ReGen Therapeutics Limited (“RGTL” or “The Company”) announces that its revenues from sales of ColostrininTM for the year 2011 were £104,000
For comparison purposes previously reported sales were £56,055 for 2009 and £187,741 for 2010. As a private company the accounts are required to be completed by the end of September and will be issued in due course.
On the 17th May 2012 the Company drew down the last £40,000 of the £240,000 loan facility currently available from Alexander David Investments PLC.
During 2011 we acquired a purpose built filtration rig for the production of Colostrinin? at the Sterling plant in South Dakota for a cost of £133,000. This has since been used successfully to produce commercial material. Significant development work has also been carried out on the production process. This has involved assessing the feasibility of changing the extraction solvent used from methanol to ethanol. The reason for evaluating this is that residual levels of ethanol in our active ingredient are more acceptable than methanol in some major markets where the ingredient is considered a “food”. Of necessity this has involved several full scale production runs and costs that have not all yielded saleable material. This is not unusual in a development process. Other costs have been incurred developing and producing our own tablet formulation and maintaining key intellectual property.
The change to ethanol has now been shown to be viable and the availability of the new tablet gives RGTL a further source of revenue. As such we have now been able to restart negotiations with potential licensees in countries where methanol was a potential issue. Golgi – our licensee in Cyprus has already ordered a bulk supply of the new tablets with the intention of blistering and packaging them locally. Development work continues to be undertaken by several parties to produce formulations containing other proprietary ingredients in combination with ColostrininTM. One of them – our USA licensee Metagenics – is hoping to introduce a proprietary combination product during 2013. Patents covering our proprietary production process for ColostrininTM have now been granted in several major markets – most notably Europe, the USA and Canada.
Sales in the second half of 2011 were disappointing. Sales have improved during 2012 but accurately predicting future sales and therefore the point of profitability remains difficult. Whilst there are a significant number of negotiations ongoing with new potential distributors and several existing licensees are moving closer to regulatory approval the experience of partners or potential partners in many territories is similar. Basically the regulatory process for nutraceuticals is less clear and more demanding than they had first thought. This means that the period between signing an agreement and first revenues can be significant. Alternatively, talks with potential partners, sometimes after lengthy discussion, can stall or be terminated when they finally appreciate the full nature of the regulatory requirements and the extent and costs of the work needed to achieve a worthwhile promotional claim.
Although remaining confident in being able to increase sales of ColostrininTM the Directors continue to explore various ways of financing and developing the company with its advisers and contacts. Further Shareholder Bulletins will be issued as appropriate.
ReGen Therapeutics Limited
+44 20 7153 4920
Tim Shilton, Chief Executive Officer
Norman Lott, Finance Director