As Filed with the Securities and Exchange Commission on July 18, 2001

                     SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549

                             Amendment No. 1 to
                                 FORM 20-F
              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                    THE SECURITIES EXCHANGE ACT OF 1934

                For the fiscal year ended December 31, 2000

                       Commission file number 0-29076

                              BIORA AB (publ)
           (Exact name of Registrant as specified in its charter)

                             BIORA CORPORATION
              (Translation of Registrant's Name into English)

                           THE KINGDOM OF SWEDEN
              (Jurisdiction of incorporation or organization)

                                 SE-205 12
                               MALMO, SWEDEN
                  (Address of principal executive offices)
       Securities registered or to be registered pursuant to Section
                             12(b) of the Act.

                                    None

         Securities for which there is a reporting obligation pursuant to
Section 12(g) of the Act.
                              Ordinary Shares
                              (Title of Class)
       Securities registered or to be registered pursuant to Section
                             15(d) of the Act.
                                    None

Indicate the number of outstanding shares of each of the issuer's classes
of capital or common stock as of December 31, 1999.

       Title of Class                      Number of Shares
       --------------                      ----------------
       Ordinary Shares                     21,203,800

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for much shorter period that the
Registrant was required to file such reports) and (2) has been subject to
such filing requirements for the past 90 days.

      Yes: |X|                                    No: |_|

Indicate by check mark which financial statement item the Registrant has
elected to follow.

      Item 17: |_|                                Item 18: |X|


                              TABLE OF CONTENTS

                                                                           Page

INTRODUCTION
Item 1.         Not Applicable
Item 2.         Not Applicable
Item 3.         Key Information                                               1
                Forward-Looking Statements                                    1
                3.a Selected Historical Financial Information                 1
                3.b Risk Factors                                              3
                3.c Dividends                                                 6
                3.d Exchange Rate Information                                 7
Item 4.         Information on the Company                                    8
                4.a History and development of Biora                          8
                Overview                                                      8
                Business Strategy                                            20
                Market Overview                                              21
                Marketing                                                    22
                4.c Organizational Structure                                 25
                4.d Desription of Property                                   25
                Competition                                                  26
                Intellectual Property                                        26
                Government Regulation                                        28
Item 5.         Operating and Financial Review and Prospects                 30
                Results from Operations                                      31
                Liquidity and Capital Resources                              32
Item 6.         Directors, Senior Management and Employees                   35
                Directors and Senior Management                              35
                Compensation                                                 39
                Employees                                                    41
                Share Ownership                                              41
Item 7.         Major Shareholder and Related Transactions                   41
Item 8.         Financial Information                                        43
Item 9.         The Offer and Listing                                        43
Item 10.        Additional Information                                       46
                10. a  Taxation                                              46
                10. b  Memorandum and Articles of Association                50
                10. c  Material Contracts
                10. d Exchange Controls                                      53
                10. h Documents                                              53
                10. i  List of subsidiaries                                  53
Item 11.        Quantitative and Qualitative Disclosures About Market Risk   54
Item 12.        Not Applicable
Item 18.        Financial Statements
                Consolidated Financial Statements                           F-1
                Condensed Financial Information of Registrant               S-1



INTRODUCTION

Special Note Regarding Forward Looking Statements

         This Annual Report contains various forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such statements are contained in Item 4 Information on the Company
and Item 5 Operating Financial Review and Prospects and may be identified
by the use of forward-looking terminology such as may, will, intend,
expect, anticipate, estimate, believe, plan or other variations thereon or
other comparable terminology, and include statements concerning strategies
and objectives of management for future operations and assumptions related
thereto. These statements are based upon management's current expectations
and beliefs concerning future events as they may affect the Company and
therefore are subject to numerous uncertainties, many of which are beyond
the control of the Company. The Company cautions that these statements are
subject to important factors that could cause actual results to differ
materially from those expressed or implied in such forward-looking
statements, including, without limitation: (i) the timing and cost involved
in the pre-clinical and clinical testing of and obtaining regulatory
approval for the Company's products under development, (ii) market
acceptance of the Company's technologies and products, (iii) the cost and
success of the Company's strategy to expand its own marketing and sales
force, (iv) competitive pressures arising from changes in technology or
product development, or changes in competitor's pricing for products, (v)
changes in the degree of protection created by the Company's patents and
other intellectual property rights, (vi) changes in general economic
conditions, including inflation or fluctuations in interest or foreign
exchange rates, (vii) the ability of the Company to expand its production
capabilities and (viii) changes in business strategy.

The Company assumes no obligation to update any particular forward-looking
statement in light of future events.

Item 3. Key Information

3.a Selected Historical Financial Information

         The following selected consolidated financial data as at December
31, 1996, 1997, 1998,1999 and 2000 and for each of the years ended December
31, 1996, 1997, 1998, 1999 and 2000 have been derived from, and are
qualified by reference to, the Company's Consolidated Financial Statements
and Notes thereto appearing elsewhere in this Annual Report. The Company's
Consolidated Financial Statements are prepared in accordance with Swedish
GAAP, which differs in certain significant respects from U.S. GAAP. A
reconciliation of differences that significantly affect the determination
of consolidated results of operations and shareholders' equity as at
December 31, 1997, 1998, 1999 and 2000 and for each of the years then ended
is set forth in Note 23 of Notes to the Consolidated Financial Statements.
The following data should be read in conjunction with the Company's
Consolidated Financial Statements and Notes thereto and Management's
Discussion and Analysis of Financial Condition and Results of Operations,
which are included elsewhere herein.


<TABLE>
<CAPTION>

                                                         Year Ended December 31,
                                      ---------------------------------------------------------------
                                             1996        1997        1998     1999     2000     2000
                                            (SEK)       (SEK)       (SEK)    (SEK)    (SEK)     $(1)

                                              (In thousands, except per share data) (2) (7)

Income Data:

Swedish GAAP:
<S>                                         <C>        <C>         <C>      <C>      <C>       <C>
       Net sales                            4 561      16 499      50 119   73 556   89 160    8 263
       Cost of goods sold (3)              -4 513      -5 533     -10 864  -15 470  -21 148   -1 960
                                      ---------------------------------------------------------------
       Gross profit                            48      10 966      39 255   58 086   68 012    6 303

       Selling expenses                   -21 220     -64 830     -89 622  -90 783  -78 387   -7 265
       Administrative expenses             -6 956     -18 173     -22 133  -18 505  -25 437   -2 357
       Research and development
         costs(4)                          -6 825     -20 293     -39 980  -41 597  -42 789   -3 966
       Other operating income                 902       2 368      42 898    4 001      643       60
       Other operating expenses            -1 782      -2 843      -1 946   -3 007     -753      -70
                                      ---------------------------------------------------------------
       Loss from operations               -35 833     -92 805     -71 528  -91 805  -78 711   -7 295

Net loss                                  -37 073     -75 358     -59 998  -86 739  -76 149   -7 057
Basic EPS
       Net loss per Ordinary Share(8)       -2,61       -3,66       -2,83    -4,09    -3,59    -0,33
       Net loss per ADS (8)                 -5,22       -7,33       -5,66    -8,18    -7,18    -0,67
Weighted average
shares outstanding(5)                      14 207      20 571      21 204   21 204   21 204   21 204

U.S. GAAP(5):
       Product sales                        4 561      16 499      50 119   73 556   89 160    8 263
       Contract revenue                       526         818         224        -        -        -
                                      ---------------------------------------------------------------
       Total revenues                       5 087      17 317      50 343   73 556   89 160    8 263

       Cost of goods sold (3)              -4 513      -5 533     -10 864  -15 470  -21 148   -1 960
                                      ---------------------------------------------------------------
       Gross profit                           574      11 784      39 479   58 086   68 012    6 303

       Selling expenses                   -21 220     -64 830     -89 622  -90 783  -78 387   -7 265
       Administrative expenses             -6 956     -18 173     -22 133  -18 505  -25 437   -2 357
       Research and development           -11 157     -23 744     -37 233  -32 653  -32 795   -3 039
       costs(4)
       Other operating income                 376       1 550      42 674    4 001      393       36
       Other operating expenses            -1 782      -2 843      -1 946   -3 659     -375      -35
                                      ---------------------------------------------------------------
       Loss from operations               -40 165     -96 256     -68 781  -83 513  -68 589   -6 357

Net loss                                  -41 680     -78 809     -57 251  -78 447  -66 027   -6 119
Basic EPS
       Net loss per Ordinary Share(8)       -2,93       -3,83       -2,70    -3,70    -3,11    -0,29
       Net loss per ADS (8)                 -5,87       -7,66       -5,40    -7,40    -6,23    -0,58
Weighted average
shares outstanding(5)                      14 207      20 571      21 204   21 204   21 204   21 204

Consolidated Balance Sheet Data:

Swedish GAAP:

Cash and cash equivalents                   5 342     286 310     187 048  112 804   53 755    4 982
Total assets                               53 947     339 334     247 186  162 736   91 224    8 454
Long-term borrowings                       19 090       5 642       5 872    5 949    8 167      757
Advances received(6)                       34 475      39 375           -        -        -        -
Shareholders' equity / deficit            -18 437     277 935     213 970  127 406   50 915    4 719

U.S. GAAP:

Total assets                               31 494     313 430     224 030  148 524   86 756    8 040
Shareholders' equity / deficit            -48 400     249 841     188 779  110 537   44 169    4 094
</TABLE>

(1)      Solely for convenience, krona amounts have been translated into
         U.S. dollars at the Noon Buying Rate on May 31, 2000 of U.S. $1.00
         = SEK 10,7900

(2)      Amounts may not total due to rounding.

(3)      The royalty payments to Astra of 2.5 percent on sales of Emdogain
         has been reclassified starting 1998 as cost of goods sold instead
         of Research and development cost in previous years. In this
         presentation all previous years have been adjusted for comparison
         purposes.

(4)      Total research and development costs incurred were SEK 11.2
         million, SEK 23.7 million, SEK 37.2 million, SEK 32.7 million and
         SEK 32,8 million for the years ended December 31, 1996, 1997,
         1998, 1999, and 2000 respectively. The royalty payments to Astra
         of 2.5 percent on sales of Emdogain, has been reclassified from
         R&D expense to cost of goods sold. In accordance with the
         Company's accounting principles under Swedish GAAP, a portion of
         research and development costs were capitalized commencing in
         1993. Under U.S. GAAP such amounts would have been expensed as
         incurred.

(5)      The weighted average number of Ordinary Shares outstanding for
         each year includes (i) the effect of Ordinary Shares subscribed
         from the date such shares were paid for and (ii) the effect of the
         issuance of three bonus shares for each Ordinary Share and a
         25-for-1 share split of the Ordinary Shares that occurred prior to
         October 31, 1996. The effect of the convertible debentures has not
         been included in the computation of loss per Ordinary Share as it
         would be antidilutive.

(6)      On September 1, 1996 the Company entered into an agreement with
         Seikagaku. Biora received $5 million for entering into the
         agreement. The agreement provided that Seikagaku could, under
         certain circumstances, request Biora to refund the $5 million
         payment in the event that the Japanese Ministry of Health and
         Welfare did not approve Emdogain for sale in Japan. Consequently,
         the $5 million was treated as a liability by Biora through the end
         of 1997. Emdogain was approved by the MHW in January 1998 and
         consequently, Biora transferred the $5 million payment to Other
         Operating Income during the three month period ended March 31,
         1998.

(7)      In 1998, Swedish companies were required to revise the
         presentation of their financial statements in accordance with the
         Swedish Annual Accounts Act (the "SAAA"). Accordingly, the
         Company's Consolidated Financial Statements have been prepared in
         accordance with the SAAA and amounts for all prior referenced
         periods have been restated in conformance with the SAAA. The
         changes effect disclosures of individual line items, but do not
         effect results of operations or shareholders' equity. See
         "Management's Discussion and Analysis of Financial Condition and
         Results of Operations--Change in Presentation of Financial
         Statements."

(8)      The impact of the Company's common stock equivalents has not been
         considered in the computation of net loss per share as the effect
         would be antidilutive.

3.b      Risk Factors

Biora's competitors may develop technologies and products that are more
effective than those being developed by Biora.

         Competitors of Biora engaged in all areas of health care in the
United States, Europe and Japan are numerous and include, among others,
major pharmaceutical and chemical companies, specialized biotechnology
firms, universities and other research institutions. There can be no
assurance that Biora's competitors will not succeed in developing
technologies and products that are more effective than any which have been
or are being developed by the Company or which would render Biora's
technology and products obsolete and/or non- competitive. Many of Biora's
competitors have substantially greater financial and technical resources
and production and marketing capabilities than the Company. In addition,
many of the Company's competitors have greater experience than Biora in
undertaking pre-clinical testing and clinical trials of therapeutic
products and obtaining applicable regulatory approvals of such products for
use in health care.

