B8F.L Regulatory News (B8F)

Ad-hoc Release pursuant to Section 15 of the German Securities Trading Act (Wertpapierhandelsgesetz)

Biofrontera AG files litigation against former supplier

· Former supplier Biosynth AG does not adhere to EMA requirements regarding the manufacturing of 5-aminolaevulinic acid (ALA)

· Biofrontera files action for negative declaratory relief against Biosynth AG

· Patient supply with medicinal product Ameluz® is safeguarded

Leverkusen, 20 August 2014 - The management of Biofrontera AG has decided today to file an action for negative declaratory relief against the former supplier Biosynth AG (Biosynth), Staat, Switzerland. This is an active reaction to unfounded claims. The law suit has the following background:

Biosynth was the supplier for active substance 5-aminolaevulinic acid hydrochloride (ALA) for Biofrontera group. ALA is a component of Biofrontera's prescription drug Ameluz®. In Ameluz®ALA is combined with a patent protected nanoemulsion, which improves skin penetration and chemical stability. Since December 2011 Ameluz® is, upon filing by Biofrontera group, approved in the EU for photodynamic therapy (PDT) of superficial skin tumours (actinic keratoses).

In the approval process, by the end of 2011, the responsible European agency, the European Medicines Agency (EMA), has defined quality standards for ALA used in Ameluz®. These are related to standards of GMP (Good Manufacturing Practice) demanded by the EMA in the production of ALA at Biosynth. The EMA allowed time limits to implement the various aspects of the required manufacturing standard.

Biosynth has up to now not fulfilled these standards and can therefore not any longer produce ALA in the GMP quality required for use in medicinal products. Without fulfilling all of the requirements of the EMA, an active substance can, according to Biofrontera's opinion, not be used in drugs in the EU. Biofrontera was therefore forced to look for other suppliers. These are by now certified to manufacture ALA according to GMP. The transition was swift and occurred without supply problems.

In addition, the management of Biofrontera AG has decided today to file an action for negative declaratory relief against Biosynth. With this law suit Biofrontera rejects claims of Biosynth, according to which a mutual venture exists with respect to production and marketing of Ameluz®. Even though the terminated business relationship was solely a supply agreement without any purchase obligation for Biofrontera group, Biosynth has - for the first time after the termination of the business relationship in 2014 - expressed such claims. It is Biofrontera's belief that Biosynth uses untenable claims to put Biofrontera under pressure in order to trigger material financial concessions. To safeguard the interests and the assets of the company and its shareholders appropriately, Biofrontera will take resolute actions against this.

Prior to claiming a mutual venture, Biosynth had initially, as outlined in the financial report of the first quarter of 2014, raised damage claims in the order of about 0.6 mln Euro. No law suit has been filed based on this claim. According to Biofrontera's judgement this claim is equally unjustified. The risks generated by these claims are considered low, so that no reserve provisions were formed.

Biofrontera AG does not expect relevant consequences for its revenues and financial results from the dispute with Biosynth.