Photocure ASA

Business and Financial Review • Oct 1, 2020

Photocure launches European Hexvix operations

Oslo, Norway, 1 October 2020: Photocure ASA(OSE:PHO) todayannounces the commencement of the sales, marketing and distribution of Hexvix® in the European markets formerlyoperated by Ipsen Pharma SAS (Ipsen). The successful transition and launch of European Hexvix operations creates a robust platformfor accelerated growth and expansion for Photocure.

"We are proud to announce the launch of our European Hexvix operations which will transform Photocure into a strong global business within the diagnosis and treatment of bladder cancer. We have built a successful commercial organization for Hexvix/Cysviewin the U.S. and the Nordics. Based on our unique understanding of bladder cancer and its care, our full commercial capabilities to growand expand these newmarkets will be applied. As bladder cancer is the most expensive cancer to treat, there is considerable and growing interest in the bladder cancer market in Europe. We see significant opportunities ahead for Photocure," says Dan Schneider, President and CEO.

Photocure announced in June 2020 that the company had finalized an agreement with Ipsen to regain the commercial rights for Hexvix in selected European and other countries. The rights have been transferred to Photocure with the official launch of the commercial operations beginning today, 1 October 2020.

"We are pleased with the successful Ipsen transition and with the launch of our European commercial operations. The entire European team has worked tirelessly over recent months to ensure we hit the ground running. We have ramped-up and strengthened our commercial organization and established an efficient distribution and third-party logistics network. By applying our experience from the commercial success in the Nordic and the U.S. markets to the European region, Photocure is positioned for accelerated growth and profitability," says Susanne Strauss, Vice President and General Manager of Europe in Photocure.

Photocure has paid Ipsen EUR 15 million for regaining the Hexvix rights and Ipsen will also receive earn-out payments in the range of 10 - 15% of sales (years 1-7 post-transfer) and 7.5% of sales (years 8-10) in the former Ipsen markets.

Confirms keyfinancial targets for the acquired rights

Photocure announced preliminary financial targets for the transaction 27 April 2020. The targets have today been confirmed.

• 2019 royalty received by Photocure was NOK 61 million excluding IFRS adjustments
• Following the transfer of the rights for the Ipsen territories to Photocure, the revenue recognized by Photocure is expected to increase around 3x to 2021 compared to 2019, driven by Photocure being granted the in-market sale in the territories and growth in market penetration
• Beyond FY 2021, Photocure is targeting approximately 20-30% annual revenue growth in the former Ipsen territories
• NOK 30-35 million in integration and ramp-up costs in 2020. Around NOK 90 million in increased SG&A costs in Europe from FY 2021 and beyond
• European operations will be EBIDTA accretive from 2021 and beyond

Market conditions are affected by the COVID-19 virus outbreak. See OSE notification of 7 April 2020 for an in-depth analysis of the risk and effects of the COVID-19 situation, in addition to the trading update 27 April 2020 and the second quarter 2020 presentation and board of directors' report of 17 August 2020.

EBITDA and other alternative performance measures (APMs) are defined and reconciled to the IFRS financial statements as a part of the APM section of the second quarter 2020 financial report on pages 22-23.

Notes to editors

About Hexvix®/Cysview® (hexaminolevulinate HCl)

Hexvix®/Cysview® is a drug that is selectively taken up by tumor cells in the bladder making them glow bright pink during Blue Light Cystoscopy (BLCTM). BLC™ with Hexvix® /Cysview® improves the detection of tumors and leads to more complete resection, fewer residual tumors and better management decisions. Cysview® is the tradename in the U.S. and Canada, Hexvix® is the tradename in all other markets.

About Bladder Cancer

Bladder cancer ranks as the sixth most common cancer worldwide with 1 650 000 prevalent cases (5-year prevalence rate), 550 000 new cases and almost 200 000 deaths annually in 2018.1

Approx. 75% of all bladder cancer cases occur in men.1 It has a high recurrence rate with an average of 61% in year one and 78% over five years.2 Bladder cancer has the highest lifetime treatment costs per patient of all cancers.3

Bladder cancer is a costly, potentially progressive disease for which patients have to undergo multiple cystoscopies due to the high risk of recurrence. There is an urgent need to improve both the diagnosis and the management of bladder cancer for the benefit of patients and healthcare systems alike.

Bladder cancer is classified into two types, non-muscle invasive bladder cancer (NMIBC) and muscle-invasive bladder cancer (MIBC), depending on the depth of invasion in the bladder wall. NMIBCremains in the inner layer of cells lining the bladder. These cancers are the most common (75%) of all BC cases and include the subtypes Ta, carcinoma in situ (CIS) and T1 lesions. In MIBCthe cancer has grown into deeper layers of the bladder wall. These cancers, including subtypes T2, T3 and T4, are more likely to spread and are harder to treat.4

1 Globocan. Incidence/mortalitybypopulation. Available at: http://globocan.iarc.fr

• 2 Babjuk M, et al. Eur Urol. 2019; 76(5): 639-657
• 3 Sievert KDet al. World JUrol 2009;27:295–300
• 4 Bladder Cancer.American Cancer Society. https://www.cancer.org/cancer/bladder-cancer.html

About Photocure

Photocure: The Bladder Cancer Company delivers transformative solutions to improve the lives of bladder cancer patients. Our unique technology, making cancer cells glow bright pink, has led to better health outcomes for patients worldwide. Photocure is headquartered in Oslo, Norway and listed on the Oslo Stock Exchange (OSE: PHO). For more information, please visit us at www.photocure.com, www.hexvix.com, www.cysview.com

For further information, please contact:

Photocure

Dan Schneider President and CEO Tel: +1-609 759-6515 Email: ds@photocure.com

Erik Dahl CFO Tel: +47 45055000 Email: ed@photocure.com

Media and IR enquiries:

Geir Bjørlo Corporate Communications (Norway) Tel: +47 91540000 Email: geir.bjorlo@corpcom.no