Caleco Pharma Corp.
OTC Bulletin Board : CAEH
FRANKFURT : T3R

Caleco Pharma Corp.

March 17, 2010 09:00 ET

Commercialization Pathway Expands as Caleco Pharma Licenses Five Compounds for Development

Broadens and diversifies pipeline to include products for cardiovascular and metabolic health

BELLINGHAM, WASHINGTON--(Marketwire - March 17, 2010) - Caleco Pharma Corp. (the "Company" or "Caleco") (OTCBB:CAEH)(FRANKFURT:T3R)(WKN:A0N9Y0) (www.calecopharmacorp.com), a biopharmaceutical and consumer health products company that identifies and develops biotech products, today announces its entry into an exclusive license agreement with Natac Biotech, S.L. ("Natac") whereby Natac has granted Caleco the exclusive right to develop, commercialize, market and distribute five compounds derived from plant extracts throughout North and South America.

"Licensing these five products signals the beginning of a more robust expansion and diversification of our new product pipeline, expanding our focus beyond our current plant-based research and development pathways," said John Boschert, Caleco's president and CEO. "Each of these products fits well within our near term developmental framework and we are moving forward on a specific commercialization pathway for each of the extracts."

In keeping with Caleco's dual pathway model of product development and commercialization, Caleco anticipates that several of these newly in-licensed compounds will enter clinical testing while others will move directly into non-clinical pre-commercialization pathways as nutritional food supplements. These new compounds will be targeted at large markets where there are significant and growing health and wellness needs. Specifically, the Caleco product pipeline now includes compounds with anti-inflammatory and metabolic effects that may prove beneficial in promoting cardiovascular and metabolic health. Worldwide over 100 million people are believed to have chronic metabolic dysfunction status whom may potentially benefit from these types of supplements.

In consideration of the exclusive license for the compounds (AOF, AH-FLO, JHF, HGF, NB-VAL40), Caleco has agreed to pay a royalty of five percent (5%) of the net sales of the compounds in North and South America. Under the terms of the License Agreement, Caleco is also required to:
(a) purchase the products from Natac in accordance with the terms of the License Agreement;
(b) complete its first commercial sale of the products by March 31, 2011;
(c) purchase a minimum of 300,000 units, each unit being 10 grams, of the products from Natac by the end of 2011; and
(d) within one year of entering into the License Agreement, complete a clinical trial(s) for the purpose of supporting the effectiveness of the products.

The License Agreement also provides that Caleco will have the right to sub-license the five compounds in North and South America. Caleco will also have the right to assign its entire interest in the License Agreement subject to the following:
(a) if the assignment is for cash consideration only, Caleco will be entitled to retain 90% of the cash payment and Natac will be entitled to 10% of the cash payment; and
(b) if the assignment is for a combination of a cash payment and royalties, Caleco will be entitled to retain 90% of the cash payment and royalty with 10% of the cash payment and royalty being paid to Natac.

The term of the License Agreement is for a period of twenty years.

About Caleco Pharma Corp.

Caleco Pharma is focused on the ongoing research and development of its pipeline of over-the-counter and prescription medications including its proprietary antiviral and "Liver Health" OTC formulations. In addition Caleco Pharma is developing Dermatological Products based on the active ingredients found in its proprietary formulation. To date, Caleco Pharma's intellectual property covering the Liver Health formulations and derivatives consists of patent applications in the United States, Europe and Canada and four European Drug Master File applications.

Caleco Pharma's shares are traded in the United States on the OTC Bulletin Board (OTCBB:CAEH) and in Germany on the Frankfurt Stock Exchange (FRANKFURT:T3R)(WKN:A0N9Y0).

This press release may contain, in addition to historic information, forward-looking statements. These statements may involve known and unknown risks and uncertainties and other factors that may cause the actual results to be materially different from the results implied herein. In particular, there are no assurances that: (i) Caleco will be granted a patent in connection with its current patent applications in the United States, Europe and Canada; (ii) Caleco will be able to manufacture and produce its products or that its products will be effective; (iii) Caleco will be able to obtain any sales of the compounds licensed from Natac; (iv) it will be able to carry out any pre-clinical or clinical trials of its products. (v) Caleco will be able to obtain additional financing in order to meet the costs of the clinical studies of its "Liver Health" formulation and the compounds it has licensed from Natac; or (vi) Caleco will be able to control the costs of the clinical studies of its "Liver Health" formulation and the compounds it has licensed from Natac. Readers are cautioned not to place undue reliance on the forward-looking statements made in this press release.

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