New Product Release

Read more at: www.genovis.com/fragit

The Product Release is attached and published at Genovis web site: www.genovis.com

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Interim Report January-September 2010

Comments from the CEO

During the quarter we continued to work toward two of our short-term goals: to increase sales of products from the protein engineering portfolio and to intensify product development of multimodal nanoparticles. We’ve seen a clear increase in both the number of customers and sales during the year and we want to further accelerate the pace. To achieve this objective, during the third quarter we strengthened our sales organization and we chose to focus on new and existing customers among biotech and pharmaceutical companies. This category of customers primarily works with characterization of antibody molecules. They have relatively recently begun testing our enzymes from the protein engineering portfolio and they use them primarily for analysis at the discovery level. To increase volumes within this target group we are working with customer meetings and marketing with the aim of ensuring that our enzymes and methods will become the obvious choice. This standard will not only apply for early research projects, but continue as quality control during clinical trials, and later even in production of antibody-based drugs. One way to achieve this objective is to work on product development in close consultation with our customers. Such feedback has resulted in a new product, FragIT, which we are launching in November.
 
In September we presented the first results from the Sentinel node project at the World Molecular Imaging Congress (WMIC) in Kyoto, Japan. The need for new imaging technologies at the preclinical level is growing and it is encouraging to see that multimodal nanoparticles have the potential to contribute improved performance, higher resolution, and more reliable analysis. Genovis’ product development of nanoparticles for multimodal imaging is progressing according to plan and is now in a phase when we are focusing on optimization of modalities, image interpretation, and targeting using antibody molecules. We have also expanded our partnership with Lund Bioimaging Center, our partner that we’ve been working with on the Sentinel node research project.
 
Lund in November
Sarah Fredriksson

Overview of Operations

Genovis develops and sells innovative technologies that will facilitate our customers’ preclinical* research. The products we have launched to date consist of nanostructures and enzymes (proteins). We conduct research and development projects that focus on design, production, and characterization of nanostructures. The nanostructures and methods that Genovis focuses on can be used as contrast in medical imaging and as carriers of various substances in the development of new drug delivery methods. Our customers are primarily within the life sciences industry and academic research. The Genovis operation largely consists of research and development of new technology, though we have initiated some sales over the past two years.  

* “Preclinical studies” refers to pharmaceutical research carried out before a product is sufficiently documented to be studied in humans.

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Interim Report January-June 2010

Second quarter highlights

In May Genovis’ rights issue closed, with a subscription rate of 68% and existing shareholders subscribing to 88% of the total proceeds.  The rights issue raised SEK 16.5m for Genovis before issue expenses, which means an increase in the number of shares from 24,589,839 to 41,121,877 and an increase in share capital from SEK 9,835,935.5 to SEK 16,448,750.8.

In April Genovis received SEK 600,000 in research support for the Sentinel Node project from LMK Industri AB. The Sentinel Node project, a collaborative effort with the Department of Radiophysics at Lund University Hospital, is based on a brand new generation of nanoparticles with combined magnetic, radioactive, and fluorescent properties for MRI/PET imaging. The Swedish Research Council previously granted Genovis a four-year position for an industry-based doctoral student for the Sentinel Node project.

In June Genovis launched a new product, Mass Spec Kit. The product, which is a combination of the enzymes IgGZERO and FabRICATOR, is mainly used in the development and production of antibody-based drugs. The Mass Spec Kit provides customers with improved, more cost-effective quality control. The product is also faster and safer than existing technologies. The launch of the Mass Spec Kit is primarily aimed at R&D operations and quality control at biotech and pharmaceutical companies that develop and produce antibody-based drugs.

Comments from the CEO

At the end of the period, net sales per rolling 12 months increased by approximately 150% compared with the same time last year and revenues for the period increased by 110% compared with the same period in 2009. I am cautious about placing too much value on percentages when volumes are low, but I can conclude that this growth represents a stable trend. It is gratifying that our products are appreciated and that the proceeds in the form of research grant support for our development in imaging has increased considerably. The customer base is growing and currently consists of four of the top ten pharmaceutical companies, several biotech companies, and academic clients.

