Davis, California
June 12,  2001

The United States Department of Agriculture awarded AgraQuest a Phase I Small Business Innovation Research grant for "Natural Products for Control of Insects, Mites and Nematodes." The $70,000 six-month grant will supplement AgraQuest's ongoing development efforts on biological pest management solutions for controlling major insects, mites and nematodes. Success of the six-month Phase I research can generate a $275,000 phase II grant for further development of the products. 

AgraQuest has successfully commercialized a product, Serenade(R) Biofungicide, specified in earlier Phase I and II SBIR grants, "Natural Product Fungicides for Control of Plant Pathogens." 

"We are pleased that the USDA recognizes that our successful research, development, and
commercialization can extend beyond fungicides to insecticides and nematicides," said Dr. Pam
Marrone, AgraQuest's President and CEO. The Phase I research described in this proposal will
demonstrate the commercial potential of two novel microbial strains with highly specific biopesticide activity against economically important insect and nematode pests. AgraQuest discovered the natural insect and nematode controls as a result of targeted screening for microbial natural products for pest management. 

The global insecticide market is approximately $8.6 billion. Root-feeding nematodes are estimated to cause the loss of one-fourth of plant-grown products in the world. New solutions for insect and nematode control are important replacements for organophosphate insecticides, which are being phased out in some markets under the Food Quality Protection Act. 

Davis, California-based AgraQuest Inc. is a leader in the discovery, development, manufacture and marketing of natural pest management solutions for farm, home and public use. Through its systematic and proprietary screening process, AgraQuest evaluates and develops naturally occurring microbes into commercial biopesticides. The Company believes that its products are environmentally safe and deliver the performance, reliability and ease of use expected by the agricultural and home gardening industries. The Company is backed by large agricultural growers, agri-businesses, domestic and international venture capital firms. AgraQuest has established collaborative partnerships with Rohm and Haas Co., SDS Biotech (Japan) and Maxygen. For more information, please visit the Company's website at www.agraquest.com.  

Company news release
N3583