Karolinska Development Interim Report January - June 2012

Karolinska Development 2Q 2012 Conference Call – August 23, 2012 Torbjörn Bjerke, CEO

Today’s Presentation

Second Quarter Highlights Selected Portfolio Companies Financial Information Summary

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Karolinska Development in Summary

Exclusive access to top class medical innovations

First-in-class drug candidates with multi billion dollar sales potential

Significant clinical progress – 14 projects in clinical phase

Large portfolio of companies removes binary risk – 26 companies, 35 projects

Cash position provides funding through major clinical data

Strong focus on business development activities across the portfolio

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Highlights During and Since the Second Quarter 2012

Pharmanest initiated Phase I and Phase II trials with SHACT, a product developed for pain relief in connection with IUD insertion

Karolinska Development AB and Industrifonden signed a share swap agreement whereby Industrifonden will exchange Karolinska Development AB’s shares in Oncopeptides AB for its shares in Aprea AB

Pergamum reported top-line Phase II-data from the clinical trial with PXL-01 for prevention of post-surgical adhesions

Strengthened Management team in Karolinska Development: – Dr Gunilla Ekström recruited as VP Operations – Ann-Sofie Sternås recruited as VP IPR

Akinion Pharmaceuticals announced the publication of preclinical results for AKN-028 in highly cited scientific journal

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CARDIOVASCULAR Athera Biotechnologies AB (Annexin A5) 65% Athera Biotechnologies AB (PC-mAb) 65%

The Portfolio has a Significant Market Potential

DERMATOLOGY Pergamum AB (DPK-060, atopic dermatitis) 62% Pergamum AB (DPK-060, external otitis) 62% Pergamum AB (PXL01) 62% Pergamum AB (LL-37) 62%

WOMEN’S HEALTH Dilafor AB 55% Pharmanest AB 59% Umecrine Mood AB 43%

INFECTIOUS DISEASE Dilaforette AB 62% Biosergen AS 60%

CNS BioChromix Pharma AB 70% Umecrine Cognition AB 54%

INFLAMMATION NovaSAID AB 89% ProNoxis AB 22%

Solid colored area = completed phase Shaded colored area = ongoing phase

PHARMACEUTICALS Ownership* Concept development

Lead discovery

Lead optimization

Preclinical development Phase I Phase II Phase III Launch

ONCOLOGY Axelar AB 50% Aprea AB 41% Oncopeptides AB 43 % KDev Oncology AB (AKN-028) 90% KDev Oncology AB (GliGene) 44%

OPHTHALMOLOGY Clanotech AB 88%

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*Including indirect ownership. Ownership in Axelar and GliGene shown after all tranches in recent investment round. All shares in Oncopeptides will be exchanged for Industrifondens shares in Aprea. Ownership in Aprea after

share swap transactiona will be 69%.

TECHNOLOGY Ownership* Concept development Prototype Development Product Sales

IMPLANTS Promimic AB 28% Oss-Q AB 16%

The Portfolio has a Significant Market Potential

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Solid colored area = completed phase Shaded colored area = ongoing phase

*Including indirect ownership

DIAGNOSTICS

Athera Biotechnologies AB (CVDefine®) 65% BioChromix AB 14%

MEDICAL EQUIPMENT NeoDynamics AB (Fourier/AS) 21% NeoDynamics AB (Therapy/PRFA) 21%

PHARMACEUTICAL FORMULATION Inhalation Sciences Sweden AB 72% XSpray Microparticles AB 62% Lipidor AB 46%

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Portfolio Focus in 2012 and 2013

Axelar – AXL1717 Phase I/II data Axelar – AXL1717 for NSCLC Initiate Phase II Akinion – AKN-028 for AML Initiate clinical studies Aprea – APR-246 Complete Phase I/II