         Additionally, competitors of Biora may succeed in obtaining
applicable regulatory approvals for other periodontal products more rapidly
than Biora. The relative speed with which Biora can develop products,
complete clinical testing and obtain regulatory approvals and supply
commercial quantities of products is expected to have an impact on Biora's
competitive position. If Biora commences significant commercial sales of
its products, it will also be competing, with respect to manufacturing
efficiency and marketing capabilities, in areas in which it has limited
experience. To the extent that other companies succeed in developing
similar products that are more effective or are produced and marketed more
effectively, the commercial success of Emdogain and other of Biora's
products under development may be materially and adversely affected, which
could have a material adverse effect upon Biora's business, financial
condition, prospects and results of operations. See "Competition."

Technological changes in the treatment of periodontal disease may put
Emdogain and the company's other products at a competitive disadvantage.

         Significant resources are being expended to develop new and
improved treatment methodologies for the treatment of periodontal disease.
Accordingly, the market acceptance and commercial success of Emdogain and
Biora's other products will depend not only on its effectiveness but also
on the relative safety and effectiveness of alternative treatments or
approaches. There can be no assurance that superior treatments for
periodontal disease will not be developed by Biora's current competitors or
others, or that alternative approaches, including preventative
alternatives, will not render Biora's technology or products under
development obsolete or non-competitive, any of which could have a material
adverse effect on Biora's business, financial condition, prospects and
results of operations.

Biora depends on a single manufacturing facility.

         The production activities performed by Biora take place in a
single facility located at Biora headquarters in Malmo, Sweden. A major
disturbance at Biora's facility in Malmo could result in a prolonged
interruption of Biora's business and potential loss of customers and sales,
which could have a material adverse effect upon Biora's business, financial
condition, prospects and results of operations. See "Description of
Property."

Biora dependence on patents and other proprietary technology, and the
degree to which such proprietary technology will be protected is
unpredictable in many jurisdictions.

         Biora's success will depend in part on its ability to obtain
patent protection for its products and processes, to preserve its trade
secrets and to operate without infringing or violating the proprietary
rights of third parties. As of June 1, 2001, Biora owned five United States
patents, three European patents and 77 patents in various other countries.
The patent positions of firms involved in the development and manufacture
of biology-based products, including Biora, are uncertain and involve
complex legal and technical questions for which important legal principles
are largely unresolved. For example, no consistent policy has emerged
regarding the breadth of biotechnology patent claims that are granted by
the United States Patent Office or enforced by the federal courts. In
addition, there can be no assurance that any patents granted to Biora will
not be challenged, invalidated or circumvented. Moreover, there can be no
assurance that any patent applications filed by Biora will result in
patents being issued, or that any patents issued will afford meaningful
protections against competitors with similar technology. Litigation, which
could result in substantial costs to Biora, may be necessary to enforce any
patents issued to Biora or to determine the scope and validity of the
proprietary rights of others.

         In addition, competitors of Biora may obtain patents claiming
products or processes that are necessary for or useful to the development,
use or manufacture of Biora's products. Such competitors can bring legal
actions against Biora claiming infringement and seeking damages and
injunctive relief. While Biora believes that its current and proposed
future activities will not infringe any valid patent heretofore issued,
there can be no assurance that such activities will not be challenged in
the future, that additional patents containing claims materially
constraining the proposed activities of Biora will not be issued or that
Biora will not become involved in costly, time-consuming litigation
regarding patents, including actions brought to challenge or invalidate
Biora's own patent rights. Such litigation or proceedings, if adversely
determined, could subject Biora to significant liabilities to third
parties, could require Biora to seek licenses from third parties and could
prevent Biora from manufacturing or selling its products, any of which
could have a material adverse effect on Biora's business, financial
condition, prospects and results of operations.

         Biora also relies upon unpatented proprietary manufacturing
technology. Biora's proprietary manufacturing technology is generally
protected from unauthorized disclosure under confidentiality agreements
with the parties involved. No assurance can be given that others will not
independently develop substantially equivalent technology or techniques or
otherwise gain access to Biora's proprietary manufacturing technology or
disclose such technology or that Biora can meaningfully protect its rights
with respect to such unpatented proprietary manufacturing technology. In
addition, there can be no assurance that these agreements will provide
meaningful protection for Biora's proprietary manufacturing technology or
adequate remedies in the event of unauthorized use or disclosure of such
information. Further, disputes may arise as to the ownership of proprietary
rights to the extent that outside collaborators or consultants apply
technological information developed independently by them or others to
Company projects or apply Company technology to other projects, and, if
adversely determined, such disputes could have a material adverse effect on
Biora's business, financial condition, prospects and results of operations.
The loss of trade secret protection of any of Biora's key proprietary
manufacturing technologies would materially and adversely affect Biora's
competitive position and could have a material adverse effect on Biora's
business, financial condition, prospects and results of operations. See
"Intellectual Property."

Biora's products are heavily regulated by government authorities, and there
can be no assurance that Biora will not be required to obtain additional
regulatory approvals for its current and future products.

Biora's Emdogain and other products are, and its products under development
will be, subject to regulation by the FDA and comparable agencies in
Europe, Japan and elsewhere around the world. In the United States, the FDA
enforces, where applicable, development, testing, registration, clearance
or approval, labeling, manufacturing, notification, marketing,
distribution, record keeping and reporting requirements for new drugs,
medical devices, biologics and cosmetics. Noncompliance with applicable
requirements can result in civil penalties, including product recalls,
injunctions or product seizure, an inability to import products into the
United States, the refusal by the U.S. government to approve or clear
product approval applications, the withdrawal of previously approved
product applications, and criminal prosecution. Similar remedies exist in
other countries in which Biora's products may be sold. While Biora has
received European and FDA approval for the marketing of Emdogain and
Emdogain Gel as a medical device in Europe and the United States,
respectively, there can be no assurance that Biora will be able to comply
with additional requirements or that other proposed products that may be
developed by Biora will be able to satisfy the current or future
requirements and regulations of applicable regulatory authorities. There
can be no assurance that government regulations applicable to the Company's
products or the interpretation of those regulations will not change, and
thereby prevent Biora from marketing some or all of its products
temporarily or permanently, the occurrence of which could have a material
adverse effect on Biora's business, financial condition, prospects and
results of operations. See "Government Regulation."

The testing, marketing and sale of human health care products entail an
inherent risk of allegations of product liability, and there can be no
assurance that product liability claims will not be asserted against Biora.

         The testing, marketing and sale of human health care products
entail an inherent risk of allegations of product liability, and there can
be no assurance that product liability claims will not be asserted against
Biora. Although Biora currently maintains what management believes to be
adequate product liability insurance for its current stage of development,
such existing coverage may not be adequate either currently or when Biora
pursues further clinical testing of its potential products and
commercializes additional products. There can be no assurance that Biora
will be able to maintain or increase its current insurance coverage in the
future on acceptable terms or that any claims against Biora will not exceed
the amount of such coverage or that potential claims will not arise which
are not covered by Biora's existing insurance, any of which could have a
material adverse effect on Biora's business, financial condition, prospects
and results of operations.

Biora's continuing operations may not generate sufficient capital and the
company may be required to undertake additional financings, the terms and
success of which cannot be assured.

Although Biora anticipates that revenue from sales of Emdogain and its
current cash balances will be sufficient to finance the Company's
operations through at least 2001, there can be no assurance that the
Company will not require additional financing. Based on its current
projections regarding its revenues and costs, the company believes that it
will break-even, from a cash-flow perspective, in the first quarter of
2002. However, while the company believes that current trends in its
revenues and costs support this projection, there can be no assurances that
such trends will continue. If the company's revenue and cost structure did
not change from their current structure and no additional financing was
raised, the company projects that it would run out of cash in the second
quarter of 2002. Biora's future liquidity and capital requirements and its
revenue and cost structure will depend upon numerous factors, including the
extent to which Emdogain gains market acceptance, the timing and cost
involved in the clinical testing of and obtaining regulatory approval for
its products under development, the cost and success of the Company's
strategy to divest or find a partner for Biora BioEx.

         At its annual meeting in May 2001, Biora's shareholders authorized
the company's board of directors, if deemed necessary and on market
conditions, to increase the company's share capital by a maximum of SEK
220,l00 through a new share issue of up to 5,500,000 shares at a nominal
value of SEK 0.04. The company currently does not have specific plans to
raise additional financing, although it is exploring options to do so with
several banks and investment banks. However, there can be no assurance that
the Company, if required, will be able to raise additional financing on
acceptable terms, or at all, the failure of either of which could have a
material adverse effect upon the Company's business, financial condition,
prospects and results of operations. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations--Liquidity and
Capital Resources."

A significant part of Biora's business is conducted through international
sales and operations.

         Biora intends to sell its products throughout the world,
principally in Western Europe (where Biora has commenced sales of its
products), the United States and Japan. A number of risks are inherent in
international transactions. International sales and operations may be
limited or disrupted by the imposition of governmental controls, regulation
of medical devices and products, political instability, trade restrictions,
changes in tariffs, and difficulties in managing international operations.
There can be no assurance that regulations, geopolitical factors and other
factors will not adversely affect Biora's business, financial condition,
prospects and results of operations.

Biora has not paid dividends, nor does it intend to for the foreseeable
future.

         Biora has not paid any cash dividends on the Ordinary Shares since
its inception. Furthermore, Biora does not anticipate paying cash dividends
in the foreseeable future.

3.c   Dividends

         The Company has never paid any cash dividends on its Ordinary
Shares. The Company currently intends to retain earnings, if any, for use
in its business and does not anticipate paying any cash dividends in the
foreseeable future.

         In September 1996, Euroventures Nordica made a conditional
contribution to the shareholders' equity of Biora in the amount of SEK
7,510,052 ($883,016) through the conversion of outstanding loans, including
accrued interest, made to Biora in the aggregate principal amount of SEK
7,160,419 ($841,907) and accrued interest of SEK 349,633 ($41,109). To the
extent that the Company has funds available for dividends, and subject to
the approval by the general shareholders' meeting of the Company, the
Company will make repayments out of such funds to Euroventures Nordica in
full satisfaction of its conditional contribution prior to making any
dividend payments to other holders of Ordinary Shares and ADSs.

         Under the Swedish Companies Act, only a general meeting of
shareholders may authorize the payment of dividends, which may not exceed
the amount recommended by the Board of Directors (except to a limited
extent in the event of a demand by holders of at least 10 percent of the
total number of shares outstanding) and which may be paid only from funds
available for dividends. Under Swedish law, no interim dividends may be
paid in respect of a financial period as to which audited financial
statements have not been adopted by the Annual General Meeting of
shareholders. The normal practice in Sweden is for dividends to be paid
only annually.

3.d   Exchange Rate Information

         The following table sets forth, for the periods and dates
indicated, the exchange rate for the U.S. dollar against the krona based on
the Noon Buying Rate.

<TABLE>
<CAPTION>

                                            Krona/Dollar Exchange Rates
                                                (Krona per Dollar)



                                                         Period End       Average(1)         High           Low
                                                       ---------------- --------------- --------------- ------------

               Year ended December 31,
                       <S>                                <C>              <C>             <C>            <C>
                        1991                               5.5550           6.0456          6.6280        5.4420
                        1992                               7.0790           5.8787          7.1150        5.0885
                        1993                               8.3400           7.8778          8.4835        7.1740
                        1994                               7.4295           7.6654          8.3840        7.0640
                        1995                               6.6290           7.1072          7.5510        6.5045
                        1996                               6.8250           6.7129          7.0300        6.5455
                        1997                               7.9400           7.6446          8.0825        6.8749
                        1998                               8.1030           7.9148          8.1440        7.5800
                        1999                                8.505           8.3007          8.6500        8.6350
                        2000                               9.4440           9.2324         10.1238

                2001 (through May 31)                       10.79
</TABLE>

(1)      Represents the average of the Noon Buying Rates on the last
         business day of each full month during the relevant period.

         Because a substantial portion of the Company's revenues and
expenses is expected to be denominated in currencies other than kronor,
results of operations and cash flows may be materially affected by
movements in the exchange rate between the krona and the respective
currencies to which the Company is exposed. For information regarding the
effects of currency fluctuations on Biora's results. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Impact of Currency Fluctuations and Inflation."

Fluctuations in the exchange rate between the krona and the dollar will
affect the dollar equivalent of the krona price of the Ordinary Shares
traded on the Stockholm Stock Exchange and, as a result, could affect the
price of the ADSs in the United States. Such fluctuations will also affect
the dollar amounts received by holders of Ordinary Shares and ADSs on
conversion of cash dividends, if any, paid in kronor on the Ordinary
Shares. The Company does not anticipate paying cash dividends on its
Ordinary Shares in the foreseeable future.

