DGAP-News: PAION GRANTS COSMO PHARMACEUTICALS REMIMAZOLAM LICENSE IN THE U.S. AND COSMO BECOMES LARGEST SHAREHOLDER OF PAION AG


DGAP-News: PAION AG / Key word(s): Contract
PAION GRANTS COSMO PHARMACEUTICALS REMIMAZOLAM LICENSE IN THE U.S. AND COSMO
BECOMES LARGEST SHAREHOLDER OF PAION AG

24.06.2016 / 19:28
The issuer is solely responsible for the content of this announcement.

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PAION GRANTS COSMO PHARMACEUTICALS REMIMAZOLAM LICENSE IN THE U.S. AND
COSMO BECOMES LARGEST SHAREHOLDER OF PAION AG

  - Cosmo to make EUR 10 million upfront license fee payment to PAION

  - PAION entitled to receive up to EUR 42.5 million in milestone payments
    and significant double-digit tiered royalties

  - PAION resolves issuance of 5,064,194 new shares to a subsidiary of
    Cosmo by way of a private placement and receives EUR 9.6 million

Aachen (Germany), 24 June 2016 - Today, PAION AG, a specialty pharma
company (ISIN DE000A0B65S3; Frankfurt Stock Exchange Prime Standard: PA8),
and Cosmo Technologies Ltd., a subsidiary of Cosmo Pharmaceuticals N.V.,
("Cosmo") entered into a license agreement for remimazolam. The agreement
grants Cosmo Technologies Ltd. an exclusive license for the development and
commercialization of PAION's lead drug candidate, remimazolam, in the
territory of the United States.

Under the license agreement, PAION will receive a EUR 10 million upfront
licence fee payment. In addition, PAION is entitled to receive additional
payments of up to EUR 42.5 million contingent upon certain milestones
related to the U.S. regulatory approval process and, upon commercialization
of remimazolam in the U.S., following regulatory approval, tiered royalties
on net sales in the U.S. ranging from 20% to 25%, which may be adjusted
under certain conditions but not to below 15% of net sales.

Under the terms of the license agreement, Cosmo has the right to further
develop and commercialize remimazolam in the U.S., while bearing all future
associated costs for market authorization and distribution. However, PAION
will be responsible for and bear the cost associated with the completion of
the ongoing U.S. trials in procedural sedation.

At the same time, Granell Strategic Investment Fund Limited ("Granell"),
another subsidiary of Cosmo, entered into an investment agreement with
PAION AG, pursuant to which it has committed to invest EUR 10 million in
shares of PAION AG. In this context, PAION AG today resolved to issue
5,064,194 new shares of PAION AG at a price of EUR 1.90 per share (5-day
VWAP) for a total of EUR 9.6 million to Granell under exclusion of
shareholders' subscription rights. The remaining amount of EUR 0.4 million
will be invested at a later date. The shares issued to Granell will be
subject to a 12-month lock-up period. Upon completion of the private
placement, which is expected to occur on 29 June 2016, Granell will hold
approximately 9% in PAION AG's issued share capital. Under the Investment
Agreement, PAION has undertaken, subject to approval by the Company's
shareholders' meeting, to cause the appointment of one supervisory board
member proposed by Cosmo to the Company's supervisory board.

Due to the significant impact of the license agreement and the investment
agreement on PAION's net assets, financial position and results of
operations, PAION will adapt the financial outlook for 2016 given on 22
March 2016 in connection with the publication of PAION's annual financial
results 2015. A new outlook will be published later in the course of 2016.

Dr Wolfgang Söhngen, CEO of PAION AG, commented: "Cosmo is an ideal
industrial partner to share PAION's vision to improve procedural sedation
specifically for patients undergoing gastrointestinal endoscopies.
Remimazolam's potential for the U.S. lead indication procedural sedation is
significant. We are convinced that Cosmo, with its innovations in
gastrointestinal endoscopies is the ideal partner to maximize the potential
of remimazolam in the U.S. We also expect this collaboration to have a
positive effect on our and our partners' progress in other territories.
With Cosmo becoming a strategic shareholder in PAION, our incentives will
be fully aligned. We intend to proceed with U.S. development full steam to
enable Cosmo to file for the NDA as planned."

Alessandro Della Chà, CEO of Cosmo Pharmaceuticals added: "The remimazolam
Phase III data are very convincing. Given its fast onset and short wake-up
time we believe that remimazolam will have a significant impact on how GI
endoscopies are being performed in a rapidly changing reimbursement
environment. Remimazolam is a perfect extension of our value proposition.
In our view, remimazolam will allow the gastrointestinal endoscopist to
sedate the patient faster and more safely, Methylene Blue MMX will help
identify more dangerous adenomas and Eleview will allow the faster and
safer excision of the lesions."

###

About remimazolam
Remimazolam is an ultra-short-acting intravenous benzodiazepine sedative/
anesthetic, currently in Phase III clinical development for procedural
sedation. In the human body, remimazolam is rapidly metabolized to an
inactive metabolite by tissue esterases and not metabolized by cytochrome-
dependent hepatic pathways. Like other benzodiazepines, remimazolam can be
reversed with flumazenil to rapidly terminate sedation and anesthesia if
necessary.

