MOLOGEN closes second quarter of 2006:
Important contracts closed and good prospects although revenues still low

In the first six months of 2006, MOLOGEN AG (ISIN DE0006637200) secured important contractual agreements and further developed its technology. Thanks to the continued good liquidity position, business prospects are considered to be excellent. The current license negotiations indicate a balanced result for the first eight months of 2006.

In the first half of 2006, MOLOGEN generated EBIT of -1.7 million EUR in the Consolidated Financial Statements prepared in line with IFRS. In the same period of the previous year, EBIT was -1.9 million EUR. The revenues are 0.5 million EUR, slightly above those of the same period of the previous year (0.4 million EUR). The earnings per share amount to -0.20 EUR as compared to -0.31 EUR in the first six months of 2005.

Cell-based gene therapy for fighting cancer

In March, an agreement was concluded with the NMC Group, United Arab Emirates, for the delivery of MOLOGEN-developed cell-based gene therapy. MOLOGEN is to deliver its cancer therapy to hospitals of the NMC Group. However, the approval of the state authorities is required before patients can be treated. The work begun in April to obtain the necessary treatment authorization is going according to plan. Since the import of the gene therapy has already been approved, the decision of the health authorities is expected in the third quarter.

Preliminary work for a license for the therapy in Europe also got underway. The so-called Innovation Task Force, a committee of EMEA, the European licensing authority, has awarded drug status to the cell-based gene therapy to combat renal cancer. This decision is an important step forward for the further clinical development of this cancer therapy in Europe, as cells other than MOLOGEN’s DNA molecules MIDGE and dSLIM have not been classified as drugs from the start.

MIDGE vaccine against leishmaniasis

In April, MOLOGEN concluded a far-reaching license and development agreement for its MIDGE-based vaccine for domestic animals against the infectious disease of leishmaniasis. The contracting party, which wishes to remain anonymous, is one of the world’s ten largest veterinary pharmaceutical companies and belongs to a major global pharmaceutical organization based in the USA.

As well as the upfront and milestone payments, MOLOGEN will obtain sizable proportions of the subsequent revenues. MOLOGEN has received the first payment on time in the form of a signing fee of USD 100,000. After licensing, the marketing of the vaccine will initially focus on Europe, where leishmaniasis is one of the most widespread diseases suffered by pets.

The project is proceeding according to plan. The partner’s project team visited MOLOGEN in July and was fully briefed about the production process and quality standards of the leishmaniasis vaccine. Following this, MOLOGEN was commissioned to produce the vaccine for the next development stage.

Latest developments

dSLIM

To prepare for a hearing at EMEA, the European drug licensing authority, we pushed ahead with the planning for the next clinical study for the application of dSLIM against colorectal cancer. A so-called ‘briefing book’ was created, which contains the detailed planning of the studies yet to be completed as well as all development data so far. In this hearing, which is scheduled for the fall, the planning of the studies will be agreed with EMEA with regard to the subsequent licensing procedure.

Cell-based gene therapy

Negotiations continued for the licensing out of the cell-based gene therapy in further regions. As well as India, potential partners were approached in China and Russia, and the business model for marketing the therapy was comprehensively presented.

WebsiteTo coincide with today’s half-yearly report, the company has relaunched its homepage. The newly designed site can as usual be accessed at www.mologen.com.

Download Half-year Report 2006

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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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