SUFFOLK, U.K., June 13, 2003 (PRIMEZONE) -- Letter of Intent signed with Penang Development Corporation to establish Biotechnology Company in Penang, Malaysia for the development, manufacture and commercialisation of human insulin. GeneMedix plc (LSE:GMX) and Penang Development Corporation ("PDC") today announce the signing of a letter of intent ("LoI") under which GMX and PDC will work together to set up a Company in Penang, Malaysia for the development, manufacture and commercialisation of human insulin.
Under the LoI, GeneMedix would out-license its existing insulin know-how to a newly formed Malaysian company. It will use its expertise in the development of biopharmaceuticals and in the design, construction and operation of state-of-the-art manufacturing facilities, to construct a facility built to international quality standards. The total anticipated investment of $34 million is expected to be funded by a mixture of development loans, grants and an issue of equity in the newly formed company to local investors. PDC will make land available, and assist in gaining access to the development loans on attractive commercial terms and to grant funding. Both parties will work together in bringing in local investors to the project, a process that is already well underway.
GeneMedix will out-license its insulin know-how to the newly formed company in return for an up-front milestone payment and royalty fee payable on sales of bulk product. It is also intended that GeneMedix will retain a majority shareholding in the new company. The development of the full-scale industrial process will be completed by GeneMedix at its own expense and transferred into the facility, which would be scheduled for completion in mid 2005.
Paul Edwards, GeneMedix' Chief Executive Officer, commented: "It has always been the Company's objective to set up an insulin company in South-East Asia, to provide insulin for the Asian markets, where demand for human insulin is anticipated to increase rapidly. We believe that the collaboration with PDC will provide GeneMedix with an exciting opportunity to develop this business in a region that is well suited for biotechnology. We believe that this will create real value for our shareholders."
ENQUIRIES: GeneMedix plc Paul Edwards, Chief Executive Officer Tel: 01638 663 320 College Hill Nicholas Nelson Tel: 020 7457 2020