Frutarom to Partner on Cinnamon Extract

12/07/07 Frutarom Industries Ltd. and Ramot at Tel Aviv University Ltd. signed an exclusive agreement to commercialize unique know how (patent pending) developed by Professor Michael Ovadia of Tel Aviv University, to produce an innovative extract from cinnamon with anti viral properties. The comprehensive research performed in Professor Ovadia's laboratory demonstrated the extract's ability to rapidly neutralize a broad range of viruses that cause infectious diseases in both humans and animal, such as human and avian influenza, herpes (HSV-1) and human immunodeficiency virus (HIV-1). Another unique activity of this innovative extract is its ability to boost the immune system against viruses, demonstrated by the ability to serve as a vaccination agent in chicken embryos infected with Newcastle disease virus (NDV). Trials performed together with a veterinary company showed that chicken embryos can be vaccinated against the NDV virus while they are still in the egg and in so doing, significantly improve the efficiency of the vaccine's administration, increase success rates and reduce mortality.

The agreement with Ramot gives Frutarom an exclusive global license to commercialize the knowhow in order to manufacture and market the unique natural extract, based on knowhow currently being patented. Frutarom intends to market this unique product to the nutraceutical, functional food, health food and animal feed industries and to further develop the knowhow as a drug for humans and animals as part of the Company's unique natural product offering. Frutarom will invest in further research and development of this unique product and additional applications within Frutarom's fields of activity. Professor Michael Ovadia will lead the research.

Frutarom will use its considerable knowhow in natural product manufacturing for the research, development and scaling up of the product's manufacturing process in accordance with international quality standards so as to achieve industrial scale production and commercialization. Frutarom estimates that the product will be launched in about a year.

The cooperation with Ramot is part of Frutarom's broad strategic plan to expand Frutarom's offering of unique natural products and to strengthen Frutarom's position and standing as a leading global supplier of natural products and functional food ingredients for tasty and healthy solutions. As part of this strategy, Frutarom invests in and cooperates with start-up companies, research institutes and universities that develop innovative and unique technologies. This supports Frutarom's own ongoing research and development activities, carried out in-house by its R&D teams throughout the world. In the last year, Frutarom initiated several such alliances: exclusive cooperation with D-Herb, of the NGT technological incubator in Nazareth, Israel, to produce and market a unique herbal extract that is used to reduce and stabilize glucose levels in diabetecs; exclusive cooperation with Magnetika Interactive Ltd., to produce, market and sell products enriched with Omega-3 fatty acid; and exclusive cooperation with CapsiVit Biotechnology Ltd. to commercialize unique knowhow developed by the Vulcani Institute in Israel to produce a natural extract from the Capsicum annuum L. plant as a highly bio-available source of carotenoids and particularly capsanthin; and others.

Ori Yehudai, President and Chief Executive Officer of Frutarom: "The addition of this unique, innovative product to Frutarom's varied offering of natural products will contribute to the continued realization of Frutarom's rapid growth strategy, with emphasis on natural products intended for segments with higher than average growth rates, such as functional food, health food and nutraceuticals. Frutarom's alliances with start-ups, research institutes and universities strengthen and expand our solid pipeline of projects and natural, innovative products that we intend to market in the coming years. Frutarom continues to work on creating additional strategic collaborations."

Dr. Yehuda Niv, CEO of Ramot at Tel Aviv University Ltd.: "The discovery and development of this unique extract are an example of research conducted at Tel Aviv University that is both creative and leading in its field. Granting the license to Frutarom is the logical step to further develop this scientific discovery into health, biotechnology and consumer products." Dr. Niv added, "Ramot fosters close relationships between Tel Aviv University researchers and industry to enable the translation of such scientific findings into novel products that will benefit the lives of people worldwide."

As part of the cooperation, Frutarom will utilize its global reach, which includes over 5,000 international and local customers - among them leading companies in their fields - in more than 120 countries, as well as Frutarom's sales and marketing organization and rich experience in industrial production, including extensive knowledge in scaling up production processes and commercialization.