Press information February 2015 Karessa develops the next generation of pharmaceutical products in the therapeutic area of erectile dysfunction Karessa Pharma AB Lahällsvägen 48 183 30 Täby www.karessa.se [email protected] Telephone +46 8 768 22 33 Fax +46 521 27 77 93 Registration no. 556942-1596 40 per cent among men aged 40 years suffer from erectile dysfunction Erectile Dysfunction (ED) is a large and growing global health problem. Its prevalence among men aged 40 years is estimated at around 40 per cent and it then increases in pace with increasing age. Only about 10 percent of men who suffer from ED receive adequate treatment. Karessa intends to supply this market with new products that have faster and more reliable effects than today's leading treatments. Our goal is to revolutionise the market for drugs that treat erectile dysfunction. Through innovation and patented technology, we want to help men to regain their sexual potency – without the need to plan far in advance. Today's medicinal products for treating erectile dysfunction are fantastic in many ways. They are safe, effective and have helped millions of men to regain their sexual self-confidence. What they lack is the possibility of spontaneity when desire well asserts itself. All of today's big sellers take a relatively long time before they achieve their intended effect. For them to function fully, planning and a time margin are required – which is of course not always possible when it counts. Our business concept is to develop and commercialise the next generation of innovative products in the therapeutic area of erectile dysfunction. We aim to do this by combining our patented drug delivery-film with clinically tested and proven substances. We already know that the film works as a delivery system for substances. We also know that the active substances produce the desired effect. By combining them, we can create a medicinal product with completely unique properties: a drug that makes it possible to eliminate the need for planning and instead embracing desire and spontaneity. Today, except in New Zealand, none of the leading substances within erectile dysfunction are approved as over-the-counter medications, but the authorities in several countries are currently reviewing whether some substances can become nonprescription drugs. Karessa is closely monitoring this development. If substances in this therapeutic area are approved for OTC Karessa will have a product available in this area too. Such an approval is expected to increase the number of users and doses considerably, since access to ED medicinal products will then no longer be dependent on a prescription from a doctor. Stockholm, February 2015 Torbjörn Kemper CEO A unique concept Benefits for the patient: • Faster and more reliable effect • Reduced the need for planning • No impact from food or drink Karessa Pharma AB Lahällsvägen 48 183 30 Täby www.karessa.se [email protected] Telephone +46 8 768 22 33 Benefits for Karessa: • Shorter time to market • Lower development costs • Reduced risk Fax +46 521 27 77 93 Registration no. 556942-1596 Business concept Karessa's business concept is to develop and commercialise innovative products with clear competitive advantages related to rapid and reliable effect in the therapeutic area of erectile dysfunction. Great benefit is generated for both patients and the company as a result of combining the company's patented drug delivery-film with clinically tested and proven substances. For the individual patient, the goal is to offer a drug with faster and more reliable effect than today's preparations. For Karessa as a company, this combination means a shorter time to market, lower development costs and significantly reduced risk with regard to clinical studies. Patented technology The foundation of Karessa's operations is a patented drug delivery platform in the form of an alignate-based polymer film. The film, which can be likened to a postage stamp, is applied discreetly to the oral mucosa and through it the drug is then rapidly delivered out into the bloodstream. The film then dissolves without leaving any residues in the mouth. From a medical perspective, this provides the possibility of fast, stable and reliable delivery. For the individual patient, the combination means a faster and more stable effect than today's preparations. Since the drug goes straight out into the blood, the time to effect is very tangibly reduced, which reduces the need for planning and a time margin. The effect is not either affect by the contemporaneous consumption of food and drink. Drugs and other substances that are delivered into the bloodstream via the oral mucosa are taken up considerably faster (and thus provide a faster effect) than is the case for delivery via tablets or capsules that are swallowed. It also offers a more reliable and discreet form of delivery than tablets and other delivery systems such as nasal sprays and orally dissolving tablets. That the drug is delivered via the mucous membrane in the mouth also avoids contact with the metabolic enzymes in the lower gastrointestinal tract and the liver, which otherwise reduce or completely eliminate the effect of a significant proportion of medicinal products that are delivered via oral tablets or capsules. Since the drug is delivered straight out into the bloodstream, and does not need to pass stomach, the time to uptake is not either affected by the contemporaneous consumption of food and alcohol or other beverages – which otherwise can make a large difference. Combining Karessa's patented drug delivery platform in the form of a film with proven, safe and known substances generates significant benefits for the patient. Karessa Pharma AB Lahällsvägen 48 183 30 Täby www.karessa.se [email protected] Telephone +46 8 768 22 33 Fax +46 521 27 77 93 Registration no. 556942-1596 Market The market for drugs for erectile dysfunction is on the brink of major changes. The patents behind the medicinal products that dominate the market today (Viagra, Cialis and Levitra) are now successively expiring. This opens the way for new players who, through generics and innovation, can offer new concepts with improved patient benefits. The market is also continuing to grow. Its main drivers include an increasingly ageing population, the