Bioton: Details of expansion in Italy and in US

The Italian companies, Pharmatex Italia and Fisiopharma, to be acquired by Bioton, had 2005 joint sales revenues of EUR 15m and net earnings of some EUR 1m. According to Adam Wilczega, Bioton’s CEO, within 4-5 years the sales of the targets should grow to some EUR 50m and net profit to a double digit number. Bioton plans to expand the distribution channels of these companies from hospitals to pharmacies. They are in the process of registration of three diabetes drugs, which is expected to be completed by the end of 2007. Adam Wilczega stated that in the future the Italian companies should enter US market with a few selected products.

According to Bioton’s CEO one year after start of US expansion, Bioton would like to be floated on Nasdaq. At that time Bioton would control 5% of world’s insulin market versus some 2% in 2006. In the opinion of Adam Wilczega it could be possible within the next 2-3 years. Separately, the CEO, stated that the company is negotiating another transaction in Europe, which is supposed to be the largest in Bioton’s history and which will be financed from the upcoming share issue. More information about this deal is expected on Monday. We expect positive reaction of the market on Bioton’s expansion to continue.