Akinion – AKN 028 Complete Phase I/II

Axelar – AXL1717 for NSCLC Complete Phase II

Pergamum – PXL01 for surgical adhesion Complete enrolment of Phase II Pergamum – DPK-060 for external otitis Initiate Phase II Pergamum – DPK-060 for skin infection Preparation for Phase IIb

Pergamum – LL-37 for chronic wounds Initiate clinical studies

Pergamum - DPK-060 for external otitis Complete Phase II

Pharmanest – SHACT for pain relief at IUD insertion Initiate Phase I

Pharmanest – SHACT for pain relief at IUD insertion Initiate Phase II

Dilafor – Tafoxiparin for protracted labor Initiate Phase IIb with partner

Pharmanest – SHACT for pain relief at IUD insertion Complete Phase I and II

Umecrine Mood – Severe PMS and PMDD Initiate Phase I/II

Dilaforette – Sevuparin for malaria Initiate Phase I/II Dilaforette – Sevuparin for malaria Complete Phase I/II

ONCOLOGY

DERMATOLOGY

WOMEN’S HEALTH

OTHER

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Anticipated Major Clinical Data

2012 2013 2014

PXL01 Phase II data Phase II data in NSCLC

DPK-060 Phase II data

Phase I data

Tafoxiparin Phase IIb data

LL-37 Phase I data

Phase I/II data

Phase I data

Phase I/II data

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Phase II data

Significant Deal Values in Our Focus Areas

Date Licensor Licensee Therapeutic Area Product Phase at Deal Total Deal

Value (USDm)

February 16, 2011 AVEO Pharmaceuticals, Inc. Astellas Pharma, Inc. Oncology AV951 Phase II 1480

February 29, 2012 Galapagos NV Abbott Laboratories Inflammatory GLPG0634 Phase II 1350

November 10, 2009 Alder Biopharmaceuticals Inc. Bristol-Myers Squibb Company Inflammatory ALD518 Phase II 1049

December 8, 2011 Pharmacyclics, Inc. Janssen Biotech, Inc. Oncology PCI32765 Phase II 975

September 3, 2009 Algeta ASA Bayer Healthcare Pharmaceuticals, Inc. Oncology Alpharadin Phase II 800

December 21, 2009 Incyte Corporation Eli Lilly & Co Inflammatory INCB28050 Phase II 755

February 12, 2009 Portola Pharmaceuticals Inc. Novartis AG CVD PRT128 Phase II 575

May 4, 2011 Molecular Partners AG Allergan Inc. Ophthalmology MP0112 Phase II 420

September 5, 2011 Evotec AG Roche Holding, Ltd. CNS EVT302, RG1577 Preclinical 830

June 1, 2010 Orexo AB Janssen Pharmaceuticals Inc./ Johnson & Johnson Respiratory OX-CLI, OX-ESI Preclinical 586

June 8, 2011 Affectis Pharmaceuticals AG Merck Serono S.A. CNS P2X7 Antagonist Preclinical 409

January 1, 2012 Virobay, Inc. LEO Pharma A/S Dermatology Preclinical 307

August 21, 2012 Molecular Partners AG Allergan Inc. Ophthalmology MP0260, eye disease DARPins Discovery 1400

December 20, 2010 Avila Therapeutics, Inc. Sanofi Oncology Discovery 964

January 5, 2012 Forma Therapeutics, Inc. Boehringer Ingelheim Corporation Oncology Discovery 815

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Selected Portfolio Companies

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AXL1717 - Block Buster Potential in Lung Cancer

Status

The only small-molecule IGF-1R inhibitor in man without insulin receptor inhibition

Unique preclinical efficacy Promising Phase I/II data Phase II ongoing – Top-line data expected in the

beginning of 2013 Next indication Glioblastoma

Market Overview

Around 420 000 new cases of NSCLC in the industrialized countries each year

UBS estimated total US lung cancer sales in 2010 for Avastin at USD 1150m, Tarceva at USD 400m, and Iressa at USD 310m

Source: Datamonitor

Ownership: 50%

AXL1717 - Potential in Multiple Cancers

Avastin, Tarceva and Iressa Sales (USDbn)

