Vancouver, BC, March 14, 2006--Forbes Medi-Tech Inc. (TSX:FMI; NASDAQ:FMTI) today announced the completion of the sale of its interest in Phyto-Source, the Company's 50-50 sterol manufacturing joint venture, for US$25 million to Chusei Oil Co. Ltd., the Japanese parent company of the Company's former joint venture partner, Chusei (U.S.A.) Inc. Forbes has received the US$25 million under the agreement, announced February 23, 2006. Forbes has also received the remaining US$1 million of its original US$4 million loan to Phyto-Source. Additionally, all guarantees provided by Forbes USA to Phyto-Source's lenders for the joint venture's commercial term loan, line of credit and capital equipment lease have been discharged.
"The completion of this transaction represents a significant step in strengthening our balance sheet and solidifying our position as a Life Sciences Company dedicated to the prevention and treatment of cardiovascular disease," said Charles Butt, President and CEO of Forbes Medi-Tech. "Moving forward, we will continue to build revenue from our value-added ingredient business with cholesterol-lowering Reducol(TM) at the forefront."
As stated in our news release of February 23, 2006, the net proceeds of sale will be used for Forbes' pharmaceutical and nutraceutical development programs. As Forbes' joint venture interest was held in its U.S. subsidiary, U.S. taxes of approximately US$5.5 million are estimated to be payable on the sale proceeds.
About Reducol(TM)
Reducol(TM) is a unique ingredient containing plant sterols and stanols, commonly known as phytosterols, or "Sterols". The combination of a prudent diet and consumption of products containing the recommended amount of Reducol(TM) may help consumers lower their cholesterol by up to 24%. Additional information on Reducol(TM) can be found at www.reducol.com
About Forbes Medi-Tech Inc.
Forbes Medi-Tech Inc. is a life sciences company dedicated to the research, development and commercialization of innovative products for the prevention and treatment of cardiovascular disease. Our vision is to develop and market products along a treatment continuum that cardiovascular disease consumers, healthcare professionals and specialized cardiovascular disease research and healthcare institutions will identify, recommend and seek. Our business strategy is to develop and commercialize proprietary compounds to address the unmet needs of patients within the cardiovascular disease market.
Information contained on the website at www.reducol.com does not form part of this News Release. This News Release contains forward-looking statements regarding the Company and its business, and in particular, regarding building revenue from the Company's value-added ingredient business, use of the net proceeds of the sale of the Phyto-Source interest, and taxes payable, which statements can be identified by the use of forward-looking terminology such as "moving forward", "continue to build", "will be used", "estimated to be payable", "vision", "to develop", "strategy" or comparable terminology referring to future events or results. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous factors, including uncertainty whether revenue will continue to build from the value-added ingredient business as anticipated or at all; the Company's reliance on Phyto-Source for supplies of Reducol(TM) and other wood sterols and the risk that the supply agreement between the parties may be terminated early; uncertainty regarding the amount of U.S. taxes, the amount of the net proceeds of sale and the use thereof; uncertainty regarding market acceptance and demand for products containing the Company's ingredients; uncertainty whether the Company's ingredient business will continue to build; product development risks; intellectual property risks; manufacturing risks; raw material and sterol supply risks; product liability and insurance risks; the effect of competition; the need for regulatory approvals, which may be withdrawn or not be obtained in a timely manner or at all; changes in business strategy or development plans; the need to control costs and the possibility of unanticipated expenses; exchange rate fluctuations; and the Company's need for future funding, any of which could cause actual results to vary materially from current results or the Company's anticipated future results. See the Company's reports filed with the Canadian and U.S. securities regulatory authorities from time to time at www.sec.gov and www.sedar.com for cautionary statements identifying other important factors with respect to such forward-looking statements, including additional risks and uncertainties, that could cause actual results to differ materially from results referred to in forward-looking statements. The Company assumes no obligation to update the information contained in this News Release.
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Contact:
Darren Seed
Forbes Medi-Tech Inc.
Manager, Investor Relations
(604) 681-8976
dseed@forbesmedi.com
www.forbesmedi.com