Ecogen Inc., a leading developer of environmentally friendly, microbial biopesticides, today announced that it has signed a letter of intent with Mycogen Corporation; an affiliate of Dow AgroSciences LLC to acquire its sprayable Bt biopesticide product line. The letter of intent contemplates that Ecogen will pay $0.5 million in cash and the balance in Ecogen common stock valued at market price at the time of closing. Mycogen's Bt bioinsecticide business recorded sales of approximately $4.0 to $5.0 million.

The proposed transaction includes the purchase of Mycogen's Bt bioinsecticides, U.S. federal and state registrations, foreign registrations, trademarks, existing product inventories and a technology license to certain of Mycogen's proprietary genes and strains for microbial biopesticides. All Bt products included in the agreement utilize Mycogen's proprietary CellCap® technology. CellCap is a system for encapsulating Bacillus thuringiensis insecticidal proteins in Pseudomonas fluorescens to prolong the activity of the proteins against targeted insect pests.

Closing of the transaction is conditional upon obtaining the necessary approvals and the negotiating and signing of a definitive agreement. The transaction is expected to close by January 31, 2000. Under a separate distribution agreement, Ecogen will begin distributing these products January 1, 2000. Dow will manufacture the products for Ecogen under a five-year supply agreement. Additionally, it is anticipated that Ecogen would grant to Dow exclusive distribution rights for the sale and distribution of the acquired products in Mexico, New Zealand and Australia.

"Mycogen's Bt bioinsecticide business reinforces and broadens Ecogen's leadership in the area of novel biopesticides,'' said James P. Reilly, Jr., Ecogen's Chairman and Chief Executive Officer.
"This product line also adds an aqueous formulation to complement our existing water dispersible
granule formulation. The addition of these patented products and toxin genes from Mycogen,
combined with our extensive Bt toxin gene portfolio, will enable Ecogen to continue to meet
customer demands for pest control with the added assurance of environmental compatibility.''

Bacillus thuringiensis (Bt) is a naturally occurring soil microorganism that produces proteins that are toxic for certain insect pests.

Dow AgroSciences LLC, based in Indianapolis, Indiana, is a global leader in providing pest
management and biotechnology products that improve the quality and quantity of the earth's food
supply and contribute to the safety, health and quality of life of the world's growing population. The
Company operates in more than 50 countries and has worldwide sales of more than $2 billion.
Dow AgroSciences and Mycogen Corporation are wholly owned subsidiaries of The Dow
Chemical Company.

Ecogen is a leader in the development of natural microbial pesticide products for the control of plant disease and insect pests. Ecogen's growing portfolio of products has been developed to address the concerns of pest management and the issues of chemical residues on fruits, vegetables and other crops. The Company's products include: two biofungicides -- Aspire® for post-harvest rot disease and AQ10® for powdery mildew, as well as the Bt bioinsecticides -- CRYMAX®, to control caterpillars on fruits and vegetables, Condor®, to control caterpillars on cotton, other row crops and in forestry, and Lepinox® to combat caterpillars on cotton, other row crops, turf and pasture. The Company also distributes products for others, including soil amendments -- Sper Sal®, to negate the influence of salt on plant growth, and the Mycor(TM) product line, to enhance growth of permanent crops. Additional bioinsecticides under development include: Cruiser®, an insecticidal nematode product for soil applications and CryStar(TM), a Bt bioinsecticide for mosquito control.

Company news release
N2345