Calix and Afepasa enter 10-year distribution licence agreement for agriculture product

Calix Ltd (ASX:CXL) has executed its first bioactive magnesium hydroxide (known as BOOSTER-Mag) distribution agreement with Afepasa – www.afepasa.com – a European leader in sulphur-based fertiliser and crop protection products.

The distribution licence agreement for the magnesium hydroxide, known internally as BOOSTER-Mag, covers Europe, the Middle East and Africa for a period of 10 years as well as the marketing of Calix bioactive materials under Afepasa branding.

Manuel Montano, Managing Director of Afepasa, said:

“For over 125 years, Afepasa have supplied sulphur fertilisers and products for the sustainable control of crop pests and diseases. Calix’s bioactive magnesium hydroxide has the potential to be a powerful and highly complementary addition to our mineral fertiliser and crop protection portfolio.”

Calix’s safe and sustainable bioactive magnesium hydroxide materials have been under development for agricultural applications for over four years, with extensive testing over consecutive years on a variety of crops in Australia, Asia and Europe. Calix has demonstrated grower productivity, safety and sustainability can be substantially enhanced through thorough testing. The agreement targets a total addressable chemical crop protection market of over US$10b which is under increasing regulatory and sustainability pressures.

Calix’s commercialisation strategy for its bioactive materials through has been to pursue
a sales and marketing licensing model with crop protection companies and distributors, whilst continuing to manufacture active materials in-house. Calix commenced this process in 2017 and today marks a significant milestone in the first phase of execution with Afepasa.

Calix’s key milestones in this process are:

1. Initiate contact with the world’s largest crop protection companies (22 engaged).

2. If high level BOOSTER-Mag results already achieved are of interest – put in place Confidentiality Agreements and disclose more detailed data (12 in place).

3. If a counter-party wishes to progress commercial and technical negotiation – invest in their own due diligence (DD) trials – put in place Material Transfer Agreements (MTAs) to cover Intellectual Property terms and conditions to protect Calix’s interests as well as agreed trial scope and protocols (4 in place).

4. Proceed to license distribution arrangements (1 in place – covering Europe, Middle East and Africa)

Phil Hodgson, Managing Director of Calix, said:

“Development of new agricultural products takes time and significant investment. As a result it is very pleasing to have reached this significant milestone through partnering with a company of the reach and experience of Afepasa. We look forward to working with them to deliver the full potential of this application.”