ABLYNX : ANNOUNCES 2013 FULL YEAR RESULTS

REGULATED INFORMATION

2013 - a transformational year for Ablynx

The FY13 results will be discussed during a webcast presentation today at 4 pm CET, 10 am EST.

The webcast may be accessed on the home page of the Ablynx website at www.ablynx.comor by clicking here. To participate in the Q&A, please dial +32 (0) 2 620 01 38 with confirmation code 8682086.

 Announced encouraging Phase IIa results from a study in RA patients treated with the anti-IL-6R Nanobody, ALX-0061, and then agreed an exclusive global license agreement for this programme with AbbVie, worth up to $840 million plus double-digit royalties

 Initiated two Phase I studies with the anti-RSV Nanobody, ALX-0171

 Merck Serono initiated a Phase I study with ALX-0761, a bi-specific Nanobody, triggering a €2.5 million

milestone payment to Ablynx

 Boehringer Ingelheim initiated a Phase I study with BI 1034020, a Nanobody with potential application in Alzheimer's disease, triggering a €5 million milestone payment to Ablynx

 Further expanded the relationship with Merck Serono through the signing of a multi-year research

alliance that could generate >€100 million in cash-income for Ablynx over the next 6.5 years

 Exclusively licensed the anti-RANKL Nanobody, ALX-0141, to Eddingpharm for development and commercialisation in China, Macao, Taiwan and Hong Kong

 Strengthened the management team and re-organized the Board with the appointment of four new independent Directors, all with considerable, relevant industrial experience

 Raised €31.5 million in a private placement of new shares (accelerated book building procedure)

 Fourfold increase in cash-income from collaborations to €157.6 million (2012: €36.5 million)

 Revenue growth of 34% to €35.9 million (2012: €26.7 million)

 Net loss for the period reduced by 32% to €19.5 million (2012: €28.5 million)

 Net cash burn (excluding net cash-income from the ABO and the AbbVie upfront payment of $175

million) well controlled at €20.0 million (2012: €21.1 million)

 Strong financial position of €200.4 million in cash, cash equivalents, restricted cash and short-term investments (2012: €62.8 million)

 Successfully placed 17 million shares from venture capital investors with institutional investors in

Europe and the United States. The Company's free float has increased from 53% at the end of 2012 to
85% at the end of 2013

 Recruitment of the worldwide Phase II TITAN study with the anti-vWF Nanobody, caplacizumab, to treat acquired TTP, was stopped prior to reaching the target of 110 patients. This will allow early analysis of the clinical data which will be released mid-2014. If these results are encouraging, then planning will begin to start a Phase III study in 2015.

REGULATED INFORMATION

 Signed a major discovery collaboration and licensing agreement with Merck & Co, worth up to €1.7 billion in upfront payments, research funding and milestones, to discover and develop Nanobody immuno-therapeutics for the treatment of various cancers.

 Obtained encouraging pre-clinical proof-of-concept data with the anti-RSV Nanobody, ALX-0171, in a neonatal lamb model, demonstrating that daily inhalation of ALX-0171 resulted in a reduction of viral titres and lung inflammation, and was effective in alleviating various clinical signs and symptoms.

 After completing pre-clinical studies with the anti-IgE Nanobody, ALX-0962, for use in severe allergic asthma, Ablynx has decided not to move forward with this programme into Phase I studies because it is now believed that there is insufficient differentiation from the competition.

"This was truly a transformational year for Ablynx scientifically, operationally and at a corporate level. We continued our evolution into one of Europe's leading biopharmaceutical companies with a broad product pipeline, key partnerships, a strong cash position, a diversified investor base and a re-organised Board of Directors with four new independent Directors. During the coming year, we expect to see continued growth based on developments in our wholly-owned and partnered programmes, new collaborative deals, and further investment in our unique technology platform, whilst keeping our net cash burn under control."

