EAGAN, Minn. — January 2, 2002 - Biopolymer Engineering, Inc. has established a new production facility in Eagan, Minn., that will make glucosamine, a natural compound clinically proven to slow the progression of osteoarthritis, and other specialty polymers.

The new facility will begin producing glucosamine, N-acetyl-glucosamine (NAG) and chitosan beginning in early 2002. The 25,000-square-foot facility has both class 10,000 and class 1,000 clean rooms for production to pharmaceutical and food grade standards. The facility also houses the corporate headquarters of this global biotechnology company.

“This new facility expands Biopolymer Engineering's production capabilities and provides additional office space that our growing company needs,” said Richard Mueller, president and CEO of Biopolymer Engineering. “Once the facility is on-line, Biopolymer Engineering will be the only commercial-volume producer of ‘Made in USA’ glucosamine.”

Glucosamine, NAG and chitosan are derivatives of chitin, a complex carbohydrate or a molecular strand of sugars essential to life in every cell. Biopolymer Engineering alters the molecular structure of chitin and other biopolymers to create products with a wide range of uses that include strengthening the immune system and fighting disease, formulating cosmetics and purifying water.

Glucosamine can be found in abundance in the human body, where it contributes to the health and resiliency of cartilage. The British medical journal, Lancet, has reported in January 2001 on research that found glucosamine to be the only clinically proven treatment capable of slowing the progression of osteoarthritis, a disease afflicting 30 million Americans. Glucosamine sales worldwide exceeded $1 billion last year, with the vast majority of product manufactured in China under substandard conditions.

“Our patented processing technology and sophisticated production facility in Eagan will enable Biopolymer Engineering to produce glucosamine that will far exceed the quality of any product on the market,” said Mr. Mueller. “Our process relies on specially engineered enzymes instead of harsh chemicals, making it more environmentally friendly.”

Biopolymer Engineering's new Eagan facility includes laboratory facilities, clean rooms for sanitary processing and packaging, and a pilot plant and production facilities. The facility will also provide a location for further processing of product from the company's El Salvador plant, which is one of the largest capacity chitosan plants in the world.

All Biopolymer Engineering manufacturing facilities maintain U.S. production standards to ensure the highest quality products for human consumption. The company has established Good Manufacturing Practices, Standard Operating Procedures and a comprehensive Hazardous Analysis of Critical Control Points (HACCP) in each of its facilities. Biopolymer Engineering subscribes to USDA, FDA and 3A standards for all production activities.

Biopolymer Engineering is a global biotechnology company that engineers complex carbohydrates for a wide range of therapeutic, diagnostic and industrial applications. Founded in 1997, Biopolymer Engineering has created a technology platform around four biopolymers—chitin, chitosan, glucosamine and beta glucan—that is protected by more than 200 U.S. and international patents. The company is privately held. For more information, visit www.biopolymer.com.