STOCKHOLM – 20 August 2020. Karolinska Development AB (Nasdaq Stockholm: KDEV) today publishes its Interim Report - January-June 2020. The full report is available on the Company's website.

“Although the COVID-19 pandemic continues to hold the world in its “iron grip”, we still have been able to continue with our internal work largely unabated minimizing the impact of the crisis on our investments but also taking advantage of the opportunities that may arise. The stock markets also recovered during the quarter after their sharp decline earlier in the year. Karolinska Development's portfolio companies made significant new advances this quarter, and our financial result improved dramatically compared with the previous quarter. Aprea Therapeutics completed enrolment for its phase III program and also presented positive results from a phase I/II study. At the same time, work began to define the plan to further develop Umecrine Cognition’s candidate drug golexanolon based on the strong efficacy signals that emerged in an in-depth analysis of the results of a recently concluded phase IIa study.”, says Viktor Drvota, CEO, Karolinska Development.

Significant events during the second quarter

• In this quarter, Umecrine Cognition completed a phase IIa study of its candidate drug golexanolon in patients at risk of developing hepatic encephalopathy. Golexanolon was tolerated well and demonstrated both a positive safety profile and favourable pharmacokinetics. One of the effect parameters used – a well-established and sensitive form of EEG study – demonstrates that the candidate drug has a significant effect on brain signalling, with a correlated positive effect on excessive daytime sleepiness. This is a symptom that occurred in a series of CNS-related disorders and dramatically reduces patients’ quality of life. Taken together, the study results open interesting opportunities for further development of the candidate drug (April and May 2020).
• The portfolio company, Dilafor, entered into a partnership with Liverpool University to study the effects of the company’s candidate drug tafoxiparin as a treatment for COVID-19. The candidate drug is being developed primarily for use against prolonged labour, but the substance is also believed to be effective in treating certain viral infections (April 2020).
• Karolinska Development sold some of its shares in the portfolio company Aprea Therapeutics. KCIF Co-investment Fund KB and Karolinska Development sold shares in Aprea Therapeutics in the same transaction. The transaction amounted to 1 per cent of all shares outstanding in Aprea Therapeutics and netted approximately SEK 59 million for Karolinska Development. Karolinska Development’s remaining holding in Aprea Therapeutics, including indirect holding through KCIF Co-investment Fund, thereafter amounted to approximately 1 per cent of the total shares outstanding. KDev Investments’ holding in Aprea Therapeutics remains unchanged at approximately 9.5% of the total number of outstanding shares (April 2020).
• Karolinska Development recruited Dr John Öhd for the position of Chief Scientific Officer. He has a solid scientific background and extensive experience from senior positions in global pharmaceutical companies’ research organisations, including AstraZeneca and Shire Pharmaceuticals. John Öhd assumes the position on a half-time basis, allowing for a parallel commitment as CEO of Modus Therapeutics, one of Karolinska Development's portfolio companies (May 2020).
• OssDsign has appointed Morten Henneveld to the role of CEO. He takes up his new position on 1 September, 2020 in conjunction with the retirement of current CEO Anders Lundqvist. Henneveld has extensive international experience in the medical technology sector, most recently in the position of Senior Vice President of Business Transformation and Strategy at GN Hearing, a global leader in hearing aids (June 2020).
• Aprea Therapeutics completed enrolment in a phase III study for the evaluation of its candidate drug eprenetapopt in combination with azacitidine in patients with a TP53 mutant myelodysplastic syndrome (MDS). The top line results are expected to be ready to be presented at the end of 2020. Aprea plans to include the study results in filing for registration with the American pharmaceutical authority, FDA, and its European counterpart, EMA, which it expects to submit in 2021 (June 2020).
• Aprea Therapeutics presented the results from a phase Ib/II study of APR-246 (eprenetapopt) in combination with azacitidine for the treatment of TP53 mutant myelodysplastic syndrome (MDS) and acute myeloid leukaemia (AML). The overall response rate (ORR) of 28 evaluable MDS patients reached 75%, with a 57% complete remission (CR) rate. With a median duration of follow-up of 9.7 months, the median overall survival (OS) for all enrolled patients, as well as for the MDS patients, was 12.1 months (June 2020). 
• At its Annual General Meeting, Karolinska Development voted to, among other things, re-elect Hans Wigzell, Tse Ping, Magnus Persson and Theresa Tse to its Board of Directors, to elect Björn Cochlovius as new board member , and to elect Hans Wigzell Chairman of the Board (June 2020).

