Agtech development company Bio-Gene Technology Limited (ASX: BGT) has signed a Licence and Development Agreement with Evergreen Garden Care to develop new insecticide solutions for consumer markets in the E.U., U.K., Australia and New Zealand.
Evergreen is the leading garden care company in Europe and Australasia, who’s leading brand portfolio includes Scotts, Osmocote, Miracle-Gro, Substral and Fertiligene.
This partnership formed through the agreement will provide Evergreen with exclusive access to Bio-Gene proprietary natural technology and data – including Bio-Gene products Flavocide and Qcide. This will enable Evergreen to exclusively evaluate and develop natural product solutions targeting mosquito and ant control.
These market segments are estimated to have a retail sales value of approximately US$600 million.
Evergreen’s strategy is driven by a strong commitment to the environment, and it has an extensive research and development program to discover and develop new natural and bio control solutions for its home and garden care product ranges.
This newly formed agreement with Bio-Gene will accelerate this program by working with an external expert partner. Evergreen have already successfully launched a number of natural products across its current plant protection, weed control and fertiliser ranges.
Under the terms of the agreement, Evergreen will pay licence and key milestone payments to enable the on-going development work that is required. The initial and largest of these milestone payments will be payable within the first 18 months.
Upon launch of a commercially viable product, Evergreen will pay Bio-Gene an agreed on-going undisclosed royalty on all product sales containing Bio-Gene’s technology. The agreement also provides an option for Evergreen to licence the right to develop Bio-Gene’s active ingredients for other applications within the broad consumer application market, with the terms of those licensing arrangements to be separately negotiated.
Bio-Gene CEO, Richard Jagger, said the agreement is a strong validation of the potential of BioGene’s technology for a range of commercial consumer applications.
Evergreen’s strategy fits perfectly with the unique natural technology we are developing at Bio-Gene and it is extremely encouraging such a leading company as Evergreen has committed to further the development of our technology after such an early-stage evaluation,” he said.
“Whilst the breadth of studies has been limited at this early stage, current observations have given both parties the confidence to proceed with a commercial agreement and the next phase of end-use product development.
“This programme will focus on specific formulation development for mosquito and ant control, as well as expanding testing to explore a number of key consumer applications for both Qcide and Flavocide. The next stage of the development program is expected to start before the end of this calendar year.
“The Agreement with Evergreen outlines the commercial pathway and obligations of both parties, including the registration requirements of the Active Ingredients and end use products.” “Bio-Gene will supply Evergreen with the Active Ingredients Flavocide and Qcide, with Evergreen having the responsibility of developing and registering end use products, which will complement Bio-Gene’s data procurement and application for the Active Ingredient registration.
“This represents a significant financial commitment on the part of Evergreen over the next five to seven years as the work continues. The licence and milestone fees payable by Evergreen to Bio-Gene will be used to partly fund our registration costs for the Active Ingredient.”
