Bioniche Receives $5 Million of Federal Government Support to Scale-up Vaccine Production in Ontario



    - funding through the new Agri-Opportunities program of Agriculture and
    Agri-Food (Canada) -

    BELLEVILLE, ON, Dec. 20 /CNW/ - Bioniche Life Sciences Inc. (TSX: BNC), a
research-based, technology-driven Canadian biopharmaceutical company, today
announced that it has received $5 million in federal government financing in
support of its vaccine production facility scale-up in Belleville, Ontario.
The $5 million repayable contribution has been provided through the new
Agri-Opportunities Program of the Department of Agriculture and Agri-Food
(Canada) (AAFC).
    The announcement was made by Guy Lauzon, Parliamentary Secretary to the
federal Minister of Agriculture and Agri-Food and the Federal Economic
Development Initiative for Northern Ontario, on behalf of the Honourable Gerry
Ritz, Minister of Agriculture and Agri-Food and Minister for the Canadian
Wheat Board. Prince Edward-Hastings MP Daryl Kramp was on hand for the
announcement. This is the first project to be approved and funded under this
new AAFC program.
    "This Government is making key investments in agriculture science and
innovation to ensure a healthy future for Canadians," said Parliamentary
Secretary Lauzon. "This project will help reduce the risk of contamination in
food and water while also helping farmers obtain better prices for their
products."
    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 of
$10 million from the Ministry of Economic Development and Trade (MEDT)'s
Advanced Manufacturing Investment Strategy (AMIS) was announced earlier this
week. 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 federal government funding recognizes the potential of our E. coli
O157:H7 cattle vaccine as an enhancement to the Canadian agricultural sector,"
said Graeme McRae, President & CEO of Bioniche Life Sciences Inc. "Adoption of
this vaccine will provide an additional stamp of safety for Canadian
agricultural products at home and abroad, particularly for our beef."
    It remains very clear that there is a pressing need to reduce the amount
of E. coli O157:H7 shed into the environment by cattle. Food recalls continue
to occur on a massive scale in beef, produce and prepared food: Just from
September, North American E. coli O157:H7-related recalls have totalled
22.7 million pounds of beef, multiple lots of packaged greens and five million
frozen pizzas. On-farm interventions to reduce the shedding of E. coli O157:H7
by cattle, such as vaccination, may assist in reducing the potential for food
and water contamination and the resulting human illnesses and deaths.
    Approximately 100,000 cases of human infection with the E. coli O157:H7
organism are reported each year in North America. 2% to 7% of those people
develop hemolytic uremic syndrome (HUS), a disease characterized by kidney
failure (in recent outbreaks, this percentage has risen to as high as 16%).
Five percent of HUS patients die, many of them children and senior citizens,
whose kidneys are more sensitive to damage.
    Beyond consumption of contaminated food or water, individuals can become
infected from E. coli O157:H7 by visiting animal exhibits. Petting zoos,
fairs, and agricultural exhibits provide many possible routes of transmission
for E. coli. Direct animal contact is the obvious route, but contact with
contaminated products (e.g., sawdust, shavings, soiled clothing or shoes) can
also lead to human infection.
    The Canada Agriculture Museum in Ottawa has taken a leadership position
among Canadian animal exhibits by adopting vaccination with the Bioniche E.
coli O157:H7 vaccine earlier this year. The Museum is a demonstration farm,
displaying a wide variety of farm animals, including a 45-head dairy herd. The
farm animals are in pens, stalls and outdoor paddocks, where visitors can get
close to them. "Vaccinating against E. coli is an important and innovative
risk-reducing measure to the other precautions that the Museum has taken,"
said David Sutin, Manager of Communications, Marketing and Farm Operations at
the Canada Agriculture Museum. "We have also installed hand washing stations
in the Museum's buildings, posted proper hand-washing procedure signs, and
remind visitors to wash their hands regularly while visiting."
    Under the terms of the loan, the Company will receive reimbursement of
20% of its eligible expenditures to a maximum of $5 million. The loan is
interest-free and is conditional upon the securing of certain other sources of
financing which are currently being negotiated.

    About the Agri-Opportunities Program

    AAFC's Agri-Opportunities Program provides funds to accelerate the
commercialization of new agricultural products, processes or services. Funding
is provided for projects that are expected to increase market opportunities
for the Canadian agricultural industry across the value chain and generate
demand for primary agricultural products.

    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.

    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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