Next generation of novel insecticide developer Bio-Gene Technology Limited (ASX: BGT) has extended the License and Development Agreement with Clarke Mosquito Control for the United States and Cayman Islands.
Under the updated Commercial Development Agreement, Clarke has expanded rights to explore, develop and commercialise an insecticide solution using Flavocide for the residential mosquito control segment, in addition to its current access agreement for the public health mosquito control market.
The residential mosquito control market in the US and Caymans is primarily served by professional service companies providing mosquito control treatments on private properties.
In line with the existing Agreement, the expanded applications with Clarke are on the same agreed terms with respect to commercial pathway and obligations of both parties.
Bio-Gene will supply Clarke with the Active Ingredient Flavocide, with Clarke having the responsibility of developing and registering end use products, while Bio-Gene will continue to focus on data procurement and application for the Active Ingredient registration.
The Agreement includes payment terms to Bio-Gene for product development related milestone payments, royalties on end-use products in market and purchasing Flavocide from Bio-Gene.
This amendment announced today triggers an immediate milestone payment, with funds to be used to support Flavocide registration enabling studies. The additional market applications open up more opportunities for commercial products, ultimately leading to higher potential revenues for Bio-Gene via royalty payments.
The market valuation for the original market application (wide area control of vector and nuisance mosquitos for public health benefit by mosquito abatement districts, municipalities, counties and states) granted to Clarke is estimated to be approximately US$100 million. The new market opportunity adds an additional market valuation of $150m annually, increasing the market opportunity size with Clarke by 150%.
We are pleased to expand our technology applications with Clarke in the US, a region that is currently facing pressures of resistance to incumbent insecticides, and public concerns over the use of various chemistries in controlling mosquito populations,” Bio-Gene CEO, Richard Jagger, said.
“Clarke has conducted extensive research with our active ingredient Flavocide. This extension of the agreement further validates the potential of Bio-Gene’s technology for controlling mosquitos.
“We strongly value our partnership with Clarke and the significant financial commitment Clarke has invested in our technology and joint development programme to date, which focuses on novel formulations and application methods.
“Clarke’s knowledge and expertise for mosquito control lends itself very well to this additional mosquito control application, and it is extremely encouraging to see Clarke wishing to expand their opportunities to use our products following an extensive in-house evaluation.”
Bio-Gene set to target US market with mosquito control system