Orexo to acquire Biolipox - building a specialty pharma company driven by innovation

Orexo to acquire Biolipox - building a specialty pharma company driven by
innovation

Orexo AB (OMX Nordic List, Mid Cap: ORX) and the principal owners of Biolipox AB
have reached an agreement under which Orexo will acquire Biolipox, an innovative
Swedish research-based pharmaceutical company that develops new therapies for
inflammatory diseases, including pain management and respiratory diseases such
as asthma and chronic obstructive pulmonary disease (COPD). 

The acquisition will create an innovative specialty pharma company with a broad
product pipeline, global partnerships with major financial potential, and
established sales channels. Substantial shareholder value will be created
through operational synergies and by optimizing the potential of the combined
product pipeline. 

The transaction will take place through an issue in kind to Biolipox's
shareholders. The deal values Biolipox at SEK 856  million, and payment will be
made through an issue of a maximum of 8,560,000 Orexo shares. The final
structure of the transaction is dependent on Orexo's completion of due diligence
of Biolipox. The deal is also conditional upon approval of the issue in kind by
an extraordinary general meeting of Orexo and customary regulatory approvals. 

A press conference will be held jointly by Orexo and Biolipox at 10 a.m. today,
Monday, 15 October 2007. Location: Summit, Grev Turegatan 30, Stockholm.

Håkan Åström, Chairman of the Board of Orexo, comments: "The combination of
Orexo and Biolipox will create a larger and more robust pharmaceutical company
with a broad and attractive product pipeline. Orexo's business model, combined
with the Biolipox innovative research pipeline is an exciting combination to
create value."

The transaction in brief
Orexo will acquire Biolipox through an issue in kind. With the settlement price
used in the transaction (SEK 100 per share based on an average share price
during the last 45 days of trading), the new Orexo will have an estimated market
capitalization of approximately SEK 2.3 billion. The company will retain the
Orexo name. Following the transaction, Biolipox's shareholders will own 38% of
the combined company. Biolipox main owners are committed to a lock-up period of
three months, following closing of the transaction.

Employees and management
The two companies have together approximately 120 employees, including nearly 90
engaged in drug development. The Orexo head office will remain in Uppsala,
Sweden. Torbjörn Bjerke M.D., currently CEO of Biolipox, will serve as President
and CEO of the new company. Claes Wenthzel will continue to serve as Executive
Vice President and CFO, and Håkan Åström will continue as Chairman of the Board.
Orexo's current CEO, Zsolt Lavotha, will be leaving his operational
responsibilities in the company for personal reasons and will serve as Senior
Advisor to Orexo's board.

Operations
Orexo will develop as a growing pharmaceutical company focusing on specialty
pharmaceuticals. Primary focus will be on development and commercialization of
products primarily in the areas of pain management and respiratory diseases
targeting well defined patient groups and specialist physicians, enabling Orexo
to play a fully integrated role from research to commercialization.
Biolipox's pipeline includes several development projects in the areas of pain
management and respiratory diseases. The company's strategy has been to seek new
partnerships at an early stage in an effort to reduce financial risk. The
combined company's product pipeline will consist of a number of priority
projects, most of which are in late stage development, as well as a number of
other projects which will be evaluated by company management. Tangible synergies
and efficiency gains can thereby be achieved."Orexo has since its listing in 2005 actively been working on identifying and
evaluating a number of acquisition candidates. We see this deal as an important
step forward in achieving a broader product pipeline that will bring us closer
to our vision of creating a formidable specialty pharma company," says Zsolt
Lavotha, President and CEO of Orexo.

Torbjörn Bjerke, CEO-elect of Orexo and currently President and CEO of Biolipox,
comments: "I look forward to leading the combined company with the objective of
commercializing its product portfolio as rapidly as possible. We have solid
capabilities and will now have greater opportunities to drive development of our
new medicines for the benefit of the patients."

Financial position
Pro forma the combined company has cash and short-term investments covering more
than 12 months, excluding any cash from out-licensing agreements or milestone
payments. As per 30 September 2007, Orexo and Biolipox combined had cash and
short-term investments amounting to SEK 242 million. In addition, Orexo and
Biolipox will receive cash payments totaling approximately SEK 171 million
throughout the remainder of 2007. 

Financial data for the period January-June 2007
(SEK millions)	Orexo	Biolipox	Pro forma
Combined company 
Sales	15.2	15.6	30.8
- Cost of goods sold	-6.8	-	-6.8
Gross profit	8.4	15.6	24.0
- Selling expenses	-3.5	-	-3.5
- Administrative expenses	-32.9	-14.5	-47.4
- Research and development costs	-70.4	-57.9	-128.3
- Other income and expenses	-0.2	0.2	-
Operating profit	-98.6	-56.6	-155.2

ABG Sundal Collier has served as financial advisor to Orexo. HDR Partners has
served as financial advisor to Biolipox.

Timetable
An extraordinary general meeting of Orexo will be held on 1 November 2007.
The acquisition is expected tobe completed in November 2007.

For further information, please contact:

Zsolt Lavotha, President and CEO, Orexo
Tel: +46-18-780 88 12 
E-mail: zsolt.lavotha@orexo.com

Claes Wenthzel, Executive Vice President and CFO, Orexo
Tel: +46-18-780 88 44 
E-mail: claes.wenthzel@orexo.com 

Torbjörn Berke, President and CEO, Biolipox
Tel: +46-8-5248 3102
E-mail: torbjorn.bjerke@biolipox.com


Information on the press conference

Orexo and Biolipox will hold a joint press and analyst conference on Monday, 15
October 2007, at 10 a.m., at Summit, Grev Turegatan 30, Stockholm.



About Orexo
Orexo is a pharmaceutical company which focuses on identifying suboptimal
therapeutic characteristics of existing products and developing more efficient
and effective delivery methods for them. By combining approved active substances
with Orexo's drug delivery technologies it is possible to significantly enhance
their therapeutic value, such as providing quicker onset of action or ease of
administration. This business model is aimed at bringing products to market
faster with lower development risk and costs

Orexo, which has its global headquarters and development laboratories in Sweden,
currently operates across the world through development, licensing and
distribution agreements in all major markets.

Orexo has a balanced portfolio with two products on the market, three in
registration and/or late stage clinical phase, one in clinical phase I, and
three under formulation development.

Orexo is listed on the OMX Nordic List Mid Cap (ticker: ORX). 

www.orexo.se


About Biolipox
Biolipox is a Swedish research-intense pharmaceutical company that focuses on
developing novel, effective drugs for treating respiratory diseases and other
inflammatory diseases, such as asthma, chronic obstructive pulmonary disease
(COPD), rhinitis (hay fever), pain and arthritis (inflammatory joint diseases).
By drawing on its knowledge in the inflammatory research area, particularly
arachidonic acid metabolism, Biolipox has created a portfolio of potential
blockbusters in these therapeutic areas. The company has 47 employees and is
owned by Health Cap, Apax Partners, Sofinnova Partners, SLS Venture, Crédit
Agricole Private Equity, Auriga Partners and the scientific founders.

www.biolipox.se