OTTAWA, June 05, 2017 (GLOBE NEWSWIRE) -- Avivagen Inc. (TSX-V:VIV) (OTC Pink:CHEXF) (“Avivagen” or the
“Corporation”), a corporation with a proven and commercially-ready, patent-protected product intended to replace the antibiotics
added to livestock feeds as growth promoters, announces business updates and an operational update from its Chairman and Interim
CEO Kym Anthony.
Kym Anthony stated, “Our mandate is now to prepare Avivagen for global scale up, optimization of regulatory strategies and
readiness for market access and acceleration of commercialization of our OxC-beta™ for Livestock product. These areas of focus will
enable the Corporation, if successful, to realize on a significant opportunity for its investors. The Corporation has
tremendously talented and dedicated people, whom, I believe, will allow Avivagen to succeed. Please find below recent updates on
the Corporation’s progress.”
KEY BUSINESS ACHIEVEMENTS IN THE PAST 90 DAYS
- Engaged in discussions with multiple parties for potential distribution or licensing agreements of OxC-beta™ for
Livestock
- Received two additional purchase orders for OxC-beta™ for Livestock from UNAHCO in both April and May 2017, with the
most recent order being for more than 2.5 times the original purchase order amount – on terms that are consistent with Avivagen’s
financial margin targets
- Executives from UNAHCO and Avivagen discussed the purchasing plan and vision for product roll-out for OxC-beta™ for
Livestock
- Engaged two regulatory consultants to help pursue regulatory pathways for approval of OxC-beta™ for Livestock in
the U.S. and European markets
- Added a U.S.-based life sciences and pharma expert to the board of directors as elected at the last Annual meeting of
shareholders
- Obtained positive results from an animal study for human applications
- Filed additional intellectual property patents
- Completed a 10:1 share consolidation on May 12, 2017 with post-Consolidation trading in the Corporation’s common
shares commencing on the TSX Venture Exchange at the start of trading on May 25, 2017
THE RISE OF ANTIBIOTIC RESISTANCE
A Global Problem with an Urgent Need for Solutions
It seems difficult to overstate the public concern and growing awareness of the dangers posed by the use of antibiotics in
livestock feeds today, and the interest in alternatives to antibiotic use as growth promoters. Antibiotic resistance
is an important, global, human health concern, with massive negative economic impacts. Many food producers depend on in-feed
antibiotics to reliably prevent disease and boost growth in livestock animals. However, these in-feed antibiotics are being banned
outright or phased out in many jurisdictions because many bacteria are becoming resistant to antibiotic treatments, as antibiotic
growth promoters added to livestock feeds are a key contributor to the development of resistance. In the U.S. alone, the
CDCi says that resistant bacteria cause:
- At least 2 million infections per year
- 23,000 deaths per year
- Direct costs of as high as $20 billion per year
- Up to $35 billion per year in costs for lost productivity
With a means to reliably and economically protect livestock through the use of OxC-beta™ for Livestock, Avivagen believes it has
brought to market an alternative to antibiotics used as growth promoters, without the risk of causing antibiotic resistance.
Market and Regulatory Access
Avivagen secured its first commercial sale in November of last year with UNAHCO, the second largest integrated feed company in
the Philippines, followed by a repeat order in April 2017 and another, new order in May 2017 for more than 2.5 times the April 2017
purchase order. With Taiwan also approved for distribution, the Corporation is actively working to gain approval in other
Asian jurisdictions such as Vietnam, South Korea and Indonesia. In concert with this strategy, the Corporation recently hired
Dr. Edward Robb, CEO of BioPharmaPotentials, whose primary focus is to help expedite the regulatory approval
process within the United States, and is also working with Dr. Klaus Hellmann, CEO of Klifovet AG, to help expedite the
regulatory approval process in Europe.
The global feed market is now over 1 billion tons of feed sold annually in a market valued at US$300B –
US$450B.ii Avivagen intends to gain worldwide regulatory and market access and then partner with large companies
whose resources and relationships will allow for maximum market penetration. The Corporation believes that OxC-Beta™ for Livestock
could be sold as an additive to the feed companies and which represents a significant opportunity to Avivagen.
