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Sperm Sexing Technology Agreement Signed

by 5m Editor
14 July 2006, at 3:39pm

TORONTO - Several companies providing artificial insemination to the dairy, beef and swine industries, including some of the world's largest, have signed licensing term sheets with Toronto-based Microbix Biosystems Inc. for distribution of its proprietary Sperm Sexing Technology.

Microbix' technology allows breeders to determine the sex of offspring prior to the insemination of cattle or swine. "Upon commercialization, this will be the single-greatest breakthrough since the advent of commercial artificial insemination almost 50 years ago and will revolutionize the way animal production takes place," said William J. Gastle, President and CEO of Microbix. "Our market research indicates within three years of launch of this technology, close to 100 per cent of the dairy semen provided will be sexed semen."

The technology is important because producers currently spend billions of dollars annually on artificial insemination, yet they can end up with animals unsuited to their particular industry's needs. In the dairy industry, for example, a certain percentage of female offspring are required annually to replace the milking herd. SST(TM) separates female-producing sperm from male-producing sperm, thus ensuring gender.

The companies that have signed account for over 13 per cent of the dairy, beef and swine semen doses marketed annually. The total revenue for premium priced sexed semen sold by these companies is expected to exceed $350 million by 2010. Microbix will retain a 15 per cent royalty, or minimum unit price whichever is higher, on sales of all semen treated by SST(TM).

The signed companies, based in Europe, North America and Australasia, represent a significant sales presence in all major markets around the world. These companies will have significant advantages enabling them to grow their market share over competitors.

"These agreements not only pave the way for global distribution of the technology, but validate the market size, royalty rate and revenue potential," said Phil Casselli, General Manager of Microbix.

Microbix' SST(TM) has significant advantages over other technologies currently in use to sex semen, making it faster, cheaper and less detrimental to the vitality of the sperm cells. The process has already been patented in the U.S. and Europe, and Microbix will continue to pursue patent protection in other countries, and over other elements of the technology.

Licensing agreements will evolve from these term sheets as Microbix moves toward the launch date scheduled for 2008.

"We believe this technology will become the standard in the industry and within two years, upwards of 80% of all artificial inseminations done in the dairy, swine and beef industries will be with semen sexed with the SST(TM) technology," said Gastle.

ThePoultrySite News Desk