Spicer....This is Livas 1 summary. He has done a great job of...

Spicer....This is Livas 1 summary. He has done a great job of capturing it all.

Hi everyone

Just caught up on the posts here since yesterday. Interesting discussions.

Ok. Yesterdays AGM.

About 70-80 people. The venue was alot more comfortable than previous years, although the noise from the adjoining rooms was a little annoying at times.
There was plenty of SibEX Bio I drink to go around. And after a few glasses im hooked biggrin.gif

Regarding the presentation. Yep, it was short. Denis presented the slides, then Charlie gave an update of his trip, Peter read out and commented on a shareholder letter, and then questions (Peter said they were doing the resolutions at the end of the meeting so that all shareholders could have their questions answered before voting), and finally the resolutions (which got passed easily).

Key take outs.

This 15kg production requirement from the RMOH is something that they just found out about. Its not something they have known about for a while that they have decided to announce to shareholders. I see this as a mute point anyway because the product wont be sold in volumes until early next year anyway.

There is a conference in mid-December in Moscow where they will receive demand numbers from the hospitals in Moscow. This is the event that was supposed to occur sooner (along the lines of Denis’s comments in a previous BRR about ‘volume sales within weeks’).
They made very clear the attention Ropren is getting in the Russian medical community.

Furthermore, the point was made that the dept of health needs to plan for its funding, and they can only do this in a co-ordinated effort with all the hospitals.

Vagif also reminded us that due to the scrutiny of the RMOH, the RMOH conducted internal trials in 4 hospitals. The clinicians that conducted these trials all support the commercialisation of Ropren due to the efficacy of the product.

In mid March there will be a decision about which product will be included in Russia’s DLO scheme. Entry into this scheme means a 100% subsidy from the RMOH. This is Russia wide. Only 1 product is included in the scheme each year. Solagran believe they are well placed for Ropren to be this product, mainly due to the support they have from the medical community.

They have lodged a submission with a Melbourne hospital for a Ropren and BioA trial. It will go to the ethics committee in the next month. This was as a result of Dr Agishev’s visit. Speaking to Denis afterwards he said that when they went to this meeting they were expecting 1 representative from the hospital, and there were 14. There are some very prominent people involved that are sponsoring the trial (ie its practitioner sponsored not company sponsored).

The documentary will be shown next year.

It looks like we are close to some distribution agreements in Western Europe (I think re BioA but could be B or I, it wasn’t clear).
Samples and documentation has been given to some ‘highly regarded companies’.

They employ 100 people in Tomsk who get paid roughly $700 per month. They have the buy-in from all the staff as working conditions are good.

Due to their presence in the Tomsk SEZ, they recently negotiated an agreement for an additional 5000ha of additional pine forest.

They have had some discussions in StP with a company that specialises in microencapsulation. This company has done some testing using this unique delivery system into the body and the results were promising (If i was to guess, I would say that the company may do the same thing here as with SibEX. Take an initial stake. Get the key people on board, and integrate it into their production process. But this will be a while yet).

Regarding the UAE/Singapore agreements, the minimum amounts specified are what are required for those companies to keep their exclusive rights.
Pulsemed is a small company and will devote all of their resources to Bioeffectives.
Solagran has worked on the distribution plan with these companies and believe sales rates will be much higher (I know we heard the same thing with BioB but im sure they have learned their lessons hence the comments that SLA has worked on the plan).

Charlie will be going overseas again in March. This will include a trip to the US.

As a throwaway line, Peter said they could up their stake in SibEX to 97%, and he also reminded shareholders that Solagran has no debt and will not be taking on any debt.

Also, he mentioned that they have spent roughly $14mn on the Tomsk plant, and he believes that if the plant was to be valued fairly, it should be on their books at $100-120mn.

Yes the raising is due to the falling AUD. They were going to send US$4mn over to Tomsk but with the fall in the AUD, this amount has increased (in AUD terms) by $900k.

There were some anecdotal comments regarding cardiologists using Ropren in association with heart operations.

The #1 product in Russia atm is Geptral. This product has annual sales in Russia of around $1bn.

There were 11 people that reached the Ropren pricing decision. This included 1 RMOH representative, 2 gastroenterologists, 1 SibEX representative, a marketing person who works with Aventis, Vagif, and I missed the last couple of people – sorry!

Some comments were made that they weren’t happy with the progress of BPO and the attention to Bioeffectives, and are now happy that the board has been changed. The chairman of BPO resigned bc when the proxies came in for his re-election, they were overwhelmingly negative so he decided to resign and not go to the AGM.

This microencapsulated BioA format will be used by BPO for their trials.

Mark and Cameron spoke about their work with BioA (I didn’t ascertain whether they were the new sales team in Oz?) Cameron is the ex-Kayaker who contracted MRSA in an Australian hospital that was cured using BioA. Mark has been doing work promoting Bioeffectives in the Australian sports community, including the use of the BioB sauna treatment in combination with the BioI sports drink. One VERY prominent AFL club (I know who but im not sure i can post it) recently installed a sauna to use BioB). It was also confirmed to me that the high profile AFL player that was mentioned at the September meeting is using the product, and also an Aussie cyclist who tends to do very well at Le Tour is also using the products.

A question was asked on the injective format trials . Vagif advised that the trials are complete and they have preliminary results. The final report is due in January so expect an announcement late January re these trials, and also the nanoparticles trials.

As an aside, Vagif is on holidays until Jan 25.

Peter S gave an update regarding the Solamind case. ANZ have applied for security of costs so Solamind has until next Friday to lodge $125k in the courts to enable the next stage of proceedings, which will be in mid-Feb. The case may be heard in the Supreme court. They remain extremely confident of a settlement.

A shareholder asked about the European investor interest that was mentioned in September. Denis advised that they haven’t had time to follow this through. But it involved a firm who specialises matching Biotechs with Biotech investors. These investors are in Switzerland and Germany.

The threat of competition from China and Japan is real.

The payment terms in Russia will be 3 months.

Denis mentioned after the meeting that BioA sales have and will continue to increase with the new sales team that has been appointed. They will be using Lifespan more as a distributor instead of their sales capability, and employing their own sales staff.

So all in all, if you are a long-term shareholder then things are moving in the right direction. Yes they are in a bureaucratic country and December shapes up like an important month for the next lot of Solagran achievements. They cant do much about the bureaucracy except satisfy each of their requests, which they have done. This, coupled with the successful trials and the interest in the medical community will IMO ensure that Ropren is sold in Russia and many lives will be better for it.

Cheers
Livas1