INTERIM REPORT JANUARY - MARCH 2011

INTERIM REPORT JANUARY - MARCH 2011

Genovis increased sales for the tenth consecutive quarter on a rolling
12-month basis

First quarter in brief

  · Net sales rose to SEK 455k (240k).
  · Loss after financial items was SEK 3,469k (loss: SEK 2,382k).
  · Loss after tax was SEK 3,458k (loss: 2,327k).
  · Earnings per share totaled SEK -0.08 (-0.10).
  · Cash and cash equivalents at the end of the period amounted to SEK
1,008k (1,037k).

  · Genovis acquired an exclusive license for a new technology that uses
so-called upconverting nanoparticles as contrast agents in optical
biomedical imaging. Genovis acquired the license from Luminab, a LUAB
company, including the option to acquire the technology in its entirety.
  · The extraordinary general meeting held March 28 resolved to increase
share capital by a maximum of SEK 12,336,562.80 through the issue of a
maximum of 30,841,407 shares. The meeting also resolved to provide an
oversubscription option for 13,000,000 shares, which will be decided by
the Board of Directors if the offering is oversubscribed. Following the
completed share issue, share capital will amount to a maximum of SEK
28,785,313.60 and the number of shares to 71,963,284. The Company will
raise about SEK 20 million before issue expenses. If the
oversubscription option is exercised the share capital will amount to a
maximum of SEK 33,985,313.60 and the number of shares to 84,963,284. In
that case the Company will raise an additional approximately SEK 8
million.

ABOUT GENOVIS

Genovis develops and sells innovative technologies that will facilitate
its customers' preclinical* research. The products launched to date
consist of nanostructures and enzymes (proteins). The company conducts
research and development projects focused on design, production, and
characterization of nanostructures for medical imaging, diagnostics, and
delivery. The nanostructures and methods that Genovis focuses on can be
used as contrast in medical imaging and as carriers of various
substances in the development of new drug delivery methods. Customers
are primarily found within the life sciences industry and academic
research. The operation largely consists of research and development of
new technology, though the company has initiated some sales over the
past two years.

* Preclinical studies refer to the pharmaceutical research that takes
place before the product is sufficiently documented to be studied in
humans.

CEO COMMENTS

The market for biomedical imaging in preclinical research is growing.
The driving force comes from a need to understand the biological
processes underlying disease and to better analyze how different drug
candidates affect the body all the way down to the cellular level. Based
on our patent-protected nanoparticle technology we have focused so far
on developing multimodal nanoparticles as contrast agents, mainly for
magnetic resonance imaging combined with PET. The technique that is
currently the largest on the preclinical market in number of users is
optical imaging and in my opinion the new technology we acquired earlier
this year represents an important strategic step that will enable us to
become competitive on this market. We have included this new technology
in the development process and we can already see excellent results.
During the period we have worked intensively with preparing this year's
product launches from the nano portfolio.

With respect to sale of products from the protein engineering portfolio,
we continue to see a clear increase in demand with distribution to even
more customers. Although sales began with extremely small volumes, we
see a steady increase and have now posted good sales growth for the
tenth consecutive quarter. We are working purposefully with various
strategies to increase sales volumes, in part by offering complementary
products that we know are in demand from existing customers, in part by
developing new applications aimed at new customer groups. Our increased
marketing activities throughout the process are producing immediate
results. After the product launches last December we added new customers
and in several cases our existing customers switched to the
application-specific added-value products. For example, during the
period we received the first orders from two new customer groups:
contract manufacturers of therapeutic antibody molecules and service
companies that carry out quality control and technical analyses for
biotech and pharmaceutical companies. We are about to launch another
product that will enable customers to scale up volumes with high yields
and shorter process times.

Since we are in the midst of an intensive phase of both product
development and marketing, stable financing is essential, which is the
main reason for the current rights issue. 

Sarah Fredriksson, CEO

For more information, please contact: Sarah Fredriksson, CEO, Genovis AB
Tel: 46 46 10 12 35
sarah.fredriksson@genovis.com (sarah.fredriksson@genovis.com)