SOURCE: Active Biotech

December 18, 2006 02:37 ET

Active Biotech to conduct guaranteed preferential rights issue for approximately SEK 240 M

LUND, SWEDEN -- (MARKET WIRE) -- December 18, 2006 -- Based on the mandate granted by the Annual General Meeting, held on April 26, 2006, the Board of Active Biotech has resolved to conduct a guaranteed preferential rights issue for approximately SEK 240 M.

The issue entitles current shareholders preferential rights to subscribe for one new share for each twelve shares held at an issue price of SEK 60 per share.

MGA Holding AB, with 28.6 percent of the capital, and Nordstjernan AB, with 10.5 percent of the capital, have committed to subscribe for the full amount of shares corresponding to their preferential rights. In addition, MGA Holding AB and Nordstjernan AB jointly guarantee to fully subscribe for any additional shares for which current shareholders choose not to subscribe, in return for a customary guarantee commission. Furthermore, MGA Holding AB and Nordstjernan AB have committed to, if required, through conversion of convertibles and subsequent subscription of shares with preferential rights, secure that the company in this rights issue is provided with a total of approximately SEK 240 M.

The purpose of the issue is to enable continued development of the company's extensive clinical portfolio. Several important results have been reported in 2006 and new studies have commenced, which means that projects will enter larger and more capital-intensive clinical development phases in 2007. The preclinical activities will also be expanded in the next year. This requires the strengthening of the company's financial position.

The issue in brief

  * Not more than 4.0 million shares issued
  * Issue price: SEK 60 per share
  * Record date for right to participate in issue: January 24, 2007
  * Issue period: January 26 - February 9, 2007


| January 2, 2007  | Final date to submit request for conversion of |
|                  | convertibles outstanding so that shares        |
|                  | arising through conversions shall carry the    |
|                  | entitlement to receive subscription rights.    |
|                  | (Conversion in accordance with requests        |
|                  | received shall be implemented not later than   |
|                  | January 14, 2007.) If conversion is not        |
|                  | requested within the stipulated time,          |
|                  | appropriate recalculation at the prevailing    |
|                  | conversion rate shall instead be conducted. In |
|                  | the corresponding manner, January 2, 2007, is  |
|                  | the final date to request the exercise of      |
|                  | warrants so that the resulting shares shall    |
|                  | carry the entitlement to participate in the    |
|                  | issue.                                         |
| January 19, 2007 | Final trading date, including right to obtain  |
|                  | subscription rights                            |
| January 22,2007  | First trading date, excluding right to obtain  |
|                  | subscription rights                            |
| January 24, 2007 | Record date for receipt of subscription        |
|                  | rights                                         |
| January 25, 2007 | Prospectus published                           |
| January 26, 2007 | Subscription period opened                     |
| February 9, 2007 | Subscription period closed                     |

Successful year

The operations have been highly successful during 2006. The milestones communicated at the beginning of 2006 have been achieved according to plan during the year. The goals for the projects' clinical development for 2007 remain unchanged in accordance with the plan announced earlier and have been expanded with the I-3D project.

In September 2006, Active Biotech's partner Teva Pharmaceutical Industries Ltd successfully concluded an additional Phase II study to establish the optimal dose for the pivotal Phase III studies, which will serve as a basis for registration. The study met its primary endpoint and proved that laquinimod significantly reduced the rate of inflammatory disease activity and demonstrated a considerable reduction in the number of flare-ups compared to placebo. The safety and side-effect data confirmed the favorable safety profile that was observed in earlier Phase II studies. A milestone payment has been received from Teva and the start of clinical Phase III studies in the US and Europe is scheduled for 2007.

A Phase II/III trial has been initiated for ANYARA. The study is a randomized study of ANYARA in combination with interferon-alpha, versus interferon-alpha alone in patients with advanced stage RCC. The study will be carried out at 45 sites in Europe. The primary endpoint for this trial is overall survival and will include approximately 500 patients. The expected median survival of these patients is 10-15 months and the duration of the trial will be dependent on the patients' disease progression. An interim analysis based on approximately 200 included patients is planned for mid 2008.

In September 2006, an interim analysis was presented of a Phase I study for the TASQ project, which showed a treatment effect for prostate cancer patients with so-called hormone-refractory prostate cancer. This is an advanced stage of prostate cancer where the tumor cells no longer respond to hormone treatment. The results also showed that treatment with TASQ was well tolerated by patients with only mild and transient side effects. Phase II/III studies are planned to commence during 2007.

A Phase I study for 57-57 including both SLE and RA patients is progressing according to plan since December 2005. The study primarily documents the candidate drug's safety and pharmacokinetic properties. In addition, a number of biological markers are monitored to determine the effect of 57-57 on disease progression. Phase II/III studies are scheduled for 2007.

In March 2006, a patent application was submitted regarding the mode of action of quinoline compounds. The candidate drugs within the projects laquinimod, TASQ and 57-57 all belong to this compound group. This patent may form the basis for the development of entirely new drugs against autoimmune diseases. The research is partially financed by VINNOVA (Swedish Governmental Agency for Innovation Systems).

In March 2006, RhuDex® successfully concluded two Phase I studies in which the product's safety, tolerance and pharmacokinetic properties in healthy volunteers was monitored. The purpose of the study was to examine the drug's safety and its pharmacokinetic properties as well as the interaction between RhuDex® and other drugs. A Phase IIa double-blind, dose- escalation study in RA patients (patients with rheumatoid arthritis) is scheduled to commence in 2007.

In May 2006, Active Biotech and Chelsea Therapeutics International Ltd. signed a partnership agreement for the development and commercialization of I-3D, a group of orally active compounds that inhibit the enzyme dihydroorotate dehydrogenase (DHODH), for the treatment of rheumatoid arthritis (RA). The aim is the selection of a candidate drug during the first quarter of 2007 and to commence clinical trials before mid 2007.

Milestone goals for 2007

*         Laquinimod - Start of Phase III program for the indication
          MS in Europe/the US
*         ANYARA -  Phase II/III studies in renal cancer patients in
*         TASQ - Phase II/III program in prostate cancer patients to
*         57-57 - Phase II/III studies in lupus patients to commence
*         RhuDex - Phase IIa studies in RA patients to commence
*         I-3D - Selection of candidate drug and start of Phase I
          clinical trial
The share issue is to be implemented with Avanza Fondkommission AB as transfer agent.
Lund, December 18, 2006
Active Biotech AB (publ)

Sven Andréasson
President and CEO

For further information, please contact:
Sven Andréasson
Tel: +46 (0)46-19 20 49

Hans Kolam, CFO
Tel: +46 (0)46-19 20 44

Active Biotech AB is a biotechnology company focusing on research and development of pharmaceuticals. Active Biotech has a strong R&D portfolio with pipeline products focused on autoimmune/inflammatory diseases and cancer. Most advanced projects are laquinimod, an orally administered small molecule with unique immunomodulatory properties for the treatment of multiple sclerosis, as well as ANYARA for use in cancer targeted therapy for the treatment of lung-, renal- and pancreatic cancer. Further key projects in clinical development comprise the three orally administered compounds TASQ for prostate cancer 57-57 for SLE and RhuDex® for RA. In addition, the preclinical development of the I-3D project is being conducted in cooperation with Chelsea Therapeutics.

Active Biotech AB
PO Box 724,
SE-220 07 Lund
Tel: +46 (0)46-19 20 00
Fax: +46 (0)46-19 20 50

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