Navamedic — Earnings Release 2017

Jul 28, 2017

Navamedic ASA: Second quarter results 2017

Navamedic ASA: Second quarter results 2017

Oslo, 28 July 2017 - Navamedic ASA (OSE: NAVA), reported revenues of NOK 89.7

million in the second quarter of 2017 (NOK 66.7 million in Q2 2016),

representing a growth of 34.4%, following the successful ramp-up of the TopRidge

Pharma partnership. During the quarter, the company entered into an agreement

with Orexigen Therapeutics, Ltd. for the distribution of prescription anti-

obesity pharmaceutical, Mysimba(TM). Commercialisation of Sippi® continues to

progress as planned, with the initiation of new clinical evaluations in new

markets.

"Navamedic had a strong second quarter in 2017, with overall revenues up 34.4

percent compared to the same quarter last year and a strong cash generation. We

continue to see a solid performance for our Pharma and Healthcare products

business area, and are continuously working to strengthen the portfolio with

additional products and partnerships. During the quarter, we entered into an

agreement with Orexigen Therapeutics for the distribution of the prescription

anti-obesity pharmaceutical Mysimba (naltrexone HCl/bupropion HCL prolonged

release) in the Nordic countries, offering physicians a prescription alternative

for treating obesity. We believe the partnership with Orexigen opens up a

significant market opportunity and revenue potential, and look forward to the

Nordic market introduction later in the year," says Tom Rönnlund, Chief

Executive Officer of Navamedic.

Revenues in the second quarter of 2017 ended at NOK 89.7 million, compared to

NOK 66.7 million in the second quarter of 2016, and the EBITDA was NOK 5.5

million, up from NOK -1.6 million in Q2 2016. The company delivered a strong

cash generation during the second quarter resulting in a cash balance of NOK

41.8 million by the end of the quarter. This is in line with the planned Aspen

transfer and inventory reduction.

Navamedic continued to expand and build the distribution of Imdur® (isosorbide

mononitrate) as part of the partnership with TopRidge Pharma Limited. Imdur® is

now distributed in a total of thirteen countries across Europe and during the

quarter Navamedic initiated preparations for distribution launch in Greece later

in the year.

The planned discontinuation of the Aspen partnership by the end of the second

quarter of 2017 is expected to result in a negative impact on revenue and a

short-term pressure on EBITDA.

"Navamedic's strategy is to offset the effects of the discontinued Aspen

contract by boosting its portfolio with additional products and partnerships.

The company is working on a pipeline of new and exciting original products with

launches scheduled for the coming 6-24 months, aiming to offset the effects of

the discontinued Aspen partnership, bringing the company back on a growth track

in the medium-term perspective", says Rönnlund.

Navamedic continued the development and commercialisation of its proprietary

urine measurement system, Sippi®, throughout the quarter. This included the

introduction of Sippi® in Italy, which is receiving initial positive feedback

from the market, and winning two tenders in Sweden. The company also initiated

clinical testing in Finland and Sweden, carried out successful tests with a new

Patient Data Management Systems, and began preparations for a number of clinical

evaluations throughout Europe.

"We are looking forward to continued exciting developments for Sippi and for our

entire portfolio of products, and to explore additional market opportunities.

The company remains committed to executing its strategy of ongoing

commercialisation and continued development of the Sippi product family,

creating opportunities for multiple future revenue streams," says Rönnlund and

continues: "While development of a technology-based proprietary products takes

time and initial sales have been lower than expected, the commercialisation

continues to be on a good track. Based on the 2017 developments and with a

multimarket growth platform in place, the company expects higher revenues in

2018 based on the introduction of the wireless version of Sippi, and to enter

onto an accelerated growth path towards the long-term annual revenue potential

for Sippi of over NOK 250 million."

For further information, please contact:

Tom Rönnlund, CEO, Navamedic

Telephone: +46 727 320 321

Navamedic ASA is a Norwegian medtech and pharmaceutical products company,

delivering products to patients, hospitals and pharmacies in selected European

markets and mainly in the Nordic markets. The Group's Medtech business has

developed and is currently introducing the next generation of digital urine

meter Sippi®. Navamedic's Pharma and Healthcare business is a distributor of

products supplied by a number of pharmaceutical manufacturers. Navamedic is

listed on the Oslo Stock Exchange (ticker: NAVA).