At the end of 2013, Ablynx had seven wholly-owned and partnered Nanobodies in the clinic, three in Phase II and four in Phase I clinical development, compared to five Nanobody-based products in the clinic at the end of 2012.
In February, the Company reported compelling Phase IIa data for its anti-IL-6R Nanobody, ALX-0061, demonstrating that intravenous administration of ALX-0061 in patients with RA resulted in a strong therapeutic effect at week 24. The Nanobody treatment was well tolerated at all doses, there was no increase in adverse events upon extension of treatment and no anti-drug antibodies were detected.
In June, Merck Serono initiated a Phase I study with the bi-specific anti-IL-17A/F Nanobody, ALX-0761, which triggered a milestone payment of €2.5 million to Ablynx. At the time of the start of the Phase I study, Ablynx announced that it had converted this co-discovery/co-development arrangement into a classical licensing deal with milestone payments and royalties. As such, Merck Serono now has an exclusive license to the programme and is fully responsible for its further development and commercialisation. ALX-0761 has the potential to treat inflammatory diseases.
In July, two Phase I studies with the inhaled anti-RSV Nanobody, ALX-0171, were initiated. The first was a safety study in subjects with hyper-responsive airways, to determine the potential occurrence and then reversibility of broncho-constriction following inhalation of ALX-0171. The second was a PK study in healthy adults to investigate the concentration of the Nanobody locally and systemically with the goal to obtain additional PK parameters for further dose selection.
In August, the study protocol for the worldwide Phase II TITAN study, using the anti-vWF Nanobody, caplacizumab to treat acquired TTP, was adapted to facilitate recruitment. At the end of 2013, some improvement in recruitment had been observed.
In October, Boehringer Ingelheim initiated a Phase I study with BI 1034020 to treat Alzheimer's disease. The start of the study triggered a €5 million milestone payment to Ablynx.

REGULATED INFORMATION

In September, Ablynx and AbbVie entered into an exclusive, global license agreement to develop and commercialise ALX-0061 for the treatment of inflammatory diseases, including RA and SLE. Under the terms of the agreement, Ablynx received an upfront payment of $175 million of which a large portion will be spent over the next four years to execute the programme. In addition, Ablynx is eligible to receive up to
$665 million in milestone payments plus tiered double-digit royalties.
Also in September, Ablynx and Merck Serono further expanded their relationship through the signing of a major research alliance to discover and develop Nanobodies against a number of disease targets that play a role in oncology, immuno-oncology, immunology and neurology. The research alliance could evolve into at least four co-discovery and co-development agreements and could generate >€100 million in cash-income for Ablynx in the next 6.5 years.
In October, Ablynx signed an exclusive license agreement with Eddingpharm for the development and commercialisation of the anti-RANKL Nanobody, ALX-0141, in the mainland of the People's Republic of China, the Hong Kong and Macao Special Administrative Regions, and Taiwan, for all indications, including osteoporosis and bone metastases. Ablynx received an upfront payment of €2 million and is eligible to receive up to 20% royalties on net sales generated by Eddingpharm. In addition, the Company will have access to the clinical data generated by Eddingpharm to support potential licensing discussions in other geographic regions. This deal represents Ablynx's first entry into the emerging markets.
The feasibility studies with Spirogen (PBD toxin-Nanobody drug conjugates in cancer therapy) and Algeta (thorium277-Nanobody drug conjugates in cancer therapy) currently continue to move forward following AstraZeneca's acquisition of Spirogen and Bayer's acquisition of Algeta.

During 2013, Ablynx further strengthened its management team with two promotions and one new appointment.
Kim Simonsen, who was previously Director of Project Management, was appointed to the newly created position of Chief Operations Officer, and Dominique Tersago, who previously held the position of Senior Medical Director, was appointed Chief Medical Officer. Tony de Fougerolles was appointed Chief Scientific Officer, joining from Moderna Therapeutics in Boston, having also worked at Alnylam and Biogen Idec. Eva- Lotta Allan (Chief Business Officer), Josi Holz (Chief Medical Officer) and Andreas Menrad (Chief Scientific Officer) left the Company during 2013.
Also during 2013, Ablynx established a re-organised Board of Directors with significant industry experience. Four new independent Directors were appointed (Dr Peter Fellner, Catherine Moukheibir, Dr William Jenkins and Dr Bo Jesper Hansen). The roles of Chairman and CEO were separated with Dr Edwin Moses remaining CEO and Dr Peter Fellner appointed as his successor as Chairman. The three remaining non- executive Directors representing the venture capital shareholders (Jim Van heusden, Denis Lucquin and Stephen Bunting) resigned, as did three independent Directors (Dr Roger Perlmutter who resigned to avoid conflicts of interest following his appointment at Merck & Co, and Mats Pettersson and Dr Geert Cauwenbergh who retired after five years on the Ablynx Board).
Approximately 17 million venture capital held shares were placed during the year with institutional investors in Europe and the United States. At the end of 2013, only Abingworth, of all the founding venture capital shareholders, retained its holding in Ablynx stock.