Product Liability Insurance

         The testing, marketing and sale of the Company's products involve
an inherent risk of product liability claims. The Company has product
liability insurance that covers all of its products. The Company currently
maintains product liability insurance providing worldwide coverage against
liabilities in connection with the manufacture and marketing of oral health
care products in the amount of SEK 50 million per incident and SEK 100
million on an annual aggregate basis. The Company believes that its product
liability insurance is adequate for its current operations. The above
insurance includes also a worldwide cover in connection with clinical
trials. There can be no assurance that the coverage limits of the Company's
insurance will be sufficient to offset potential claims or that potential
claims will not arise which are not covered by the Company's existing
policies. Product liability insurance is expensive and difficult to procure
and may not be available in the future on acceptable terms or in sufficient
amounts, if available at all. A successful claim against the Company in
excess of its insurance coverage or with respect to which the Company lacks
coverage could have a material adverse effect upon the Company's business,
financial condition, prospects and results of operations.

Item 4. Information on Company

Business of Biora

4(a)     History and Development of Biora

         Biora AB (publ) is a public company, with indefinite life,
incorporated under the laws of the Kingdom of Sweden in 1986. The address
of the company's registered office is SE 205 12, Malmo, Sweden.

         Biora has one class of stock-ordinary shares-and had 21,203,800 of
such ordinary shares outstanding as of May 31, 2000. Biora conducted an
initial public offering of 7,475,000 of its ordinary shares in February
1997. These shares are listed on the "O-list" of the Stockholm Stock
Exchange in Sweden and on the Nasdaq National Market (in the form of
American Depositary Shares) in the United States. At its annual meeting in
May 2001, Biora's shareholders authorized the company's board of directors,
if deemed necessary and on market conditions, to increase the company's
share capital by a maximum of SEK 220,l00 through a new share issue of up
to 5,500,000 shares at a nominal value of SEK 0.04.

         The company's principal capital expenditures for the past three
years include patent applications SEK 3.6 million ($0.3 million) for 2000,
SEK 1.0 million ($0.1 million) for 1999 and SEK 1.3 million ($0.1 million)
for 1998.

Overview

         Biora develops, manufactures, markets and sells products primarily
for treatment of diseases in the mouth. The overall goal is to use the
Company's patented technologies and biological knowledge to develop biology
based products primarily for treatment of diseases in the mouth. During
2000, Biora continued to grow the market penetration in North America,
Europe and Japan. However, in November, 2000, Seikagaku Corporation,
Biora's marketing and sales partner in Japan, recalled all deliveries of
Emdogain to comply with the registration authority's guidelines which
required the same changes to be made to the production process for
deliveries to Japan as had previously been implemented for other markets.
In the marketing and operational areas, Biora had, by the end of 2000,
launched Emdogain, the Company's principal product, in approximately 30
countries. In 200 the Company begun focusing more on cultivating its
existing customers and markets. Simultaneously Biora's efforts in research
concerning matrix proteins have continued. This investment has produced
results during 1999 and 2000 that indicate some new areas of use for
Emdogain and other enamel matrix proteins. In 1999, the U.S. Food and Drug
Administration (FDA) approved Emdogain, for use as an adjunct to a
minimally invasive surgical technique. The FDA approval indicates that
Emdogain could be utilized in conjunction with scaling and root planing for
the treatment of periodontal intrabony defects. The approval is for teeth
in the "aesthetic zones". While Biora currently is not marketing Emdogain
for use in minimally invasive surgical techniques, the Company is
evaluating its options for marketing Emdogian for use in conjunction with
these minimally invasive surgical techniques. Emdogain Gel, a development
of Emdogain was introduced in Europe in June 2000 and the FDA approved
Emdogain Gel in January 2001. In the markets where Emdogain Gel has
received regulatory approval Biora has replaced the old formulation of
Emdogain with Emdogain Gel.

         Emdogain is an innovative treatment for defects caused by
periodontal disease based on findings relating to natural tooth development
by the founders of Biora in conjunction with the Karolinska Institute, a
renowned center for medical research in Stockholm, Sweden. Periodontal
disease causes the progressive loss of the supporting soft and hard tissues
surrounding the tooth. Emdogain, which is applied in gel form on the
tooth-root surface during periodontal flap surgery, promotes the regain of
such tooth-supporting tissues and hence reattachment of the tooth. In
Biora's controlled clinical trials, use of Emdogain as an adjunct to
periodontal flap surgery resulted in significant regain of tooth-supporting
tissues as compared to conventional periodontal flap surgery alone. Regain
of attachment was observed in patients within the first year of treatment
with Emdogain and increased throughout the three-year follow-up period. In
addition, Biora believes that Emdogain will provide the Company with a
platform to develop new products and indications based on the protein that
gives Emdogain its unique properties. Biora submitted a patent application
relating to new, positive biological effects of Emdogain-related proteins
for wound healing in February 1998 (the "XP11 project"), and pre-clinical
studies started in Denmark, Norway and Sweden in 1998. Clinical pilot
studies were initiated during 2000. Research in the area of enamel matrix
proteins indicates that these proteins can play a large role in the
treatment of several disease conditions, both inside and outside the oral
cavity. Biora BioEx was formed in the spring 1999 when international
patents applications for wound healing with matrix proteins were being
submitted. The intention was that Biora BioEx would develop products or
indications outside the oral cavity. During 2000, the Swedish Industrial
Development Fund granted a conditional loan of Sek 15 million to finance
the wound-healing project. The Company intends to divest Biora BioEx or
seek collaboration with other companies. Boira's ability to sell or find
partner for BioEx on terms and conditions favorable to the company depend
on the availability of interested buyers/partners and other market
conditions. If these efforts are not successful, alternative strategies
will be considered.

         Emdogain received regulatory approval in 1995 in the European
Economic Area (the "EEA") (which comprises the European Union ("EU") member
countries as well as Norway, Iceland and Liechtenstein) pursuant to a CE
Mark and was introduced on a limited basis in selected European countries
in 1996. Emdogain received approval in the United States from the FDA in
September 1996 and in Japan from the Ministry of Health and Welfare (the
"MHW") in January 1998.

         United States surveys have estimated that advanced periodontal
destruction affects about one in eight people. Advanced destruction
increases with age, reaching a prevalence of over one-third among people
aged over 55. Treatment of the initial stages of periodontal disease
includes oral hygiene measures and scaling. Defects associated with the
more advanced stages of periodontal disease require additional treatment,
including surgical procedures and antibiotics. Based on industry
statistics, there were approximately five million periodontal flap surgery
procedures performed worldwide in 1995. The Company believes that most of
the patients undergoing such surgeries could be candidates for Emdogain
treatment. In an attempt to improve upon the results of conventional
periodontal flap surgery, periodontists and dentists specializing in
advanced dental treatment ("periodontal specialists") currently utilize
adjunctive mechanical treatments in approximately one out of seven
periodontal flap surgeries performed. In contrast to these treatments,
Emdogain offers a biology-based treatment of periodontal defects with
predictable results, rapid post-operative clinical healing, little
discomfort, ease of use and no increase in chair time. Consequently, the
Company believes that periodontal specialists and patients will prefer
Emdogain to, and use Emdogain more extensively than, currently available
treatments used in conjunction with conventional periodontal flap surgery.

         Biora is also developing other indications and novel biology-based
products, including additional products based on Emdogain technology. These
products are at various stages of clinical and pre-clinical development and
have yet to be approved by applicable regulatory authorities.

         New dental products/indications

         The Company is currently performing pilot studies in the U.S.
                  with Emdogain for local application to investigate the
                  possibility of restoring lost tooth-supporting structures
                  and accelerate the healing following non surgical
                  treatment of defects caused by periodontal disease. A
                  Swedish study has been completed. The results show that
                  Emdogain has no significantly improved effect of the
                  regeneration of bone and tooth supporting tissues compare
                  to traditional treatment of these mild defects. The
                  studies confirmed the good wound healing features of
                  Emdogain.

         The Company has tested Emdogain WT in clinical trials in
                  Sweden. Final results from the Swedish study are not
                  conclusive. A pilot study using Emdogain in connection
                  with the surgical removal of impacted wisdom teeth has so
                  far shown primarily positive effects on the healing of
                  the wound. Further studies of this indication has been
                  deferred as priority has been given to other indications.
                  Emdogain WT is specifically intended to be used in
                  conjunction with complicated wisdom tooth extractions to
                  eliminate or reduce periodontal lesions that typically
                  afflict neighboring teeth. Based on industry statistics,
                  there are approximately ten million complicated tooth
                  extractions performed annually in the United States.

         The Company has recently completed a series of clinical
                  studies using Emdogain to improve the result in patients
                  with exposed root surface (recession defects). Many
                  people lose part of the gum on the front side of the
                  teeth for example due to an inflammation or an improper
                  tooth-brushing technique. These gum defects often cause
                  increased sensitivity and shooting pains in the teeth.

         The Company is performing studies in the indication dental
                  trauma in order to further strengthen the documentation
                  of this indication and to prepare an application for
                  registration in the US. The dental trauma indication is
                  approved in Europe, Canada and Brazil.

         The Company is also performing preliminary studies with
                  Emdogain to investigate the possibility of using Emdogain
                  in patients with severe periodontal defects between the
                  dental roots, so-called furcation involvement, in a molar
                  with several roots

         The Company has initiated a new project aiming at to develop
                  a new method to preserve the dental pulp. When the
                  dentists removes infected hard tissue during treatment
                  for caries the dental pulp is often exposed, with injury
                  to the pulp as a result. In repeated pre-clinical studies
                  Emdogain has been shown to stimulate formation of hard
                  tissue bridges over the pulp wounds. Development of a new
                  formulation of Emdogain adapted for this indication is
                  under way, and the project is expected to go into
                  clinical phase during the third quarter this year.

         The Company has also initiated another project aiming at to
                  develop a new product for wound healing in treatment of
                  mild periodontitis. Most patients who have a milder
                  degree of periodontal disease are treated by removal of
                  layers of bacteria. And tartar that have collected in
                  periodontal pockets around the affected teeth. This
                  treatment often leads to ulceration along the gum margin
                  and causes the patient discomfort for several days. At
                  the end of year 2000, Biora commenced a project with a
                  new product based enamel matrix protein with good effect
                  on tissue healing. A formulation of this product has been
                  developed and the first pilot studies are expected to
                  begin in the middle of 2001.

         Dry mouth (xerostomia) is like periodontitis, a widespread
                  disease. There is a great need for better ways to help
                  those who are afflicted with this disease. The professors
                  Jorgen Ekstrom and Herbert Helander had in their research
                  found a very innovative method as well as promising
                  pre-clinical and clinical work results. At the beginning
                  of 2000 the Company acquired the rights to their patented
                  discovery that could lead to a new drug for dry mouth.
                  During the first quarter 2001, Biora entered into a
                  license agreement with a British biomedical development
                  company, Medpharma, under which Biora retains the right
                  to develop and market the product to dentists while
                  Medpharma receives the right to develop and market the
                  product to target groups outside the dental area. Under
                  the agreement Biora receives a number of instalments as
                  well as a royalty based on future sales once the drug has
                  been introduced to the market. Biora and Medpharma will
                  collaborate and share development costs for the project
                  up to and including early clinical tests (phase II a).
                  The agreement covers the entire world except Japan.


                  New non-dental projects

         The company submitted a patent application for wound healing
                  with matrix proteins in 1998, and pre clinical studies
                  started in 1998. During year 2000 the Swedish Industrial
                  Development Fund granted a conditional loan of SEK 15
                  million to finance the wound healing project. The project
                  has advanced through further pre-clinical tests and is
                  now in phase II for the indication venous leg ulcers.

         In new pilot studies Biora has found that certain enamel
                  matrix proteins stimulate local formation of new bone.
                  The continuing work is intended to document the effect
                  and to determine future areas for indications. Biora has
                  submitted an application to participate in a project with
                  four European universities, which among other things is
                  applying for funding within the fifth frame program of
                  the European Commission. The goal is to prove that enamel
                  matrix proteins can be as or even more effective then the
                  growth factors being developed today. The speed of this
                  project is depending on the success of the application
                  for funding.

         Cell studies show that growth of certain cancer cells
                  (carcinoma) is inhibited by Emdogain. The discovery is
                  supported by the knowledge of Emdogain's mechanism of
                  action that Biora has previously reported, that is, that
                  Emdogain promotes growth of connective tissue cells while
                  certain epithelial cell experience so-called programmed
                  cell death. Biora has submitted two applications for
                  global patent protection for the discovery. No clinical
                  study has yet started.

         Given the relatively small number of periodontal specialists and
the need for a highly specialized sales force, Biora continues to market
and sell its products primarily through its own marketing and sales
organization. In 2000, Biora concentrated its resources in markets in which
Emdogain has already been introduced to increase penetration in these
markets. Since 1997, the Company used a portion of the net proceeds
received from the Company's initial public offering of Ordinary Shares in
February 1997 (the "IPO") to develop marketing and sales activities in the
United States and Europe, and the Company intends to continue using such
proceeds to strengthen its marketing and sales activities in especially in
the United States, Germany and Japan (through Seikagaku Corporation).
Currently, Emdogain is sold through Biora AB and subsidiaries in 14
countries and through distributors in an additional 16 countries and the
Company estimates that approximately 250,000 patients have been treated
with Emdogain worldwide as of December 31, 2000, as compared to 170,000
patients as of April 30, 2000. In December 2000 a distribution agreement
was signed for Switzerland.

