saponin at abic 2008 cork, ireland

1

Dr. Michael M. Oelck, PAg, Co-founder and CEO

SAPONIN Inc.

- The Prairie Carnation™ Company -

Pink(s) to the Prairies!

2 ABIC 2008, Cork Ireland,

Pink(s) to the Prairies!

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Two Parts

Part I - The SAPONIN business case.

Part II - Why did the investors invest?

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Part I

• Company Intro

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Mission

SAPONIN is the leading supplier of industrial bio-

products from Prairie Carnation™ (Saponaria

vaccaria) . We produce and sell

• the finest native starch from any plant for cosmetics,

• saponins for vaccine adjuvants and

• cyclopeptides for medical applications!

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The Crop

• Prairie CarnationTM

• Saponaria vaccaria L.

• syn. Vaccaria pyramidata

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Brand New Crop! - A Patent Attorney‘s Dream -

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Agronomy that Works!

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The Seed

Starch

Protein

Lipids

Saponins

Cyclopeptides

Phenolics

Soluble fibre

60

13

5

3

0.3

05

5

84 %

Useable Content in %

Genetics

• 18 chromosomes

• Self compatible fertilisation > 80%

• Microsospore derived embyro regeneration

• Double haploid breeding lines

• Hybrids for variety protection

• Si system required or molecular male sterility

• Transformation system in progress

• Molecular pharming potential

7/5/2011 10

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The Products

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The

Biorefinery

Concept

CHO

O

OH

O

O

ORO

HO

HOOC

OHOH

HO

HO

OH3C

R3O O

O

R1O

HO OR2

O

O

CH3 OH

OH

O

O OH

HO

OH

O

O

GAL

FUC

ARA

RHA

1628

4

12

23

H3C

NH

NH HN

O

NHO

N

O

HN

NH

O

O

O

SEGETALIN AMW 609.3274

cyclo (gly-val-pro-val-trp-ala)

Soluble fibre

Protein

Starch

Seed Extract

Oil

Cyclic peptides

Saponins

Phenolics

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Micro-Starch cash flow early

• Novel!

• Granule size of 1 micron - smallest starch known in nature

• Remarkable texture and performance properties

• Proprietary production method

• Premium pricing

• Cosmetic and specialty foods ingredient

• New industrial applications

Wheat starch 20-100um Prairie Carnation starch 1um

25 μm

1 μm

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Saponins Membrane active because of detergent structure

• Mode of action of saponins as cholesterol analogue

• Free cholesterol in the blood stream binds saponins

• Membrane effects against fungi and bacteria

• Cholesterol in cell membrane binds cholesterol

• Cell membranes permeable for seconds

• Removal with cholesterol by the liver

• Catalytic effect to help big molecules into cells

CHO

O

OH

O

O

ORO

HO

HOOC

OHOH

HO

HO

OH3C

R3O O

O

R1O

HO OR2

O

O

CH3 OH

OH

O

O OH

HO

OH

O

O

GAL

FUC

ARA

RHA

1628

4

12

23

H3C

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Saponin Market: Vaccine Adjuvants

• Cholesterol binding

• Immune stimulant

• Less hemolytic than any other saponins

• Antigen developed QS-21Saponin

• GSK has QS-21 for first Malaria vaccine to come

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Saponin Market: Cancer

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Cyclopeptides Part of Natural Defense System of Plants

Effects:

• Antimicrobial effect against protozoa, bacteria

Markets:

• Veterinary feed supplement

• Natural Fungicides for Organic Production

• Cardiovascular Therapy

NH

NH HN

O

NHO

N

O

HN

NH

O

O

O

SEGETALIN AMW 609.3274

cyclo (gly-val-pro-val-trp-ala)

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Ingredient Market Marketing

Starch Cosmetics license for customer products, supply

raw product, customer does

regulatory

Saponins Cosmetics Adstringend , anti-wrinkle, sell to

formulators and cosmetics

Saponins Adjuvant

Develop proof of concept, then

license

To vet first, pharma second

Saponins Pharmaceutical Develop proof of concept, then

license (e.g. mouse models in cancer)

Segetalins

(cyclic peptides)

Pharmaceutical Develop proof of concept,

then license (e.g. mouse models )

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Conclusion of Intro (Part I)

• SAPONIN is a new bio-pharmaceutical company

• Agriculture and seed production accomplished!

• Regulatory expertise needed at the beginning.

• Creative fractionation easy for more than one product.

• Natural Actives in large scale production!

• Markets are cosmetics, agriculture , vet. and pharma

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Part II

Why did the Investors Invest?

Less Risk, more Rewards!

21 ABIC 2008, Cork, Ireland

Investors Need a Convincing Team

- enriched by their own "experts", just in case…

SAPONIN was founded in 2003. Clarity Capital Corporation invested $2.2 Million

into SAPONIN Inc. in 2006 and $1 Million in 2008. The company is looking for

another investment of $5Million at present.

