April 3, 2012
Rosetta Green Ltd. (TASE:RSTG), which develops improved crop traits for the agriculture and alternative fuel industries, and Bayer CropScience AG, a world leader in the development, production and commercialization of seeds announce signing a licensing agreement that relates to a joint project in the discovery and characterization of microRNA genes that have potential to provide drought tolerance and improved yield in cotton.
Extreme climate damage such as drought or long periods between rain showers causing abiotic stress in plants, are among the toughest problems farmers encounter while growing crops. Every year less rain or rain delay cause losses in the range of billions of dollars to farmers across the world. Bayer and Rosetta Green will attempt to develop new cotton varieties that could produce better yields under difficult environmental conditions.
Bayer will have an exclusive license for targets identified during this collaboration toward yield improvement in Cotton. In return for the above, Bayer has committed to pay Rosetta Green milestone payments if certain steps are achieved in the development and commercialization of the products and royalties on future revenues from sales which could amount to tens of millions of dollars.
The cotton industry is facing challenges, such as ensuring higher yields in difficult climatic conditions. "We're pleased to initiate a research collaboration with Rosetta Green as a partner in developing cotton with improved yield," said Dr. Frank Schmidt, Head of Research BioScience for Bayer CropScience. We aim to become the partner of choice to offer farmers superior integrated solutions to improve cotton production in a sustainable way. We anticipate that Rosetta Green's innovative technology platform can contribute to further strengthening our leadership position in the global cotton market.
Mr. Amir Avniel, Rosetta Green's CEO said: "We are greatly honored by Bayer's decisions to work with Rosetta Green, signing this agreement is another significant milestone for the company and a vote of confidence in its technology. We believe that microRNA genes have great potential in the agriculture industry and in crop improvement.
In recent years, we witness a dramatic increase in food prices and great shortage in crops in many countries. Weather-related damage creates very difficult growth conditions for plants. Additionally, the increase in the world's population that caused a situation of more than a billion hungry people, a figure which unfortunately increases annually. We are hopeful that the new technology that Bayer and Rosetta Green will develop will succeed in significantly increasing cotton yields, especially in periods of drought and water shortage and in countries that suffer from chronic scarcity in potable water. Such developments could significantly increase the areas where crops can be grown and gradually grow more and more crops in arid areas with limited water availability or access to brackish water only".