Ambri tech development dropped by US partner

Biosensor Enterprises (BEL) will no longer work to develop Sydney-based Ambri's (ASX:ABI) ion-channel switch (ICS), and will instead focus on out-licensing the technology.

Ambri signed an initial licensing agreement with US giants Dow Corning and Genencor International in November 2002, which in turn created BEL. Under the deal, Ambri received an injection of up to $15.7 million and the two US heavyweights agreed to acquire $5.3 million worth of shares in ASX-listed Ambri, plus options for up to another $9.6 million of Ambri stock over the following 27 months.

In return, the Dow Corning-Genencor joint venture gained exclusive worldwide rights to Ambri's advanced membrane technology in markets outside Ambri's core area of professional human healthcare.

BEL also told Ambri that despite its decision to cease its own research activities with ICS biosensor technology, which is designed to test for multiple diseases such as influenza A and diabetes, it has been in active commercialisation discussions in recent months with a number of other parties, and that it intends to continue to meet contractual commitments to Ambri.

According to BEL, those discussions included one with a "significant" US-based party which had expressing early interest in sub-licensing BEL's rights to the ICS technology for a particular market segment in which it already had diagnostic products.

In a statement, Ambri managing director Roman Zwolenski said Ambri's own R&D would continue, with the aim of finding a commercial partner. "Ambri is also continuing to actively pursue merger and acquisition discussions as a means of protecting Ambri shareholder value and providing another avenue for exploitation of Ambri's technical, physical and financial resources," he said.

Ambri also announced that Dave Cornelius had stepped down from the role of non-executive director. Cornelius was seconded from Dow Corning in March 2003 and initially performed the role of Ambri managing director and acting CEO until September 2003, when he returned to the US and his position at Dow.

On news of the BEL announcement yesterday, Ambri shares fell more than 32 per cent. In today's trading the shares had clawed back some value, and at press time were at AUD$0.06.

Ambri had not responded to requests for comment by press time today.