REGULATED INFORMATION

(1) including €2.3 million in restricted cash

(2) including €2.7 million in restricted cash

In 2013, revenues increased by 34% to €35.9 million (2012: €26.7 million), driven by FTE funding, milestone payments from Boehringer Ingelheim and Merck Serono, recognised income from the upfront payment received from AbbVie, and higher grant income.
Total research and development costs decreased to €43.7 million (2012: 46.9 million), in line with lower external development costs which are largely related to the timing of clinical trials spending. General and administrative costs remained well under control at €10.0 million (2012: €9.4 million).
Other operating income was €0.1 million (2012: operating expenses of €0.2 million).
As a result of the foregoing, the loss from operations, before tax and net finance income, decreased
substantially to €17.7 million (2012: €29.8 million).
Finance income (€0.9 million) primarily comprises interest income from bank deposits and floating and fixed rate notes. Finance expenses (€2.7 million) relate to the impact of discounting the tax credit, the realised exchange rate losses of €0.7M on dollars sold in 2013 and the unrealised exchange losses of €1.3M at the end of 2013 on the remaining $92M from the $175 million upfront payment received from AbbVie in October 2013. As a result, the net finance result in 2013 was -€1.8 million (2012: net finance result of €1.3 million).
As a result of the foregoing, the net loss decreased to €19.5 million (2012: €28.5 million).
As the Company incurred losses in all of the relevant periods, the Company had no taxable income, and therefore paid no taxes.

The Company's intangible assets include a portfolio of patents which are being amortised over approximately 12 years and technology licenses which are being amortised over 5, 18 and 20 years. The Company has not capitalised any other patents and it expenses all its research and development activities in the IFRS consolidated financial statements. The intangible assets also include software licenses.
The Company's non-current tangible assets include the Company's laboratory and office equipment, the investments in its facilities and €2.3 million restricted cash, which is a cash pledge that the Company has provided for the lease of its building. The Company does not own any real estate but continues to invest in equipment for its research activities. Tax receivables include a tax credit of €8M.

REGULATED INFORMATION

The Company's current assets consist mainly of €198M other short term investments, cash and cash equivalents, including $92M.
Current liabilities consist mainly of trade payables and deferred income related to the upfronts received from the partners.
The Company's equity increased from €31.7 million to €46.2 million mainly as a result of the net proceeds of €30.1 million from the Private Placement in February 2013. The equity increase has partially been offset by the net loss for the year (€19.5 million).

There was a net cash inflow from operating activities of €105.6 million in 2013, compared to a net outflow of €21.2 million in 2012. The change is mainly related to an increase in net working capital resulting from the $175 million upfront payment received from AbbVie in October 2013.
There was a net cash outflow from investing activities of €132.0 million in 2013, as compared to a net cash inflow of €22.9 million in 2012. The net cash outflow in 2013 comprises primarily the net movements in short-term financial investments as a result of the transfer of cash received to deposit accounts.
There was a net cash inflow from financing activities of €32.4 million, as compared to a net cash outflow of
€0.7 million in 2012, mainly as a result of the net proceeds of €30.1 million from the Private Placement in
February 2013.

On 13 th January 2014, Ablynx provided an update on its anti-vWF Nanobody, caplacizumab, to treat acquired TTP, a rare thrombotic disorder. Ablynx announced that it had stopped recruitment of the worldwide Phase II TITAN trial to allow earlier analysis of the data for potential proof-of-concept. Phase II data are now expected by mid-2014 and if the results are promising, a Phase III study is anticipated to commence in 2015.
On 3 rd February 2014, Ablynx announced that it had entered into a second research collaboration and licensing agreement with Merck & Co, known as MSD outside the United States and Canada. This new alliance is focused on the discovery and development of Nanobodies in cancer immunotherapy. Ablynx received an upfront payment of €20 million and is eligible to receive €10.7 million in research funding and up to €1.7 billion in milestone payments plus tiered royalties.
The anti-RSV Nanobody, ALX-0171, demonstrated pre-clinical proof-of-concept in a neonatal lamb model. This model is a good mimic of the infant with respect to size, breathing characteristics, lung architecture and RSV induced lower respiratory tract infection. RSV infected animals were treated once daily with inhaled ALX-0171, starting at the peak viral load, in a manner which is believed to be representative of the situation which will be investigated in the first-in-infant study. Treatment with ALX-0171 led to a strong reduction in viral titres and inflammation in the lungs. In addition, ALX-0171 was effective in improving various clinical signs and symptoms, such as behavioural activity and general well-being.
Pre-clinical results with the anti-IgE Nanobody, ALX-0962, for use in the treatment of severe allergic asthma had demonstrated that ALX-0962 has a novel dual mode of action, but upon review of the final pre-clinical data package, it was clear that results were not sufficiently compelling to ensure a significant competitive advantage compared with the benchmark and so the programme has been stopped.

