TORONTO, June 12 /CNW/ - Microbix Biosystems Inc. (TSX:MBX) announced today that it is has made a significant discovery that takes it a major step forward in commercializing its animal reproduction technology.
The Company has been able to identify specific proteins that allow female-producing and male-producing sperm cells to be separated, and has also developed the monoclonal antibodies that will be used to commercialize this process. This is the first time that sex-specific proteins have been positively identified. Microbix has filed a provisional patent on this discovery.
The Company's Semen Sexing Technology(TM) (SST(TM)) can ensure the sex of livestock offspring resulting from artificial insemination. The technology is significant because livestock producers currently spend billions of dollars annually on artificial insemination, yet they can end up with animals unsuited to their particular industry's needs. Dairy farmers, for example, want female animals for milk production. Beef producers want predominantly male animals for meat production. Swine producers want female animals for meat. SST(TM) can ensure that these requirements are met.
This is the second important milestone in the SST(TM) development program. Microbix obtained this technology through its acquisition of Sequent Biotechnologies Inc. in September, 2005. Under the terms of that agreement, Sequent's founders are to receive $3 million in common stock of Microbix, payment being staged and contingent upon the achievement of certain milestones that enable entry into the marketplace. With today's announcement, Sequent's founders have been issued 1,821,862 common shares of Microbix, representing half of the total potential payment.
The first milestone, reported last year, was the signing of agreements with a number of artificial insemination (AI) companies based in Europe, North America and Australasia. These companies represent 13 per cent of the $2.5 billion global AI market in the commercial livestock industry.
Today, the average price for unsexed dairy semen is about $20. Sexed semen will garner a premium price of approximately 2 1/2 times the price of the unsexed product. Microbix will receive a royalty of 15 per cent of sales in addition to fees for the SST(TM) components.
"On a commercial scale, the market for SST(TM) would be considered a blockbuster by traditional biotech or pharmaceutical standards. Unlike biopharmaceutical drug development, however, there is no regulatory process required to bring a semen sexing product to market. The product will readily integrate into established AI facilities and procedures," explained Microbix CEO William J. Gastle.
"This discovery confirms the presence of biological markers specific to male and female never before known, which can be leveraged for the AI industry," said Dr. Peter Blecher, a founder of Sequent and Microbix Director.
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 Vaccine Enhancement Technology which significantly boosts the yield of influenza virus from eggs; the thrombolytic drug Urokinase, being developed for a new therapeutic indications; and the SST(TM) animal reproduction technology.
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. 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.
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