increased prevalence of underlying diseases such as diabetes, and an increased awareness of effective treatment methods. Since Viagra was introduced in 1998, the market for drugs for erectile dysfunction has grown substantially. By 2012, the global market was valued at SEK 35 billion. As the patents behind today's most frequently used drugs successively expire in the coming years, the price of today's treatments is expected to gradually decline as they become exposed to price competition from generics. However, this development may come to be avoided through continued product development and the addition of value-adding factors. The actual demand measured in number of doses, however, is expected to continue to rise. The main drivers include a proportionally increasingly older population, increased awareness of the possibility of effective treatment, less of a social stigma and the increasing prevalence of underlying diseases and public health problems such as diabetes and obesity. There is much to indicate that, on several large and established markets, drugs to treat erectile dysfunction will begin to be sold over the counter, which is likely to increase volumes further. Listing on Nasdaq Stockholm First North The listing of Karessa on Nasdaq Stockholm First North is a natural part of the Company's aim to create a world-leading company in the growing market for drugs for erectile dysfunction. The listing is also anticipated to constitute a stamp of quality in relation to customers and potential partners in cooperation and in the recruitment of staff, as well as contribute to an increased interest in the Company among new groups of investors, the media and other stakeholders. Spokespersons Torbjörn Kemper, CEO – business related questions [email protected] Telephone: +46 8-768 22 33 Erik Nerpin, Chairman of the board – owner related questions [email protected] Telephone: +46 8-661 88 47 Karessa Pharma AB Lahällsvägen 48 183 30 Täby www.karessa.se [email protected] Telephone +46 8 768 22 33 Fax +46 521 27 77 93 Registration no. 556942-1596 Management Torbjörn Kemper CEO, Board member See Board of Directors. Karessa Pharma AB Lahällsvägen 48 183 30 Täby www.karessa.se [email protected] Erik Mascher CTO Born: 1956 Education: PhD in biochemistry, Uppsala University Other current engagements: – Previous directorships: – Past experience: Senior Scientist, Section Manager General Electric Healthcare, Vice President Process Development and Production Resistentia Pharmaceuticals AB, Consultant, MAKK Consulting AB Shareholding: 0 Option holding: 0 Telephone +46 8 768 22 33 Hans Richter CFO on a consultative basis Born: 1949 Education: MBA, Uppsala University, BA from Stockholm University Other current engagements: Chairman of the Board of Magelhusen AB, Hela Sveriges Assistans AB, Anti-Snore Sweden AB, board member of Icehotel AB, Gällöfsta Utbildning och Konferens, Professionell Ägarstyrning AB. Previous directorships: Chairman of IPQ IP Specialists AB, IDEntity AB, Zuera AB, board member of Vivaldi AB, COOD Investments AB Past experience: Professional board member and CFO for hire Shareholding: 0 Option holding: 0 Fax +46 521 27 77 93 Jan Berglund Chief Operating Officer Born: 1961 Education: Nursing Care/Science of Care at Mid Sweden University in Sundsvall, Bachelor of Science in Nursing, Anaesthetist Care from Uppsala University Other current engagements: Previous directorships: Past experience: Country manager, Cipla Europe NW, Nordic Commercial Director at Nestlé Health Care Science, Deputy Managing Director Sweden, Director of Contract Placement Solutions and Head of Marketing and Sales at Trial Form Support, Area Manager General Medicine at Novartis, various senior positions held at GlaxoSmithKline. Shareholding: 5,000 Option holding: 55,000 Registration no. 556942-1596 Board of Directors Erik Nerpin Chairman Born: 1961 Education: LL.M, Uppsala University. International Banking Law, Boston University Main occupation: Lawyer Other current engagements include: Chairman of the Board of Nicoccino Holding AB, Cassandra Oil AB, Kancera AB and WYA Holding AB. Board member of Diamyd Medical AB, Effnetplattformen AB, Aqeri Holding AB, AB Igrene, Blasieholmen Investment Group AB and Otirol Art AB Previous directorships include: Chairman of the Board of Factum Electronics AB (until 2013) Shareholding: 20,000 Option holding: 0 Karessa Pharma AB Lahällsvägen 48 183 30 Täby www.karessa.se [email protected] Michael Bracké Board member Born: 1963 Education: Harvard Business School Alumni Master Degree Applied Arts Other current engagements: CEO Nicoccino Holding AB and board member of MSM Advice AB Previous directorships: Board member of Dicota Holding AB, board member of Urbanista AB and CEO of OSM Holding AB. Shareholding: 10,000 Option holding: 0 Telephone +46 8 768 22 33 Stefan Arver Board member Born: 1952 Education: MD, PhD (Karolinska Institute), Registered medical practitioner, specialist in endocrinology Other current engagements: Director European Academy of Andrology accredited Educational Centre in Andrology, Fellow and chief physician, Section manager Centre for Andrology and Sexual Medicine at Karolinska University Hospital, Stockholm. Research group leader in Andrology and Sexual Medicine, Karolinska Institute. Scientific adviser, consultant in the area of men's gender-specific diseases. Board member Vitamin Well AB, Alabio AB, Acrosomen AB Shareholding: 0 Option holding: 75,000 Scott Boyer Board member Born: 1962 Education: PhD, University of Colorado, Boulder – Toxicology. NIH Fogarty International Centre Postdoctoral Fellow – Karolinska Institute Other current engagements: Director – Computational Toxicology, Karolinska Institute, CEO, Klaria Pharmaceuticals AB Previous directorships: Shareholding: 10,000 Option holding: 0 Fax +46 521 27 77 93 Torbjörn Kemper CEO, Board member Born: 1969 Education: University of Gothenburg, School of Business, Economics and Law Other current engagements: Board member of Nicoccino Holding AB Past experience: Sales Director, HENKEL Business Development Director, MEDA OTC AB Nordic Commercial Director, NESTLÉ HEALTH SCIENCE Commercial Director, Novartis Medical Nutrition Sales Manager Glaxo Smith Kline Previous directorships: Shareholding: 4,000 Option holding: 175,000 Registration no. 556942-1596