Photocure ASA

Earnings Release • Apr 27, 2020

PHOTOCURE REGAINS WORLDWIDE RIGHTS OF HEXVIX

PHOTOCURE REGAINS WORLDWIDE RIGHTS OF HEXVIX

HIGHLIGHTS

· Photocure has reached an agreement with Ipsen to regain rights for the sales

and marketing of Hexvix[®] in Europe

· The transaction is expected to be EBITDA accretive from FY 2021

· Ipsen achieved Hexvix 2019 sales of EUR 18.7 million and Photocure sees

significant growth opportunities in Europe

Oslo, Norway, 27 April 2020: Photocure ASA (Photocure, PHO: OSE) has reached an

agreement with Ipsen Pharma SAS (Ipsen) on key terms for the return of Hexvix

sales, marketing and distribution rights in Europe and other markets currently

controlled by Ipsen. With taking direct control over Photocure's own

Hexvix/Cysview product in key regions, the company supports the ambition of

becoming a global leader in bladder cancer with a solid basis for expansion and

further growth opportunities. Following a final agreement, Photocure will

commence the Hexvix commercialization in Europe from the fourth quarter of 2020

and expects the potential Ipsen agreement to be EBITDA accretive from full-year

2021 and beyond.

"We have agreed terms with Ipsen for a transformative agreement in our strategy

of building a strong and profitable global business within the diagnosis and

treatment of bladder cancer. We have built a successful commercial organization

for Hexvix/Cysview in the U.S. and the Nordics, with a solid underlying growth

potential post the COVID-19 situation. Photocure aims to apply lessons learned

in Nordic and U.S. and sees significant growth opportunities in Europe and other

markets currently not served by Ipsen," says Dan Schneider, President and CEO,

and continues:

"The agreement will provide a platform for growth when returning to normal

market conditions and we see the terms as financially highly attractive. The

agreement is expected to be EBITDA accretive from full-year 2021 and beyond.

Photocure sees major opportunities in Europe for accelerated growth and

expansion going forward."

Photocure entered into a global commercialization agreement with Ipsen in 2011

for the sales, marketing and distribution of Hexvix outside the Nordic region

and the U.S. Ipsen has served as strategic partner and has built a solid

position for the brand in select key European markets. Photocure today announces

that the company has agreed terms for an agreement with Ipsen to regain the

global commercialization of Hexvix following the company's pure-play bladder

cancer focus, solid track-record from other markets and a commercial opportunity

provided by Ipsen's strategic priorities going forward.

"The alliance with Ipsen was entered into at a time where Photocure was set on

developing multiple medical solutions based on our photodynamic technology

platform. Photocure has since re-positioned the company and decided to focus

exclusively on bladder cancer. To retrieve the rights for developing Hexvix in

major markets brings flexibility and expansion at a perfect point in time. There

is a considerable and growing interest in the bladder cancer market, as the

disease remains the most expensive cancer to treat, and we see significant

opportunities ahead," Schneider comments.

The parties have entered into a term sheet setting out the key terms and

conditions for an agreement. Pursuant to the term sheet, Photocure will, by the

fourth quarter of 2020, pay Ipsen EUR 15 million and at the same date regain all

Hexvix marketing rights from Ipsen subject to satisfaction of closing

conditions. Ipsen will book sales up until these dates. Ipsen will in addition

receive earn-out payments in the range of 10-15% of sales (years 1-7 post

-termination) and 7.5% of sales (years 8-10) in the current Ipsen markets.

Current market conditions are affected by the COVID-19 virus outbreak. The

development in both Photocure's operations as well as relevant financial markets

in general may have a significant impact on the feasibility of concluding any

agreement. See OSE notification of 7 April 2020 for an in-depth analysis of risk

and effects of the COVID-19 situation.

The final agreement with Ipsen will be subject to customary terms and

conditions, as well as adequate financing to complete settlement. Photocure had

a cash position at the end of 2019 of NOK 125 million and may in addition

satisfy the financing condition by way of equity or debt, or a combination

thereof. Further, Photocure has had advanced discussions and received offers

from debt providers, and agreements on financing may be entered into to ensure

completion of settlement.

Photocure expects to outline the following key financial targets for the

acquired rights, pending a final agreement:

· 2019 royalty received by Photocure was NOK 61 million excluding IFRS

adjustments. Following the potential 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 20-30% annual revenue growth in current Ipsen

territories

· NOK 30 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, with NOK 30-35 million increase for 2020

Outlines updated potential group 2023 ambitions

Photocure delivers transformative solutions which improve the lives of bladder

cancer patients. Based on experience and the performance of the breakthrough

bladder cancer product Hexvix/Cysview, Photocure has embarked on a stepwise

approach to continued growth. Photocure sees significant long-term value

creation potential in the global bladder cancer market and has developed a

defined growth strategy:

· Accelerating - Drive the breadth and depth of Hexvix/Cysview usage in key

accounts

· Expanding - Generate sales in new geographies and product enhancements

· Acquiring - Products used in the management of bladder cancer patients

· Transforming - Partner and in-license assets to strengthen the bladder

cancer portfolio

The primary growth geographies for Photocure are the U.S. and European markets

with large untapped market opportunities. The company will regain the sales and

marketing rights from Ipsen in the fourth quarter of 2020 and sees significant

growth opportunities in Europe. The agreement is expected to be EBITDA accretive

from full-year 2021 and beyond.

