EDMONTON, ALBERTA--(Marketwire - May 16, 2012) - Innovotech Inc. (TSX VENTURE:IOT) announced its audited financial and operational results for the quarter ended March 31, 2012.

Highlights:

• Innovotech receives initial purchase orders for Human and Veterinary InnovoSCEPT products
• Encouraging interim results in one of the two blinded study groups from the clinical trial at the Hospital for Sick Children
• Launched aggressive marketing campaign to promote Innovotech biofilm research expertise

"Initial purchase orders received in the quarter for the InnovoSCEPT susceptibility test product line from Spectrum Labs, for our veterinary tests, and Doctor's Data, for our human tests, are a promising start for revenue growth " said Ken Boutilier, CEO of Innovotech. "The Company also received interim results from the ongoing clinical trial at the Hospital for Sick Children showing a greater reduction in bacteria in the lungs in one of the two patient groups, although to maintain the integrity of the trial it could not be revealed if the beneficial group was the one using Innovotech's product bioFILM PA. Reduction of bacteria in the lungs means that the treatment is more effective and will likely be administered for a shorter time, meaning faster recovery for a patient and reduced cost for the medical system."

The Company has launched an aggressive marketing program to promote its biofilm expertise, including; adding to the contract research marketing team, hosting a Biofilm Workshop for the US Food and Drug Administration and industry clients in Washington DC, and increasing participation in industry conferences.

Subsequent to the quarter end the Company is actively engaged in a private placement financing to strengthen its cash position. Commitments have already been received for over $500,000.

Financial Summary

Revenues

In the three-month period ended March 31, 2012, total revenues were $172,995 (2011 - $296,936; 2010 - $454,370). This included contract research revenue of $139,657 (2011 - $261,509; 2010 - $375,315) and product sales of $33,338 (2011 - $35,427; 2010 - $19,055). Recent delays in regulatory approvals have slowed product development for major Innovotech's clients within this sector resulting in a reduction in Innovotech's contract research revenue.

General and Administrative Expense

In the three-month period ended March 31, 2012, general and administrative expense, including stock based compensation expense and allocated amortization expense, was $297,986 (2011 - $281,535). The increase was mainly attributable to increased building and overhead expenses and stock options compensation expense.

Research and Development

In the three-month period ended March 31, 2012, research and development expense was $237,718 (2011 - $279,693). The cost was partially offset by various grants of $154,782 (2011 - $112,023)

Liquidity and Capital Resources

At March 31, 2012, the Company had $271,031 in cash compared to $459,275 at December 31, 2011. Continued investment in development and marketing of two of the Company's lead products have contributed to a decrease in cash reserves over the past year. These expenditures were partially offset by cash inflows from product sales, contract research revenue and various grants.

Innovotech's first quarter 2011 Financial Statements and Management's Discussion and Analysis will be filed on The System for Electronic Document Analysis and Retrieval (SEDAR) at [ www.sedar.com ]

About Innovotech Inc.

Innovotech Inc. is a pioneer in the field of biofilm product development, focused on providing innovative and practical solutions to medical, agricultural and industrial problems caused by microbial biofilms. [ Biofilms ]are organized communities of microorganisms that exist in virtually every natural environment and are responsible for a host of diseases in human health, animal health and agriculture. There are few products or regulatory standards, aside from those of Innovotech, designed specifically for biofilm-forming organisms.

Innovotech has a broad range of products that address the issue of biofilms within a number of different industries, including commercially available products in three market segments; the MBEC Assay™, bioFILM PA™, InnovoSCEPT-Human and InnovoSCEPT-Veterinary tests. The MBEC Assay™ is a high throughput biofilm growth device that was recently approved as an ASTM International standard. bioFILM PA™ and InnovoSCEPT-Human are the first diagnostic tests to assist physicians in the selection of the most effective antibiotic treatment for patients with biofilm-based chronic infections, while the InnovoSCEPT veterinary tests are designed to determine the most effective antibiotic treatment for chronic infections in both large and small animals.

Innovotech also has two products in advanced stages of development; Agress® is a unique, environmentally friendly seed treatment and plant spray designed to protect crops against both bacterial and fungal infections and AgreGuard™ is a unique antimicrobial for coating medical devices such as catheter.

This document may contain forward-looking statements that are predictive in nature and subject to risks and uncertainties that cannot be predicted or quantified; consequently, actual results may differ materially from past results and those expressed or implied by any forward-looking statements. Factors that could cause or contribute to such risks or uncertainties include, but are not limited to: the regulatory environment including the difficulty of predicting regulatory outcomes; changes in the value of the Canadian dollar; the Company's reliance on a small number of customers including government organizations; fluctuations in operating results; government policies or actions; progress and cost of clinical trials; reliance on key strategic relationships; uncertainty related to intellectual property protection and potential costs associated with its defense; the Company's exposure to lawsuits and other matters beyond the control of management. Should known or unknown risks or uncertainties materialize, or should management's assumptions prove inaccurate, actual results could vary materially from those anticipated. The Company undertakes no obligation to publicly make or update any forward-looking statements, except as required by applicable law.

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