Daewoong to distribute Medivir’s Xerclear™ in South Korea

Huddinge, Sweden, August 24, 2010 - Medivir AB (Sweden) today announced it has appointed Daewoong Pharmaceutical Co. Ltd. as its exclusive distributor for Xerclear™ in South Korea. Under the terms of the agreement, Daewoong will be responsible for obtaining the regulatory approvals, and for marketing, sales and distribution of Medivir’s cold sore product in the territory. In consideration of the rights granted to Daewoong, Medivir will receive upfront and milestone payments and royalties on sales according to a profit sharing scheme.

“We are pleased to announce this collaboration and to have Daewoong as our partner for Xerclear™ in South Korea”, said Ron Long, CEO of Medivir AB, and continued, “We recently initiated a collaboration with Daewoong around MIV-210 and the Xerclear™ distribution agreement further strengthens the relationship between our companies”.

“Medivir is an ideal partner for us and Xerclear™ is a perfect fit for our portfolio, providing us the excellent opportunity to offer health care professionals, care providers and patients its considerable benefits. We believe there will be a substantial market opportunity in South Korea for this topical product for the treatment of recurrent herpes labialis”, concluded Dr. Jong-Wook Lee, President and CEO, Daewoong Pharmaceutical Co. Ltd.

About Xerclear™

Xerclear™ (Xerese™ in the USA) – Medivir’s first pharmaceutical product – is a patented combination of 5% acyclovir and 1% hydrocortisone in Medivir’s proprietary cream formulation for the topical treatment of recurrent herpes labialis (cold sores). The indication text as approved by FDA, states “Xerclear™ is indicated for the early treatment of recurrent herpes labialis (cold sores) to reduce the likelihood of ulcerative cold sores and to shorten the lesion healing time in adults and adolecents (12 years of age and older)”. Xerclear™ is the first topical product that in controlled clinical trials has been shown to significantly (P<0.0001 vs. placebo) reduce the development of ulcerative lesions during a cold sore episode.

The product is approved by the US FDA (trademark "Xerese™") and in Europe (trademark "Xerclear™") and will be marketed by Meda Pharma in North America and by GlaxoSmithKline (under its own consumer health brands) in Europe and a number of key markets. Medivir intends to establish further partnerships for Xerclear™ outside Sweden and Finland, where Medivir markets and sells the product today on prescription only basis.

About cold sores

Recurrent herpes labialis (cold sores) is a common infection that affects one-third of the population in the Western world resulting in around 600 million episodes per year with 57 million people having 3 or more episodes per year. The great majority of cases are caused by herpes simplex virus type 1 (HSV-1). Unlike most viruses, the cold sore virus is not completely eliminated by the body’s immune response. Instead it establishes a chronic, latent and life-long infection in sensory ganglia. At a later date, the virus may be reactivated and travel back to the skin – often around the mouth and nose – to trigger a clinical episode of recurrent herpes labialis. The virus is reactivated by factors like sunlight and stress.

Products based on antiviral substances such as aciclovir, penciclovir, famciclovir and valaciclovir are the most commonly used treatment options and to date no other combination product than Xerclear™/Xerese™ is available. The market for topical treatment of herpes infections in South Korea is estimated at USD 5 million, and in the USA and Europe at USD 230 million and USD 170 million, respectively.

About Daewoong Pharmaceutical Co. Ltd.

Daewoong Pharmaceutical Co. Ltd. is a leading Korean pharmaceutical company with annual turnover of nearly $605 million U.S. in 2009. Daewoong Pharmaceutical Co. Ltd. was ranked first in the South Korean pharmaceutical market in terms of requested reimbursement totals, according to Health Insurance Review Agency (HIRA). Daewoong has expanded global business operations throughout Asia and is currently developing strategies for the global market.

Daewoong Pharmaceutical Co. Ltd. engages in the research, development, manufacturing and marketing of healthcare products. It provides a full spectrum of healthcare products for various therapeutic areas that include infectious diseases, cardiovascular diseases, metabolic disorders, disorder of central nervous system, digestive disorders, oncology and vaccines.

Daewoong's R&D activity explores a broad spectrum of innovative approaches and has developed new products in key therapeutic area such as EGF for Mucositis and Wounds and WP05195 for Neuropathic Pain.

In particular, Daewoong Pharmaceutical Co. Ltd. has made numerous successful partnerships with multinational pharmaceutical companies launching many blockbuster products on the Korean market, and its strong growth is attributable to its dedication to excellence in sales and marketing, which is backed by a comprehensive portfolio of both innovative and generic prescription drugs.

For more information on Daewoong Pharmaceutical Co. Ltd., please see the company

website: www.daewoong.co.kr

About Medivir  

Based on its world class expertise in protease and polymerase inhibition technology, Medivir develops drugs with primary focus on infectious diseases. Its objective is to become a sustainable and profitable speciality pharmaceutical company with a strong research base. 

Medivir was listed on the Stockholm Stock Exchange in 1996 and at the end of 2009 the company had 85 employees.

For more information on Xerclear™, please contact;

Eva Arlander, VP Medivir Pharma, at +46 702 556 855

Johan Inborr, Head of Business Development Medivir Pharma, at +46 708 853 893

For financial and IR information, please contact;

Rein Piir, CFO & VP Investor Relations, Medivir, at  +46 708 537 292

For general information, please visit;

www.medivir.se