Pursuit of Strategic Partnering Opportunities
Avivagen understands that its target market, while very large and attractive, is not without challenges for a small company –
from economic and other resource constraints to trying to build a geographic footprint internationally to drive sales. As a result
of this and with careful analysis, the Corporation is actively pursuing potential distribution and partnership agreements with
companies, whose size and stature could, if secured, significantly accelerate the growth trajectory of the Corporation. While we
have initiated discussions with companies such as these, there cannot yet be any guarantee that any agreement will be concluded or
that such deals would be favourable to Avivagen.
Vivamune Re-launch
While the Corporation’s primary focus is and will continue to be the replacement of antibiotics in animal feed, Avivagen
believes that the Corporation’s companion animal health product line – Vivamune Vital Health3 – has the potential to
contribute to its overall revenue stream by providing a safe and effective product to companion animals that will optimize their
health and quality of life. The Corporation plans to re-launch its Vivamune Vital Health3 line of products through an
exciting, new social media marketing campaign, focused directly at pet parents, with Amazon as Avivagen’s supply chain partner.
Augmenting the Board and Management for Future Success
As one of the world’s largest markets, gaining access to the U.S. is a main priority for the Corporation. Avivagen was
fortunate to have Mr. Jeffrey Kraws join its Board of Directors. In addition to being an analyst for biotech stocks for
almost two decades, Avivagen believes that Mr. Kraws has cultivated a wealth of industry knowledge and a level of credible,
insightful equity analysis that few share. Mr. Kraws expertise and insight is expected to prove invaluable in helping establish
Avivagen within the U.S. market.
Intellectual Property Portfolio
With intellectual property protection on various aspects of its products extending into the late 2020s and mid-2030s, Avivagen
continues to build its portfolio of seven families of issued or pending patents, aided especially by the results of new livestock
trials using our OxC-beta™ Livestock product. These patents are supported by the results of 16 separate trials to date, together
with published papers in peer-reviewed scientific literature.
Potential Human Markets
On April 10, 2017, the Avivagen announced positive results from a proof-of-concept study that could extend OxC-beta™ technology
into human health applications. The proof-of-concept study evaluated OxC-beta™ technology as a preventative therapeutic against C.
difficile infection (CDI). As strains of C. difficile change, antibiotics are becoming less effective or even completely
ineffective in clearing CDI. It is estimated that CDI adds an annual economic burden of US$1.5 billion to the United States
healthcare system.iii
The proof-of-concept study evaluated Avivagen’s OxC-beta™ technology for the ability to improve survival rate, increase median
time until death, and improve clinical indicators of health using a standard mouse model of human C. difficile infection. The
research was conducted by the National Research Council of Canada (NRC). Further trials are scheduled in the near future.
Search for a New CEO
In February of this year, the Corporation retained the services of a well-respected international executive search firm in order
to assist Avivagen in seeking placement of a CEO to lead the Corporation. While there have been a number of qualified
candidates identified, the Board of Directors recognizes that it is paramount that the ideal candidate be chosen to lead the
Corporation at this pivotal time, and therefore wants to ensure that this process is done thoroughly and prudently. While
this search continues, management and the Board continue to strongly focus on the mandates mentioned above.
About Avivagen
Avivagen Inc. is a public company traded on the TSXV under the symbol VIV and the OTC Pink under the symbol CHEXF and is
headquartered in Ottawa, Canada, based in partnership facilities of the National Research Council of Canada and Charlottetown,
Prince Edward Island. For more information, visit www.avivagen.com.
About OxC-beta™ Technology and OxC-beta™ Livestock
Avivagen’s OxC-beta™ technology is derived from Avivagen discoveries about carotenoids, compounds that give certain fruits and
vegetables their bright colors and is a non-antibiotic means of maintaining optimal health and growth. OxC-beta™ Livestock is a
proprietary product shown to be effective and economic in replacing the antibiotics commonly added to livestock feeds.
OxC-beta™ Livestock is currently registered and available for sale in the Philippines, Taiwan and Thailand.
Avivagen’s OxC-beta™ Livestock product has been proven safe and effective and could fulfill the global mandate to remove all
in-feed antibiotics as growth promoters. Sixteen international livestock trials with poultry and swine using OxC-beta™ Livestock
have demonstrated that the product performs as well as, and, sometimes, in some aspects, better than in-feed antibiotics.
Forward Looking Statements
This news release includes certain forward-looking statements that are based upon the current expectations of management.
