Largest Customer Confirms Conversion Timetable & Provides Full-Scale Order
TORONTO, August 1, 2019 – Microbix Biosystems Inc. (TSX: MBX, Microbix®), an innovator of biological products and technologies, provides an update on the conversion of its highest-selling product into bioreactors – that the largest customer for that antigen has confirmed its intended timetable for conversion of its future orders to bioreactor product and has provided its initial full-scale order.
In 2018, Microbix completed a 500% expansion of its bioreactor capacity, moving to six full-scale units from one, along with multiple other production facilities upgrades. Its facilities upgrades were made to house up to eight bioreactors in a dedicated suite. Since that time, multiple customers for that native viral antigen have converted to bioreactor produced product, but its largest customer had been continuing a lengthy program of real-time stability studies and not yet converted. Those stability studies are now completed for some of that customer’s test formats and it has now confirmed how conversions are expected to occur over the course of Microbix’s fiscal 2020, with its first full-scale order for bioreactor product now received.
Due to the long production cycle for this antigen product and the parties’ order scheduling process, it is expected that the first such sales to this customer will be recorded in Q1 of 2020. Completion of the conversion process will mean that Microbix’s production of this largest-selling antigen has moved to its bioreactors. In contrast, over the 12 months ending June 30, 2019, a substantial majority of sales of this antigen were from conventional roller-bottle culturing processes.
Benefits of conversion are expected to be considerable. That antigen has been Microbix’s highest volume and lowest margin product and can comprise as much as half of quarterly sales. Conversion to bioreactor production is expected to enable Microbix to generate a higher and more consistent percentage gross margin. Additionally, transfer of this high volume product into bioreactors liberates capacity to produce more of its other conventionally-made antigen products. Specifically, the full conversion of this product into bioreactors enables Microbix to more than double overall antigen production with little additional capital expenditures. Making such further capacity available will help Microbix keep pace with the demand growth that is expected to be driven by the expanding use of immunoassay medical tests in Asia, where Microbix antigens are being widely incorporated into locally-developed tests seeking approval.
Cameron Groome, CEO and President, commented on this milestone, “We’re delighted about the broadening acceptance of our bioreactor Rubella antigen. All departments have helped with creating and commercializing these new processes. In addition to helping our profitability, the skills we’ve honed are tools to further optimize our business and place us at the cutting edge of antigen production technology.”
Microbix’s catalogue of antigen and quality assessment products is available on its website, as are detailed disclosures about its business and financial results (please visit www.microbix.com).
About Microbix Biosystems
Microbix specializes in developing proprietary biological and technology solutions for human health and well-being. It manufactures a wide range of critical biological materials for the global diagnostics industry, notably antigens used in immunoassays or quality assessment products (QAPs™). Microbix’s products are sold to more than 100 customers worldwide, primarily to multinational diagnostics companies and laboratory accreditation organizations.
Microbix also applies its biological expertise and infrastructure to create proprietary new products and technologies. Currently it has two; (1) Kinlytic® urokinase, a biologic thrombolytic drug (used to dissolve blood clots) and (2) LumiSort™ cell-sorting, a technology platform for ultra-rapid and efficient sorting of cells or other particles. Established in 1988, Microbix is a publicly traded company, listed on the Toronto Stock Exchange and headquartered in Mississauga, Ontario, Canada.
This news release includes “forward-looking information,” as such term is defined in applicable securities laws. Forward-looking information includes, without limitation, management’s discussion of financial results or the outlook for the business, the risks associated with its financial results and stability, its bioreactor technology and its expected benefits, actions of its customers, its antigens and quality products businesses, development projects such as those referenced herein, operations in foreign jurisdictions, engineering and construction generally, production (including control over costs, quality, quantity and timeliness of delivery of products), foreign currency and exchange rates, maintaining adequate working capital and raising further capital on acceptable terms or at all, and other similar statements concerning anticipated future events, conditions or results that are not historical facts. These statements reflect management’s current estimates, beliefs, intentions and expectations; they are not guarantees of future performance. The Company cautions that all forward looking information is inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company’s control. Accordingly, actual future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. All statements are made as of the date of this news release and represent the Company’s judgement as of the date of this new release, and the Company is under no obligation to update or alter any forward-looking information.
Please visit www.sedar.com for recent Microbix filings.
For further information, please contact:
Cameron L. Groome, CEO
Jim Currie, CFO
Deborah Honig, Investor Relations – Adelaide Capital Markets
(647) 203-8793 email@example.com