          In 1999, the Food and Drug Administration (FDA) approved
Emdogain, for use as an adjunct to a minimally invasive surgical technique.
The FDA approval indicates that Emdogain could be utilized in conjunction
with scaling and root planing for the treatment of periodontal intrabony
defects. The approval is for teeth in the "aesthetic zones". While Biora
currently is not marketing Emdogain for use in minimally invasive surgical
techniques, the Company is evaluating its options for marketing Emdogian
for use in conjunction with these minimally invasive surgical techniques.

         Before the original Emdogain is used the dentist mixes both
components. Biora's global marketing strategy is to establish Emdogain
among specialists in their respective countries in order to subsequently
reach out to a broader customer group. Emdogain has since its market launch
been delivered as two components, one with the freeze dried protein and the
other with a solution, a "gel". To simplify use Biora has developed a new
formulation of Emdogain. The product, Emdogain Gel, is stabilized as a
premixed gel and filled in a syringe and offers the dentists a simplified
solution which is easy to use and saves time for the dentist. Emdogain Gel
has been launched in Europe during the second quarter of 2000 and in the US
during the first quarter 2001following the approval by FDA in January 2001.
Emdogain Gel will replace the original Emdogain in all markets as soon as
regulatory approval is available.

         As of December 31 of 2000 approximately 3000 American
periodontists have bought Emdogain at least once since its introduction. A
total of 670 new customers purchased Emdogain in 2000, and of these, 475
were periodontists. Compared to 1999, Biora has increased the number of
customers who have purchased the product at least three times. The share of
customers who bought Emdogain at least three times during 2000 was 43%
compared to 36% during 1999. Biora's penetration of the U.S. market has
initially been hindered by Emdogain receiving less exposure than originally
anticipated when it was launched in April 1997, partly as a result of
delays in the publication of reviews in industry journals. Biora's sales in
the United States increased following publication of the seven articles on
Emdogain in The Journal of Clinical Periodontology in September 1997 and
the exposure received by Emdogain at the Conference of the American Academy
of Periodontology (the "AAP") in October 1997. The single largest marketing
activity in the United States is the Annual Meeting of the American Academy
of Periodontology.

         Biora began marketing Emdogain in 1996 through its own sales force
in Sweden and wholly-owned subsidiaries in Germany and The Netherlands. As
of April 30, 2001, Biora's penetration in percent of the estimated total
number of flap surgeries performed in each of the markets was approximately
ten percent in Sweden and almost seven percent in Germany. In Sweden,
approximately 90 percent of the approximately 500 specialist and perioaware
customers in the country that treat advanced periodontitis have purchased
Emdogain at least once, approximately 70 percent of which have made repeat
purchases. Germany is at present the biggest market for Emdogain in Europe.
As of December 31, 2000 an increasing number of dentists perform surgical
interventions to treat periodontitis in Germany. Sales in Germany began in
1996, and during 1998 sales in Germany and Austria more than doubled
compared to 1997. During 2000 Biora GmbH sales decreased by 13 percent over
1999. Importantly, sales during the last quarter 2000 have increased in SEK
as well as in local currency compared to Q4 1999, with a sales record in
November. Sales increased Q1 2001 was 54% (45% in local currency) compared
to the corresponding period of the previous year. Biora had sold Emdogain
to approximately 7,000 customer in Germany. The sales development in
Germany until the last quarter was lower than expectations. The stagnation
of sales on the German market was mainly caused by a defocus and deviation
from Biora strategy. Local management was removed at the end of 1999. After
a period of refocus and education a new General Manager was appointed in
June 2000.

         Biora markets Emdogain (i) through its own sales force in Sweden,
Norway and Finland, (ii) through wholly-owned subsidiaries in Germany
(covering Germany and Austria), Italy, The Netherlands (covering Belgium,
Luxembourg and The Netherlands) the United Kingdom (covering the United
Kingdom and Ireland) and the United States, and (iii) through distributors
in Denmark, Canada, Japan, Israel, France, Spain, Portugal, Greece, the
Czech Republic, Poland, Mexico, Puerto Rico, Brazil, Colombia, South
Africa, Taiwan and Switzerland

         The Company believes that its present lead product, Emdogain,
offers its customers a more efficacious, cost-effective and convenient
solution to the treatment of defects caused by periodontal disease than
existing treatments and thereby will serve as an entry vehicle for the
Company's other innovative products for the dental therapy market. The key
elements of the Company's strategy are to (i) focus on key markets i.e.
Germany, US and Japan, (ii) develop new products and indications with a
shorter time to market introduction.(iii) divestiture or collaboration for
products with non-dental indications.

Periodontal Disease and Conventional Treatment

         Periodontal disease is an infection caused by bacterial
accumulation on the teeth and along the adjacent gums. The mildest form,
clinically termed gingivitis (bleeding gums), is reversible and can be
eliminated by means of professional dental care and adequate oral hygiene
measures. However, in many individuals in whom gingivitis is not
controlled, the disease progresses into periodontitis. Effective treatment
of periodontitis is possible only through professional intervention.

         A healthy tooth attachment apparatus is made up of the root
cementum, the outer layer of the root; the periodontal ligament, which both
anchors the root to the jaw bone and cushions the tooth; and the jaw bone,
which serves to hold the teeth. During the course of periodontitis, the
gums become detached from the tooth-root surface as the attachment
apparatus is gradually destroyed as a consequence of bacterial infection
and the accompanying inflammatory process. As detachment progresses, a
periodontal pocket forms between the tooth root and the gums. The depth of
the pocket (usually measured in millimeters) indicates the severity of the
disease. A periodontal pocket may deepen so that the tooth is no longer
properly supported, leading to deteriorated function and eventually tooth
loss.

         Professional intervention to treat periodontitis includes periodic
professional cleaning, such as root planing and scaling. Root planing and
scaling involve the removal of hard and soft bacterial deposits on the root
surfaces within the periodontal pocket. For serious cases where a
significant amount of jaw bone has been lost, the additional use of
surgical procedures is warranted. The standard surgical technique used in
these cases is periodontal flap surgery. This involves the incision and
reflection (folding back) of the gums in order to expose the root surface
below the gum margin and the jaw bone to allow for extensive mechanical
debridement (the removal of granulation tissue as well as soft and hard
deposits from the root surface) of these normally unreachable areas. The
gums are then repositioned and sutured in close proximity to the tooth and
surrounding jaw bone in order to reduce or eliminate pockets.

         When successful, conventional periodontal flap surgery merely
arrests further deterioration of the attachment apparatus. Typically, this
means that there is no regain of lost periodontal attachment structures and
deepened periodontal pockets may remain. Consequently, the results of
conventional treatment are often unsatisfactory to the patient and to the
periodontal specialist. The patient often complains of cosmetic and
aesthetic problems, such as longer looking teeth and open gaps between
teeth. The periodontal specialist is often dissatisfied because while the
disease has been controlled, there has not been a "cure"; the tooth has not
been returned to its original form and function.

Products and Technology; Research and Development


Research & Development Process

         The emphasis on research and development within Biora continues,
both in the search for new biologically based methods and to develop
Emdogain for use in treatment of other diseases in the mouth. This emphasis
during 2000 is on research projects that support the use of Emdogain and
have a shorter time to market introduction.

         The research in enamel matrix proteins, which led to the principle
product Emdogain, gives Biora a platform to develop new biology based
products to be used both in and outside the mouth. Biora expects that
during the year 2001, the company will be able to evaluate the potential
benefits of Emdogain in recession type defects and if positive outcome will
be shown, to launch the indication later during this year. Two new
projects were initiated during the fourth quarter 2000; (i) new treatment
to preserve dental pulp and (ii) wound healing in treatment of mild
periodontitis. The subsidiary Biora BioEx AB was established to perform
research regarding indications outside the mouth, for example wound healing
and local bone formation. During 2000, the Swedish Industrial Development
Fund granted a conditional loan of SEK 15 million to finance the
wound-healing project. The Company intends to divest Biora BioEx or seek
collaboration with other companies.

         Conducting the clinical studies necessary for marketing approval
for new indications generally takes two to three years. The time frame for
the development of new products is considerably longer, generally ranging
from five to 15 years depending upon the complexity of the indication or
product and the length of the clinical trials. Prior to receiving marketing
approval for new products, (i) initial trials must be conducted that form
the basis for patenting; (ii) studies must be conducted (both in the
laboratory and in simulated models) to document the effects and safety of
the product; and finally (iii) clinical trials must be authorized and
conducted.

          Biora's pre-clinical research consists of three parallel
operations:

         Tissue Components. Tissue components-particularly matrix
         proteins-are prepared and characterized.

         Effects. The biological effects of the product are tested in the
         laboratory.

         Formulation. A formulation for the product is developed that
         provides for optimal handling and efficacy.

         While either a clinical trial or new product development is being
conducted, a production method must be established and the appropriate
pharmaceutical formulation (e.g., tablet, gel or aerosol) must be developed
prior to the final stages of the clinical studies. Finally, the results of
the clinical trials and the new product development and related
documentation must be approved by the regulatory authorities in the markets
in which Biora intends to market the new indication or product.


Products

         The Company currently has two products approved for marketing
(Emdogain and PrefGel) and several products and new indications under
development. Emdogain was developed by Biora during the period from 1988 to
1995 and the Company intends to expand Emdogain technology to develop and
commercialize new formulations as well as new indications for Emdogain.
PrefGel is a more tissue-friendly product for conditioning and cleaning
tooth surfaces than presently utilized acids and is intended to further
strengthen the biology-based approach to periodontal therapy. Another
product under development is the xerostomia-project to treat dry mouth.

         The Company's two approved products and products under development
and their respective applications/indications and status are shown in the
following table. Products under development are listed in order of such
product's expected approval for marketing in Europe and the United States.
With respect to the products under development, no assurance can be given
that the Company will be successful in developing these new products,
obtaining approvals or clearance to market such products, or in marketing
such products.

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------

      Products and New
      Indications Under
         Development                   Indication                                   Status
                                                           ---------------------------------------------------------

                                                                  United States               Rest of World
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
<S>                           <C>                            <C>                         <C>
          Emdogain            Topical application for the    FDA approval(1) obtained    European approval (the "CE
                              regain of tooth attachment     in September 1996;          Mark") received in June
                              lost                           to periodontal              approval received in January
                                                             disease                     1998, marketing
                                                             marketing                   commenced in April 1998.
                                                             commenced in                Bioras partner in Japan
                                                             the 1995;                   recalled the product in
                                                             marketing                   November 2000 in order to
                                                             commenced                   follow the guidelines
                                                             second quarter              from the regulatory
                                                             of 1997 in                  authorities.
                                                             Europe in
                                                             1996; Japanese
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

         PrefGel(2)          Topical gel that cleans and     FDA amended marketing       CE Mark received February
                             conditions tooth-root           clearance obtained in May   1998; marketing commenced
                             surface                         1998; marketing commenced   second quarter 1998
                                                             in 1998                     Not approved in Japan under
                                                                                         current classification.
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

        Emdogain Gel         New formulation of Emdogain     Application submitted to    European approval in March
                             packaged in a ready-to-use      FDA in March 2000. FDA      2000. Launch in June 2000.
                             syringe.                        approval in January 2001    Submisison to Japanese
                                                             and launch in February      regulatory authority Q1
                                                             2001.                       2001.
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

        Emdogain WT          New indication of Emdogain      Further studies in this     Clinical trials in Sweden
                             for the treatment of damage     indication have been        completed in 1999. Results
                             caused by complicated           deferred since results      not conclusive. Positive
                             extractions of wisdom teeth     from Swedish trials not     effect on wound healing.
                                                             conclusive.                 Further studies in this
                                                                                         indication have been
                                                                                         deferred
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

   Emdogain Recession type   New indication of Emdogain      Pilot study planned to be   Clinical trials started
           defects           as a local application to       completed mid 2001.         1999. Studies finished
                             treat receded gums                                          during Q1 2001, and results
                                                                                         are now being analyzed
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

  Emdogain Trauma (avulsed   New indication of Emdogain      Clinical trials to further  Market launch in June 2000
           teeth)            for the regain of tooth         strengthen the              at an international Trauma
                             attachment in connection        documentation. began in     convention in Oslo. Studies
                             with reimplantation of          1999 in Canada.             are in progress to further
                             avulsed teeth                                               strengthen the documentation.

