May 18, 2005

 

Chemeq successful commercial-scale field trials

 

 

Chemeq Limited (ASX: CMQ) today announced the results of recent commercial-scale field trials of CHEMEQ® polymeric antimicrobial (for poultry) on South African farms.

 

A total of 600,000 birds were involved in the trials.

 

The birds were managed in accordance with existing management procedures of the particular farms used for the trials, including the routine use of antibiotics.

 

The only variation from existing management procedures was the introduction of CHEMEQ® polymeric antimicrobial in the drinking water of half of the birds.

 

The trials showed that CHEMEQ® polymeric antimicrobial is an effective antimicrobial.

 

Its usage on-farm demonstrated the following benefits:

• Reductions in mortality rates (average reduction 1.4%)
   
• Reduced feed required per kilogram of meat produced (average improvement 3.6%)
   
• Increased weight per bird (average increase 0.9%)
   
• Overall improvements in Performance Efficiency Factor (average increase in PEF 5.3%)

Chemeq Chairman Dr Graham Melrose said the results were most encouraging as they demonstrated the efficacy of CHEMEQ® polymeric antimicrobial.

 

"These results are significant as previous R&D trials with CHEMEQ® polymeric antimicrobial were conducted under controlled conditions, whereas these trials were in actual farming situations" he said.

 

"These latest results confirm that our product works effectively in normal farming conditions across very large numbers of birds."

 

"Commercially, the benefits to farmers from using CHEMEQ® polymeric antimicrobial are clear."

 

"This is particularly important as poultry producers operate on very low margins, and small percentage point increases in growth rates in animals are significant for farmers."

 

Following the launch of sales and marketing campaigns, Chemeq is now progressing with further commercial trials and continuing the collection of field data under a wide range of production conditions.

 

These additional trials will support sales and marketing activities in the various countries in which CHEMEQ® polymeric antimicrobial has received regulatory approval.

 

Commercial trials are the usual prerequisite to making substantial sales. Farmers normally seek reassurance of product efficacy on-farm, before adopting new products.

 

 

About Chemeq

 

Chemeq is a veterinary drug producer which has developed a unique product, Chemeq® polymeric antimicrobial, for the prevention and control of intestinal bacterial diseases in feedstock animals, pigs and poultry.

 

The company's manufacturing facility at Rockingham in Western Australia is currently undergoing optimisation. The Australian Pesticides & Veterinary Medicines Authority (APVMA) issued a Good Manufacturing Practice (GMP) licence for the plant in April 2005. The nameplate capacity of the plant is 20 tonnes of active pharmaceutical ingredient per annum; equivalent to approximately 400,000 litres of finished product per annum.

 

To date, product approval has been secured in South Africa (pigs and poultry) and New Zealand (pigs). Distribution agreements with leading distributors have been secured in South Africa, New Zealand and Malaysia.

 

Chemeq's breakthrough AU$1.5 million sales order was signed with a South African group in August 2004.

 

Chemeq's intellectual property is protected by patents registered in more than 80 countries. The most recent approvals were received in U.S.A., and China where Chemeq now has manufacturing and marketing protection through to 2020 in both countries.

 

In March 2005, Chemeq shareholders approved an issue of convertible bonds worth up to AU$60 million with investment groups Mizuho International plc, Stark Trading and Shepherd Investments, which underpins the future financial strength of the Company.