TORONTO, Nov. 13 /CNW/ - The CEO of Toronto-based Microbix Biosystems
Inc. (TSX:MBX), William J. Gastle, held a series of meetings with high-ranking
Chinese officials over the past week to formalize the licensing agreement for
the Company's animal reproduction technology and to discuss other business
opportunities in China.
As announced on June 18, 2007, the Animal Fine Breeding Station of Hebei
Province has agreed to become the exclusive distributor of Microbix'
proprietary Semen Sexing Technology(TM) (SST) in that country.
Gastle met with senior officials of the province including the Vice
Governor of Hebei, Song En Hua, the Minister of Agriculture for Hebei, Liu Da
Qun, and many other important dignitaries from the Chinese federal and
provincial governments, along with representatives of the Canadian Embassy in
The Chinese demand for milk and beef is growing substantially and
expectations are they will require 200 million tons of milk per year. The
average production of milk from a cow is just under 10 tons per year. The
current dairy herd in China is about 10 million cows so this needs to double
to meet domestic demand.
Microbix' SST technology allows producers to determine the sex of
livestock offspring resulting from artificial insemination. SST will allow
Chinese dairy farmers to breed only female animals for their milking herds.
Likewise, the technology will ensure that beef producers end up with only the
required male animals for meat production. SST will allow China to expand its
beef and dairy capacity at a much faster pace.
"China represents a significant growth opportunity for our technology,"
said Gastle. "We're pleased to be involved in this market, and we're delighted
by the incredibly warm reception we've been given." Microbix was also honoured
at a formal dinner event that was attended by over 200 people including many
Chinese academic and agricultural associations, breeding stations of several
other regions in China and various media representatives.
Last year, Microbix also signed non-exclusive agreements with a number of
artificial insemination (AI) companies based in Europe, North America and
Australasia. These companies will pay a 15% of sales royalty to Microbix and
represent 13 per cent of the current $2.5 billion (expected to increase to
over $4.3 billion with the commercialization of SST) global AI market in the
commercial livestock industry.
Established in 1988, Microbix specializes in developing proprietary
biological technologies and commercializing them through global partners. The
Company currently has three large-market technologies at various stages in the
product pipeline - its VIRUSMAX(TM)Technology which significantly boosts the
yield of influenza virus from eggs; Urokinase, a thrombolytic biologic that
can be used as a catheter clearing drug and has potential in new cancer drug
combination; and the Semen Sexing Technology(TM).
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. For
instance, product development may not result in products that can be
commercialized, savings by producers may not reach value estimates or at all
and sales may not reach sales targets or be made at all. Not all suppliers of
dairy semen may convert to a sexed semen product, term sheet agreements may
not lead to definitive agreements between the parties. There is no guarantee
that the Company will complete development of the technology and if it does
that it will perform to the levels projected by the Company. While the Company
is not aware of another technology on the market, or under development, that
can provide the product at competitive pricing levels compared to Microbix'
sexed semen, other technologies may emerge before SST enters the market.
Royalty rates may change subject to the definitive agreement, the markets may
not sustain the premium for sexed product should world economies shift
significantly. Market utilization rates may not be reached. Market value of
products may vary. Patents may not provide adequate protection of the
Company's intellectual property and may be subject to challenge. 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:
For further information: visit www.microbix.com or contact: Phil
Casselli, President, Microbix Biosystems Inc., (416) 234-1624 x 224