedding of an organism that, while potentially lethal to humans,
causes no disease in cattle. The Company obtained approval to distribute its
vaccine under the Permit to Release Veterinary Biologics regulations by the
Canadian Food Inspection Agency (CFIA) last December.
    The Company plans to scale-up vaccine production at its Belleville
facility over the next two years to provide capacity of 40 million doses of
the E. coli O157:H7 vaccine. The scale-up is expected to cost approximately
$25 million, and is part of a long-term, $100 million project to create an
Animal Health and Food Safety Vaccine Manufacturing Centre. Financing for the
remainder of the $25 million for the first phase of scale-up is in the process
of being secured from other sources, the details of which will be announced
when finalized.
    "This provincial government funding represents the cornerstone of the
financing we need to achieve our vision for a state-of-the-art vaccine
manufacturing facility to produce not only our E. coli O157:H7 cattle vaccine,
but other vaccines to reduce the likelihood of human illness from animal
diseases," said Graeme McRae, President & CEO of Bioniche Life Sciences Inc.
"The Ontario Ministry of Economic Development and Trade, through AMIS, has
given a strong endorsement to our efforts to address serious human health
threats that cause illness and death in thousands of people each and every
year."
    Approximately 100,000 cases of human infection with the E. coli O157:H7
bacteria are reported each year in North America. Health reports indicate that
2% to 7% of those people develop hemolytic uremic syndrome (HUS), a disease
characterized by kidney failure. However, the percentage of HUS has risen to
as much as 16% in recent outbreaks. Approximately five percent of HUS patients
die, many of them children and senior citizens, whose kidneys are more
sensitive to damage. Surviving persons may also be left with long-term
impairment to the function of their kidneys and other organ systems.
    The most serious case of E. coli O157:H7 water contamination in Canadian
history occurred in Walkerton, Ontario, Canada (population: 5,000) in May,
2000. Walkerton is approximately 145 km west of Toronto. After heavy storms
and flooding, E. coli contaminated run-off from farms entered the town water
supply, where it was later discovered that purification systems/processes had
broken down. Seven people died directly from E. coli, another 14 elderly
people died of E. coli complications, and at least 2,300 people (more than 40%
of the population at the time) became ill. One of the farms whose cattle were
implicated in the contamination belongs to Dr. David Biesenthal, a
veterinarian who was already adhering to the best herd management practices
then available. Dr. Biesenthal is one of the first adopters of a vaccination
program using the Bioniche E. coli O157:H7 cattle vaccine.
    "I feel that this is another defense mechanism in reducing the likelihood
of E. coli O157:H7 contaminating the environment," said Dr. Biesenthal. "It
assists us in the agricultural community to demonstrate due diligence. I
commend Bioniche and the Ontario government on their forward thinking."
    Under the terms of the loan, the Company will receive reimbursement of
50% of its eligible expenditures to a maximum of $10 million. The loan is
conditional upon the securing of certain other sources of financing which are
currently being negotiated.

    About the Advanced Manufacturing Investment Strategy (AMIS)

    AMIS is a $500 million strategy that provides repayable loans,
interest-free for up to five years, to support investments in technology and
innovation. The innovative projects supported by this strategy will generate
more than $720 million in new investment and support the creation or retention
of more than 3,500 high quality jobs in Ontario.

    About the E. coli O157:H7 Cattle Vaccine

    This vaccine received international recognition in September, 2007 by the
Animal Pharm Industry Excellence Awards as the best new veterinary product for
livestock. The vaccine has been developed by a strategic alliance formed in
2000 between the University of British Columbia (UBC), the Alberta Research
Council (ARC), the University of Saskatchewan's Vaccine & Infectious Disease
Organization (VIDO), and Bioniche, which holds the rights for worldwide
commercialization of the vaccine. The vaccine prevents the E. coli O157:H7
bacteria from attaching to the intestines of vaccinated cattle, thereby
reducing their reproduction within the animal, and reducing the amount of
bacteria that can be released through cattle manure in the environment. More
than 30,000 cattle have been involved in clinical testing of the vaccine over
the past five years. Commercial usage of the vaccine began in September, 2007
with it being made available through veterinarian permit requests to the CFIA
and Bioniche.

    About Bioniche Life Sciences Inc.

    Bioniche Life Sciences Inc. is a research-based, technology-driven
Canadian biopharmaceutical company focused on the discovery, development,
manufacturing, and marketing of proprietary products for human and animal
health markets worldwide. The fully-integrated company employs approximately
200 skilled personnel and has three operating divisions: Human Health, Animal
Health, and Food Safety. The Company's primary goal is to develop proprietary
cancer therapies supported by revenues from marketed products in human and
animal health. Bioniche has been named one of Canada's Top Ten Life Sciences
Companies for 2008. For more information, please visit www.Bioniche.com.

    Except for historical information, this news release may contain
forward-looking statements that reflect the Company's current expectation
regarding future events. These forward-looking statements involve risk and
uncertainties, which may cause, but are not limited to, changing market
conditions, the successful and timely completion of clinical studies, the
establishment of corporate alliances, the impact of competitive products and
pricing, new product development, uncertainties related to the regulatory
approval process, and other risks detailed from time to time in the Company's
ongoing quarterly and annual reporting.

    %SEDAR: 00013159EF




For further information:

For further information: Jennifer Shea, Corporate Communications &
Investor Relations Manager, Bioniche Life Sciences Inc., Telephone: (613)
966-8058, Cell: (613) 391-2097, Jennifer.Shea@Bioniche.com

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