Karo Bio and Bristol-Myers Squibb expand and extend collaboration

KARO BIO AND BRISTOL-MYERS SQUIBB EXPAND AND EXTEND COLLABORATION

The three-year collaboration between Karo Bio and Bristol-Myers Squibb has
been extended for the second time and also expanded to include Karo Bio
Molecular Braille® technology.

An innovative research collaboration was initiated between Karo Bio and
Bristol-Myers Squibb Company (NYSE: BMY) in 1997 using the thyroid hormone
receptor (THR) as a drug target for a novel treatment of metabolic
disorders. This primary collaboration spanned a three-year period,
successfully resulting in two clinical development candidates for the
treatment of obesity. A one-year extension aiming to develop second
generation compounds and explore subsequent indications began in October
2000.

Karo Bio and Bristol-Myers Squibb are announcing a renewed, broader
collaboration that will incorporate and utilize Karo Bio’s proprietary
Molecular Braille® technology. This expansion includes an extended term
for the collaboration of one year and promises new milestones.

“We are enthusiastic about the expanded scope of the collaboration with
Karo Bio”, says Richard Gregg, M.D., Vice President of Metabolic and
Cardiovascular Drug Discovery at Bristol-Myers Squibb. “We look forward to
accelerating the development of our second generation products with the
application of Molecular Braille® technology. The technology appears
promising for the characterization and selection of tissue selective
compounds.”

“We are very pleased for the additional expansion and prolongation with
Bristol-Myers Squibb,” says Torben Jørgensen, President of Karo Bio. “The
great commitment and expertise of Bristol-Myers Squibb in the metabolic
disease area makes them an ideal partner for Karo Bio. This is also the
first agreement which would apply Molecular Braille® technology and we
look forward to its inclusion in the already successful collaboration with
Bristol-Myers Squibb.”

For further information contact:

Torben Jørgensen, President, Karo Bio
Direct telephone: +46-8-608 6020
Mobile telephone: +46-70-749 0584

Tracy Furey, Director, Public Affairs, Bristol-Myers Squibb
Direct telephone: +1-609-252-3208
Tracy.Furey@bms.com

Background

Karo Bio is a leading company within the field of nuclear receptors and
genomics-based drug discovery. The company uses its state-of-the-art
technologies for the development of tissue selective and receptor specific
drugs for major markets. Karo Bio AB, based in Stockholm, Sweden, is a
global drug discovery company with a leading position for drugs acting on
nuclear receptors. Karo Bio has strategic alliances in the nuclear
receptor area with Merck & Co (MRK.NYS), Bristol-Myers Squibb (BMY.NYS)
and Abbott Laboratories (ABT.NYS). In addition, Karo Bio has a strong
pipeline of projects owned solely by Karo Bio that will be further
reinforced with the BioKey technology. Karo Bio has 100 issued patents and
more than 250 patent applications. The company has 120 employees in its
facilities in Stockholm, Sweden and Durham, NC.

Through the Company’s technology access and therapeutic programs, Karo Bio
USA is creating a pipeline of novel pharmaceuticals that act on the wealth
of targets coming from genomics. On May 10, 2000, Novalon merged with Karo
Bio AB to become Karo Bio USA. The company’s BioKey assay technology
enables the quick identification of small molecule leads and is the
subject of alliances with Bayer AG (BAY.FSE), Boehringer Ingelheim
Pharmaceuticals, Inc., Serono International(AREBE.ZRH), GPC Biotech AG
(GPC.FSE), NovImmune S.A., and Aventis Pharma (NYSE:AVE).

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