(ABTX) Aqua Bounty Technologies Inc

27 January 2012

AquaBounty Technologies, Inc.

("AquaBounty" or "the Company")

Operational Update

AquaBounty Technologies, Inc. (ABTX), a biotechnology company focused on enhancing productivity in the aquaculture market, announces an update on the Company's regulatory progress, operations and financial outlook for the 2012 fiscal year.

Regulatory Update

As previously reported, AquaBounty completed all submissions for its New Animal Drug Application ("NADA") for AquAdvantage Salmon ("AAS") with the Food and Drug Administration ("FDA") in 2010.  After public meetings on the results of their review, the FDA released documents stating that the product was safe as food, safe to the fish and safe for the environment.  Since that time, the FDA has been working to complete its Environmental Assessment ("EA") for AAS to ensure that an approval of the pending NADA would have no adverse effect on the environment.  The Company will update the market when the FDA completes this review and publishes the EA. 

Congressional Update

The Company reported in June 2011 that an amendment to the Agricultural Appropriations Bill to prohibit the FDA from utilizing any of the appropriated funds for the purpose of approving "genetically engineered salmon" was introduced in the U.S House of Representatives when fewer than ten members (out of a total of 435) were in attendance.  This amendment did not represent a broad consensus of opinion by U.S. lawmakers, and was viewed by many as subverting the authority of the FDA and undermining science-based regulatory policy.  The Agricultural Appropriations Bill approved by the U.S. Senate did not include a provision regarding genetically engineered salmon and the House amendment was removed when the Bill went to joint conference. 

Financial Matters

In its 2011 half year report, the Company indicated that its cash resources were sufficient to take it into Q2 of 2012.  Following a review of options, the Directors have decided, in view of the continuing uncertainty surrounding the timing of the FDA approval, to reduce operating costs by restructuring the organization in order to increase the Company's cash runway.  It is expected that these measures will be implemented by the end of the first quarter of 2012 and will reduce the cash costs of operations by approximately 30 percent. 

In conjunction with this action, it is expected that a circular to shareholders proposing a limited placement of new shares will be distributed for their review and approval within the next 30 days.

Enquiries:

AquaBounty Technologies

David Frank, Chief Financial Officer                                     +1 781 899 7755

Nomura Code Securities

Giles Balleny                                                                        +44 (0)207 776 1200

Luther Pendragon

Harry Chathli, Claire Norbury                                              +44 (0)207 618 9100

23 September 2011

AquaBounty Technologies, Inc.

("AquaBounty" or "the Company")

Interim results for the six months ended 30 June 2011

AquaBounty Technologies, Inc. (ABTX), a biotechnology company focused on enhancing productivity in the aquaculture market, announces its interim results for the six months ended 30 June 2011.

Financial and operational summary:

·    U.S. Food and Drug Administration ("FDA") continued to review the Company's application for AquAdvantage^® Salmon ("AAS");

·    A new batch of AAS fry shipped to Panama for grow-out;

·    Net loss of $2.8 million (H1 2010: $2.5 million);

·    Continue to exercise tight control on cash; and

·    Cash and marketable securities at 30 June 2011: $3.8 million (30 June 2010: $3.6 million).

Ronald Stotish, Chief Executive Officer of AquaBounty, commented: "While the approval process has taken longer than anticipated, we strongly believe that the FDA is moving towards a successful conclusion.  Equally, the potential market for AquAdvantage^® Salmon and other biotechnology-based products continues to grow.  As a result, we look to the future with confidence and to delivering value to our shareholders."