I presented our product Mass Spec Kit at two conferences in the United States: Immunology 2010 in Baltimore and Antibody Engineering and Design in Boston.  At the conference in Boston Centorcore, part of global Johnson & Johnson, presented studies in which they used FabRICATOR as research reagent. It was especially rewarding that the results showed that the enzyme FabRICATOR (IdeS) is specific with high enzymatic activity which is in line with our studies. The response to the presentations has been positive and the launch of the product is now underway in cooperation with our distributors. The product was developed in conjunction with specialists in mass spectrometry (MS) at Lund University and is a direct result of requests from our customers. Development of additional products in Genovis’ protein engineering portfolio proceeded according to plan during the period and will be launched in the autumn.

In late April I participated at the first consortium meeting in the EU-funded LUPAS project. Genovis’ role in the project is to help create nanostructures and to analyze and project future market potential and commercial opportunities. Initial results and future research strategy were discussed at the meeting. Genovis’ Sentinel Node research project is also proceeding according to plan. Optimization of the nanostructures’ various functions and dosing for detection of lymph nodes in the preclinical phase is underway. It is gratifying to note that we received additional financial support for the project in the spring.

Sarah Fredriksson, CEO 

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New Product Release

The Product Release is published at Genovis web site: www.genovis.com

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Interim Report January-March 2010

First quarter highlights

•Net sales during the first quarter increased by100 % compared to the same period 2009. Although the turnover is still low the number of cutomers increased.

•Genovis is participating in the LUPAS project, where the EU is investing almost SEK 50 million in research to diagnose and treat Alzheimer’s disease and prion diseases (e.g., Creutzfeldt-Jakob disease). Underpinning the project, which is an EU seventh framework programme, is the discovery of a luminescent molecule that signals when it encounters the disease-causing plaque in the brain. Linköping University is coordinating the project and to date Genovis has received SEK 1.4 million for the initial efforts. Part of Genovis turnover is research support and will be distributed over the year.
LUPAS (Luminescent Polymers for in vivo imaging of Amyloid Signatures), www.lupas-amyloid.eu

Important recent events

•The subscription rate for Genovis’ rights issue was 68% and existing shareholders subscribed to 88% of the total proceeds. The rights issue raised SEK 16.7m for Genovis before issue expenses, which means an increase in the number of shares from 24,589,839 to 41,337,227 and an increase in share capital from SEK 9,835,935.6 to SEK 16,534,890.8. The capital provided by the new share issue shall be used for the Company’s business operation and will primarily be invested to reinforce the Company’s sales organization, to launch new products from the protein portfolio, and in infrastructure for the production of nanoparticles.

•Genovis received SEK 600,000 from LMK Industri AB in research support for the Sentinel node project. The Sentinel node project, a collaborative effort with the Department of Radiophysics at Lund University Hospital, is based on a brand new generation of nanoparticles with combined magnetic, radioactive, and fluorescent properties for MRI/PET imaging. The Swedish Research Council previously granted Genovis a four-year position for an industry-based doctoral student for the Sentinel node project, which for 2010 entails approximately SEK 400,000 over the course of the year.

•At the Immunology 2010 conference in the United States Genovis presented new findings that facilitate and improve production and quality control of substances such as antibody-based drugs. The results are based on a study carried out in cooperation with Lund University. The study shows that the combination of two unique products from Genovis’ protein engineering portfolio is highly advantageous in mass spectroscopy of antibody molecules. The new method is faster, more reliable, and improves the analysis compared with existing technology.

CEO comments

In March we signed an agreement for the EU LUPAS project, marking the formal kickoff for a project that began some time ago with the actual application process. It was truly rewarding that these efforts were successful. Working with a strong research team is extremely stimulating. The same applies to the Sentinel Node project, a unique interdisciplinary project. We will have the opportunity to learn as well as an outstanding opportunity to market our nanostructures directly to the various partners we meet in the project and via the scientific articles generated during the course of the project. Full financing for the projects also reduces our costs for research projects.
During the period we continued to work with our subsidiary, Eijdo Research, on development of products and services within the multimodal nanoparticles product group and contract services within preclinical imaging. The products in the protein portfolio have expanded with a brand new application that we recently presented at a scientific conference together with our American distributor Bulldog Bio. The application is aimed at a new customer group and we are looking forward to the launch. Sales of all products in the protein portfolio continue to increase, though volumes are still modest. This trend has been stable over the past twelve months and we plan to intensify our efforts to continue to increase the sales rate. With respect to nanoparticles, we will primarily market them to academic customers and research projects in 2010 and subsequently complement them with new applications and services. Sales of nanoparticles will mainly occur via direct selling to end customers.
Although the rights issue carried out in April was not fully subscribed it brought the company financial stability. Now we can focus our full attention on operational activities and our targets for at least 18 months moving forward and I am very pleased by the support from our shareholders.

