Orexo AB (publ.) - Year-end Report, January to December 2010

Uppsala, February 16, 2011 - Abstral continues to grow strongly and is now also approved in the USA. OX-MPI has made significant progress towards clinical trials and has received its first milestone payment. The three new programs OX219, OX51 and OX27 announced in August 2010 have now all entered the clinical phase.

Key events during the period

  • The loss after tax for the year excluding exceptional items was MSEK –54.9 (-98.1).
    Including these items, the loss after tax for the year was MSEK -89.2 (-98.1).
  • Royalty income from Abstral®, Orexo’s leading sublingual fentanyl product for breakthrough pain in cancer patients, increased to MSEK 42.2 (16.2). Product sales amounted to MSEK 183.
  • Orexo and its partner Boehringer Ingelheim reported a significant step forward in their cooperation aimed at development of drugs to treat pain and inflammation. The first milestone payment amounted to MSEK 57.6 and was paid in January 2011. Additional amounts will be payable when certain other milestones are achieved, as well as royalties on sales of commercial products.
  • In June, Orexo signed a collaboration and licensing agreement for new drugs for respiratory diseases with Ortho-McNeil-Janssen Pharmaceuticals, Inc. and Janssen Pharmaceutica NV ("OMJ"). The agreement provides Orexo with research funding of up to MSEK 167 during the first three years, including an advance payment of MSEK 77.8. In addition, Orexo will be entitled to milestone payments of up to MSEK 4,390 if certain other stages are achieved, plus additional sales milestones and royalties in each program.
  • Orexo reported positive Phase I clinical data for OX219, a new sublingual tablet formulation for the treatment of opioid dependence.
  • Net revenues amounted to MSEK 210.5 (236.1).
  • Cashflow from operating activities was MSEK -43.0 (-133.9).
  • The loss after tax per share was SEK -3.81 (-4.32).
  • Cash and cash equivalents amounted to MSEK 135.8 compared to MSEK 87.4 at the beginning of the period.
  • Orexo financial and strategic position was strengthened earlier in the year when Novo Growth Equity invested in a convertible debt instrument.

Fourth Quarter

  • Net revenues amounted to MSEK 109.1 (27.9).
  • Cashflow from operating activities was MSEK -29.2 (-16.2).
  • Profit after tax for the quarter excluding exceptional items was MSEK 28.0 (-58.0), and including exceptional items the profit for the quarter after tax was MSEK 2.1 (-58.0).
  • Earnings per share amounted to SEK 1.20 (-2.48) excluding exceptional items and SEK 0.09 (-2.48) including exceptional items.
  • The exceptional items for the period were the costs in respect of recruitment costs of MSEK 1.8 and the write-down of the costs of the OX914 program of MSEK 24.1 in the fourth quarter.

Operations

"For the full year 2010, we saw strong sales of Abstral, providing an increase of approximately 320%. Sales of Edluar also grew, particularly in the fourth quarter.

On January 10, 2011 Abstral was approved by the FDA for sale in the United States. As a result of the approval and the new distribution agreements signed with Newbridge for the Middle East and Africa and Invida for the remaining key markets in Asia and Australia, Abstral is now a global product.

In August Orexo launched their new strategy "Orexo 2015". It is based on developing and commercializing products in-house in the future. In the first program, OX-219 (for the treatment of opioid dependence) has already completed a positive Phase I trial. Clinical phase I trials have been initiated in the other two new programs, OX27 and OX51.

Orexo’s arachidonic acid research made significant progress during the year. The company entered an alliance and license agreement with Ortho-McNeil-Janssen Pharmaceuticals and Janssen Pharmaceutica on its program OX-CLI for the treatment of respiratory diseases. Orexo also achieved its first milestone for OX-MPI in the research collaboration with Boehringer Ingelheim, "says Anders Lundström, President and CEO.

For the entire report, see enclosed link to pdf.

For further information, please contact:
Anders Lundström, President and CEO, Tel: +46 (0)18-780 88 12, e-mail: [email protected]
Robin Wright, EVP / CFO, Tel: 0044-7720 30 00 25, e-mail: [email protected]

Note
Orexo AB publ. discloses the information provided herein pursuant to the Securities Markets Act. The information was provided for public release on February 16, 2011, at 8:00 a.m. CET. This report has been prepared in both Swedish and English. In the event of any discrepancy in the content of the two versions, the Swedish version shall take precedence.