- NeuroSearch exercises option to issue shares worth EUR 5 million to
GlaxoSmithKline
- The share issue will consist of 345,238 new shares at a price of DKK 107.84
per share
- NeuroSearch will receive additional EUR 4 million in cash upon Phase I
initiation

Copenhagen, 4 August 2009 - NeuroSearch (NEUR) has successfully completed the
preclinical development of NSD-721, a selective GABAA receptor modulator, and
is now advancing this novel drug candidate into clinical studies for the
treatment of social anxiety disorder under the alliance with GlaxoSmithKline
(GSK). An Investigational New Drug (IND) application has been filed and
approved, and NeuroSearch plans for the initiation of Phase I studies with
NSD-721 within the near future.

Under the terms of the alliance agreement, upon the filing of an IND
application for NSD-721 NeuroSearch has the option to issue new shares to GSK
at market price with a value of EUR 5 million, equal to DKK 37 million, based
on the EUR:DKK exchange rate of the Danish Central Bank as of 31 July 2009.
Hence, NeuroSearch has decided to issue 345,238 new NeuroSearch shares to GSK
to be subscribed at a price of DKK 107.84 per share, corresponding to proceeds
of DKK 37,230,500 (EUR 5 million) to NeuroSearch.

Further, under the agreement NeuroSearch will receive EUR 4 million (DKK 30
million) as milestone payment upon the initiation of Phase I studies with
NSD-721.

The alliance with GSK covers a number of drug candidates, including NSD-721.
Under the terms of the alliance agreement, NeuroSearch has the option to issue
new shares to GSK at market price for a total amount of up to EUR 20 million
(DKK 149 million), to be exercised in four equal tranches upon the filing of
IND applications for drug candidates developed under the agreement.
Furthermore, NeuroSearch is entitled to milestone payments of up to EUR 109
million (DKK 812 million) plus royalties of net sales per product developed and
marketed under the agreement.

Flemming Pedersen, CEO at NeuroSearch comments;
“We are very pleased to announce the advancement of the novel drug candidate
NSD-721 into clinical development for the treatment of social anxiety disorder
under our alliance with GSK. The related income and financing of EUR 9 million
in total adds to our already strong financial capabilities and allows us to
progress both NSD-721 and other valuable assets in our pipeline.“

The issue of new shares to GlaxoSmithKline (GSK)
The 345,238 new NeuroSearch shares to be issued to GSK will be subscribed at a
price of DKK 107.84 per share of DKK 20 nominal value. The subscription price
is calculated as the average closing price of NeuroSearch's shares within a 30
days period prior to 3 August 2009.

The 345,238 new shares will be issued without pre-emption rights for
NeuroSearch's current shareholders. The issue has been decided by NeuroSearch's
Board of Directors on the basis of Article 5 of NeuroSearch's Articles of
Association authorising the Board of Directors to increase the share capital of
NeuroSearch. The new shares will rank pari passu with and have the same rights
as the existing shares in NeuroSearch.

Registration, admission to trading and official listing of the new shares
The new shares will be registered with VP Securities Service
(‘Værdipapircentralen'). The new shares will be admitted to trading and
official listing on the Nasdaq OMX Copenhagen exchange under the ISIN code of
NeuroSearch's existing shares (ISIN code DK0010224666) once they have been
registered with the Danish Commerce and Companies Agency ('Erhvervs- og
Selskabsstyrelsen'). Admission to trading and official listing of the new
shares will take place as soon as possible after the registration of the new
shares with the Danish Commerce and Companies Agency.

NeuroSearch's issuing agent is Nordea Bank Danmark A/S.

Expected timetable for the capital increase:

Date / Event
3 August 2009
Decision by NeuroSearch's Board of Directors to exercise its authorisation to
increase the share capital.

No later than 2 September 2009
Payment.
Registration of the new shares with the Commerce and Companies Agency as well
as issue and registration of the new shares with VP Securities Services as soon
as possible after receipt of payment.

As soon as possible after registration of the new shares
Admittance for trading and official listing of the new shares with the Nasdaq
OMX Copenhagen exchange.


NeuroSearch maintains its financial guidance for 2009 of an expected loss
before financials and other shares of results in the region of DKK 350 million.


Flemming Pedersen
CEO



Contact persons:
Flemming Pedersen, CEO, telephone: +45 2148 0118
Hanne Leth Hillman, Vice President, Director of Investor & Capital Market
Relations, telephone: +45 4017 5103



About NSD-721
NSD-721 is a potent and selective modulator of GABAA receptors containing α3
proteins with little effect on receptors containing α1 proteins. The
preclinical profile predicts that NSD-721 could have anxiety-reducing effects
similar to those of benzodiazepines (such as Valium®) but without producing
certain of the adverse effects characteristic of these drugs.

NSD-721 is being developed under NeuroSearch's alliance with GlaxoSmithKline.

 
About NeuroSearch
NeuroSearch (NEUR) is a Scandinavian biopharmaceutical company listed on Nasdaq
OMX Copenhagen. The core business of the company covers the development of
novel pharmaceutical agents, based on a broad and well-established drug
discovery platform focusing on ion channels and central nervous system (CNS)
disorders. A substantial share of the activities is partner financed through
strategic alliances with Eli Lilly and Company and GlaxoSmithKline (GSK), and a
license collaboration with Abbott. The drug pipeline comprises seven clinical
(Phase I-III) development programmes: Pridopidine (ACR16) for Huntington's
disease (Phase III), tesofensine for obesity (Phase III ready), ABT-894 for
ADHD (Phase II) in partnership with Abbott, ACR325 for the treatment of
dyskinesias in Parkinson's disease (Phase II ready), ACR343 for schizophrenia
(Phase II ready), ABT-560 for the treatment of cognitive dysfunctions (Phase I)
in partnership with Abbott and NSD-788 for anxiety (Phase I). In addition,
NeuroSearch has a broad portfolio of preclinical drug candidates and holds
equity interests in several biotech companies.

fonds.31-09 - nsd-721 and gsk share put - final - uk.pdf