Avivagen Terminates Exclusive U.S. Sales and Distribution Agreement

Rhea-AI Summary

Avivagen Inc. (TSXV:VIV, OTCQB:VIVXF) has terminated its sales and distribution agreement with CSA Animal Nutrition in the U.S. This decision comes as demand for Avivagen's OxC-beta^TM Livestock product rises in Asia and Mexico. CEO Kym Anthony noted the company's intent to replicate this success in the U.S. market. The U.S. represents 18% of the global livestock feed market, producing 215 million tonnes in 2020. Avivagen's OxC-beta™ technology is a non-antibiotic alternative to traditional livestock feed antibiotics, which may fulfill global mandates to remove in-feed antibiotics.

Positive

• Growing demand for OxC-beta™ Livestock in Asia and Mexico may indicate strong future sales in the U.S.
• The U.S. livestock feed market offers significant growth potential, accounting for 18% of the global market.

Negative

• Termination of the sales agreement with CSA Animal Nutrition may disrupt distribution efforts in the U.S.
• Dependence on future market acceptance of OxC-beta™ Livestock to replace traditional antibiotics poses a risk.

Avivagen Inc. (TSXV:VIV, OTCQB:VIVXF) (“Avivagen”), a life sciences corporation focused on developing and commercializing products for livestock, companion animal and human applications that safely enhances feed intake and supports immune function, thereby supporting general health and performance, has announced that it has terminated its sales and distribution agreement with CSA Animal Nutrition in the United States.

“We’ve seen demand for OxC-beta^TM Livestock grow rapidly in key markets across Asia and throughout Mexico, and will be looking to replicate that same corporate strategy and success in the United States moving forward,” said Kym Anthony, Chief Executive Officer, Avivagen Inc. “We appreciate all of CSA’s efforts on Avivagen’s behalf over the past few years.”

With production of 215 million tonnes of livestock feed in 2020, the United States accounts for 18% of the world’s 1.19 Billion tonne global livestock feed market.ⁱ

About OxC-beta™ Technology and OxC-beta™ Livestock
Avivagen’s OxC-beta™ technology is derived from Avivagen discoveries about β-carotene and other carotenoids, compounds that give certain fruits and vegetables their bright colours. Through support of immune function the technology provides a non-antibiotic means of promoting health and growth. OxC-beta™ Livestock is a proprietary product shown to be an effective and economic alternative to the antibiotics commonly added to livestock feeds. The product is currently available for sale in the United States, Philippines, Mexico, Taiwan, New Zealand, Thailand, Brazil, Australia and Malaysia.

Avivagen’s OxC-beta™ Livestock product is safe, effective and could fulfill the global mandate to remove all in-feed antibiotics as growth promoters. Numerous international livestock trials with poultry and swine using OxC-beta™ Livestock have proven that the product performs as well as, and, sometimes, in some aspects, better than in-feed antibiotics.

About Avivagen
Avivagen is a life sciences corporation focused on developing and commercializing products for livestock, companion animal and human applications that, by safely supporting immune function, promote general health and performance. It is a public corporation traded on the TSX Venture Exchange under the symbol VIV and is headquartered in Ottawa, Canada, based in partnership facilities of the National Research Council of Canada. For more information, visit www.avivagen.com. The contents of the website are expressly not incorporated by reference in this press release.

Forward Looking Statements
This news release includes certain forward-looking statements that are based upon the current expectations of management. Forward-looking statements involve risks and uncertainties associated with the business of Avivagen Inc. and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions “aim”, “anticipate”, “appear”, “believe”, “consider”, “could”, “estimate”, “expect”, “if”, “intend”, “goal”, “hope”, “likely”, “may”, “plan”, “possibly”, “potentially”, “pursue”, “seem”, “should”, “whether”, “will”, “would” and similar expressions. Statements set out in this news release relating to the future plans of Avivagen’s customers and the potential for additional and/or increased orders from such customers, Avivagen’s expectations as to growth of its branding in certain jurisdictions, continued distribution and acceptance of Avivagen’s technology, anticipated growth in demand for Avivagen’s products, the potential for Avivagen’s products to be commercialized in human applications, the anticipated date of fulfillment for the order described, the possibility for OxC-beta™ Livestock to replace antibiotics in livestock feeds as well as fill a critical need for health support in certain livestock applications where antibiotics are precluded and the size of market opportunities are all forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. For instance, the order described may not result in new orders for Avivagen’s products, the customer plans may change due to many reasons, demand for Avivagen’s products may not continue to grow and could decline, Avivagen’s brand recognition may not increase as anticipated or could be impacted by negative events, Avivagen’s products may not gain market acceptance or regulatory approval in new jurisdictions or for new applications, including human applications, and may not be widely accepted as a replacement for antibiotics in livestock feeds, new market access may not occur in the timeline or manner expected by Avivagen, timing of fulfillment of the order may be delayed beyond current expectation for a number of reasons which would push fulfillment and recognition of revenues for this order into a future quarter and the market opportunities may not be as large as Avivagen anticipates, in each case due to many factors, many of which are outside of Avivagen’s control. Readers are referred to the risk factors associated with the business of Avivagen set out in Avivagen’s most recent management’s discussion and analysis of financial condition available at www.SEDAR.com. Except as required by law, Avivagen assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Copyright © 2021 Avivagen Inc. OxC-beta™ is a trademark of Avivagen Inc

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ⁱ https://www.world-grain.com/articles/14784-global-feed-output-rises-by-1-in-2020

View source version on businesswire.com: https://www.businesswire.com/news/home/20210507005031/en/

FAQ

Why did Avivagen terminate its agreement with CSA Animal Nutrition?

Avivagen terminated the agreement to focus on capturing growing demand for its OxC-beta™ Livestock product in the U.S. market.

What is the significance of the U.S. livestock feed market for Avivagen?

The U.S. livestock feed market is a key opportunity, representing 18% of the global market, which produced 215 million tonnes in 2020.

What are the main features of OxC-beta™ Livestock?

OxC-beta™ Livestock is a non-antibiotic product that supports immune function and has been shown to be an effective alternative to traditional antibiotics in livestock feeds.