Enquiries:

AquaBounty Technologies

David Frank, Chief Financial Officer                                     +1 781 899 7755

Nomura Code Securities

Richard Potts, Giles Balleny                                                  +44 (0)207 776 1200

Corfin Public Relations

Harry Chathli, Claire Norbury                                              +44 (0)207 596 2860

Chairman's Statement

FDA approval

AquaBounty completed all submissions for its New Animal Drug Application ("NADA") for AquAdvantage^® Salmon with the U.S. Food and Drug Administration ("FDA") in 2010.  After public meetings on the results of their review, the FDA released documents stating that the product was safe as food, safe to the fish, and safe for the environment.  As reported in the Company's preliminary results announcement of 3 May 2011, the next stage in the approval process is expected to be the publication by the FDA of an Environmental Assessment for AAS ("EA"), followed by a period for public comment.  Any approval by the FDA of AquaBounty's AAS application would follow this assessment.  AquaBounty has not been informed of the likely date of the publication of the EA, but remains in dialogue with the FDA which leads the Company to believe that they are advancing towards the successful conclusion of the process.  

Operations

In June 2011, the Company shipped a new batch of recently hatched AquAdvantage^® Salmon to AquaBounty's facility in Panama for grow-out.  The fry have acclimatized and are performing extremely well.  Two prospective customers within the U.S. have made applications to begin preliminary trials on an R&D basis of AAS and are awaiting approval from the requisite regulatory authorities to be able to proceed.  Once AAS is approved for sale, the Company will immediately begin field trials with prospective customers in the U.S. and abroad who have registered their interest.

The Company advanced its development program for the second generation of AAS, which is being partially funded by a grant from the Atlantic Canada Opportunities Agency.  

Financial review

Operating expenses for the six month period were slightly higher at $2.8 million (H1 2010: $2.5 million), primarily due to an increase in R&D spending as the Company invested in AAS product improvements and new technologies.  Cash used in the first half of 2011 totaled $2.4 million (H1 2010: $2.1 million).  Current balances are sufficient to take the Company into Q2 2012. 

The Company's spending and cash use remained on budget.  In addition, to further reduce costs, the Board of AquaBounty resolved to reduce its number from eight members to five, effective following the Company's Annual General Meeting on 19 July 2011.

The Board is conscious, however, that the Company's cash resources will need to be supplemented early in 2012 and is currently considering options for raising further working capital, subject to shareholders' approval.

Update on Congressional Bill

As announced on 17 June 2011, an amendment to the Agricultural Appropriations Bill to prohibit the FDA from utilizing any of the appropriated funds for the purpose of approving "genetically engineered salmon" was introduced and approved by voice-vote in the U.S House of Representatives when fewer than ten members (out of a total of 435) were in attendance.  This amendment does not represent a broad consensus of opinion by U.S. lawmakers, and is viewed by many as subverting the authority of the FDA and undermining science-based regulatory policy.

The Agricultural Appropriations Bill currently under consideration by the U.S. Senate does not include a provision regarding genetically engineered salmon.  The bill has been approved by the Senate Appropriations Committee and will now be debated on the floor of the Senate.

The management of the Company believes that it is unlikely that a provision designed to obstruct the approval of AquaBounty's NADA will be included in any eventual final law passed by the House and the Senate.  Leadership in both the House and Senate have historically rejected attempts to subvert the science-based regulatory policy of the FDA. 

In August 2011, the Company was pleased to note the opposition of the scientific community against this interference by certain politicians.  One such challenge to the politicians came in a letter to Congressional Leadership from the Biotechnology Industry Organization (BIO), which joined 37 scientific and agriculture organizations in urging Congress to support the U.S. Food and Drug Administration's mandate to base its assessments on science. 

Outlook

While the process has taken longer than initially expected due to the pioneering nature of the application, the Company remains confident that the FDA is advancing towards the approval of its New Animal Drug Application.  Once received, AAS will be the world's first genetically modified animal approved for human consumption.

Aquaculture continues to grow more rapidly than other food-producing sectors.  According to the United Nations Food and Agriculture Organization, 82% of global fish stocks are overexploited, depleted or endangered.  With world population and demand for fish protein increasing, sources of supply are under ever increasing pressure.  The Company believes that biotechnology-based solutions, such as its AAS, can assist in overcoming this shortfall by enabling a new and sustainable production system. As a result, the potential market for AAS and other AquaBounty products is substantial.