Further to a Letter of Intent previously reported, Genesis Bioventures today announced that it has entered into a binding agreement with Efoora Inc. and Prion Developmental Laboratories, Inc. to buy all of Efoora's majority interest shares owned or pledged in PDL thereby gaining controlling interest of PDL. A Form 8-K has been filed with the SEC in this regard. Prior to the Agreement, GBI had one-third equity interest in PDL.
Under the terms of the Agreement, GBI will buy Efoora's 5,120,000 shares of PDL at $0.50 per share for a total of $2,560,000 US dollars. The funds are scheduled to be paid in installments until December 2005 but are subject to certain milestones being met by PDL. The first installment has been paid to Efoora and was achieved through the support of an existing shareholder of the Company who made a further investment in GBI with the stipulation that the funds be used to further the Company's position in PDL.
Efoora is a private corporation based in Buffalo Grove, Illinois that specializes in the development and manufacture of medical diagnostics products. PDL is a subsidiary of Efoora, specializing in the development of diagnostic tests to detect prion disease in both humans and animals. PDL has a USDA approved rapid strip test for Chronic Wasting disease, which affects deer and elk. According to a 2001 survey done every five years by the US Fish and Wildlife Service, 10.9 million people hunt big game such as deer and elk per year in the United States.
Using the same technology, PDL has developed a rapid strip test for Bovine Spongiform Encephalopathy ("BSE") commonly known as Mad Cow disease. Once approved, the test would be utilized at the "point of kill" in slaughter houses to immediately detect the presence of BSE. The added cost of the test would be minimal and testing every animal would be feasible. According to estimates from the World Organization for Animal Health, over 145 million cows are slaughtered annually in 16 major beef producing countries. Mad Cow disease has devastated the cattle industry in North America with losses exceeding 10 billion dollars in just the past two years.
Chairman and CEO of GBI, Greg McCartney commented, "We believe that achieving over 90% controlling interest in PDL will be a tremendous asset to the Company. PDL's rapid strip test for BSE has the potential to change the face of the cattle industry and ensure that all borders worldwide will always remain open for trade. BSE free cattle would be assured on every consumer level. Based on the global number of cows slaughtered annually, the potential number of tests that could be sold would in turn be very lucrative for GBI and its shareholders."