--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

  Emdogain -Non surgical     Subgingival application of      Clinical trials started    Pilot studies commenced in
cleaning of the dental root  Emdogain to achieve             second half of 1999.       1997. Clinical studies
                             periodontal regain without      Approval received by FDA   ready 2001.The results show
                             surgical intervention           as Minimally Invasive      that Emdogain has no
                                                             surgery in 1999. Clinical  significantly improved
                                                             studies to be finalized    effect on regeneration of
                                                             and results to be analyzed bone and tooth supporting
                                                             during 2001.               tissues compared to
                                                                                        traditional treatment of
                                                                                        these mild defects. The
                                                                                        studies confirmed the good
                                                                                        wound healing features of
                                                                                        Emdogain.
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

New EMP based product for    Local application of a new       A formulation of the new  A formulation of the new EMP
 wound healing XP11          EMP based product to accelerate  EMP based product has     based product has been developed,
                             the postoperative healing        been developed.           and the first pilot studies are
                             process following non-surgical                             expected to begin in the middle of
                             treatment                                                  2001.
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

Emdogain - new method to     New indication of Emdogain                                 Pre-clinical studies show
preserve dental pulp         to stimulate formation of                                  new dentin formation in
                             hard tissue bridges over                                   pulp capping and pulpotomy
                             the pulp wounds                                            and the project is expected
                                                                                        to go into the clinical
                                                                                        phase during Q3 2001.
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

Xerostomia project           Local application to treat                                 The development of a
                             dry mouth disease                                          formulation is in final
                                                                                        phase and early clinical
                                                                                        studies are in progress
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)      Specifically, the FDA-approved indication for use appearing on
         Emdogain's package insert reads as follows: Emdogain is intended
         as an adjunct to periodontal surgery for topical application onto
         exposed surfaces to treat intrabony defects without furcations
         resulting from loss of tooth support due to moderate or severe
         periodontitis.

         Under the XP11 project, Biora has submitted several patent
applications relating to new, positive biological effects of
Emdogain-related proteins for wound healing in February 1998, and
pre-clinical studies have been performed in the Scandinavian countries
(Denmark, Norway and Sweden) since 1998. In December 1997, Biora acquired
the patent rights for a new protein patent that formed the basis of the
XP20 project from the Center for Oral Biology ("COB"), a research
foundation formed in 1986 by the Karolinska Institute in Stockholm, Sweden.
The protein is present during normal tooth development in humans and Biora
continuous to investigate the potential of this protein combination for use
in dental surgery.


Emdogain

         Emdogain is an innovative treatment for periodontal defects caused
by periodontal disease. It is applied in gel form on the tooth-root surface
during periodontal flap surgery to help promote the regain of
tooth-supporting periodontal tissues and hence reattachment of the tooth in
patients suffering from loss of periodontal attachment due to periodontal
disease or trauma. Emdogain simulates one step of the biological process in
nascent tooth development. This step involves the deposit of a protein
matrix layer on the developing root, thereby providing for the formation of
the attachment apparatus. With time, the treatment results in the regain of
the lost tooth support and function.

         Patients qualifying for Emdogain treatment typically have
periodontal pockets deeper than six millimeters with marked loss of jaw
bone. In Biora's controlled clinical trials, adult patients with
periodontal disease who had lost most of the attachment achieved regain of
jaw bone within 16 months of treatment with Emdogain to about two-thirds of
normal levels, as compared to unchanged levels for a different, but
comparable, site on the same patients treated with conventional periodontal
flap surgery.

         The preparation and application of Emdogain are relatively simple
and, in contrast to currently used mechanical approaches to treatment, not
particularly technique sensitive. Emdogain, which must be refrigerated
during storage, comes as a freeze-dried powder, together with a liquid
"vehicle" solution. One milliliter of the vehicle is added to the powder
and the residual gel is applied, by means of a syringe, onto the exposed
and cleaned root surfaces in connection with periodontal flap surgery.

         Emdogain received the CE Mark in the EEA in June 1995, FDA
approval in the United States in September 1996 and from the MHW in Japan
in January 1998. The Company began marketing Emdogain in Europe in 1996, in
the United States in the second quarter of 1997 and in Japan in April 1998.


PrefGel

         PrefGel was originally developed under the name EDTAgel, and
received European approval under the name PrepHgelTM (before being changed
to PrefGel) in February 1998. A prior version of PrefGel received marketing
clearance from the FDA in September 1994, but Biora did not market the
product in the United States at that time. Biora subsequently developed a
new version of PrefGel and consequently, filed a request for an amended
marketing clearance from the FDA for the product prior to its being
marketed in the United States (which Biora received in May 1998). The
Company began marketing of the product in Europe in the second quarter 1998
and in the United States during the third quarter 1998. PrefGel was not
approved in Japan under the current classification. Biora is considering
but has not yet decided to submit a new application. PrefGel is meant to
replace the strong acids periodontists presently use to clean the root
surface during periodontal surgery. Because of its neutral pH, PrefGel does
not damage the root surface or surrounding soft tissues, and the Company
believes that PrefGel will afford periodontists a greater complement of
products for use during invasive oral surgical procedures.


Emdogain Gel

         Emdogain Gel is a stabilized formulation of Emdogain dissolved in
the vehicle. Thus, the product can be shipped and stored in a pre-packed
ready-to-use applicator. The actual indication is identical to that for
Emdogain. Biora believes that Emdogain gel is more simple and user-friendly
than Emdogain, enhancing the appeal of the product to practitioners,
especially in "first-use" situations. The Company has received approval in
Europe and in the US to market Emdogain Gel. Biora has conducted clinical
trials in Europe, which were completed in the beginning of 1999. Emdogain
Gel has been launched in Europe during April - June 2000 and in February
2001 in tyhe US. In Japan, Emdogain Gel was submitted to the regulatory
authorities during Q1 2001.


Emdogain WT

         Emdogain WT involves the use of Emdogain for a new
indication--complicated wisdom tooth extractions. Through evolutionary
processes jaw bones are becoming smaller, resulting in less room for wisdom
teeth. As a consequence, normal eruption of wisdom teeth is hindered and
the teeth must often be extracted. Despite successful completion of this
complicated form of surgery, periodontal pockets often form on the adjacent
surface of the neighboring second molar. Emdogain WT, applied in
conjunction with surgical extraction of an impacted wisdom tooth, may
eliminate or at least reduce the development of neighboring periodontal
pockets. Biora has completed clinical trials for Emdogain WT in Sweden
during 1999. Based on the results from the trials in Sweden showing
primarily positive effects on the healing of the wound further studies of
this indication have been deffered as priority has been given to other
indications.


Emdogain - Recession Type Defects

         Biora is developing a new indication of Emdogain as a local
application to treat receded gums. In many people, gum tissue recedes to
expose the root surface of teeth (often on teeth at the front of the
mouth). These gum defects, known as "recession defects", many times are
caused by gum inflammation or incorrect or excessively hard tooth-brushing.
Biora has been conducting multi-center clinical trials in Sweden, Belgium,
The Netherlands and Germany to determine if the surgical procedure used to
cover exposed root surfaces has a better effect when conducted in
conjunction with the use of Emdogain. The twelve-month follow-up was
completed during Q4 2000 and the results are now being analyzed. Biora
started clinical trials in the United States in 1999 and results are
expected in the middle on 2001.


Emdogain Trauma (evulsed teeth)

         Biora is developing a new indication of Emdogain for the regain of
tooth attachment in connection with re-implantation of avulsed teeth (i.e.,
teeth that have been dislodged completely without breaking). Biora received
the CE Mark to market Emdogain Trauma in 1995, and started clinical trials
in Canada in 1999. The indication was launched to the European and Canadian
markets during an international Trauma convention in Oslo in June 2000.
Further studies are in progress to further strengthen the documentation of
this indication and to prepare an application for registration in the U.S.


Emdogain -  Non-surgical cleaning of the dental root

         Emdogain was approved in 1999 in the U.S. as an adjunct treatment
in mild periodontitis in the area of the front teeth. The American Food and
Drug Administration approved Emdogain for use with minimal invasive
periodontal surgery. This means that Emdogain can be used in connection
with conventional treatment of periodontitis, such as scaling and root
planing to treat periodontal intrabony defects in aesthetic zones to
optimize tissue height. Biora intends to further document the use of
Emdogain in conjunction with different types of manual and mechanical
"scaling and root planing". This documentation is expected to be finished
for evaluation in during 2001.


Wound healing in treatment of mild periodontitis

         When Emdogain was launched in Europe in 1996 the company received
reports from periodontists that wounds from oral surgery healed more
quickly. Since then, similar observations were reported from all new
markets where Emdogain were launched. Subsequently, the study of Emdogain's
wound healing effect has become an important pre-clinical project for
Biora.

         Biora has shown in cell culture studies that Emdogain-covered
surfaces inhibit certain bacteria, especially some of the pathogens behind
caries (e.g. Streptococcus mutans) or periodontal disease (e.g.
Actinobacillus actinomycetemcomitans). Another interesting bacteria is
Staphylococcus, which is common in e.g. "hospital disease".

         This implies that an Emdogain-treated area is kept free from
pathogens, which improves healing without need for prescription of local or
general antibiotics. While several of the pathogenic bacteria area are
inhibited but not killed in contact with Emdogain, there are other, less
harmful bacteria, that are not affected or perhaps even favored. This type
of modulating effect on bacteria opens for the possibility to use Emdogain
also for other indications.

         The wound healing effect is believed to rest not only with the
contact inhibition on bacteria but also with the increased production of
favorable growth factors by connective tissue cells. New studies are
directed at the interaction between these cells and the epithelial cells,
which will cover the wound.

         Biora has submitted several patent applications for the new
findings and the first results will be published during this year, in
cooperation with the dental schools in Oslo in Norway, Gothenburg in Sweden
and Ulm in Germany, and from the dental school ACTA in Amsterdam.

         Continued work with wound healing indications outside the oral
cavity is conducted by Biora's subsidiary Biora BioEx AB.

         Biora is presently in the early stages of testing the local
application of Emdogain to accelerate the postoperative healing process
following non surgical treatment of mild periodontitis. Pilot studies
commenced in Europe in 1997 and clinical trials commenced in Europe in
1998. Clinical trials commenced in 1999 in the United States.

At the end of last year, Biora commenced a project with a new product based
on enamel matrix protein with a potential for a good effect on soft tissue
healing. A formulation of this product has been developed and the first
pilot study are expected to begin in the middle of 2001.


Emdogain - new method to preserve dental pulp (endodonthics)

         Biora is presently developing an Emdogain-based product for use in
         connection with Endodontics. When the dentists removes infected
         hard tissue during treatment for caries the dental pulp is often
         exposed, with injury to the pulp as a result. In repeated
         pre-clinical studies Emdogain has been shown to stimulate
         formation of hard tissue bridges over the pulp wounds. The project
         is expected to go into clinical phase during the third quarter
         this year. Pilot studies commenced in Sweden in 1996 and clinical
         trials started in 2000. Interest has also been shown in the
         possibility of using Emdogain with conventional root canal
         filling.


Xerostomia (Dry mouth)

         As a further step in Biora's concentration on diseases in the
mouth, Biora has during February 2000 acquired the rights to a new
patent-protected pharmaceutical project for treating dry mouth
(Xerostomia). A normal flow of saliva plays a decisive role in the health
of the mouth, and therefore in the individual's well being. A greatly
reduced flow of saliva is accompanied by difficulty in swallowing and
causes great discomfort. In addition, dry mouth increases the risk for
various diseases in the oral cavity, such as caries and infections in the
mucous membrane.

         Just as periodontitis, dry mouth is a very common disease that
primarily affects a large number of the older population. Research in
Sweden show that dry mouth is estimated to affect approximately 15 percent
of 50 year olds and approximately 40 percent of those over 80. Dry mouth is
also a common side effect of many medicines and radiation treatment.

         The acquired process is based on local application of a
cholinesterase-inhibitor, to stimulate the production of saliva from
thousands of small salivary glands in the oral mucous membrane.

         During the first quarter 2001, Biora entered into a license
agreement with a British biomedical development company, Medpharma, under
which Biora retains the right to develop and market the product to dentists
while Medpharma receives the right to develop and market the product to
target groups outside the dental area. Under the agreement Biora receives a
number of instalments as well as a royalty based on future sales once the
drug has been introduced to the market. Biora and Medpharma will
collaborate and share development costs for the project up to and including
early clinical tests (phase IIa). The license agreement covers the entire
world except Japan.


Research and Development Organization and Collaborative Agreements

         Biora's present research laboratory, which was opened in Malmo,
Sweden in December 1997, is equipped for biochemistry, molecular biology
and cell biology research. As of April 30, 2001, Biora employed thirteen
biochemists, eight of whom have completed their doctoral theses. The
biochemists at the Malmo facility also conduct studies in close cooperation
with the Experimental Laboratory of the University Hospital in Malmo,
Sweden, the University of Oslo, Norway, the University of Leeds, U.K. and
the University of Ulm, Germany. The research network within oral biology
also includes other universities in Europe, U.S.A., Japan and Australia.

         The Company's expenditures on research and development, including
expenditures related to clinical trials and costs in connection with
product approvals, amounted to SEK 37.2 million ($4.4million), SEK 32.7
million ($3.8million) and SEK 32,2 million ($ 3.0 million) in 1998, 1999
and 2000, respectively. However, the majority of the Company's research and
development activities are conducted in collaboration with third parties.