0

2

4

6

8

10

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Company: Axelar AB

Active ingredient: Small molecule

Primary indication: Non Small Cell Lung Cancer

Current Phase: Phase II

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AXL1717 – Promising Phase I/II-data (March 30 Update) Ownership: 50%

SAFETY

AXL1717 was well-tolerated with reversible neutropenia as dose limiting toxicity - Even at exposures 5-10 fold higher than those needed for anti-tumor activity in animals. - No changes in blood levels of glucose, insulin or C-peptide were reported.

CLINICAL BENEFIT

For the NSCLC patients treated for 14 days or longer (Mar 30, 2012):

Median survival 60 weeks Median time to progression 31 weeks One Partial Response according to RECIST

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Progression-free survival and overall survival of 15 patients with progressive and refractory NSCLC treated with single agent AXL1717 in 3rd or 4th line. Patients with a treatment duration longer than 14 days. Status per March 30, 2012

Normalizing p53 to Overcome Drug Resistance Ownership: 41%*

Company: Aprea AB

Active ingredient: Small molecule

Primary indication: Ovarian cancer

Current Phase: Phase I/II

Status

Aprea has identified small molecules that reactivate p53, considered a prime target for new first-line cancer therapies

Gained orphan drug status for indication AML in the EU

Planning in progress of a Phase I/II study in chemotherapy-resistant patients

Market Overview

63 500 patients are diagnosed with ovarian cancer each year in 7MM, 25 % with an advanced disease at diagnosis

Close to half of the patients in second line treatment develop resistance to platinum-based treatment

Aprea's drug candidate aims to target this problem

25%

58%

86%

75%

42%

14%

Third Line Treatment (18000 patients)

Second Line Treatment (30500 patients)

First Line Treatment (60500 patients)

Platinum refractory patients in ovarian cancer (US)

Patients given platinum-based therapy Patients ineligible for platinum-based therapy

*Ownership in Aprea will be 69% after share swap transaction with Industrifonden.

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AKN-028 - Targeting all AML Tumor Types

Status

Targets FLT3 and c-Kit – important factors in leukemia development

Unique preclinical efficacy in chemotherapy resistant cells

Phase I/II ongoing in AML

Market Overview

Chemotherapy is the only viable pharmaceutical treatment for AML today

About 42 000 patients are affected by AML each year in the US, EU and Japan

5-year survival: 33% in patients under 65, 4% in patients over 65 years

Sources: Datamonitor, NCCN, SEER, Appeldaum et al 2006

Ownership: 90%

Company: Akinion Pharmaceuticals AB

Active ingredient: Small molecule

Primary indication: Acute Myeloid Leukemia (AML)

Current Phase: Phase I/II 0%10%20%30%40%50%60%70%

<56 56-65 66-75 >75Age Group

AML Treatment Outcomes

30 day TreatmentMortality

Resistance

Complete Remission aftercytarabine + daunorubicintreatment

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Ex vivo Efficacy of AKN-028 vs. Quizartinib Ownership: 90%

Cytotoxic response to AKN-028 and Quizartinib (AC220) in 11 primary AML samples outlined as individual dose–response curves from the FMCA (a–f ). Samples are grouped according to in vitro response to Quizartinib. Because of the configuration of data for Quizartinib, a sigmoid curve fitting was not possible. SI, survival index. (Eriksson et al 2012)

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Synergistic Response of AKN-028 with Chemotherapy Ownership: 90%

Cytotoxic response to AKN-028 in combination with standard cytotoxic agents cytarabine (a) and daunorubicin (b) in MV4-11 cell line in three different sequences; (I): pretreatment with chemotherapy (24 h), followed by AKN-028; (II): simultaneous treatment with both agents; (III): pretreatment with AKN-028 (24 h). Results are presented as mean CI, (n¼11–16) of all experimental combination data points with effect levels between 10–90%, error bars representing s.e.m. CI o0.7 indicate synergy and CI of 1 additive interactions. (Eriksson et al 2012)