Significant post-period events

• Karolinska Development AB has sold shares in the portfolio company Aprea Therapeutics, Inc. KCIF Co-investment Fund KB and Karolinska Development has sold shares in Aprea in the same transaction. In total, the transaction comprises 1 percent of the total outstanding shares in Aprea and brings net approx. SEK 39 million to Karolinska Development. After the transaction, Karolinska Development has a remaining holding in Aprea through KDev Investment, which remains unchanged at approximately 9.5 percent of the total number of outstanding shares in Aprea (July 2020)
• Aprea Therapeutics has decided to expand the enrollment of patients in its Phase 1 clinical trial evaluating eprenetapopt in TP53 mutant Acute Myeloid Leukemia (AML). Following the completion of the safety lead-in portion of the clinical trial, the first expansion cohort will evaluate the combination of eprenetapopt with venetoclax and azacitidine in frontline TP53 mutant AML.

Financial update

• The net profit/loss for the second quarter was SEK 2.1 million (SEK 21.4 million in the second quarter of 2019). Earnings per share totalled SEK 0.01 (SEK 0.12 in the second quarter of 2019). Net profit/loss for the period January – June 2020 amounted to SEK -124.0 (-11.2) million.
• The result of the Change in fair value of shares in portfolio companies amounted to SEK 7.4 million (SEK -115.3 in the second quarter of 2019). The result was largely attributable to the upturn in share price of the listed holdings Aprea Therapeutics and Lipidor. The result of the Change in fair value of shares in portfolio companies for the period January – June 2020 amounted to SEK -115.3 (21.8) million.
• The total fair value of the portfolio was SEK 1,331.8 million at the end of June 2020, corresponding to a decrease of SEK 37.8 million from SEK 1,369.6 million at the end of the previous quarter. The net portfolio fair value at that time was SEK 885.2 million, corresponding to a decrease of SEK 47.3 million from SEK 932.5 million at the end of the previous quarter.
• Net sales totalled SEK 0.6 million during the second quarter of 2020 (SEK 1.6 million during the second quarter of 2019). Net sales for the period January – June 2020 totalled SEK 1.7 (1.9) million.
• Karolinska Development invested a total of SEK 7.6 million in portfolio companies during the second quarter, which this quarter also corresponded to the total investments in portfolio companies.
• Cash and cash equivalents increased by SEK 35.2 million during the second quarter, totalling SEK 46.1 million on 30 June 2020.
• The Parent Company equity totalled SEK 883.7 million on 30 June 2020.

The Interim Report for Karolinska Development AB for the period January-June 2020 is available as a PDF at www.karolinskadevelopment.com.

For further information, please contact:

Viktor Drvota, CEO, Karolinska Development AB
Phone: +46 73 982 52 02, e-mail: viktor.drvota@karolinskadevelopment.com

Fredrik Järrsten, CFO and deputy CEO, Karolinska Development AB         
Phone: +46 70 496 46 28, e-mail: fredrik.jarrsten@karolinskadevelopment.com

TO THE EDITORS

About Karolinska Development AB

Karolinska Development AB (Nasdaq Stockholm: KDEV) is a Nordic life sciences investment company. The company focuses on identifying breakthrough medical innovations in the Nordic region that are developed by entrepreneurs and leadership teams. The Company invests in the creation and growth of companies that advance these assets into commercial products that are designed to make a difference to patients' lives while providing an attractive return on investment to shareholders.

Karolinska Development has access to world-class medical innovations at the Karolinska Institutet and other leading universities and research institutes in the Nordic region. The Company aims to build companies around scientists who are leaders in their fields, supported by experienced management teams and advisers, and co-funded by specialist international investors, to provide the greatest chance of success.

Karolinska Development has established a portfolio of ten companies targeting opportunities in innovative treatment for life-threatening or serious debilitating diseases.

The Company is led by an entrepreneurial team of investment professionals with a proven track record as company builders and with access to a strong global network.

For more information, please visit www.karolinskadevelopment.com