February 17, 2011

Microbix further strengthens patent position for LumiSort (Press Release)

Microbix Biosystems Inc. has filed new patent applications related to the continuing development of LumiSortâ„¢, Microbix's proprietary technology that will enable livestock breeders to pre-determine the sex of their herd prior to conception.

These filings represent significant new intellectual property arising from the ongoing engineering work to deliver Microbix's proprietary LumiSortâ„¢ semen sorting technology to the livestock market in 2012.

The new intellectual property protects a significant evolution of the LumiSort concept, with improvements that will both simplify and further reduce the cost of the construction of LumiSort units, while increasing the speed and efficiency of operation. LumiSortâ„¢ is an attractive initiative for Microbix both because there are no regulatory barriers to global markets, and because of an aggressive intellectual property strategy that Microbix anticipates will result in significant intellectual property protection. Microbix expects LumiSort will significantly increase livestock fertility rates compared with conventional sexing technology making the dairy and cattle industries more efficient and improving producers' margins. Additionally, the technology has the potential to more than double the yield of sexed semen straws after processing, making LumiSort far more economical, leading to wider usage in the marketplace.

Prior to market introduction, Microbix has established agreements for LumiSort with companies located in the US, Canada, Australia, Europe, South America, and China representing more than 35% of the dairy semen collection centres and will enter a global animal health market for artificial insemination valued at more than CAD2.5 billion (US$2.5 billion). All agreements include the same royalty payment to Microbix of 15% of selling price.

In 2010 Microbix announced two partnerships including one with an engineering firm focused on the development of the technology and the other with one of the largest suppliers of livestock reproduction products in the world.  The second firm has taken an equity position in the programme through a milestone based, CAD2 million (US$2.03 million) investment, and will leverage their 2-year, regionally exclusive license to rapidly deploy LumiSort into their markets generating revenues enabling subsequent global expansion.

William Gastle, Microbix CEO, said, "These new developments stem directly from investments we've made not only to engineer and deliver the LumiSort instrument, but also to understand and solve the fundamental problems underlying the sex-specific identification and separation of cells. By maintaining a broad view of the science and technology and continuing a program of development, we will bring the next generation of semen sexing technology to livestock producers."

LumiSort is a proprietary instrument and technology that will improve the yield and quality of sexed semen by a significant margin over methods used in the livestock industry today. It incorporates a novel and innovative instrument design to address fundamental problems with existing commercial sex selection technologies, while providing Microbix with a strong and well differentiated intellectual property advantage in the industry. Microbix expects to introduce LumiSort to the dairy and beef livestock management markets before the end of 2012.  The technology will not only provide a much higher quality product leading to higher conception rates, but is also expected to improve significantly the sexed semen production yield.