Microbix Sales Grow Over 30% In The Second Quarter; Up 43% In The First Half '09



    
    New manufacturing facility opens with substantially increased capacity
    for continued growth
    

    TORONTO, May 14 /CNW/ - Microbix Biosystems Inc. (TSX:MBX) announced
today robust double digit growth in sales, improved cash flow, and reduced
operating losses for the second quarter ended March 31, 2009.
    In a news release today, William J. Gastle, CEO of Microbix said "Our 43%
growth in the first half of 2009 coupled with the strong growth over the past
three years indicates the potential for our base business. The new
manufacturing facility is now fully operational, cash flow is increasing and
the shareholder value creation opportunity is still available in all three
pipeline products albeit somewhat delayed."

    First Quarter Highlights

    Core Business

    In the second quarter, sales improved over 30% per cent compared to the
same quarter last year. "We exceeded our sales target again in the second
quarter," Mr. Gastle continued "and we are on a path to meet or exceed
projections for this fiscal year. Subsequent to the second quarter, the new
core business manufacturing facility opened with significantly improved
capacity. Microbix fortunately operates in a major market with an ongoing
strong demand for virology products."

    Influenza Vaccine Business

    The Hunan China manufacturing joint venture continues making progress as
internal milestones are met by both partners. Microbix and Hunan are
completing the pre-conditions that have been set for financing. Both levels of
government in China are involved in the project. Recent events resulting from
the emergence of the H1N1 virus strain that spread globally in April has
increased the level of urgency of this project in China. The Feasibility Study
has determined the capital required for this project. The Hunan Liuyang
Biomedical Park under the supervision of Microbix financed the Study. A
potential investor has agreed in principle to lead the fundraising efforts
subject to finalization of the deal structure.

    Semen Sexing Technology (SST)

    In the SST program, Microbix focused on strengthening its intellectual
property position. "We concluded the research phase of the program in the
second quarter," said Mr. Gastle. "The results led to a conclusion which
brings the market opportunity closer with more certainty and also provides a
significant competitive advantage over existing technology. It will give the
Company a strong patent position in a $ 3 billion artificial insemination
market which has no regulatory barrier to entry." The Company is currently
evaluating non-dilutive ways to advance the product.

    Urokinase

    The Company acquired all Urokinase assets from ImaRx Therapeutics, Inc.
of Tucson, Arizona, (Nasdaq:   IMRX) in September 2008. These assets included
ImaRx' remaining Urokinase inventory as well as the regulatory file for the
product (formerly known as Abbokinase(R), now rebranded as Kinlytic(R)), key
raw materials for Urokinase manufacturing, and the corresponding sales and
marketing infrastructure.
    The anticipated launch of the drug Kinlytic has been delayed due to the
ongoing review by the FDA of the Company's request for the release of this
Urokinase product for distribution in the US market. The company is preparing
to file an appeal that will be submitted in the third quarter. "There are no
problems with the safety and efficacy of this drug. Concerned physicians are
asking for Urokinase supply on a daily basis," Mr. Gastle explained. Microbix
is one of many drug companies that are experiencing delays at the FDA today
and continues to press matters with the agency," said Mr. Gastle. "We are
optimistic that ultimately we will reach the market" he said.

    Other Highlights

    "The Company has reduced its overhead as we transitioned into the new
manufacturing facility and we expect to be profitable in 2010. With the
additional capacity, we expect to expand sales in 2010 and to see continued
financial improvement for the Company."

    Financial Results

    For the quarter ended March 31, 2009, the Company recorded a net loss of
$512,834 or one cent a share compared to a loss of $1,337,698 or two cents a
share in the same period in fiscal 2008. The company's negative cash position
improved by 86% to $ 244,708 for the second quarter 2009 compared to negative
cash flow $ 1,771,934 in the same period in 2008.
    The loss for the quarter was lower due to the reduction in expenditures
on pipeline projects and the increase in revenues. However, research and
development expenditures for SST and the development expenditures for Kinlytic
contributed to the loss. Research and development expenditures as a whole will
be substantially lowered in the second half. Also, capital expenditures will
be substantially reduced in the third quarter as the last of those
expenditures for the new manufacturing facility will be made. Pipeline
projects, now completed, are going to be financed through non-dilutive
agreements with partners. Microbix continues its corporate restructuring to
conserve cash and lower its burn rate in order to ensure its pipeline products
reach their full potential.
    "Given the unusually difficult market conditions, Microbix is controlling
its cash flow prudently", said James A. Long, CFO. "We remain confident in our
ability to operate the business using existing cash flow from our core
business." The growth in sales in the next 12 months will be accretive to the
Company's projected positive cash flows.

    
                              Second Quarter Ended         6 months ended
                              --------------------         --------------
                                     March 31                  March 31
                                     --------                  --------
                                 2009         2008         2009         2008
                                 ----         ----         ----         ----
                                    $            $            $            $

    Sales                   1,570,204    1,179,771    3,176,728    2,216,622

    Net Profit (loss)        (512,834)  (1,337,698)  (1,096,502)  (2,282,685)

    Net Profit (loss)
     per share                  (0.01)       (0.02)       (0.01)       (0.05)

    Cash Flow                (244,708)  (1,771,934)  (2,856,777)   3,831,239
    

    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 authorization to release Kinlytic for
distribution in the US from the FDA, inability to complete financing for the
Hunan China project currently the subject of financing; risks associated with
commercializing the technologies; risks associated with failure to develop and
commercialize SST; non-adoption of SST. 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.

    %SEDAR: 00004220E




For further information:

For further information: 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

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Microbix Biosystems Inc.

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