In clinical studies, remimazolam demonstrated efficacy and safety in over
1,000 patients. A Phase III program is currently in progress in procedural
sedation in the U.S. Data so far indicate that remimazolam has a rapid
onset and offset of action combined with a favorable cardio-respiratory
safety profile.

A pediatric development plan has been agreed with the FDA and will be
implemented following the development of remimazolam for adult patients. A
full clinical development program for general anesthesia has been completed
in Japan, and a Phase II study in general anesthesia has been completed in
the E.U. Development for ICU sedation beyond 24 hours is considered
following successful completion of development in procedural sedation and
general anesthesia.

Remimazolam is available for licensing outside the U.S., China, Russia
(CIS), Turkey, the MENA region, South Korea and Canada, where the compound
is partnered with Cosmo Pharmaceuticals, Yichang Humanwell, R-Pharm, TR-
Pharm, Hana Pharm and Pharmascience (Pendopharm), respectively.

About Cosmo Pharmaceuticals
Cosmo is a specialty pharmaceutical company that aims to become a global
leader in the field of optimized therapies for selected gastrointestinal
disorders and endoscopic procedures. The company's proprietary clinical
development pipeline specifically addresses innovative treatments for IBD
(inflammatory bowel disease), such as ulcerative colitis and Crohn's
disease, and colon infections. In addition, the company has developed a
medical device for polyp excision and is developing a product for the
detection of colon cancer and has a large shareholding in Cassiopea SpA, a
clinical-stage specialty pharmaceutical company focusing on developing and
commercializing innovative and differentiated medical dermatology products.
Cosmo's MMX(R) products that have reached the market are Lialda(R)/
Mezavant(R)/Mesavancol(R), a treatment for IBD that is licensed globally to
Nogra and Shire Limited and Uceris(R), the first glucocorticosteroid
indicated for the induction of remission in active, mild to moderate
ulcerative colitis, licensed in the U.S. to Santarus/Salix/Valeant and in
the rest of the world to Ferring. Cosmo's proprietary MMX(R) technology is
at the core of the company's product pipeline and was developed from its
expertise in formulating and manufacturing gastrointestinal drugs for
international clients at its GMP (good manufacturing practice) facilities
in Lainate, Italy. The technology is designed to deliver active ingredients
in a targeted manner in colon. For further information on Cosmo, please
visit the company's website: www.cosmopharmaceuticals.com.

About PAION
PAION AG is a publicly listed specialty pharmaceutical company
headquartered in Aachen (Germany) with further sites in Cambridge (United
Kingdom) and New Jersey (USA). PAION's lead substance, remimazolam, is an
intravenous ultra-short-acting benzodiazepine sedative/anesthetic currently
in Phase III clinical development for procedural sedation. Remimazolam is
designed to complement and improve currently available treatment options
for patients requiring sedation and anesthesia. PAION is focusing its
clinical development activities on remimazolam according to PAION's vision
to become an acknowledged "PAIONeer" in sedation and anesthesia.

For more information please visit www.paion.com or
www.cosmopharmaceuticals.com

PAION Contact
Ralf Penner
Director Investor Relations / Public Relations
PAION AG
Martinstrasse 10-12
52062 Aachen - Germany
Phone: +49 241 4453-152
E-mail: r.penner@paion.com
www.paion.com

COSMO Contact
Dr. Chris Tanner
Cosmo Pharmaceuticals NV
Riverside II
Sir John Rogerson's Quay
Dublin 2, Ireland
investor.relations@cosmopharma.com
+353 1 817 03 70

Disclaimer:
This release contains certain forward-looking statements concerning the
future business of PAION AG. These forward-looking statements contained
herein are based on the current expectations, estimates and projections of
PAION AG's management as of the date of this release. They are subject to a
number of assumptions and involve known and unknown risks, uncertainties
and other factors. Should actual conditions differ from the Company's
assumptions, actual results and actions may differ materially from any
future results and developments expressed or implied by such forward-
looking statements. Considering the risks, uncertainties and other factors
involved, recipients should not rely unreasonably upon these forward-
looking statements. PAION AG has no obligation to periodically update any
such forward-looking statements to reflect future events or developments.


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24.06.2016 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The DGAP Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Archive at www.dgap.de

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   Language:    English                                                    
   Company:     PAION AG                                                   
                Martinstr. 10-12                                           
                52062 Aachen                                               
                Germany                                                    
   Phone:       +49 (0)241-4453-0                                          
   Fax:         +49 (0)241-4453-100                                        
   E-mail:      info@paion.com                                             
   Internet:    www.paion.com                                              
   ISIN:        DE000A0B65S3                                               
   WKN:         A0B65S                                                     
   Listed:      Regulated Market in Frankfurt (Prime Standard); Regulated  
                Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich,  
                Stuttgart                                                  
 
 
   End of News    DGAP News Service  
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474339 24.06.2016