Berlin, August 19, 2009 – A licensee of MOLOGEN AG has initiated arbitration proceedings at the German Arbitration Institute. The background to this is the request made by the current licensee to return the licence it acquired to market cell-based gene therapy for the treatment of cancer in the Indian region. It has not been possible to agree on the arrangements for this yet. The papers submitted value the licence at EUR 2.2 million. The matter is unlikely to be settled before mid-2010. The Executive Board of MOLOGEN AG is not at the present time working on the assumption that the licensee’s claims are enforceable.

CEO Dr Matthias Schroff explains: “We are relaxed about the proceedings because the contracts do not provide for a return of the licence. We are at the same time very interested in the settlement process itself, since the economic results produced with the licence by the licensee have fallen far short of MOLOGEN AG’s expectations.”

The lawyers commissioned by MOLOGEN AG to handle this matter think that the licensee has no chance of enforcing the return of the licence on his conditions. There is said to be no doubt about the contractual position that MOLOGEN AG holds in this case.

Product pipeline

MOLOGEN AG is one the few biotech companies in the world that is working on DNA-based cancer treatment in the clinical development programme. Following the positive interim results achieved in the current phase 1b clinical study with the cancer drug MGN1703, the authorities responsible approved an extension of the study to include an additional dosing group. The company has in the meantime been able to start investigation of the maximum dosage of 60 mg per treatment. Initial results achieved with this additional dosing group are expected towards the end of the third quarter of 2009.

The preparations for a phase I/II clinical study with cell-based gene therapy for the treatment of renal cancer MGN1601 have also continued. An application for this study is to be submitted before the end of this year.

MOLOGEN AG has made progress in the development of a DNA vaccine against leishmaniasis in humans too. The preclinical work is to be carried out and completed in the context of a project supported by European funding. MOLOGEN AG is part of an international alliance of leishmaniasis experts in this project.