Kinlytic® urokinase to be developed for re-entry into U.S. market

MISSISSAUGA, CANADA, May 16, 2023 – Microbix Biosystems Inc. (TSX: MBX, OTCQX: MBXBF, Microbix®), a life sciences innovator, manufacturer, and exporter, announces execution of an agreement (“Agreement”) to return Kinlytic® urokinase (“Kinlytic”) to market, initially for dissolving blood clots in venous catheters in the United States and to be followed by other geographies and clinical indications. Its Agreement is with Sequel Pharma, LLC (“Sequel”), a specialty pharma company with expertise in developing and commercializing drugs for the U.S. market that is funded by a leading private equity firm.

The Agreement provides for Sequel to fund and undertake the necessary work to return Kinlytic® to the U.S. for the clinical indication of venous catheter clearance, currently a US$ 350 million per year market that is a monopoly. Long-term venous catheters are used to administer pharmaceuticals, nutrition, or dialysis, often needing to remain in place for extended periods. About 25% of such catheters become blocked with blood clots and, if not cleared, can require costly surgical replacement.

Microbix will receive a closing payment of US$ 2.0 million under the Agreement. Sequel and Microbix will now prepare for an updated consultation with the U.S. Food and Drug Administration (“FDA”) to confirm that prior regulatory guidance received by Microbix remains pertinent. Should FDA guidance be satisfactory, the parties will undertake the work needed to file a supplementary Biologics Licensing Application (“sBLA”) filing, with funding for such work to be fully provided by Sequel.

Upon a satisfactory FDA consultation, Sequel will make a further US$ 2.0 million payment to Microbix, followed by a US$ 1.0 million milestone on U.S. re-approval via sBLA, sales-driven milestone payments of up to US$ 30 million, and ongoing royalties targeted to be a double-digit percentage of net sales. Should the FDA consultation be unexpectedly negative, Sequel may terminate the Agreement and recoup US$ 1.0 million of the closing payment.

Mike Anderson, CEO of Sequel commented, “We’ve completed extensive technical and market diligence on Kinlytic and are excited to partner with Microbix in bringing it back to market. It is important that safe, effective, and economic drugs such as Kinlytic are available to address the needs of millions of patients.”

Cameron Groome, CEO and President of Microbix also commented, “For many years Microbix has sought to apply its expertise to restore availability of this clinically-important cell-culture derived biologic drug. Lack of capital has always been a principal constraint, which this agreement fully addresses. Additionally, Sequel and its backers provide tremendous expertise in helping to navigate the processes for U.S. drug approval, marketing, and reimbursement, which are not core skills of Microbix. We are delighted to be working with Mike and the Sequel team to bring Kinlytic back into widespread clinical use.”

About Sequel Pharma, LLC

Sequel Pharma, LLC has been established as an affiliate of New American Therapeutics, Inc. (https://newamericantx.com) for the purpose of restoring Kinlytic® to market. Sequel’s management team has almost 100 years of life science experience and leadership and has expertise in branded pharmaceutical products, generic pharmaceuticals, injectable products, and devices. Sequel also has broad international experience.

About Microbix Biosystems Inc.

Microbix Biosystems Inc. creates proprietary biological products for human health, with over 100 skilled employees and annualized sales targeting C$ 2.0 million per month. It makes a wide range of critical ingredients and devices for the global diagnostics industry, notably antigens for immunoassays and its laboratory quality assessment products (QAPs™) that support clinical lab proficiency testing, enable assay development and validation, or help ensure the quality of clinical diagnostic workflows. Its antigens drive the antibody tests of approximately 100 diagnostics makers, while QAPs are sold to clinical lab accreditation organizations, diagnostics companies, and clinical labs. Microbix QAPs are now available in over 30 countries, supported by a network of 10 international distributors. Microbix is ISO 9001 & 13485 accredited, U.S. FDA registered, Australian TGA registered, Health Canada establishment licensed, and provides CE marked products

Microbix also applies its biological expertise and infrastructure to develop other proprietary products and technologies, most notably viral transport medium (DxTM™) to stabilize patient samples for lab-based molecular diagnostic testing and Kinlytic® urokinase, a biologic thrombolytic drug used to treat blood clots. Microbix is traded on the TSX and OTCQX, and headquartered in Mississauga, Ontario, Canada.

Forward-Looking Information

This news release includes “forward-looking information,” as such term is defined in applicable securities laws. Forward-looking information includes, without limitation, discussion of Sequel, the Agreement, Kinlytic® or its relevance, Microbix’s products or services, business and business results, goals or outlook, risks associated with financial results and stability, development projects such as those referenced in its presentations, regulatory compliance and approvals, sales to foreign jurisdictions, engineering and construction, production (including control over costs, quality, quantity or timeliness of delivery), currency exchange rates, maintaining adequate working capital or raising new capital on acceptable terms or at all, and other similar statements about 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. Microbix cautions that all forward-looking information is inherently uncertain and actual performance may be affected by a number of material factors, many of which are beyond its 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 Microbix’s judgement as of the date of this new release, and it is under no obligation to update or alter any forward-looking information.

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