Financial Statement, 1 January - 30 June 2011

Financial Statement, 1 January - 30 June 2011

Operating profit/loss of SEK 215.7 m

All figures for the group unless otherwise stated. Unless otherwise
stated, comparisons in this Interim Report are with the corresponding
period of2010.

Interim period (January 2011 - June 2011)

  · Net sales were SEK 444.6 (35.7) m
  · Profit/loss after tax amounted to SEK 220.3 (-50.3) m
  · Basic and diluted earnings per share were SEK 7.37 (-2.14)
  · Cash flow from operating activities amounted to SEK 230.9 (4.6) m;
cash and cash equivalents and investments in securities etc. amounted to
SEK 716.4 (462.7) m at the end of the period

Second quarter (April 2011 - June 2011)

  · Net sales were SEK 322.9 (14.1) of which BioPhausia, which was
consolidated from 1 June, contributed SEK 42.4 m
  · Profit/loss after tax amounted to SEK 167.4 (-24.1) m
  · Basic earnings per share were SEK 5.52 (-1.01)

Business highlights in the second quarter

  · Medivir's commercial presence in the Nordics enhanced through the
acquisition of BioPhausia
  · Positive interim results after 48 weeks' treatment presented from
phase 2b ASPIRE study on TMC435 in treatment-experienced hepatitis C
genotype 1 patients
  · Clinical phase 1b trial commenced on polymerase inhibitor TMC649128
in patients with chronic hepatitis C virus genotype 1 infection
  · Medivir receives USD 45 m (SEK 279 m) from Meda, which acquired the
American rights to Xerese®

Post-period end highlights

  · Tibotec decides to conduct a combination study on TMC435 with
Pharmasset's PSI-7977 for hepatitis C
  · TMC435 receives Fast Track designation by the FDA in the US
  · BioPhausia CEO Maris Hartmanis appointed Deputy CEO and Chief
Operating Officer
  · BioPhausia's generics business, BMM Pharma AB, has been divested

“Medivir's commercial presence strengthened in the Nordics”

CEO's comment

A trading company at the leading edge
We continued to make major advances in all segments in the second
quarter. We took a momentous step forward to consolidate our commercial
operation through our acquisition of Swedish specialty pharmaceutical
company BioPhausia.

The acquisition of BioPhausia brings Medivir a profitable product
portfolio with a number of well-known brands such as Mollipect (cough
medicine), Citodon (analgesic), Laxabon (laxative) and Egazil (irritable
bowel). The cash flow from this portfolio and enhancement of our
commercial platform via BioPhausia's network significantly improves our
prospects of acquiring more products for sale in the Nordics, which
complements the future flow of Medivir's proprietary products.

BioPhausia also brings an infrastructure and platform that will
facilitate the expected launch of TMC435 for HCV patients in the
Nordics, where we've retained the commercial rights to the product. The
Nordic market for hepatitis C consists of some 115,000 chronically
infected patients. Of this total, some 3,000 per year are currently
treated with current SoC (standard of care). In the best case, existing
therapies cure only about 50% of the patients treated for this
life-threatening disease. In addition, current therapy has problems with
both safety and tolerability. Overall, this indicates that the Nordic
region is a valuable future market for TMC435.

Late in the period, we consolidated our financial position further by
renegotiating the terms with our commercial partner Meda on Xerese®, and
our unique cold sore (labial herpes) product. Through a sale of the
rights to Xerese® in the US, Canada and Mexico to Meda, we raised USD 45
m (SEK 279 m). This agreement will trigger a payment to AstraZeneca, the
original patentee, according to previously agreed terms. Medivir has
retained the existing global rights to Xerclear® outside the US, Canada
and Mexico. We will continue to exploit these market opportunities via
various partners.

Our hepatitis C projects
Medivir is continuing to make major advances in its hepatitis C
portfolio. Our leading CD (candidate drug), the next-generation protease
inhibitor TMC435, which is under development in partnership with Johnson
& Johnson subsidiary Tibotec Pharmaceuticals, has continued to achieve
very positive results. Interim data after 48 weeks' treatment from the
phase 2b ASPIRE study on previous null responders with chronic hepatitis
C genotype 1, demonstrated significantly higher efficacy data for TMC435
than current standard of care (SoC). Additionally, TMC435 again
demonstrated an excellent safety and tolerability profile. This is
important because treatment-related adverse events are the main reason
for the poor patient compliance with current SOC.

Medivir and Tibotec also have a sharp development focus on new
combination therapies for treating hepatitis C. Our polymerase inhibitor
TMC649128 has the potential to become a key component in forthcoming HCV
combination therapies. This is due to the compound's high genetic
resistance barrier and anti-viral activity against several HCV
genotypes. In June, phase 1b clinical studies on TMC649128 commenced on
HCV patients. A combination study on TMC435 and TMC647055, a
non-nucleoside NS5B polymerase inhibitor developed by Tibotec
Pharmaceuticals also commenced in June.

After the end of the period, Medivir presented reports regarding the
progress of the company's hepatitis C projects. TMC435 was granted Fast
Track designation by US regulatory authority the FDA. This is a further
validation of the strong and clear profile TMC435 demonstrated in major
phase 2 studies and in comparison with the recently approved competing
antivirals, Incivek™ and Victrelis™.

TMC435 has potential to be a cornerstone of forthcoming combination
therapies. Medivir has given its support to partner Tibotec
Pharmaceuticals' decision to commence combination studies on TMC435 with
Pharmasset's polymerase inhibitor PSI-7977. These phase 2b combination
studies are scheduled to commence in the year. This is corroboration of
the efforts that are made to develop new treatment methods with the aim
of improving current SoC for this serious disease.

We're looking forward to the second half of 2011. We expect to be able
to report further results from several clinical studies that may
continue to confirm the potential of TMC435 and indicate further
advances towards our goal of becoming an integrated and profitable
specialty pharmaceutical company focusing on infectious diseases.

Ron Long,
Chief Executive Officer

For more information, please contact
Rein Piir, CFO and VP, Investor Relations, mobile: +46 (0)70 853 7292.