MOLOGEN announces half year results for the first half of 2005

Strong foundation for a positive development, result prognosis

for second half year good

Company performance first half year 2005

During the first six months of 2005, MOLOGEN has strengthened its basis for a positive future business development. Investments in an expansion of the dSLIM segment and a better capitalization set the course for the future.

The consolidated financial statement, compiled with IFRS, shows MOLOGEN to have had a business volume of 0.4 million EUR in the first half of 2005. The volume is expected to increase significantly in the second half year, due to the revenues anticipated from cell- and gene-therapy centers. In the first half of 2004, the business volume was 1.1 million EUR. The volume for the second quarter 2005 was 0.3 million EUR.
A determining factor for the -1.9 million EUR EBIT were the expansion of the dSLIM segment and the non-recurring expenditures for the successful capital increase. MOLOGEN's increased activities in the dSLIM segment have further improved the very positive prospects linked with the immune modulator. In the first half of 2004, EBIT was -1.2 million EUR. The result per share in the first half of 2005 was -0.31 EUR, compared to -0.23 EUR in last year's period. In the second quarter of 2005, EBIT was -1.2 million EUR, in last year's period, -0.4 million EUR.

The operational cash flow was -1.7 million EUR during the first half of 2005 due to increased activities in research and development. The operational cash flow was -1.3 million EUR in the first half of 2004.
The inventory of financial resources went up from 0.9 million Euro on March 31, 2005 to 2.1 million Euro on June 30, 2005.

Investment focus gene-therapy centers

Investment activities in the report period have focused strongly on the expansion of the gene-therapy center segment. Thus, roughly 0.9 million EUR of the total investment volume of 1.2 million EUR went to the joint venture INMOG. The responsibilities of this company, situated in Saudi Arabia, include further marketing and sales of the gene-therapy centers. Marketing activities have been launched according to schedule. Investments in INMOG have been in the form of real estate and premises, so that INMOG will be able to start building cell- and gene-therapy centers as planned in the third quarter of this year.

Research and development

In the first quarter of 2005, the exceptional clinical test results for the MIDGE-based leishmaniasis vaccine for dogs have been reviewed and confirmed by a panel of independent experts. The development of a MIDGE-based vaccine against leishmaniasis in humans, carried out in cooperation with and under the direction of IDRI (USA), is currently at an advanced pre-clinical phase.

Two preparatory projects for clinical studies are also making satisfactory progress. The first of these is the development by the Chinese cooperation partner Starvax of dSLIM-based medication against cancers of the liver, the colon, and the lungs. The other concerns the pre-clinical development of a therapeutic against cancer of the kidneys (RCC) from cells with a quadruple MIDGE gene modification and dSLIM immune modulation.

dSLIM patents

An important milestone has been reached during the report period in our dSLIM technology segment: The United States Patent and Trademark Office has granted MOLOGEN the patent for its dSLIM technology. The first dSLIM patent had been granted by the European Patent Office in early 2004. The time limit for appeal against this patent has by now expired and no appeals have been filed. The US patent protects future dSLIM-based medication and vaccines on the US market until the year 2020.

Prospect

Based on existing contracts and planned revenues, MOLOGEN's prospect for the second half of 2005 includes a clearly positive cash flow development as well as positive EBIT.

Download Half-year Report 2005

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About MOLOGEN

MOLOGEN uses its proprietary DNA technologies to create and develop treatments for high-unmet-need illnesses. The main focuses are the unique and patented MIDGE and dSLIM technologies. Based on these platforms, MOLOGEN is developing DNA-based vaccines and therapeutics to prevent or cure a wide range of diseases.

Going public in 1998, MOLOGEN was one of the first German biotechnology companies to be floated on the stock exchange. The MOLOGEN shares are traded on the Geregelter Markt in Frankfurt.

Disclaimer concerning prognoses

Certain statements in this communication contain formulations or terms referring to the future or future developments, as well as negations of such formulations or terms, or similar terminology. These are described as forward-looking statements. In addition, all information in this communication regarding planned or future results of business segments, financial classification numbers, developments of the financial situation, or other financial or statistical data contains such forward-looking statements. The company cautions prospective investors not to rely on such forward-looking statements as certain prognoses of actual future events and developments. The company is neither responsible nor liable for these forward-looking statements. It is not responsible for updating such information, which only represents the state of affairs on the day of publication.

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