Based on the outlook and strategic opportunities, Photocure aims to increases

its group revenue ambitions for 2023 in the range of NOK 1 billion with EBITDA

margins of approximately 40%, following the completion of the potential

transaction.

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

first quarter 2020 financial report on pages 20-21.

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

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 (BLC[TM]).

BLCT 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. NMIBC remains 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 MIBC the 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/mortality by

population. Available at: http://globocan.iarc.fr/Pages/bar_pop_sel.aspx

[2] Babjuk M, et al. Eur Urol. 2019; 76(5): 639-657

[3] Sievert KD et al. World J Urol 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

About Ipsen

Ipsen is a global specialty-driven biopharmaceutical group focused on innovation

and Specialty Care. The Group develops and commercializes innovative medicines

in three key therapeutic areas - Oncology, Neuroscience and Rare Diseases. Its

commitment to oncology is exemplified through its growing portfolio of key

therapies for prostate cancer, neuroendocrine tumors, renal cell carcinoma and

pancreatic cancer. Ipsen also has a well-established Consumer Healthcare

business. With total sales over Euro 2.5 billion in 2019, Ipsen sells more than 20

drugs in over 115 countries, with a direct commercial presence in more than 30

countries. Ipsen's R&D is focused on its innovative and differentiated

technological platforms located in the heart of the leading biotechnological and

life sciences hubs (Paris- Saclay, France; Oxford, UK; Cambridge, US). The Group

has about 5,800 employees worldwide. Ipsen is listed in Paris (Euronext: IPN)

and in the United States through a Sponsored Level I American Depositary Receipt

program (ADR: IPSEY). For more information on Ipsen, visit www.ipsen.com.

All trademarks mentioned in this release are protected by law and are registered

trademarks of Photocure ASA. This press release may contain product details and

information which are not valid, or a product is not accessible, in your

country. Please be aware that Photocure does not take any responsibility for

accessing such information which may not comply with any legal process,

regulation, registration or usage in the country of your origin.

Important information

This announcement is not and does not form a part of any offer to sell, or a

solicitation of an offer to purchase, any securities of Photocure ASA (the

"Company"). The distribution of this announcement and other information may be

restricted by law in certain jurisdictions. Copies of this announcement are not

being made and may not be distributed or sent into any jurisdiction in which

such distribution would be unlawful or would require registration or other

measures. Persons into whose possession this announcement or such other

information should come are required to inform themselves about and to observe

any such restrictions.

Matters discussed in this announcement may constitute forward-looking

statements. Forward-looking statements are statements that are not historical

facts and may be identified by words such as "believe", "expect", "anticipate",

"strategy", "intends", "estimate", "will", "may", "continue", "should" and

similar expressions. The forward-looking statements in this release are based

upon various assumptions, many of which are based, in turn, upon further

assumptions. Although the Company believes that these assumptions were

reasonable when made, these assumptions are inherently subject to significant

known and unknown risks, uncertainties, contingencies and other important

factors which are difficult or impossible to predict and are beyond its control.

Actual events may differ significantly from any anticipated development due to a

number of factors, including without limitation, changes in investment levels

and need for the Company's services, changes in the general economic, political

and market conditions in the markets in which the Company operate, the Company's

ability to attract, retain and motivate qualified personnel, changes in the

Company's ability to engage in commercially acceptable acquisitions and

strategic investments, and changes in laws and regulation and the potential

impact of legal proceedings and actions. Such risks, uncertainties,

contingencies and other important factors could cause actual events to differ

materially from the expectations expressed or implied in this release by such

forward-looking statements. The Company does not provide any guarantees that the

assumptions underlying the forward-looking statements in this announcement are

free from errors nor does it accept any responsibility for the future accuracy

of the opinions expressed in this announcement or any obligation to update or

revise the statements in this announcement to reflect subsequent events. You

should not place undue reliance on the forward-looking statements in this

announcement or any of its attachments.

The information, opinions and forward-looking statements contained in this

announcement speak only as at its date and are subject to change without notice.

The Company does not undertake any obligation to review, update, confirm, or to

release publicly any revisions to any forward-looking statements to reflect

events that occur or circumstances that arise in relation to the content of this

announcement.

Even if Ipsen and Photocure have agreed terms, are participating in advanced

discussions, are positive and see business benefits from a potential transfer,

no final agreement setting out that the transfer of Hexvix sales, marketing and

distribution rights to Photocure will be made has been entered into. There can

be made no guarantees that the current agreement on terms and ongoing

discussions will lead to any agreement or the completion of any transfer or as

to the terms of any transfer.

This announcement is for information purposes only and is not to be relied upon

in substitution for the exercise of independent judgment. It is not intended as

investment advice and under no circumstances is it to be used or considered as

an offer to sell, or a solicitation of an offer to buy any securities or a

recommendation to buy or sell any securities of the Company.

This information is subject of the disclosure requirements of section 5-12 of

the Norwegian Securities Trading Act.