Today, 11 November 2016, the board of directors of Active Biotech AB (publ) ("Active Biotech" or the "Company") has resolved, based on the authorization from the general meeting, on a rights issue of approximately SEK 55 million.

• The shareholders of the Company have pre-emptive rights to subscribe for the new shares, whereby 13 existing shares entitle to subscription for one new share. Subscription for shares in the rights issue can only be made with pre-emptive rights.
   
• The subscription price amounts to SEK 8 per share. Subscription shall be made during the period 23 November - 7 December 2016.
   
• The rights issue is at no cost guaranteed in its entirety by Active Biotech's largest shareholder MGA Holding AB.

Background and reasons
The board of directors of Active Biotech has decided to primarily focus the Company's operations on supporting its partner Teva in the development of the laquinimod project and its partner NeoTX Therapeutics in the development of ANYARA as well as to conduct only out-licensing activities for the remaining projects.

The laquinimod project is in late clinical development for the treatment of neurodegenerative diseases. The diseases for which clinical development is pursued are relapsing remitting MS ("RRMS"), primary progressive multiple sclerosis ("PPMS") and Huntington's disease. Results from a pivotal clinical phase 3 study for the treatment of RRMS are expected in the first half of 2017 and from a clinical phase 2 study for the treatment of PPMS in the second half of 2017. The phase 3 study in RRMS was fully recruited in June 2015 and had then included 2199 patients. In addition, extension studies with more than 1,000 RRMS patients are ongoing and have yielded a clinical experience of over 11,000 patient years.

The rights issue that now is conducted aims at providing Active Biotech with the financial stability required to await the outcome of the ongoing phase 3 study of laquinimod for the treatment of RRMS and the phase 2 study for the treatment of PPMS. Laquinimod is assessed to have a significant commercial potential and a significant and decisive impact on the Company's commercial prospects. If the outcome of these studies is positive, the Company expects that a positive operating result can be achieved from and including the financial year 2018. The proceeds from the rights issue, approximately SEK 55 million at full subscription, are intended to be used mainly for general working capital requirements. The Company's current liquidity and the proceeds from the rights issue, combined with revenues from existing and anticipated partner agreements, are according to current plans assumed to be sufficient to finance operations until a positive cash flow can be generated.

The rights issue
On 11 November 2016, the board of directors of Active Biotech resolved, based on the authorization by the general meeting, to increase the Company's share capital with not more than approximately SEK 26,068,856.73 through issue of not more than 6,916,022 new shares. The subscription price amounts to SEK 8.00 per share, whereby Active Biotech will be provided with approximately SEK 55 million at full subscription, before issue expenses.

The Company's largest shareholder, MGA Holding AB, with holdings of approximately 25.9 percent of the shares and votes, has undertaken to subscribe for its pre-emptive part of the rights issue. In addition, the board members Peter Sjöstrand and Peter Thelin intend to subscribe their allotted subscription rights. MGA Holding AB has also undertaken, without consideration, to subscribe for all shares in the rights issue that are not subscribed for by others. The rights issue is thereby guaranteed in its entirety.

Subscription for shares in the rights issue can only be made with pre-emptive rights. Shares not subscribed for with pre-emptive rights shall be allocated to the guarantor MGA Holding AB. 

The record date for the right to participate in the rights issue is 18 November 2016. Subscription for new shares shall be made during the period 23 November - 7 December 2016.

A prospectus relating to the rights issue will be made public before the commencement of the subscription period.

Indicative timetable

Advisor
Advokatfirman Vinge is legal advisor to Active Biotech in connection with the rights issue.
                            
For further information, please contact:
Tomas Leanderson, President and CEO
Tel: +46 (0)46 19 20 95
E-mail: tomas.leanderson@activebiotech.com

Hans Kolam, CFO
Tel: +46 (0)46 19 20 44
E-mail: hans.kolam@activebiotech.com

Active Biotech AB
P.O. Box 724, SE-220 07 Lund, Sweden
Phone +46 (0)46 19 20 00
Fax +46 (0)46 19 11 05

Active Biotech AB (publ) (NASDAQ Stockholm: ACTI) is a biotechnology company with focus on neurodegenerative/inflammatory diseases and cancer. Laquinimod, an orally administered small molecule with unique immunomodulatory properties, is in pivotal Phase 3 development for the treatment of relapsing remitting multiple sclerosis. Also, laquinimod is in Phase 2 development for the treatment of primary progressive multiple sclerosis and Huntington's disease. Furthermore, commercial activities are conducted for the tasquinimod, paquinimod och SILC projects. Please visit www.activebiotech.com for more information.

This information is information that Active Biotech AB is obliged to make public pursuant to the EU Market Abuse Regulation. This information was submitted for publication, through the agency of the contact persons set out above, at 19.01 p.m. CET on 11 November 2016.