Sangui BioTech Inc. has acquired Citadel Investment Systems Inc.

SANTA ANA, Calif.--(BUSINESS WIRE)--March 20, 1997--Sangui BioTech Inc. Thursday announced that its shareholders have acquired a majority of the common shares from Citadel Investment Systems Inc. of Colorado (NASDAQ/OTCBB:CIIS).

The name of Citadel will be changed to Sangui BioTech, Colorado, Inc., and the common stock will continue to trade with the same name on the OTC Bulletin Board.

Sangui BioTech has two wholly owned subsidiaries, Sangui BioTech AG and GlukoMediTech AG, both located in Mainz, Germany.

Sangui BioTech AG engages in the research and development of a novel hemoglobin-based hyperpolymers blood substitute.

"The importance of a blood substitute is due to today's chronic shortage of stored blood. Transfusion of stored blood is currently the only specific treatment for an acute loss of blood and for chronic oxygen deficiencies," reported Prof. Dr. Barnikol, director and vice president of SanguiBioTech AG.

Barnikol further emphasized that current blood substitutes, which are in various stages of developments and clinical trials, are either monomeric or dimeric. These low-molecular-weight blood substitutes suffer from short circulating life and inefficient oxygen delivery.

This is in contrast to the Sangui BioTech's blood substitutes that are high-molecular-weight hyperpolymers of hemoglobins.

"The shortage of blood donors, limited stability of stored blood (about one month), coupled with blood type and leukocyte incompatibilities have created difficulties which are further exacerbated by the risk of hepatitis or HIV transmission," said Dr. That T. Ngo, director of Sangui BioTech. "The worldwide market for blood substitute (excluding plasma expanders) is estimated at $10 billion (USDLR) per year."

Dr. Burkhard, vice president and director of SanguiBioTech AG, said: "Oxygen deficiencies in organs, e.g. cardiac or brain infarction, can be treated only in rare circumstances by increasing the oxygen content of the blood, as these diseases are caused by decreased blood perfusion.

"Blood transfusions will not significantly improve the situation because stored erythrocytes stiffen with time, and, consequently, their passage through the capillaries is impaired."

Dr. Barnikol-Keuten, president of both subsidiaries, said, "For both clinical requirements (acute loss of blood and chronic oxygen deficiency), it would be of great value to have a universal and long-term stable oxygen transporter available."

GlukoMediTech AG is developing a unique glucose implant sensor for monitoring glucose in diabetes patients and a novel oxygen sensor for medical applications (skin and respiratory).

"Prototype sensors for environmental and laboratory use are expected to be completed by the end of 1997," said Dr. Klaus Lang, vice president of Sangui BioTech. "SanguiBioTech AG's oxygen sensor requires less-frequent replacement for the sensor membrane. This new device is based on a concept of photoluminescence quenching, in lieu of polarographic measurement. First clinical tests should begin in 1999."

The Diagnostic Division of Sangui BioTech in the United States develops, manufactures and markets niche in vitro immunodiagnostic test kits for detection and monitoring of selected diseases.

"Through strategic alliance and internal development, the Diagnostic Division intends to introduce approximately eight niche products in the next 12 months. Evaluation kits of Sangui BioTech Inc.'s first two products have been sent to China," said John J. Kiang, president and chief executive officer of Sangui BioTech.

CONTACT: Sangui BioTech Inc.

John J. Kiang, president and CEO 

714/429-7807 (phone); 714/429-7808 (fax)

or

Dr. Klaus Lang, vice president (Germany)

49-6131-38-2001 (phone); 49-6131-38-5001 (fax)

or

Axel J. Kutscher, director, (Germany)

49-208-530-11 (phone); 49-208-509-21 (fax)