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SHACT - Pain Management in Gynecology

Market Overview

UN estimates the prevalence of IUD at 15 million women in the developed world

Assuming an IUD insertion every 5 year, the annual number of IUD insertions is 3 million in developed countries

China represents a large market potential - Over 100 million women with IUD

Potential to expand to other indications such as hysteroscopy, abortions and obstetric pain

Status

Unique formulation and applicator developed for local pain relief during gynecological procedures

Last patient dosed in Phase I safety and pharmacokinetics study

A randomized, double blind Phase II-study with about 200 patients initiated in 2Q 2012

Phase II-data is expected in 2H 2013

Company: Pharmanest AB

Active ingredient: Small molecule

Primary indication: Pain in connection with IUD-insertion

Current Phase: Phase II

Sources: United Nations, World Contraceptive Use (2011)

Ownership: 59%

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Financial Information

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Key Financial Information for the Group

Amounts in SEKm 2012 2011 2011

Jan-June Jan-June Full year Income statement Revenue 5.5 5.2 10.5 Profit/loss after tax -189.2 -130.8 -385.7 Earnings per share before and after dilution (SEK) -3.52 -3.09 -8.07 Balance sheet Cash and cash equivalents 170.3 162.1 163.3 Short-term investments 291.1 577.5 457.2 Share information

Net asset value per share (SEK) 42.5 49.6 44.7 Share price, last trading day in the reporting period (SEK) 19.5 29.4 24.0 Portfolio information Investments in portfolio companies* 115.7 226.2 297.6 Of which investments not affecting cash flow - 84.1 94.9 Valuation of total portfolio holdings 1,564.4 1,652.1 1,546.9

* Portfolio companies comprise subsidiaries, joint ventures, associated companies and other long-term securities holdings

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Strong Shareholder Base

As at June 30, 2012

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Shareholder A Shares B Shares Cap % Votes % Third Swedish National Pension Fund 4 678 500 9.6% 7.5% Karolinska Institutet Holding AB 1 503 098 2 453 933 8.2% 28.2% Coastal Investment Management LLC 3 470 541 7.2% 5.6% The Foundation of Baltic and East European Studies 3 345 537 6.9% 5.4% Swedbank Robur Funds 1 920 074 4.0% 3.1% Jarla Investeringar AB 1 629 354 3.4% 2.6% Foundation Asset Management AB 1 392 035 2.9% 2.2% Länsförsäkringar Group 1 364 415 2.8% 2.2% Skagen Funds 1 297 700 2.7% 2.1% Stefan Persson 1 261 278 2.6% 2.0% Insamlingsstiftelsen för främjande och utveckling av medicinsk forskning vid Karolinska Institutet 1 150 323 2.4% 1.9% Government of Norway 781 951 1.6% 1.3% Holberg Funds 754 653 1.6% 1.2% SBSB Innovation AB 692 000 1.4% 1.1% Ruffer Funds 450 000 0.9% 0.7% Fourth Swedish National Pension Fund 383 959 0.8% 0.6% Gålö Foundation 375 535 0.8% 0.6% Nordea Funds 366 600 0.8% 0.6% KL Ventures AB 300 000 0.6% 0.5% Lingfield AB 281 989 0.6% 0.5% Sum listed shareholders 1 503 098 28 329 673 61.5% 69.9% Sum other shareholders 0 18 698 646 38.5% 30.1% Sum all shareholders 1 503 098 47 028 319 100.0% 100.0%

Karolinska Development in Summary

Exclusive access to top class medical innovations

First-in-class drug candidates with multi billion dollar sales potential

Significant clinical progress – 14 projects in clinical phase

Large portfolio of companies removes binary risk – 26 companies, 35 projects

Cash position provides funding through major clinical data

Strong focus on business development activities across the portfolio

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Questions

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