July 28, 2008
This is an open letter to all ViroGen shareholders. To all those shareholders who have been involved with the company these last few years and those new to the company as a result of the most recent public initiative, welcome to the company and know that management is most appreciative of your continuing support of the company and its operations.
In this letter, I am going to highlight the company's progress over the last two quarters.
For those of you who are yet unaware, the company went public in April of 2008. The stock symbol is VRNI.PK. As you may or may not be aware, this was an arduous process with many regulatory hurdles to overcome. It is however a milestone in the company' evolution. Virogen common stock can now be traded through any stock brokerage company in the United States.
The company has sent teams to Pakistan and Egypt these last few months and these endeavors have resulted in signed contracts worth $1,000,000 US in sales commitments annually. These are contract minimums and both Vet Cure Pharma (Pakistan) and Microbiotech (Egypt) expect to exceed these minimums by substantial amounts. These are very large markets and the poultry consumption in these markets is growing by approximately 30-35% per annum. In the case of Microbiotech, in the days after they signed the distribution contract with ViroGen, they in turn signed contracts with the largest poultry producers in Egypt and Saudi Arabia; thus, ViroGen is virtually guaranteed a dominance in the Middle East with its in ovo immune vaccine, as the rest of the Middle Eastern countries and producers will follow the lead of these major producers. Similarly, Vet Cure Pharma enjoys a unique position in the Pakistani market and considers the Innovo Immune vaccine to be a new and unique technology that will further their market dominance with the major producers. The Pakistani market yields approximately 1 billion birds per annum and is experiencing rapid growth.
On July 19th 2008, ViroGen received an EU license to manufacture and export its B1 and Innovo Immune Vaccines. This is truly a milestone for the company. This EU certification will open markets worldwide. Our manufacturer is Romvac. (www.romvac.ro) Romvac presently manufactures a full line of veterinary products and has been supplying the veterinary market since the mid 1970s. They have recently built a state of the art facility complete with ISO 9001 certifications and GNP certifications. We are very pleased to have them under contract for production. With this license we are now able to fill sales orders. The company has been informed that Microbiotech will place their 1st order with the company within the next 2-4 weeks. The company also expects the first orders from Vet Cure Pharma within the next 60-90 days. The company has yet to be approved by the Pakistani Government which will take 60 days or so to complete and was dependent upon having the EU license issued. Thus, ViroGen should realize revenue streams from the sale of its products by the end of the 3rd qtr of 2008. This again is a watershed event in the company's history.
The company is now free to pursue additional contracts in countries and target markets worldwide. The company has successfully made the transition from and R&D enterprise to a viable commercial company. Needless to say, shareholder value has been enhanced by these very significant events. As with any new product introduction with innovative technology, management anticipates rapid growth over the next several quarters, as we aggressively market the company's products worldwide.
I want to thank all those on staff with Virogen and its consultants for their tireless efforts and commitment to the ongoing success of this enterprise.
Regards,
Paul Hogan
CEO Virogen Inc.
NOTE: Certain statements in this memorandum are �forward-looking statements� within the meaning of the Private Securities Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause results to differ materially. Such risks, uncertainties and other factors include but are not limited to new economic conditions, risk in product development, market acceptance of new products and continuing product demand, level of competition and other factors described in Company reports and other filings with regulatory bodies.