Agreement for MT201, Currently in Phase II Clinical Trials

    GENEVA, Switzerland and MUNICH, Germany, December 7
/PRNewswire-FirstCall/ -- Serono (virt-x: SEO and NYSE: SRA) and Micromet
(private) have signed an exclusive collaboration and license agreement for
the development and commercialization of Micromet's fully human monoclonal
antibody MT201 (adecatumumab). MT201 is a pan-carcinoma monoclonal antibody
directed against the epithelial cell adhesion molecule Ep-CAM. The product is
currently being tested in two multicenter phase II clinical trials for the
treatment of prostate and metastatic breast cancer. Ep-CAM, the target
antigen for MT201, is over-expressed with high frequency on most human
carcinomas, suggesting that it may have therapeutic potential in the
treatment of a broad range of cancers, including prostate, breast, colon,
lung, stomach, pancreatic, head & neck, and ovarian cancer.
    Under the terms of the agreement, Micromet will be responsible for
completing the ongoing phase II clinical trials, and Serono will take over
further development and commercialization of the product. Effective
immediately, Serono will be responsible for all development costs. Micromet
will receive an initial license fee of US$10 million and additional milestone
payments of up to US$138 million if the product is successfully developed and
registered worldwide in three or more indications. In addition, Micromet will
receive undisclosed royalties based on net sales of the product. Under
certain terms and conditions, Micromet may elect to share in the development
and commercialization of the product in the US and EU in exchange for a share
of profits.
    "With its longstanding history and experience in protein based
therapeutics, Serono is an excellent partner for MT201," commented Christian
Itin, CEO of Micromet. "We are excited to collaborate with Europe's most
successful biotechnology company."
    "We are committed to the development of novel targeted therapeutics for
cancer," said Serono's CEO Ernesto Bertarelli. "MT201 is a promising product
with considerable therapeutic potential in the treatment of solid tumours.
With this important addition to our pipeline, Serono's portfolio of novel
anti-cancer agents is evolving well." Serono is currently evaluating TACI-Ig
in two clinical trials for the treatment of B-cell malignancies.
    MT201 has been specifically designed to selectively eliminate tumour
cells while leaving healthy tissues largely unharmed. Phase I data have
demonstrated an excellent safety profile of MT201, and no MT201 neutralizing
antibodies have been observed so far in man. An investigational new drug
application (IND) for the product was recently cleared by the United States
Food and Drug Administration (FDA) for the initiation of phase II studies in
the United States.
    Some of the statements in this press release are forward looking. Such
statements are inherently subject to known and unknown risks, uncertainties
and other factors that may cause actual results, performance or achievements
of Serono S.A. and affiliates to be materially different from those expected
or anticipated in the forward-looking statements. Forward-looking statements
are based on Serono's current expectations and assumptions, which may be
affected by a number of factors, including those discussed in this press
release and more fully described in Serono's Annual Report on Form 20-F filed
with the U.S. Securities and Exchange Commission on March 25, 2004. These
factors include any failure or delay in Serono's ability to develop new
products, any failure to receive anticipated regulatory approvals, any
problems in commercializing current products as a result of competition or
other factors, our ability to obtain reimbursement coverage for our products,
and government regulations limiting our ability to sell our products. Serono
has no responsibility to update the forward-looking statements contained in
this press release to reflect events or circumstances occurring after the
date of this press release.
    About Serono
    Serono is a global biotechnology leader. The Company has eight
biotechnology products, Rebif(R), Gonal-F(R), Luveris(R), Ovidrel(R
)/Ovitrelle(R), Serostim(R), Saizen(R), Zorbtive(TM) and Raptiva(R). In
addition to being the world leader in reproductive health, Serono has strong
market positions in neurology, metabolism and growth and has recently entered
the psoriasis area. The Company's research programs are focused on growing
these businesses and on establishing new therapeutic areas.
    In 2003, Serono achieved worldwide revenues of US$2,018.6 million, and a
net income of US$390.0 million, making it the third largest biotech company
in the world. Its products are sold in over 90 countries. Bearer shares of
Serono S.A., the holding company, are traded on the virt-x (SEO) and its
American Depositary Shares are traded on the New York Stock Exchange (SRA).
    About Micromet
    Micromet AG, a private Munich-based biotechnology company, puts novel
concepts in immunoB-therapy to work. Using proprietary technologies, the
Company is building a strong pipeline of innovative drug candidates for the
treatment of cancer, inflammation and autoimmune disease. Two candidates are
currently in clinical trials. The Company has established a powerful drug
development platform based on its BiTE(TM) technology ("Bispecific T cell
engagers"), a unique drug format that leverages the outstanding cytotoxic
potential of T cells, the most powerful 'killer cells' of the human immune
system. In addition, Micromet is exploiting the potential of SCAs
(single-chain antibodies) for the development of novel drug candidates under
a multi-year strategic collaboration with Enzon Inc. Micromet has integrated
infrastructure and expertise in all disciplines of drug design and
development. The Company has attracted both top-tier life science investors
and corporate drug development partners such as MedImmune, Inc., Enzon, Inc.,
and now Serono.
    For further information, please visit the Company's web site at
http://www.micromet.de
    Reuters: SEO.VX / SRA.N
    Bloomberg: SEO VX / SRA US

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