Forward-looking statements involve risks and uncertainties associated with the business of Avivagen Inc. and the environment in
which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be
forward-looking, including those identified by the expressions “aim”, “anticipate”, “appear”, “believe”, “consider”, “could”,
“estimate”, “expect”, “if”, “intend”, “goal”, ”helps”, “hope”, “likely”, “may”, “plan”, “possibly”, “potentially”, “pursue”,
“seem”, “should”, “whether”, “will”, “would” and similar expressions or opinions of management. Forward-looking statements in
this news release include but are not limited to statements about the ability of Avivagen’s products to replace antibiotics;
Avivagen’s ability to scale up or obtain regulatory approval or commercial success in new jurisdictions; Avivagen’s ability to
realize on opportunities to the benefit of its investors; Avivagen’s ability to expand its products into human applications;
Avivagen’s ability to enter into partnership or distribution agreements with third parties to sell its products; the ability of
certain products to contribute to Avivagen’s revenues or growth; Avivagen’s plans to re-launch its Vivamune Vital Health line of
products; whether Avivagen’s new director and personnel will contribute to the Corporation’s success; whether Avivagen will be able
to engage a new Chief Executive Officer; and Avivagen’s plans for further product trials.
Avivagen is an early-stage commercialization company which faces significant risks and uncertainties in connection with its
business and readers should be cautioned that investors may lose the entire value of their investment. Some of these risks and
uncertainties include, but are not limited to, the following: Avivagen’s ability to continue as a going concern; whether the
Corporation can expand its global regulatory advisor network in order to gain market approval of OxC-beta™; Avivagen has
only one manufacturer of its products and, if that manufacturer cannot produce its products, Avivagen will not be able to find
another manufacturer, if at all; whether the Corporation can obtain market approval in additional geographies, if at all; whether
discussions will advance with potential strategic partners, if at all; whether the Corporation will achieve additional partnerships
or other commercial agreements with potential strategic partners, if at all; whether the Corporation will be successful in
augmenting communications with stakeholders; whether the Corporation will be successful in recruiting an executive team that will
maximize the value of OxC-beta™ in any markets, if at all; the results of ongoing or future trials of OxC-beta™
may not be positive or sufficiently positive; even if the results of trials are positive, there is no guarantee that Avivagen’s
products will be commercially successful or that requisite registrations or regulatory approvals will be obtained or maintained;
the timing and results of trials may be delayed or may not be completed at all; whether the company’s relaunch of its pet health
product Vivamune will be successful, if at all; whether Avivagen’s social media campaign with respect to its Vivamune Vital Health
line of products will be successful, if at all; whether the addition of Mr. Jeffrey Kraws to the board will enable the company
penetrate the U.S. market, if at all; whether Avivagen’s patent applications will be issued, if at all; whether Avivagen will be
subject to infringement or other claims; whether the 10:1 share consolidation will be received positively by the market, if at all;
whether Avivagen will achieve any of the goals set out in this press release, if at all; whether Avivagen can obtain further
commercial and trial alliances in Asia and elsewhere; and intellectual property rights may not be granted, or, if granted, may
prove inadequate to protect Avivagen’s inventions.
Readers should also refer to the risk factors in Avivagen’s management’s discussion and analysis for the year ended October
31, 2016 and other securities law filings from time to time all of which are available at www.SEDAR.com. Any of the foregoing
risk factors could negatively impact Avivagen’s ability to achieve the matters described in the forward-looking statements
contained above as described or at all. Accordingly, readers should not place undue or even any reliance on forward-looking
statements. Except as required by law, Avivagen assumes no obligation to update the forward-looking statements, or to update
the reasons why actual results could differ from those reflected in the forward-looking statements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Copyright © 2017 Avivagen Inc. OxC-beta™ is a trademark of Avivagen Inc.
Footnotes:
i https://www.cdc.gov/drugresistance/threat-report-2013/pdf/ar-threats-2013-508.pdf
ii http://www.alltech.com/sites/default/files/global-feed-survey-2015.pdf
http://go.alltech.com/alltech-feed-survey
iii Leffler DA et al. N Engl J Med 2015; 372: 1539-1548
For more information: Avivagen Inc. Drew Basek Director of Investor Relations 100 Sussex Drive, Ottawa, Ontario, Canada K1A 0R6 Phone: 416-540-0733 E-mail: d.basek@avivagen.com Kym Anthony Interim Chief Executive Officer 100 Sussex Drive, Ottawa, Ontario, Canada K1A 0R6 Head Office Phone: 613-949-8164 Website: www.avivagen.com