REGULATED INFORMATION

Ablynx is well positioned for further growth during the course of 2014, due to its world-leading Nanobody technology, broad pipeline and strong cash position. Ablynx's cash position will enable the Company to continue to invest in its earlier stage discovery product pipeline and Nanobody technology, as well as further advancing its lead wholly-owned and partnered programmes.
By mid-2014, Ablynx expects to announce potential proof-of-concept results from the Phase II study with caplacizumab (anti-vWF) in patients with acquired TTP.
During the year 2014, Ablynx expects to report clinical results for the Phase I study with the subcutaneous formulation of ALX-0061 (anti-IL-6R), and two Phase I studies with ALX-0171 (anti-RSV). The Company also expects that two partnered programmes will have completed Phase I development: the Phase I study performed by Merck Serono with ALX-0761 (anti-IL-17A/F); and the Phase I study with the Nanobody for Alzheimer's disease (BI 1034020) performed by Boehringer Ingelheim.
In addition, Ablynx plans to start the first-in-infant Phase II study with ALX-0171 to treat RSV infections in infants and to advance the preparations for the Phase II studies in RA and SLE with the subcutaneous form of ALX-0061.
Ablynx also expects to receive potential milestone payments from on-going collaborations and potentially to enter into additional partnering deals.
Finally, good cash management continues to be a priority for the Company, with a strong focus on net cash burn and the generation of cash to support the on-going development of the Company. For the full year
2014, Ablynx expects to have a net cash burn in the range of €30-€35 million.

The Ablynx management team will host a webcast during which the full year results for 2013 will be presented, followed by a Q&A session. This event will be held on Thursday, 27 February 2014 at 4 pm CET (10 am EST). The conference call will be webcast live and may be accessed on the home page of the Ablynx website at www.ablynx.comor by clicking here. Shortly thereafter, a replay of the webcast will be available on the Company's website under the section News & Events/past events.

31 March - online publication annual report 2013
24 April - Annual General Meeting 2014
14 May - results Q1 2014
28 August - half year results 2014
13 November - results Q3 2014

13 March at 5.45pm
21 May at 5.45pm
17 September at 5.45pm
10 December at 5.45pm
To attend an event, please register via email: investors@ablynx.com, stating your name and preferred day.
The events are on a "first come, first served" basis.

REGULATED INFORMATION

FTE full time equivalent
IL-6R receptor of interleukin-6 - a cytokine involved in a wide range of biological activities
IL-17A/F interleukin 17A and F - cytokines associated with the pathology of many human inflammatory and autoimmune disorders
PBD pyrrolobenzodiazepine
RA rheumatoid arthritis
RSV respiratory syncytial virus - virus that infects the respiratory tract, including the lungs
SLE systemic lupus erythematosus
TTP thrombotic thrombocytopenic purpura - rare disorder of the blood coagulation system

Ablynxis a biopharmaceutical company engaged in the discovery and development of Nanobodies ®, a novel class of therapeutic proteins based on single-domain antibody fragments, for a range of serious human diseases, including inflammation, haematology, oncology and pulmonary disease. Today, the Company has approximately 30 programmes in the pipelineand seven Nanobodies in clinical development. Ablynx has on-going research collaborations and significant partnerships with major pharmaceutical companies including AbbVie, Boehringer Ingelheim, Eddingpharm, Merck & Co, Merck Serono and Novartis. The Company is headquartered in Ghent, Belgium.
More information can be found on www.ablynx.com.