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Own the Value Chain! Germplasm

Contract production

Processing

Product Quality Control

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Intellectual Property

Position METHOD FOR PRODUCTION OF SAPONARIA FROM MICROSPORES , PCT/CA2006/000725

EXCLUSIVE LICENCE OF SCOTT LANDLINE FROM AAFC,

Closed loop production system with contract farmers

PROCESSING OF SAPONARIA VACCARIA SEED,

United States Patent 3622389

EXCLUSIVE PRODUCT ACCESS AS USP

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Features Benefits

Extremely small, uniform, smooth For improved skin feel

Large inner surface area High carrying load for ingredients

White free flowing powder Easy formulation

Amylose content ~13% Physical-chemical properties for

potentially superior gels

Large scale seed production Domestic production and security of

supply for cosmetic needs

Exclusive partnerships Marketing by product segment

and by geography

Unique Novelty Product Branding exclusivity,

A must for the cosmetic industry

Early to Market Cash Flow: Starch

Low regulatory hurdles for cosmetic applications

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Wild type seed

Identity preserved double haploid seed

Contract produced farmer seed

Seed extract,:60% saponin, phenolics, cyclic peptides

Seed flower – finest starch, proteins, fibre, oil

Vaccine adjuvants vet + human

Therapeutic saponins

Cardiovascular

Cell Proliferation

$10/kg

$100/kg

$1kg

$250kg

$20kg

$10kg

$1000kg

Licence Downpayment$10Mill

Royalties $10Mill

Joint Venture $50Mill

Royalties $100Mill Example with theoretical values

Prairie Carnation Value Chain

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Wild type seed

Double haploid seed

Identity preserved certified seed

Contract produced farmer seed

Seed extract

Seed flower

Seed Protein

Seed Oil

Saponin adjuvant

Seed Peptides Library

Saponin adjuvants

Therapeutic saponins

Blood Pressure

Cell Proliferation

Drugs

$10/kg

$25/kg

$50/kg

$1/kg

Example with theoretical values

$100/kg

$20/kg

$2/kg

$10/kg

$30/kg

$10/kg

$200/kg

Outlicence $1Mill

Downpayment$1Mill

Royalties $10Mill

Joint Venture $50Mill

Royalties $100Mill

Potential Value per 100 ha:

500 to

50 to

400 to

50 to

15 to

30 kg

30 kg

30 kg

Where is the home run? Focus!

particle starch, conformations

saponins, antioxidants, soluble fibre

protein for food, feed,

seed oil for food

vet. adjuvants

vaccines

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Added Value: Cyclopeptide Pharma Doesn’t this sound like a home run?

• Known multiple pharmacological properties

• Not easy to produce – creates barrier

• Identified application for cardiovascular disease

• Compound library for numerous new drug candidates

• Proprietary production methods in-place

• Patent in preparation

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Productive Agriculture

Taken for Granted

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Broad Markets are a Backup

toothpaste Mouth rinse

shampoo

root beer

beer degreasing and

cleaning products

photographic

emulsions

ore separation

fire

extinguishers

Commercial saponin uses

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The Upscale Potential!

Prairie Carnation ( sales value per bushel)

Saponin – crude $ 250 or

Saponin – animal adjuvant (100µL/dose) $7,500 or

Saponin – human adjuvant (100µL/dose) $3.75 MM or

Saponin – cancer drug (100 mg/dose) $4.5 MM and

Cyclopeptides – cardiovascular drug (100 mg) $75,000

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Question:

Why would anybody grow a brand new crop?

Answer:

Control of the crop from the seed all the way to end user products!

• Create a strong intellectual property position,

• Multi faceted (six) uses of all seed contents,

• Multiple pharmaceutical compounds with proof of concept product in

pre-clinics

• Identity preserved germplasm control

Fazit:

Proprietary Technology Platform offering FTO, Genetics, Extraction

for six significant commercial uses ,

The Business Concept

the six pillar company!

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1. Starch for cosmetic application

2. Saponins for vaccine adjuvants, dermatology,

3. Biological fungicide, nematicide, SAR

4. Cyclic peptides for blood pressure application etc.

5. Antioxidant for food supplement

6. Edible Protein for food and feed

The Six Pillars

33 ABIC 2008, Cork, Ireland

Investor Speak

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Concept for Success

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Contact Info

Michael M. Oelck,

Manotick (Ottawa) Ontario

Canada K4M 1A6

(613) 692-2382

IM Skype: Moelck

Michael M. Oelck, Ph.D., PAg. (Seed Business, Genetics, Regulatory)

Elke Steinmann-Oelck, Ph.D. (Agronomy, Plant Pathology)

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Prairie Carnation