         Biora's pre-clinical research has historically been performed in
close collaboration with research institutions affiliated with the
Karolinska Institute in Stockholm, Sweden. The basis for the Company's
principal product, Emdogain, was research findings by scientists at the
Karolinska Institute, primarily Dr. Hammarstrom. Pursuant to an agreement
with COB (Centre of Oral Biology), Biora has the rights to commercialize
the results of all COB research in return for royalties. Dr. Hammarstrom
left his position as Director of COB in 1998. Most of the Company's
collaboration efforts have been with Dr. Hammarstrom, who currently gives
the Company's research organisation support from his position as Director
of the Board in the Company. Pre-clinical research cooperation agreements
were entered into with the University of Michigan in the United States, the
University of Leeds in the United Kingdom, the University of Queensland in
Australia and the University of Ulm in Germany.

         In 1996, Biora and COB entered into a cooperation agreement which
was to remain in force until December 31, 2001, after which time it is to
be automatically renewed for successive one-year periods unless terminated
by either party on at least six months' written notice before the end of
the relevant calendar year. Pursuant to the agreement, COB granted Biora a
first priority right to acquire all technology and products that are
developed by COB during the term of the cooperation agreement. The
agreement was terminated during 1999.

         Biora submitted a patent application relating to new, positive
biological effects of Emdogain-related proteins for wound healing in
February 1998, and supplementary information from pre-clinical studies were
added to final application in February 1999 under the wound healing project
and clinical studies started in the second half of 2000.

         In December 1997, Biora acquired the patent rights for a new
protein patent that formed the basis of the XP20 project from COB. The
protein is present during normal tooth development in humans and Biora
intends to investigate the potential of this protein for use in dental
surgery. Biora also relinquished its rights to a patent for a duo-ceramic
implant developed by COB in December 1997. The patent was relinquished to
enable the Company to focus greater resources on the expansion of its
biology-based products program.

         During 1997, a five-year research collaboration agreement was
signed with the University of Gothenburg (Sweden) to be led by Professor
Jan Lindhe. Professor Lindhe will direct the early-stage clinical research
for new indications of Emdogain, as well as test new products and
technologies for the Company. A similar research agreement was entered into
with the University of Texas to be led by Professor David Cochran.

         Pre-clinical safety assessments of Biora's products have been
performed by contract laboratories in Europe and Japan, as well as by Astra
Safety Assessment in Sweden. Kinetic studies, which monitor Emdogain over
time, have been performed in collaboration with the University of Lund in
Sweden and the Institute of Surface Chemistry in Stockholm. Clinical safety
assessments have been performed in close collaboration with the Karolinska
Hospital in Stockholm, Sweden. The Company performs chemical development,
including protein chemistry and process development, internally. All of the
Company's manufacturing and quality control, including the ISO
9000-certified quality system, is performed by Biora's own employees.
Although not officially certified under ISO 9000 the company works as if
even the R&D were certified.

         The clinical effectiveness and safety of Emdogain have been tested
through a program of controlled randomized trials in Sweden and the United
States run by Biora and Astra AB ("Astra"), a Swedish pharmaceutical
company that participated in the funding of Biora's research and
development between 1989 and 1992. In December 1992, Biora, Astra and
certain other shareholders of Biora entered into an agreement pursuant to
which Astra terminated its commitment to fund the research and development
of products relating to Emdogain as well as all licensing agreements which
Biora and Astra had previously entered into. As part of the agreement,
Astra was granted a royalty through December 31, 2009, of 2.5 percent of
commercial income (other than deductions for VAT and customs duties) from
the dental application of two patents held by the Company relating to
Emdogain: "binding-inducing composition" and "composition inducing a
binding." See "Description of Business--Patents and Proprietary Rights" and
"Interest of Management in Certain Transactions."

Business Strategy

BIORA develops, manufactures and sells pharmaceutical products to dentists
and dental hygienists so that patients with dental diseases can regenerate
or retain their dental health and esthetics. In this way Biora creates
added value for its customers, and through long term sales and profit
development added value is also created for its owners.

Objectives

Biora's goal is to be a market leader within the area of pharmaceutical
products that are used to treat or mitigate dental diseases. Biora's target
group is dentists and dental hygienists in key markets. Research and
development will be concentrated on dental indications that can be expected
to expand the use of Emdogain and that can be expected to have a short time
to market introduction.

Emdogain Gel - Biora's platform

Emdogain Gel, a further development of Emdogain that offers a simpler and
less time consuming treatment, is Biora's principal product and the
platform on which Biora will build its business. The product offers
dentists a ready mixed product that like Emdogain regenerates a natural
tooth supporting structure. It was launched in Europe during June 2000 and
has had a positive reception. A registration of Emdogain Gel in the U.S.
was received in January 2001. The Japanese authority views favorably an
accelerated registration process for this product, and a registration is
expected during 2001.

Focus on key markets

The U.S., Germany and Japan together make up 75 per cent of Biora's total
sales. In the U.S. and Germany Biora will have complete marketing
organizations to be able to effectively cultivate the target groups and
attain a strong position. These marketing companies will also be able to
market and sell other products in Biora's future product portfolio. In
Japan Emdogain is marketed and sold by Biora's Japanese partner, Seikagaku
Corporation. Biora has the ambition to first secure a strong position in
several important key markets and then to expand to other markets.

Focus on established customers with large sales potential

Experience with Emdogain and Emdogain Gel shows that customers who learn to
use the product correctly and who have used it repeatedly are very
satisfied with the results of treatment. The emphasis of the work is to get
them to increase their use of Emdogain Gel. Through expanding the
indications for Emdogain, these customers will be able to use the product
on more and more patients.

Focus of clinical research on new indications for Emdogain Gel

Research and Development within Biora will be concentrated on dental
indications that can be expected to expand the use of Emdogain Gel such as
surgical treatment of exposed dental roots or to restore a lost tooth
supporting structure in connection with mechanical treatment of the dental
root.

Divestiture or collaboration for products within non-dental indications

As a step in focusing the business, Biora intends to divest or find an
alliance partner for Biora BioEx, that is, that part of the R&D portfolio
that is directed towards products within non-dental indications. Several
interesting indications for enamel matrix proteins, such as healing of
chronic sores, such as, for example, wound healing, and stimulation of
bone formation, are included in BioEx as well as the patent application
relating to inhibition of certain cancer cells based on early cell studies.
The process of divesting BioEx or finding a buyer or partner is under way.
A divestiture or a partnership would result in improved liquidity for Biora
while enabling the development of the project to be completed. As is usual
with negotiations no guarantees can be made regarding the results. If these
efforts are not succesful, alternative strategies will be considered.

Increased product portfolio within the dental area

In order to better take advantage of Biora's marketing and sales resources
in the marketing companies, Biora is actively seeking new pharmaceutical
products within dental indications. During the year Biora has acquired the
rights to a patent protected pharmaceutical project against dry mouth. In
order to maximize the market potential for this product, Biora is looking
for an alliance partner that can develop and market the drug to patients
who are not treated by dentists.


Authorization to issue new shares

As a step in ensuring long-term financing, the Annual General Meeting, May
4, 2001, authorized the Board, if deemed necessary and on prevailing market
conditions, during the period before the next Annual General Meeting, in
the spring of 2002, to increase the company's share capital by a maximum of
220,000 SEK by a new share issue of up to 5,500,000 shares, each at a
nominal value of 4 ore (0.04 SEK). If all authorized shares are issued this
will equal 20.4% of the company's share capital assuming exercise of all
outstanding warrants. According to the proposal, the Board shall have the
authority to issue new shares with or without giving existing shareholders
priority rights to purchase shares.

Market Overview


Periodontitis

         It has been reported by the National Institute of Dental Research
that, based on a survey done in 1985-86, approximately 44 percent of
employed adults in the United States have some form of periodontal disease.
Based on World Health Organization statistics, European countries have
similar incidence levels of periodontal disease. According to a 1990
American Dental Association report (the "ADA Report") (the most recent
publicly available source of information on the subject), of those
Americans suffering from periodontal disease, almost 14 million receive
root planing and scaling treatment from private dental practitioners.
Although all of the patients treated for periodontal disease undergo root
planing and scaling, only a portion of those seeking treatment will undergo
periodontal flap surgery. According to the ADA Report, there were
approximately two million flap surgeries performed in 1990 in the United
States. The Company believes that most of those persons undergoing flap
surgery have cases that would call for some sort of adjunctive procedure
aimed at repair of tooth attachment, yet only one out of seven actually
undergo such treatment. This low rate can be explained by the fact that
current additional adjunctive techniques do not adequately address the
users' needs, such as ease of use, comfort to the patient, predictability
and rapid healing. The Company believes that Emdogain could be used to
promote the regain of tooth attachment in substantially all of those cases
where the patient would benefit from any adjunctive technique.

         The market for the Company's Emdogain technology for the treatment
of defects caused by periodontitis is comprised predominantly of
periodontal specialists, who either have their own private practices or
clinics or who are associated with universities or dental maintenance
organizations. According to the ADA Report, 90% of all flap surgeries
carried out in 1990, by private practitioners were performed by
periodontists in private practice. Based on industry statistics, there are
approximately 4,000 periodontists in the United States. The Company
estimates that there are approximately 4,500 periodontal specialists in
Europe and approximately 2,000 periodontal specialists in Japan. In
addition, a growing number of general dentists are specializing in
Periodontology in Europe and Japan.


Wisdom Teeth Extractions

         According to the ADA Report, there are approximately ten million
complicated tooth extractions performed annually in the United States. The
Company believes that Emdogain WT would be suitable in at least half of
such procedures to eliminate or reduce the formation of pockets on teeth
adjacent to the extracted wisdom teeth.

         The target market for Emdogain WT, if, and when, the product
reaches commercialization, will be comprised primarily of oral surgeons,
who either have their own private practices and clinics or who are
associated with hospitals. Based on industry statistics, there are
approximately 5,000 oral surgeons in the United States.

Marketing

         The primary target markets for Biora's products are periodontists
and periodontal specialists. Based on industry statistics, there are
approximately 4,000 periodontists in the United States, approximately 4,500
periodontal specialists in Europe and approximately 2,000 periodontal
specialists in Japan. Given the relatively small number of periodontal
specialists and the need for a highly specialized sales force, Biora
intends to market and sell its products primarily through its own marketing
and sales organization. An estimated five million operations involving flap
surgery are performed worldwide each year (with about 2 million, or 40
percent, of these surgeries being performed in the United States).

          The Company is selling Emdogain Gel to periodontal specialists in
Europe at an average price of approximately Euro 150 per unit for a Multi
defect size (0.7 ml) (sufficient for the treatment of three teeth) and Euro
112 per unit for a Single defect unit (0.3 ml). Biora has priced Emdogain
at a similar price level in the United States and other markets.

         While Biora believes that Emdogain has considerable potential, the
periodontists and periodontal specialists comprising the Company's target
market have indicated that they want to see results from their own patients
before they are prepared to accept Emdogain as the preferred therapy.
Results are usually evaluated between 10 and 12 months after treatment. A
number of case studies show that the results continue to improve on average
at least until 36 months. Positive results on as much as ten year and eight
year data were presented at the Europerio Exhibition in Geneva in June 2000.


Biora.com and ICC

         With the launch in June 2000 of Biora.com, Biora has been creating
an interactive Internet service. The goal is to create an effective sales
and communication channel for existing and new customer groups over the
Internet as well as to be able to publish ad distribute marketing material
and information electronically. The portal www.biora.com creates a flexible
entryway, which enables specialists to register with Biora by creating a
personal search profile. Registered specialists can use Biora.com to
download clinical information, professional articles regarding Biora's
products and information regarding surgical techniques. In addition,
patients who are considering having Emdogain used in their surgical
procedures can review information regarding those procedures. With
Biora.com, Biora's goal is to improve total customer service in a
cost-effective way.

In November 2000, Biora opened its International Customer Center (ICC).
This center proivides Biora's customers with an improved service by,
among other things, enabling customers in markets where Biora does not have
its own market organizations to order Emdogain directly and to have the
product delivered to their offices.


Europe


         Germany is at present the biggest market for Emdogain in Europe.
The number of dentists who perform surgical interventions to treat
periodontitis on a more regular basis are about 5,000. Sales in Germany
began in 1996, and during 2000 sales in Germany decreased by 13 percent
over 1999. Importantly, sales during the last quarter 2000 have increased
in SEK as well as in local currency compared to Q4 1999, with a sales
record in November. Sales increase Q1 2001 was 54% (45% in local currency)
compared to the corresponding period of the previous year. Sales during the
first half year 2000 was under expectation, which resulted in a change of
management in the German subsidiary. The marketing approach has changed
from simply adding new customers to a strong customer focus and a
systematic approach on increasing use within the existing customer base.

         The Company has established a sales force to cover the Nordic
market (Norway and Sweden). Biora's Nordic operation, which commenced
marketing Emdogain in Sweden in 1996, currently has four employees (of
which three are marketing representatives. In Sweden, approximately 90
percent of the 500 specialist and perioaware customers in the country that
treat advanced periodontitis have purchased Emdogain at least once,
approximately 70 percent of which have made repeat purchases. The customer
base is now increasing with general dentists performing Emdogain treatment.
Biora's market share in Sweden is approximately 10 percent. The current
increase in Biora's customer base in Sweden is to a large extent general
dental practitioners who perform flap surgery. In all of the Nordic
countries, Biora continues to focus its marketing efforts on increasing
usage of Emdogain among periodontists and general dentists specializing in
Periodontology through participation in specialist conventions, seminars
and educational programs together with universities with dental programs.

