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7-Business: Bankrupt Large Scale Biology sells manufacturing plant to Kentucky BioProcessing



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TITLE:  Biotech in Chapter 11 selling Kentucky factory
SOURCE: Sacramento Business Journal, USA, by Celia Lamb
       
http://www.bizjournals.com/sacramento/stories/2006/03/06/daily19.html?from_rss=1
DATE:   06 Mar 2006

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Biotech in Chapter 11 selling Kentucky factory

Large Scale Biology Corp. of Vacaville has reached a deal to sell its
Owensboro, Ky., manufacturing plant for $6.4 million.

Large Scale Biology voluntarily filed for Chapter 11 bankruptcy protection
Jan. 9. The Owensboro sale is subject to approval of the bankruptcy court
and an auction March 27.

The potential buyer, Kentucky BioProcessing LLC, would pay in cash, cash
equivalents or assumption of Large Scale's debt, Large Scale said in a
document filed with the Securities and Exchange Commission.

The Kentucky site includes a 30,000-square-foot greenhouse complex, 23
acres, machinery and equipment used to extract useful proteins from plants.
The company used the Owensboro site for its own research and for work
performed on contract for other companies.

Kentucky BioProcessing is a "designee" of Owensboro Medical Health System
Inc. in the planned sale hearing, according to a document filed with the
bankruptcy court by Large Scale.

The health system, which owns a hospital and a center for outpatient care
and physical therapy, pledged to lend Large Scale $25,000 per week to keep
the bioprocessing plant running temporarily after the bankruptcy filing,
according to the court document. It had loaned Large Scale Biology $150,000
as of Feb. 27.

Founded in 1987, Large Scale was one of the first companies focused on
genetically engineering plants to make drug proteins. The company believed
it could produce pharmaceuticals from tobacco plants more cheaply than
possible with conventional methods.

Despite years of effort and a $90 million initial public offering of stock
in 2000, the company never brought any drugs to market. The company ceased
operations in December with assets of $9.76 million, including the Kentucky
facility, and liabilities of $7.84 million.

Large Scale has disputed a claim by Agility Capital LLC, which has said
Large Scale owes more than $1 million for a loan secured by substantially
all of Large Scale's assets.




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