Karo Bio reorganizes R&D operations

Karo Bio Reorganizes R&D Operations

Karo Bio has promoted Dr. Anders Berkenstam, Director R&D Sweden, to
Vice President R&D Sweden and Dr. Paul Hamilton, Director R&D US, to
Vice President R&D USA. Drs. Berkenstam and Hamilton will now report
directly to President & CEO Dr. Björn Nilsson and will become members of
the Karo Bio management team.

The two new R&D Vice Presidents will replace current Chief Scientific
Officer Dr. Dana Fowlkes who has decided to leave his position. Dr.
Fowlkes has accepted to continue to serve as a Director of the Karo Bio
Board. He will work, at the latest until May 2003, with special projects
reporting to Björn Nilsson.

“Dana Fowlkes has played an important role in the integration of the
Karo Bio Sweden and US sites since the merger year 2000” says Björn
Nilsson. “I am happy that he is prepared to continue to make his
expertise available to the Company. I am also pleased to promote two
very competent R&D Vice Presidents into the Karo Bio management team.
Both have made significant contributions in laying out the future
strategic direction for Karo Bio’s R&D and for the build-up of the new
organization.”

These changes are a part of a reorganization and savings initiative that
will lead to a reduction of staff taking place at the sites in Sweden
and the US. The new organization of Karo Bio will in total have 116
employees compared to the present 133. The reduction in staff, which
primarily affects biology functions in R&D, is the first step in a
reengineering effort aiming at changing the ratio between the number of
chemists to biologists in Karo Bio. Further, Karo Bio will strengthen
its chemistry capabilities in order to generate more high quality lead
compounds. To further support this goal Karo Bio is also preparing for
expanded pharmacological studies.

“The downsizing will not affect prioritized projects. R&D productivity
will be maintained by utilizing new approaches and tools in biology”,
Björn Nilsson underlines.

Huddinge January 28, 2003

KARO BIO AB (publ)

For further information, please contact
Per Otteskog, Senior vice President, tel +46 8 608 60 18, +46 8 608 60 21

Background
Karo Bio has operations in Sweden and the United States. The Company
employs 133 people.

Karo Bio has been listed on the Stockholm stock exchange (Reuters:
KARO.ST) since 1998 and maintains a leading position in the field of
drug discovery focused on nuclear receptors. Nuclear receptors are
validated drug targets for a number of clinical indications and the
Company uses proprietary technologies for the development of novel and
improved therapies for major markets. Karo Bio has 395 patent cases
including 161 granted patents.

Karo Bio has drug discovery programs in several therapeutic areas
including men and women’s health care, metabolic disorders such as
obesity, cardiovascular disease, diabetes, dermatology and
ophthalmology.

Karo Bio collaborates with major pharmaceutical companies for the
development of products and marketing. In these partnerships Karo Bio
receives upfront payments, R&D funding and milestone payments, as well
as royalties on net sales when products reach the market.

Karo Bio has strategic pharmaceutical drug discovery partnerships with
Abbott Laboratories, Bristol-Myers Squibb, Merck & Co., Inc. and Wyeth
Pharmaceuticals.

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