         In order to focus on the key markets, Biora has also reduced its
sales organization in other European markets. The UK market company closed
its officies in February 2000 and the BeNeLux market company closed its
offices during the beginning of year 2001. Customer service and
distribution of products are managed from the International Customer Center
in Malmo (ICC).

Biora entered into a new distributor agreement for Poland during 1999 and a
distribution agreement with Globopharm for Switzerland during Q4 2000.

North America

         Biora conducts sales and marketing operations in the United States
through its Chicago, Illinois-based subsidiary, Biora, Inc. Donna Janson,
serves as President of the U.S. subsidiary. During 2000, Biora increased
the size of its United States operations from 22 to 26 employees.

         The market for the Company's Emdogain technology for periodontal
treatment is comprised predominantly of periodontal specialists, who either
have their own private practices or clinics or who are associated with
universities or dental maintenance organizations. According to the ADA
Report, 90 percent of all flap surgeries done in the United States in 1990
by private practitioners were performed by periodontists in private
practice.

         Sales increased for the twelve month period ended December 2000 by
51% (36% in local currency) compared to the same period 1999. As of
December 31 of 2000 approximately 3000 American periodontists have bought
Emdogain at least once since its introduction. A total of 670 new customers
purchased Emdogain in 2000, and of these, 475 were periodontists. Compared
to 1999, Biora has increased the number of customers who have purchased the
product at least three times. The share of customers who bought Emdogain at
least three times during 2000 was 43% compared to 36% during 1999. However,
Biora's penetration share as percent of the total estimated flap surgery
procedures performed in the United States is approximately 3 percent.
Biora's penetration of the U.S. market has been hindered by Emdogain
receiving less exposure than originally anticipated when it was launched in
April 1997, partly as a result of delays in the publication of reviews in
industry journals. Biora's sales in the United States increased following
publication of the seven articles on Emdogain in The Journal of Clinical
Periodontology in September 1997 and the exposure received by Emdogain at
the Conference of the AAP in October 1997. Biora has entered into
agreements with several U.S. periodontists and several U.S. universities,
including the University of Texas, to develop U.S.-based data and test
results for Emdogain. Such results generally take from six to 18 months to
be developed.


Japan

         The Company has also entered into certain marketing and
distribution arrangements with local or regional partners in other parts of
the world. On September 1, 1996, the Company entered into an agreement with
Seikagaku Corporation ("Seikagaku") pursuant to which Biora appointed
Seikagaku as its exclusive distributor in Japan. The agreement expressly
covers the indication of Emdogain relating to the use of the product for
the regain of tooth support due to periodontal disease (the "Initial
Indication") and also provides that the agreement will be amended to
provide analogous terms for future indications for the Japanese market. The
agreement also gives Seikagaku a right of first refusal for such market
with respect to any other dental product developed by Biora. In addition,
in June 1998, Biora and Seikagaku signed a letter of intent to expand the
agreement to cover PrefGel, and the launch of PrefGel in Japan is expected
for the third quarter of 1999, subject to regulatory approval. Biora
received an aggregate of $5 million from Seikagaku through September 1996
for entering into the Emdogain agreement. The agreement provides that
Seikagaku may, under certain circumstances, request Biora to refund the $5
million payment in the event the MHW does not approve Emdogain for sale in
Japan by June 1999 and grants Seikagaku a security interest in Biora's
Japanese patent and trademark rights to secure such potential repayment
obligations. Consequently, the $5 million was treated as a liability by
Biora through the end of 1997. Biora submitted an application for the
registration of Emdogain with the MHW in September 1996, which was approved
in January 1998. With approval from the MHW, the amount was recognized as
other operating income during the first quarter 1998. Marketing of Emdogain
in Japan commenced in April 1998. Under the agreement, Biora shall supply
all of Seikagaku's requirements for Emdogain for the Initial Indication at
a unit price which is the higher of (i) 35 percent of the reimbursement
rate for Emdogain set by the MHW and (ii) 4,000 Japanese yen. Each of Biora
and Seikagaku has agreed to use its best efforts to establish a
reimbursement rate for Emdogain in Japan of no less than 17,000 Japanese
yen. A filing with the MHW for reimbursement was made in March 1998. The
price has been set at 26,000 Japanese yen, giving a sales price from Biora
to Seikagaku of 9,100 Japanese Yen. Seikagaku is responsible for costs
relating to post-marketing studies of Emdogain for its initial indication
and for clinical trials to obtain government approval for the sale of
Emdogain for additional indications in Japan. In accordance with the
agreement Biora and Seikagaku have established a joint steering committee,
consisting of two Biora and two Seikagaku representatives, to meet and
issue non-binding recommendations relating to the commercialization of
Emdogain and other activities in Japan. See "Description of
Business--Government Regulation."

  However, in November 2000, Seikagaku Corporation, Biora's marketing and
sales partner in Japan, recalled all deliveries of Emdogain to comply with
the registration authority's guidelines which required the same changes
to be made to the production process for deliveries to Japan as had
previously been implemented for other markets. Discussions with the
Japanese registration authority have resulted in the decision to accelerate
the registration process for Emdogain Gel. The application for registration
of Emdogain Gel was submitted to the Japanese registration authority during
the first quarter of 2001.

         At December 31, 2000 approximately 1,100 periodontists and
dentists had bought Emdogain, of which approximately 500 had purchased the
product more than once. 27 of the 29 dental universities in Japan have
begun to use Emdogain in their training in 1999.


Rest of the World

         Biora also began marketing Emdogain in South Africa in June 1997
through a subsidiary, but decided in 1998 to sign a distributor agreement
with a well established distributor in the dental industry for that market.
At the beginning of 2000, Biora entered into distribution agreements with
distributors for the markets Brazil, Colombia, Ecuador, Panama, Peru,
Puerto Rico, South Korea, Taiwan and Venezuela. Sales and marketing efforts
will start subject to regulatory approvals in each of these markets.


Third Party Reimbursement

         The Company's primary customers for Emdogain are, and for its
other products will be, periodontal specialists and perioaware GPs. Certain
of these customers may seek reimbursement for the Company's products from
third-party payers, such as governmental and private health insurance
plans, for all or part of the costs associated with the treatment of
patients. Reimbursement schemes for the treatment of periodontal disease
vary from one country to another, and potential customers in several of the
Company's targeted markets may be influenced by the type of third-party
payer coverage available for procedures using the Company's products. The
Company will consider reimbursement rates when deciding on market
approaches and strategies for pricing its products.

         In the United States, as in most major European countries,
reimbursement for additional treatments used in conjunction with
periodontal flap surgery is generally not available, and most patients,
with or without dental insurance, pay the cost of such treatment themselves
without assistance from third-party payers. The Company believes that
certain third-party payers provide reimbursement at a specified rate for
periodontal surgeries, without additional reimbursement if an additional
interventive technique, such as Emdogain, is used. In addition, according
to a 1995 industry report, less than half of the population of the United
States (approximately 95 million people) are covered by dental insurance.
Patients who lack dental insurance or who have insurance that puts a set
cap on amounts that will be reimbursed for periodontal flap surgery, and
therefore must pay the cost of any additional treatment themselves, may
elect to forego the use of an additional interventive treatment. However,
the Company believes that the relatively low cost of Emdogain treatment as
compared to the stand-alone cost of conventional periodontal flap surgery
along with the potential benefits offered by Emdogain treatment will
largely offset patients' concerns about paying for Emdogain treatment
themselves. In Germany, several insurance companies have agreed to fully or
partly reimburse patients for the cost of treatment with Emdogain Gel.

         In Japan, the Company expects that sales volume and prices of the
Company's products will be more dependent on the availability of
reimbursement than in the United States and Europe. Under the terms of
Biora's agreement with its distributor in Japan, Seikagaku is responsible
for submitting an application for Emdogain to the MHW for approval of a
reimbursement rate. The agreement also provides that the price per unit
paid by Seikagaku to Biora for Emdogain shall fluctuate based upon the
reimbursement price approved by the MHW. There can be no assurance that
reimbursement approval will be obtained in Japan in a timely manner, if at
all. Failure to receive a reimbursement approval could have the effect of
delaying the initial acceptance of the Company's products in Japan. See
"Description of Business-- Marketing."

Item 4 c. Organizational Structure

Biora AB is a public company incorporated in Sweden.

Significant subsidiaries are Biora Inc., in the US and Biora GmbH, in
Germany. Biora Inc. is incorporated in Delaware in the United States and
Biora AB owns 100 % of its stock. Biora GmbH is incorporated in the Federal
Republic of Germany and Biora AB owns 100 % of its stock.



Item 4 d. Description of Property

         The Company's executive offices and development, manufacturing and
testing operations are located in Malmo, Sweden under a lease expiring on
September 30, 2001. The lease is renewable for successive two year terms
unless terminated by either party at least twelve months before the
expiration of the lease term. The current period expires at the end of
September, 2002. Under the terms of the lease, the total annual rent is
currently approximately SEK 3.0 million ($0.3 million), which may be
adjusted upwards based upon certain increases in the Swedish consumer price
index. The manufacturing facilities cover an area of approximately 600
square meters and during 1997 the production capacity has been increased
from 200,000 to 400,000 units of Emdogain. After converting completely to
the manufacturing process for Emdogain Gel the capacity has increased to at
least 600,000 units. The Company is currently investigating the possibility
of expanding the production capacity further in its current manufacturing
facility. Plans also exist to build an additional production facility at an
estimated cost of SEK 30 million ($2,8 million) to increase annual
production capacity to one million units but this expansion is not
contemplated in the short term.

         The manufacturing process of the newly formulated Emdogain Gel
includes out-sourcing of the filling of the syringes at Statens Serum
Institut (SSI) in Copenhagen, Denmark.

         The Company has out-sourced the manufacturing and packaging of
PrefGel to Miwana AB, which is located in Gallivare, Sweden. Miwana AB are
in receipt of the ISO 9002 and EN 46002 certifications for their facilities
since October 1998. Biora expects that Miwana AB will be able to meet
Biora's production requirements for PrefGel for the foreseeable future.

         Biora's production facilities generally are subject to health and
quality standards set by the various governmental authorities that regulate
its products, and to inspection and monitoring by such authorities. Among
the conditions for FDA approval of a medical device is the requirement that
the manufacturer's quality control and manufacturing procedures conform to
Good Manufacturing Practices ("GMP"), which must be followed at all times.
GMP regulations impose certain procedural and documentation requirements
upon a company with respect to manufacturing and quality assurance
activities. In 1994, the FDA inspected Biora's plant and confirmed that the
Company's quality control and manufacturing procedures conformed to GMP.
GMP controls every phase of production from the receipt of raw materials to
the labeling of the finished product, and follow-up and reporting of
complaint information. At a recent FDA-inspection (March 1997) the new
Quality System Requirement (QSR) was also applied, and no written comments
were received. For an approval under the EU's MDD, the Company's quality
system must comply with ISO 9000 and EN 46000 requirements (the latter are
European standards specific for medical devices), which are broader than
the GMP regulations. Biora obtained certification in compliance with ISO
9002 and EN 46002 in 1995 and is audited annually by BSI. As part of the
ongoing review by the Japanese authorities, an inspection was performed in
February 1997. In complying with standards set forth in the GMP and ISO
regulations, as well as in other applicable regulations, the Company will
be required to continue to expend time, money and effort in the area of
production and quality control to ensure full technical compliance. See
"Description of Business--Government Regulation."

Competition

         The conventional surgical technique used in patients with advanced
periodontal disease is flap surgery, without any adjunctive technique.
Several clinical studies have demonstrated that flap surgery alone results
in minimal regain of periodontal tissues. In Biora's controlled clinical
trials, adult patients with periodontal disease who had lost most of the
attachment achieved regain of jaw bone within 16 months of treatment with
Emdogain to about two-thirds of normal levels, as compared to unchanged
levels for control sites in the same patient (treated with conventional
periodontal flap surgery).

         At present, the most widely used adjunctive technique in
conjunction with flap surgery is guided tissue regeneration ("GTR"). GTR
was introduced about ten years ago with the aim of using a non-resorbable
or bioresorbable physical barrier to prevent cells lining the gum tissue
from growing into the healing wound after periodontal flap surgery. If a
non-resorbable barrier is used, a second surgical procedure is required to
remove the barrier at a follow-up visit. GTR barriers have been developed
by several companies, the most significant of which is William L. Gore
Company. The Company estimates that GTR is used in approximately 10 percent
to 15 percent of the flap surgery procedures performed in the United States
and Western Europe.

