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Pronova BioPharma: Q1 Results


5/10/2011 9:36:07 AM

10 May 2011, Lysaker, Norway: Pronova BioPharma announced first quarter 2011 revenues of NOK 452 million, down 0.9 per cent year-on-year and 16.3 per cent up quarter-on-quarter. EBITDA reached NOK 177 million, down 4.2 per cent year-on-year and 36.1 per cent up quarter-to-quarter. End-user demand in Pronova BioPharma current eight largest markets, as measured by IMS, grew 14 percent, pushing the moving annual total volumes to 1 238 tonnes, representing USD 1.3 billion in drug sales, consolidating the position of Pronova BioPharma's pharmaceutical product as a blockbuster drug. The robust end-user demand was more than offset by a decision by US marketing partner GSK to bring inventory levels of Lovaza(TM) in line with end-user demand. The resulting lower shipments to GSK were compensated for by higher 2011 supply prices, with the revenue-to-shipment ratio increasing to 1.18 in the first quarter of 2011 compared to 0.97 in the same period last year. Pronova BioPharma maintains its outlook for 2011, with volume off-take in line with underlying end-user demand, tempered by inventory adjustments in the US market. Supply prices are expected to increase by 10-20 per cent, from 2010 to 2011.

Pronova BioPharma is continuing its geographical expansion into new markets and expects to generate sales from these initiatives from 2012. The most important new market will be Japan, supplemented by a number of new emerging markets which also represent growth opportunities. Takeda Pharmaceutical Company and Pronova BioPharma have disclosed top-line results of the pivotal phase III clinical trial of TAK-085 which included head-to-head study against an EPA product. The trial met primary end-points and once again demonstrated that Omacor® is a superior triglyceride lowering and lipid management product.

Pronova BioPharma also has high expectations for its emerging pipeline of new products which have demonstrated encouraging pre-clinical results. The lead candidate, PRB-6014, is an entirely newly engineered compound in the dyslipidemia area. Pronova BioPharma is in the process of submitting a Clinical Trial Application, an Investigator Brochure and an Investigational Medicinal Product Brochure to the UK authorities (Medicines and Healthcare products Regulatory Agency and the ethics committee) and expects to begin clinical studies at the end of Q2 2011.

Some 21 months post patent expiry in most European countries, no generic entrant has been observed, demonstrating the high barriers to entry and in particular the unique strengths of Pronova BioPharma's manufacturing capabilities. In Italy, the 10-year license and supply agreement with Pronova BioPharma's Italian partners, which expired in April 2011, was renewed through a multi-year exclusive supply agreement. The agreement will provide 100 per cent of the total requirements of Prospa, Sigma Tau and Pfizer in the Italian market. Italy was the first market where Pronova BioPharma's pharmaceutical product was launched in 1994 and remains the second largest pharmaceutical market, with continued double digit growth. Italy continues to be a key market in terms of both size and growth, as well as the important backing it has received from key opinion leaders. Data from three large scale trials (the GISSI Prevenzione trial, the GISSI Heart Failure trial and the ongoing GISSI Risk and Prevenzione trial) have involved most leading cardiology centres in Italy and have provided important clinical evidence of the product's cardiac protective effects.

The group reached an agreement with Apotex during the first quarter to settle patent litigation regarding Apotex's proposed generic version of Lovaza(TM). The terms of the settlement are confidential, but Apotex has been granted a license to enter the US market with a generic version of Lovaza(TM) in the first quarter of 2015 or earlier under certain circumstances. As part of the settlement, the parties will enter a supply agreement for delivery of Pronova BioPharma's active pharmaceutical ingredient to Apotex' proposed generic version of Lovaza(TM). The license and supply agreement with GSK has been amended to allow for potential generic entry. According to the amendment, Pronova BioPharma will continue, after generic entry, to provide GSK with its entire requirements of the active pharmaceutical ingredient and the pricing formula will remain unchanged as long as GSK is Pronova's exclusive licensee in the US territory. Pronova BioPharma is currently involved in lawsuits with Teva and Par regarding infringement of the company's patents relating to Lovaza(TM).

Pronova BioPharma has developed and patented a unique process for removing environmental pollutants and cholesterol. With the increasing regulatory and public focus on the harmful effects of environmental pollutants in omega-3 fish oils, these patents constitute important intellectual property and are a testament to Pronova BioPharma's dedication to, and investment in, patient safety. In the US, Europe and Asia, suppliers seeking to enter the pharmaceutical market as well as established companies in the omega-3 nutritional supplements market, may be infringing these key production process patents. Pronova BioPharma will vigorously defend its intellectual property and is currently preparing several enforcement actions in North America, Europe and Asia.

Pronova BioPharma's Chief Executive Officer Morten Jurs commented, "This was another strong quarter, with a robust operational performance combined with a continued increase in demand for Omacor® / Lovaza(TM). A key event in the quarter was entering into a renewed, exclusive supply agreement with our existing Italian partners. Italy is Pronova BioPharma's second largest market and the biggest market in Europe for our products. Moreover, some 21 months after patent expiry in Europe, we remain the only player in the market, demonstrating the significant barriers to entry including the need for substantial upfront investment. In addition to our leading role in our current markets, we continue to focus on expansion into new territories including Japan where a very successful 6-year clinical development programme is close to realisation."

The complete first quarter report is available at www.newsweb.no and at www.pronova.com.The company will present the results today at 08:30AM CET/07:30 GMT. The presentation will be webcast live and can be accessed at www.pronova.com. (Internet explorer web browser needed). Webcast attendees may send questions electronically during the session.

For further information, please contact:

Hamed Brodersen, Vice President IR and Communications

+ 47 22 53 48 60

Synne H. Røine, CFO

+ 47 22 53 48 92

This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act) Disclaimer

Certain statements in this release concerning our future growth prospects are “forward-looking statements”, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in the pharmaceutical industry including those factors which may affect our ability to manufacture our products, our ability to attract and retain highly skilled professionals, the regulatory environment in which we operate and unauthorized use of our intellectual property and general economic conditions affecting our industry. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.

THIS RELEASE HAS BEEN PREPARED BY PRONOVA BIOPHARMA ASA (THE ”COMPANY”) EXCLUSIVELY FOR INFORMATION PURPOSES. THIS PRESENTATION HAS NOT BEEN REVIEWED OR REGISTERED WITH ANY PUBLIC AUTHORITY OR STOCK EXCHANGE. THE DISTRIBUTION OF THIS PRESENTATION AND ANY OFFERING, SUBSCRIPTION, PURCHASE OR SALE OF SECURITIES ISSUED BY THE COMPANY IN CERTAIN JURISDICTIONS IS RESTRICTED BY LAW. POTENTIAL INVESTORS ARE REQUIRED BY THE COMPANY TO INFORM THEMSELVES ABOUT AND TO COMPLY WITH ALL APPLICABLE LAWS AND REGULATIONS IN FORCE IN ANY JURISDICTION IN WHICH IT INVESTS AND MUST OBTAIN ANY CONSENT, APPROVAL OR PERMISSION REQUIRED UNDER THE LAWS AND REGULATIONS IN FORCE IN SUCH JURISDICTION. THE COMPANY SHALL NOT HAVE ANY RESPONSIBILITY OR LIABILITY FOR THESE OBLIGATIONS. THIS PRESENTATION DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION IN SUCH JURISDICTION.


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