3-Months Report: MediGene AG Reduces Net Loss by 84% - Fivefold increase in revenues from 0.7 million euro to 3.9 million euro MARTINSRIED, Germany and SAN DIEGO, May 5 /PRNewswire-FirstCall/ -- Today the German-American biotechnology company MediGene AG (Frankfurt, Prime Standard: MDG) presented the 3-Months Report 2004. For the first time MediGene generates revenues from the commercialization of Eligard(R) In the first quarter 2004, MediGene reduced net loss by 84% to -1,410 T euro (3M-2003: -9,037 T euro). Earnings before interest, tax, depreciation and amortization (EBITDA) improved by 86% to -1,015 T euro (3M-2003: -7,246 T euro). This significant improvement in EBITDA results from the increase in total revenues, and from the clear decline in expenditure in all areas. Operating loss before interest and tax (EBIT) decreased to -1,226 T euro (3M- 2003: -7,519 T euro). The net loss per share was reduced to -0.11 euro compared to -0.81 euro in the first three months 2003 (total number of shares as of March 31, 2004: 13,474,032). In the first quarter 2004, total revenues increased from 726 T euro (3M- 2003) to 3,910 T euro. Of this amount, 3,857 T euro are allocated to revenues from the commercialization of the approved drug Eligard(R). These revenues were gained within the framework of a marketing partnership for the commercialization of Eligard(R) concluded with the Japanese pharmaceuticals group Yamanouchi. Apart from a prorata signing fee totaling 4 million euro, a milestone payment was due upon grant of the German marketing authorization for the three-months product of Eligard(R). Due to the reorganization measures implemented in 2003, R&D expenses were reduced by 35 % to 3,680 T euro. At the same time general administrative and selling expenses decreased by 53% to 1,245 T euro. Cash Position 37,983 T euro; Equity Ratio of 78% Compared to December 31, 2003, the balance sheet total has increased by 44% to 55,373 T euro (December 31, 2003: 38,367 T euro). This increase results from the capital increase closed in March 2004 which has led to an improved equity ratio of 78%. The cash position as of March 31, 2004 was 37,983 T euro. This includes proceeds of 16.0 million euro from the three-step capital increase in March 2004. As of March 31, 2004, share capital of the group was increased to 13,474,032 shares (December 31, 2003: 11,206,205 shares), with a total of shares of 2,245,670 issued during the capital increase. Milestones reached in 2004: -- Eligard(R): In January 2004, MediGene received marketing authorization for the three-months product. A marketing partnership was concluded with a leading Japanese pharmaceuticals group, Yamanouchi, for the pan-European commercialization of Eligard(R). Within the framework of this contract, MediGene will receive milestone payments totaling up to 23.5 million euro, as well as royalties on sales of Eligard(R). Eligard(R) was launched in Germany on May 4, 2004. It is planned to apply for approval and to commercialize the product in additional European countries. -- Polyphenon(R) E Ointment: In March, MediGene reported excellent clinical results of the Polyphenon(R) E Ointment for the treatment of genital warts obtained in a European phase 3 trial with more than 500 patients. The results showed high and lasting efficacy as well as excellent safety of the ointment. -- On April 29, 2004, MediGene initiated a clinical phase 2 trial of the Polyphenon(R) E Ointment for the treatment of actinic keratosis (precursor of skin cancer). The objective of the trial is to investigate efficacy and safety of Polyphenon(R) E Ointment applied against actinic keratosis The results are expected to be available in 2005. -- Realization of a three-step capital increase. This capital increase was successfully closed on March 24, 2004. MediGene generated gross proceeds of 16.7 million euro. Forecast for 2004 For 2004, the company expects to quadruple revenues to 8 million euro, and to reduce the loss by 50%, down to 15 million euro. Cash at the end of 2004 is estimated to be around 25 million euro, including the completion of the capital increase measures announced in March 2004. Regarding our product portfolio, we expect to reach the following milestones: -- Initiation of a clinical phase 1/2 trial of the oncolytic virus NV1020 for the treatment of colorectal carcinoma metastasized to the liver (second half of 2004). -- Completion of the phase 1 trial of the tumor vaccine jointly developed with Aventis (midyear 2004). -- Results of the American part of the clinical phase 3 trial of the Polyphenon(R) E Ointment for the treatment of genital warts (end of 2004). The 3-Months Report 2004 is available at http://www.medigene.com/englisch/quartalsberichte.php. This press release contains forward-looking statements that involve risks and uncertainties. The forward-looking statements contained herein represent the judgement of MediGene as of the date of this release. These forward- looking statements are no guarantees for future performance, and the forward- looking events discussed in this press release may not occur. MediGene disclaims any intent or obligation to update any of these forward-looking statements. MediGene(TM) is a trademark of MediGene AG, Polyphenon(R) E is a trademark of Mitsui Norin, Eligard(R) is a trademark of Atrix. About MediGene: MediGene AG is a publicly quoted (Frankfurt: Prime Standard), German- American biotechnology company located in Martinsried, Germany and San Diego, USA. MediGene has the most mature drug development pipeline in the German biotech industry and possesses innovative platform technologies. With Eligard(R) for the treatment of prostate cancer, MediGene is the first German biotech company with a drug on the market. With the Polyphenon(R) E Ointment, MediGene has a further oncological late-stage product in the clinical phase 3, the last stage of clinical development. MediGene's core competence lies in research and development of novel approaches for the treatment of various tumor diseases. Thus MediGene focuses on indications of high medical need and economic opportunities. DATASOURCE: MediGene AG CONTACT: Financial press and investors - Julia Hofmann, Public Relations, +49-89-85-65-3324, or Dr. Michael Nettersheim, Investor Relations, +49-89-85-65-2946, both of MediGene AG, , or fax, +49-89-85-65-2920 Web site: http://www.medigene.com/englisch/quartalsberichte.php

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