Not so quick notes on the CC.
KBLB signed a lease on a new lab - are moving into new facility. Will still be working with university labs but this will allow us to expand and increase our capabilities. This physical expansion is lock step with ramp up of monster silk production.
National Academy of Sciences and Textile World articles have significantly increased the level of interest in our monster silk program during the first quarter.
We have long since achieved homozygosity and the silkworms are definitely producing monster silk.
Current monster silk fiber is stronger than what was described in Academy of Sciences’ article.
Following Monster Silk development, Zinc Finger nucleus has been added to the KBLB arsenal. With it KBLB has created more than one knock out strain and they are currently working on a knock in strain. Anticipate one or more of these new knock outs will become the basis for a new platform technology.
Gen 2 technology is in an advanced state of development. It is a primary RD focus but not exclusively during the second quarter.
Gen 3 technology will be the focus of RD after the development of Gen 2. This platform will incorporate customizable fibers such as antibiotics.
Our business model is to partner with established companies in our target market for product development, manufacturing, and distribution. First step has been to identify and begin discussions with potential partners. The pace of contact with potential partners has increased significantly with the two articles on Monster Silk. We have been approached by a number of companies for use of Monster Silk in their product lines or to develop new products using Monster Silk.
During the first quarter we have entered into NDAs and CAs with a number of those companies ranging from sportswear and fashion to defense / military applications. These are large companies from billions to 50 millions of dollars in worth. We are in very early stages of discussions with each of these companies. We are also in contact with market development partners. These partners are aware KBLB is on track to develop more advanced spider silk products and know that by being involved with KBLB now they will have the inside track into future products.
Kim does not see a spinoff in the immediately foreseeable future for KBLB as he feels at this time it would not be in the best interests of the shareholders. We are still a small company and we are stronger together than we would be broken apart.
Every member of our advisory board brings a diverse expertise to the board. They are not involved on a day to day basis as they are also involved in other interests. That being said these folks are invaluable to Kim and he pays attention to them when he has questions relevant to their particular field of expertise.
As to marketing Kim feels we have only one chance to select who we will be working with and we need to do this right. It's more important to do this right than it is to sign deals so we can say we signed deals. We are only looking for a few partners at this time.
For example, one company may use our product for a particular sportswear application. Another company that weaves fabric for the defense industry might integrate our product into their product line.
We are already talking to more marketing partners than we need. We will be selective based on long term plans. We want to make sure any prospective company we enter into a relationship with:
1. Has the ability to move significant volume of products in the marketplace.
2. Has necessary products and expertise to work with us on successfully integrating monster silk and eventually our Gen 2 products into their product line.
3. They share our vision and passion for this breakthrough fiber.
At the same time we are going to significantly increase our recombinant spider silk production through our Monster Silk brand.
We are already underway in that ramp up process with a significant increase of silk worms and we are successfully stockpiling eggs in preparation for a significant increase of production capacity.
New lab will increase that ramp up for industrial production.
Sigma Aldridge will not be involved in distribution or production but we will continue utilizing their expertise with ZF.
Defense contractors mentioned again with them contacting us with ideas for monster silk applications. This indicates the applicability of monster silk may be broader than we realized.
Kim's Summary Statement:
As company grows and we interact with larger companies in our target market, we need to grow internally as well as externally. We anticipate adding significant new corporate communications and investor relations support as part of our increasing public profile.
Our lab is physically growing as we move part of our RD and production into the new lab.
We are also accelerating our RD on the next Gen 2 technology.
We are also ramping up production of our Monster Silk products. We are reaching out to form partnerships with existing companies in our target market.
