INTERIM REPORT JANUARY–JUNE 2010

NICHE INDICATION WITH LARGE UNMET MEDICAL NEEDS SELECTED AS FIRST INDICATION FOR EPROTIROME

The period January-June and the second quarter of 2010 in brief
•    Net sales amounted to MSEK - (4.4), whereof the second quarter MSEK - (2.2)

•    Net loss decreased to MSEK 79.0 (82.7), whereof the second quarter MSEK 38.5 (36.8)

•    Loss per share decreased to SEK 0.51 (0.65), whereof the second quarter SEK 0.25 (0.29)

•    Cash flow from operating activities amounted to MSEK -80.8 (-79.6), whereof the second quarter MSEK -37.9 (-38.6)

•    Cash and cash equivalents and other short-term investments totaled MSEK 152.3 (156.3) at the end of the period

•    Scientific publication in New England Journal of Medicine on March 11 of clinical phase II results on eprotirome and its ability to further reduce serum LDL cholesterol levels in statin-treated patients

•    Important meetings with European authorities and key opinion leaders regarding the clinical phase III program for eprotirome were carried out in a positive mode

•    Clarified general product development strategy, with a focus on drugs for treating niche indications within selected indication areas with large unmet needs

•    Annual general meeting held on April 23, Bo Håkansson, Johan Kördel, Jon Risfelt, Birgit Stattin Norinder (re-elections) and Margaret von Platen (new election) were elected as board members. Bo Håkansson was elected chairman of the board.

•    Fredrik Lindgren started as the new CEO of Karo Bio on April 27, 2010

•    The publication of the interim report for the period January-September 2010 has been moved from October 21 to October 26

SIGNIFICANT EVENTS AFTER THE END OF THE REPORTING PERIOD

•    On July 7, Karo Bio decided that the clinical phase III program around eprotirome initially will be concentrated on the treatment of the insufficiently treated, hereditary disease heterozygous familial hypercholesterolemia (HeFH)

For further information, please contact:
Fredrik Lindgren, President, tel. +46 705 61 61 77
Erika Söderberg Johnson, Chief Financial Officer, tel. +46 8 608 60 52