Lund May,18
Sarah Fredriksson

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Genovis: Premiere for unique product concept

“With this new concept we can offer producers of antibodies and antibody-based drugs new tools for improved and more cost-effective quality control. We will launch the concept immediately. It is important for Genovis to broaden the customer base for our products and the excellent results from this study provide an excellent opportunity to attract new customers,” says Sarah Fredriksson, CEO of Genovis.

Mass spectroscopy (MS) is an analytical technique to determine the chemical composition in substances such as proteins and peptides.

Meet Sarah Fredriksson May 8-10 in booth number 113, Bulldog Bio.
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Genovis protein portfolio
Genovis produce and market three different proteins with trade names FabRICATOR®, IgGZERO™ and FcDOCKER™. FabRICATOR is recombinant IdeS, a cysteine protease which cleaves the IgG molecule in the hinge region (Popular science animation of FabRICATOR see http://www.youtube.com/user/biotechgenovis ). IgGZERO is recombinant EndoS, an endoglycosidase which hydrolyze glycans attached to the Fc-fragments of IgG molecules. FcDOCKER is a mutated form of EndoS that can be used for affinity purification of IgG molecules.

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GENOVIS RIGHTS ISSUE 67% SUBSCRIBED

“I am extremely grateful for the support from our shareholders. While it is impossible to be fully satisfied when you fall short of the goal, the rights issue is still a demonstration of strength for Genovis. Proceeds from the share issue together with the revenues we received so far this year will cover the company’s financing needs for at least 18 months and enable us to execute our strategy as planned,” says Sarah Fredriksson.

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Genovis’ principal shareholder subscribed in full and paid for his part of the company’s issue of new shares.

Genovis new share issue in progress with preferential rights to existing shareholders and the right to subscribe for shares without preferential rights:
Subscription period April 15-30, 2010
Issuing price SEK 1

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Genovis has received SEK 1.4 million in research support

“The opportunity to apply an interdisciplinary approach with leading groups in medical imaging means a lot to Genovis. Proactive research is important for the company’s long-term development and of course it is gratifying when costs for high-priority projects can largely be financed with external funding. We are constantly evaluating potential new forms of cooperation in combination with external research support,” says Sara Fredrik, CEO of Genovis.

Genovis is one of eight partners in the LUPAS consortium, which aims to develop new tools and technologies for the diagnosis and treatment of Alzheimer’s disease and neurodegenerative diseases caused by prions, an infectious protein that causes illnesses such as mad cow disease in cattle and Creutzfeldt–Jakob disease in humans. The LUPAS project is financed with a total of SEK 50 million from the EU’s seventh framework programme over the course of three years.

Sentinel node is the working name of the development project that Genovis is conducting together with the Department of Medical Radiation Physics at Lund University. The project is interdisciplinary and the objective for Genovis is to develop a multimodal particle that can guide the surgeon and facilitate diagnosis prior to surgery by separating tumor cells from healthy cells in the “gatekeeping” gland. The project is supported by the Swedish Research Council and LMK Industri AB.

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Genovis’ prospectus has been approved in Norway, Finland, Denmark and United Kingdom

Genovis’ prospectus on a new share issue with preference for existing shareholders, approved on April 1 by the Finansinspektionen (the Swedish Financial Supervisory Authority), has also been approved in Norway, Finland, Denmark and United Kingdom. Residents in these countries can now subscribe for shares in the new share issue with subscription period April 15-30, 2010. The prospectus is available at Genovis web-site www.genovis.com.

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