Dr Edwin Moses
CEO
t: +32 (0)9 262 00 07
m: +44 (0)7771 954 193 /
+32 (0)473 39 50 68
e: edwin.moses@ablynx.com
Marieke Vermeersch
Associate Director Investor Relations t: +32 (0)9 262 00 82
m: +32 (0)479 49 06 03
e: marieke.vermeersch@ablynx.com

@AblynxABLX

Mary-Jane Elliott, Amber Bielecka, Lindsey Neville t: +44 207 920 2345
e: ablynx@consilium-comms.com

Certain statements, beliefs and opinions in this press release are forward-looking, which reflect the Company or, as appropriate, the Company directors' current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. A multitude of factors including, but not limited to, changes in demand, competition and technology, can cause actual events, performance or results to differ significantly from any an ticipated development. Forward looking statements contained in this press release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. As a result, the Company expressly dis claims any obligation or undertaking to release any update or revisions to any forward-looking statements in this press release as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward-looking statements are based. Neither the Company nor its advisers or representatives nor any of its parent or subsidiary undertaking s or any such person's officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does either accept any responsibility for the future accuracy of the forward-looking statements contained in this press release or the actual occurrence of the forecasted developments. You should not place undue reliance on forward -looking statements, which speak only as of the date of this press release.

REGULATED INFORMATION

The consolidated financial statements have been prepared in accordance with IFRS, as adopted by the EU. The financial information included in this press release is an extract from the full IFRS consolidated financial statements which will be published on 31 March 2014.
The statutory auditor, Deloitte Bedrijfsrevisoren/Reviseursd'Entreprises, represented by Gert Vanhees, has substantially completed the audit procedures on the IFRS consolidated statements as of and for the year ended 31 December 2013, and has confirmed that the consolidated balance sheet, the consolidated statements of comprehensive income, cash flow and changes in shareholders' equity, included in this press release, are consistent in all material aspects with the consolidated accounts from which they have been derived.

REGULATED INFORMATION

Revenue:

Research and development 33,181 25,645

Grants 2,761 1,082

Research and development expenses (43,699) (46,868) General and administrative expenses (10,044) (9,409) Total operating expenses (53,743) (56,277) Other operating income 131 204
Other operating expenses (3) (426)

Operating result (17,673) (29,772) Finance result (net) (1,797) 1,264

Finance income 949 1,452

Finance cost (2,746) (188) Loss before taxes (19,470) (28,508) Income tax expense 0 0

Total comprehensive income for the period (19,470) (28,508) Loss attributable to equity holders (19,470) (28,508) Total comprehensive result attributable to equity holders (19,470) (28,508) Basic and diluted result per share (0.40) (0.65)

REGULATED INFORMATION

Intangible fixed assets 328 600

Property, plant and equipment 2,394 3,450

Restricted cash 2,320 2,660

Tax receivables 8,026 5,594

Trade receivables 515 591

Other current assets 502 729

Tax receivables 448 608

Accrued income and deferred charges 977 656

Other short-term financial investments 187,519 55,810

Cash and cash equivalents 10,531 4,297

Equity attributable to equity holders 46,173 31,722

Share capital 84,004 73,465

Share premium account 150,747 126,466

Share-based payment reserve 6,736 8,078

Retained earnings (195,314) (176,287)

Borrowings 141 927

Borrowings 786 825

Trade payables 11,336 8,070

Other current liabilities 3,299 3,214

Deferred income 151,825 30,237
Total liabilities 167,387 43,273

REGULATED INFORMATION

Loss before income tax (19,470) (28,508)

Adjustments for:

Amortisation 462 727

Depreciation 1,508 326 (Profit)/loss on disposal of property, plant and equipment

Share-based payment expense 699 1,542

Finance income - net 1,797 (1,337)

Net movement in trade and other receivables (2,289) 527

Net movement in trade and other payables 124,938 4,179

Interest paid (2,746) (74)

Interest received 949 1,411
Income tax paid 0

Purchases of property, plant and equipment (599) (700)

Proceeds from sale of property, plant and equipment 147 1,908

Purchases of intangible assets (190) (309)

Sale of short-term financial investments (131,369) 22,030

Transfer to non-current asset 0 0

Proceeds from issuance of ordinary shares

Proceeds from exercise of warrants 33,222 58

Proceed of borrowings

Repayments of borrowings (825) (805)

Cash and cash equivalents at beginning of the period 4,297 3,322

REGULATED INFORMATION

Other comprehensive income Available-for-sale financial assets Total Comprehensive Income Warrant plans

Share-Based Payments 1,570

Capital increase

Issuance costs

Exercise of warrants 228 36 (99)

Other comprehensive income Available-for-sale financial assets Total Comprehensive Income Warrant plans

Share-Based Payments 1,542

Capital increase

Issuance costs

Exercise of warrants 161 9 (112)

Other comprehensive income Available-for-sale financial assets Total Comprehensive Income Warrant plans

Share-Based Payments 699 443

Capital increase
Issuance costs

Exercise of warrants 10,539 24,281 (2,041)

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