REG - OptiBiotix Health - Formation of OptiBiotix Health India

OptiBiotix HealthAnnouncement

17/11/2021 07:00

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RNS Number : 5834S  OptiBiotix Health PLC  17 November 2021

OptiBiotix Health plc

("OptiBiotix" or the "Company" or the "Group")

 

Formation of OptiBiotix Health India

 

OptiBiotix Health plc (AIM: OPTI), a life sciences business developing
compounds that modulate the microbiome to tackle metabolic syndrome, systemic
low grade inflammation, obesity and diabetes, cardiovascular disease and high
cholesterol, announces the formation of its new Indian subsidiary, OptiBiotix
Health India Ltd ("OHI").

 

With a population of 1.3 billion people and cardiovascular disease accounting
for up to 27% of all deaths (WHO) and obesity prevalence at 40.3%
(https://journals.sagepub.com/doi/full/10.1177/0972753120987465
(https://journals.sagepub.com/doi/full/10.1177/0972753120987465) ), India is a
market of great strategic importance to OptiBiotix. The formation of OHI
allows significant opportunities for additional revenue growth through sales
of the Group's products in India.  The middle-class population in India is
expected to reach 475 million by 2030. Currently most middle-class consumers
live in the European Union (EU) and the United States, but over the next
decade, the majority will shift heavily toward India, with one in four
global middle-class consumers expected to reside in India by 2035
https://www.asianstudies.org/publications/eaa/archives/the-middle-class-in-india-from-1947-to-the-present-and-beyond/
(https://www.asianstudies.org/publications/eaa/archives/the-middle-class-in-india-from-1947-to-the-present-and-beyond/)
.

The nutraceuticals market in India is expected to grow from $4 billion in 2017
to $18 billion in 2025 against the backdrop of rising demand for dietary
supplements from upper and middle class
https://www.investindia.gov.in/team-india-blogs/growing-nutraceuticals-market-india
(https://www.investindia.gov.in/team-india-blogs/growing-nutraceuticals-market-india)
.

In March 2021, OptiBiotix announced the appointment of Dr Taru Jain to focus
on business development and growing sales in the strategically important
Indian and Asian markets.  The formation of OHI builds on that presence and
is expected to bring the following benefits:-

 

·    OHI will be able to manage the purchase and sale of ingredients (e.g.
LPLDL®, SlimBiome®) and final product (e.g. CholBiome® range, GoFigure®)
manufactured and sold in India increasing operational efficiency and partner
engagement.  This is highly challenging without a physical presence in India

·    OHI will buy ingredients from its ingredients manufacturers, sell to
product manufacturers, and then buy and sell final product through partners,
deriving value from all parts of the supply chain

·    We anticipate this will result in greater sales at improved margins
and if successful make a significant contribution to revenue growth.  The
ability to sell both ingredient and final product leads to a double impact on
revenues and will allow OptiBiotix to protect its brands from the risk of
commoditisation

·    OHI will be able to benefit from reduced or negligible import,
export, and General Sales Taxes which would be charged in the absence of a
local company presence.

 

The formation of OHI allows OptiBiotix to migrate existing profit-sharing
agreements (RNS:7 January 2019, 16 May 2018) to manufacture and supply
agreements. This allows the Company to manage and extract value from all areas
of the supply chain to better exploit the market opportunity India represents.

 

Stephen OHara, CEO of OptiBiotix Health plc, commented: "We are pleased to
announce the setting up of a subsidiary in India, a country we have identified
as of strategic importance for its high growth potential and access to Asian
markets. This is all part of our plans to grow sales, margins, and product
ranges with new and existing partners in key strategic markets. Establishing a
physical presence allows us to maximise the potential opportunity in this
market and and if successful make a significant contribution to future sales
growth."

 

The Directors of the Company are responsible for the release of this
announcement.

 

For further information, please contact:

 

 OptiBiotix Health plc                                     www.optibiotix.com (http://www.optibiotix.com/)
 Stephen O'Hara, Chief Executive  Contact via Walbrook below

 Cairn Financial Advisers LLP (NOMAD)                      Tel: 020 7213 0880
 Liam Murray / Jo Turner / Ludovico Lazzaretti

 Cenkos Securities plc (Broker)                            Tel: 020 7397 8900
 Callum Davidson / Neil McDonald
 Michael Johnson / Russell Kerr (Sales)

 Walbrook PR Ltd                                           Mob: 07876 741 001
 Anna Dunphy

 

 

Caution regarding forward looking statements

 

Certain statements in this announcement, are, or may be deemed to be, forward
looking statements. Forward looking statements are identified by their use of
terms and phrases such as ''believe'', ''could'', "should" ''envisage'',
''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect",
''will'' or the negative of those, variations or comparable expressions,
including references to assumptions. These forward looking statements are not
based on historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the amount,
nature and sources of funding thereof), competitive advantages, business
prospects and opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on information
currently available to the Directors.

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