INTERIM REPORT JANUARY-JUNE 2011

| Source: Karo Pharma AB Karo Pharma AB 

INTERIM REPORT JANUARY-JUNE 2011

The January - June period and the second quarter of 2011 in brief

  · Net sales amounted to MSEK 0.0 (0.0)
  · Net loss was MSEK 124.9 (79.0), whereof the second quarter MSEK 77.2
(38.5)
  · Loss per share was SEK 0.32 (0.33), whereof the second quarter SEK
0.20 (0.16)
  · Cash flow from operating activities was MSEK -112.7 (-80.8), whereof
the second quarter MSEK -65.2 (-37.9).The difference from the previous
period concerns costs related to the phase III program for eprotirome.
  · Cash and cash equivalents and other short-term investments totaled
MSEK 245.8 (152.3) at the end of the period.
  · In March, Karo Bio entered into a one year extension of the research
collaboration with Zydus Cadila on GR.
  · In April, Karo Bio entered into an agreement regarding eprotirome
with Indian Alkem Laboratories Ltd., which lowers Karo Bio's costs for
eprotirome's phase III program by SEK 100 million.
  · The Annual General Meeting elected Göran Wessman as Chairman of the
Board and Per Bengtsson, Christer Fåhraeus, Elisabeth Lindner, Jan N.
Sandström and Anders Waas as Directors.
  · Karo Bio arranged a symposium where leading scientists within
academia and industry discussed ERbeta data on the cutting edge and its
therapeutic applications.
  · Per Bengtsson was appointed acting President and CEO in May, after
Fredrik Lindgren.
  · Applications to start patient studies with eprotirome were filed in
12 countries.

Significant events after the end of the reporting period

  · 3D structure depicted for RORgamma receptor with Karo Bio's leading
drug-like compound bound to it, which facilitates and shortens the
process of identifying an optimal drug candidate.
  · Discussions started regarding the out-licensing of ERbeta and
RORgamma.

Conference call today at 10.00 CET
Acting CEO Per Bengtsson will present the report today at 10.00 CET in
an audiocast, held in Swedish, available via a link on Karo Bio's
website www.karobio.se (http://www.karobio.se/) and via telephone: +46
(0)8 5051 3791 or +44 (0)20 7806 1968

For more information, please contact:          Karo Bio AB (publ)
Per Bengtsson, Acting Chief Executive Officer  Novum, 141 57 Huddinge,
Sweden
Telephone: +46 734 474 128                     Telephone: +46 8 608 60
00
                                               Facsimile: +46 8 774 82
61
                                               Corp. reg. no.
556309-3359
                                               Website:
www.karobio.com (http://www.karobio.com/)

The information in this report is such that Karo Bio is required to
disclose under the Swedish Securities Market Act. The information was
disclosed on July 13, 2011, 08:30 CET.

Attachments