         Bone grafting, which involves the surgical implantation of living
or synthetic bone and marrow into the periodontal defect, has been shown in
clinical and non-clinical studies to add to the bulk of bone tissue around
the affected tooth. However, studies have not demonstrated that grafting
results in regain of the cementum and periodontal ligament and certain
studies on bone grafting have indicated that cells lining the gum tissue
will repopulate the area between the added bone and the root surface,
blocking the formation of a new periodontal ligament.

         The Company believes that Emdogain technology has many advantages
over existing adjunctive techniques. First, it represents a biology-based
approach to the treatment of defects caused by periodontal disease, which
provides predictable regain of tooth supporting structures in contrast to
existing mechanical treatments. Second, as a gel, Emdogain is significantly
easier and more convenient to use than the current technique-sensitive
treatments, and can be applied independent of tooth topography.
Additionally, the Company believes that patients will prefer Emdogain
because it causes less discomfort and has better healing characteristics
than existing adjunctive techniques treatments and requires less chair
time.

         Certain pharmaceutical companies, such as the Genetic Institute
(owned by American Home Products) and Creative Biomolecules (owned by
Stryker Corp.), have begun testing the applicability of growth factors and
bone morphogenetic proteins to the regain of attachment lost due to
periodontal disease. Pre-clinical studies have demonstrated that growth
factors and bone morphogenetic proteins may in fact regrow jaw bone. While
the testing of growth factors and bone morphogenetic proteins as a proposed
regenerative treatment is still in its early phases, they may eventually
prove to be commercially viable products that could compete with Emdogain.

         Biora may also compete with companies developing and marketing
treatments for periodontitis through the subgingival controlled release
delivery of antimicrobial agents. However, the indicated use for
antimicrobial agents is as an adjunctive treatment to root planing and
scaling, and the Company does not believe such agents will reduce the need
for procedures that promote the regain of periodontal tissues.

         The competition on the wound healing market is large with many of
the largest pharmaceutical companies as participants. However, Emdogain is
a product that has been tested for safety for application in wounds from
surgery, and has been used on more than 250,000 (as per December 2000)
patients since selling began. The first product for wound healing with
growth factors began to be marketed in the U.S. in 1998, but the concept of
using a matrix protein such as Emdogain has not yet been exploited.

Intellectual Property

         The Company's success will depend in part on its ability to obtain
patent protection for its products and processes, to preserve its trade
secrets and to operate without infringing or violating the proprietary
rights of third parties. It is the Company's policy to protect its
proprietary technology by, inter alia, filing patent applications. The
Company's general procedure is to first file a priority application in
Denmark followed by an application under the Patent Corporation Treaty
("PCT") designating all major countries with a significant involvement in
the fields of oral health care and bioscience, including the member-nations
of the EU, the United States and Japan. Subsequently, the Company files
regional European patent applications derived from the PCT application in
accordance with the European Patent Convention.

         As of June 1, 2001, the Company had been issued five U.S. patents,
three European patents, two Japanese patents and 77 patents in various
other countries. In the United States, the duration of patents that were
granted prior to June 8, 1995 is the longer of 17 years from the date of
issuance or 20 years from the date of filing. The same applies to patents
filed before June 8, 1995 and issued on or after June 8, 1995. The duration
of patents based on applications, including confirmation applications,
filed after June 8, 1995 and issued after such date is 20 years from the
date of filing. The duration of patents elsewhere in the world is generally
20 years from the date of filing.

         The Company's current Emdogain related patent portfolio may be
divided into five families: the "binding-inducing composition" family, the
"composition inducing a binding" family, the "surface etching" family, the
XP11 family and the XP20 family. The "binding-inducing composition" family
and the "composition inducing a binding" family form the basis for the
patent protection of Emdogain.

         The "binding-inducing composition" family relates to a precursor
to dental enamel--the so-called enamel matrix. At present, 40 patents in
this family have been granted to the Company and one application is still
pending. Patents in this family have been issued in most target markets,
including the United States, Canada, Australia and most European countries.
The expiration date for this patent in the United States is 2012 and in
most European countries is 2007.

         The "composition inducing a binding" family relates to a protein
fraction originating from a precursor to dental enamel. At present, 33
patents in this family have been granted to the Company and two
applications are still pending. Patents in this family have been issued in
most target markets including the United States, Australia and most
European countries. The expiration date for the patents in the United
States are 2008 and 2009 respectively and in most European countries the
expiration date is 2009.

         The "surface etching" family relates to tooth-root conditioning
with PrefGel. The Company has been granted seven patents in this family
including one in the U.S. and fourteen patents are still pending.

         Under the XP11 project, Biora submitted a patent application
relating to new, positive biological effects of Emdogain-related proteins
for wound healing in February 1998. Two patents have been issued in March
1999 and 23 applications are pending. Two priority applications were filed
relating to the use of Emdogain-related proteins for other areas. In
December, 1997, Biora acquired the patent rights for a new protein that
formed the basis of the XP20 project. Two patents have been issued and 22
applications are pending.

          In January 1989, Biora transferred all of its rights, including
patent rights, relating to Emdogain technology (the "Assigned Property"),
to its wholly owned Dutch subsidiary, Bioventures BV ("Bioventures").
Bioventures subsequently transferred the Assigned Property to Bioventures
NV ("BNV"), a wholly owned Netherlands Antilles subsidiary of Bioventures.
Pursuant to the transfer, Biora retained the exclusive right to manufacture
all products developed with the use of Emdogain technology and any future
developments thereof and, in consideration for the transfer, Bioventures
agreed to pay Biora a royalty on payments received from third parties with
respect to the licensing, use or transfer of the Assigned Property. This
royalty obligation expired in December 1995. Bioventures maintained the
exclusive license to market and distribute products developed with the use
of Emdogain technology in return for a royalty to be paid to BNV.
Bioventures liquidated BNV in 1997 and the Assigned Property was
transferred back to Bioventures. Starting 1998 Biora and Bioventures have
entered into a royalty agreement, giving Bioventures a 7.5 percent royalty
on all external sales of Emdogain for the treatment of periodontal disease
up to December 31, 2009.

         In 2000, Biora acquired a patent covering local use of
cholinesterase inhibitors in the treatment of xerostomia from scientists in
Gothenburg. The US patent has since been issued and 20 applications are
pending.



Raw Materials

         Biora purchases raw materials and primary packaging materials from
suppliers or subcontractors evaluated and approved by the Company in
accordance with the requirements of ISO 9000 regulations. The Company is
situated in an agricultural region where the biological raw material,
porcine dental tissues, can be obtained from several commercial meat
producers. At present, Biora has approved only Sweden's largest commercial
meat producer as a supplier for a one year term running from January 2000
through January 2001. The Company plans to enter into contracts with
alternative suppliers provided they meet the EU standards for Class III
medical devices, in addition to United States and European food
regulations. All other raw materials, including chemicals or packaging
materials, are purchased as pharmaceutical grades or from suppliers with
ISO 9000 certificates. The cost of raw materials accounts for approximately
5 percent of the sales price of Emdogain in European markets. See
"Description of Business--Government Regulation."



Government Regulation

         All products currently manufactured and marketed by Biora are
subject to regulation by the FDA in the United States, by authorized bodies
under EU Directive 93/42/EEC (the Medical Device Directive ("MDD")) in the
EU, by the MHW in Japan, and by other regulatory authorities throughout the
world. In addition, all of the products currently under development will
require regulatory approvals from these authorities prior to marketing.
Regardless of the regulatory classifications assigned to Biora's products,
all human therapeutic products are subject to rigorous testing. The process
of obtaining clearance or approvals from the FDA and other regulatory
authorities can be costly, time consuming and subject to unanticipated
delays. Except for Emdogain, which has been approved in the United States,
the EU and Japan; and PrefGel, which has received an amended marketing
clearance in the United States and approval in Europe, there can be no
assurance that the FDA, the EU regulatory authorities, the MHW and other
authorities will approve any of Biora's products for marketing or, if they
are approved, that they will be approved on a timely basis, the failure of
which could have a material adverse effect upon the Company's business,
financial condition, prospects and results of operations.


United States

         The FDA has regulated medical devices since 1976, when the Medical
Devices Amendments to the Food, Drug and Cosmetic Act ("FDCA") were
enacted. Under the FDCA, the FDA regulates the clinical testing,
manufacture, labeling, packaging, marketing, distribution and record
keeping for medical devices in order to ensure that medical devices
distributed in the United States are safe and effective for their intended
use. Noncompliance with applicable requirements can result in civil
penalties, including product recalls, injunctions or product seizure, an
inability to import products into the United States, refusal to approve or
clear product approval applications, the withdrawal of previously approved
product applications and criminal prosecution. The FDA also has the
authority to request repair, replacement or refund of the cost of any
device manufactured or distributed by the Company.

         The Company's products approved for commercial distribution,
Emdogain/Emdogain Gel and PrefGel, are registered as medical devices under
the FDCA and FDA regulations. The primary department within the FDA
responsible for the pre-market review of medical devices is the Office of
Device Evaluation (the "ODE"), within the Center for Devices and
Radiological Health. Dental devices are reviewed by the Dental Devices
Branch within the ODE.

         The FDCA provides that, unless exempted by regulations, devices
may not be commercially distributed in the United States unless they have
been approved or cleared by the FDA. The regulatory requirements for the
approval or clearance of a device vary according to the type of product and
the degree of risk associated with it. One avenue for clearance is through
the 510(k) pre-market clearance process in which devices are evaluated
according to their substantial equivalence to devices marketed prior to the
legislative enactment date of the Medical Devices Amendments to the FDCA in
1976 in terms of materials, indication statements and labeling claims. A
510(k) notification must contain information to support a claim of
substantial equivalence, which may include laboratory test results or the
results of clinical studies of the device in humans. Commercial
distribution of a device for which a 510(k) clearance is required can begin
only after the FDA issues an order finding the device to be "substantially
equivalent" to a predicate device. Many devices specifically intended to
treat periodontal diseases, including GTR barriers, have progressed through
the 510(k) process based on their substantial equivalence to the predicated
devices. This regulatory approach was also successfully used for the
Company's PrefGel, which is now cleared for marketing in the United States.

         New devices that incorporate technologies that are not
substantially equivalent to predicate devices require that a pre-market
approval ("PMA") application be filed with the FDA and that the device's
safety and effectiveness must be established on its own without reference
to any previously approved products. The first step in the PMA approval
process is the submission to the FDA of the results of pre-clinical
laboratory and animal studies. A device that poses a significant risk to
human patients must undergo clinical evaluation under an investigational
device exemption ("IDE") that is granted by the FDA to permit testing of
the device in a limited number of humans in clinical trials conducted at a
restricted group of clinical sites. Results from clinical trials are
presented to the FDA in a PMA application. In addition to the results of
clinical investigations, the applicant must submit other information
relevant to the safety and effectiveness of the device, including the
results of non-clinical trials, a full description of the device and its
components, a full description of the methods, facilities and controls used
for manufacturing and proposed labeling. Such submissions are extremely
detailed and complex, often involving thousands of pages. The FDA staff
then reviews the submitted application and determines whether or not to
accept the application for filing.

         Once the submission is accepted for filing, the FDA begins an
in-depth review of the PMA application. Based upon industry and FDA
publications, the Company believes that an FDA review of a PMA application
generally takes one to three years from the date the PMA application is
accepted for filing, but may take significantly longer. The PMA process can
be expensive, uncertain and lengthy, and a number of devices for which FDA
approval has been sought by other companies have never been approved for
marketing.

         Emdogain was approved through a PMA application in September 1996
and Emdogain Gel in January 2001. The PMA route is also intended to be used
for Biora's products under development which incorporate essentially the
same composition as Emdogain. PMA applications for new products will be
filed as amended versions of the original PMA application for Emdogain
which, the Company believes, will reduce the review time by the FDA.

         Any devices manufactured or distributed by the Company pursuant to
FDA clearance or approvals are subject to pervasive and continuing
regulation by the FDA and certain state agencies, including record keeping
requirements and reporting of adverse experiences with the use of the
device.

         Labeling and promotional activities are subject to scrutiny by the
FDA and, in certain circumstances, by the Federal Trade Commission. FDA
enforcement policy strictly prohibits the marketing of FDA cleared or
approved medical devices for unapproved or "off-label" uses. The Company
also is subject to numerous federal, state and local laws relating to such
matters as safe working conditions, manufacturing practices, environmental
protection, fire hazard control and disposal of hazardous or potentially
hazardous substances. There can be no assurance that the Company will not
be required to incur significant costs to comply with such laws and
regulations in the future or that such laws or regulations will not have a
material adverse effect upon the Company's business, financial condition,
prospects and results of operations.

         The Company received an amended marketing clearance to market
PrefGel in the United States in May 1998.

         The FDA approved Emdogain, for use as an adjunct to a minimally
invasive surgical technique(previously referred to as Emdogain non
surgical). This indicates that Emdogain can be utilized in conjunction with
scaling and root planing for the treatment of periodontal intrabony
defects. The approval is for teeth in the "aesthetic zones".


Europe

         In order for a medical device to be marketed in the EU and the
EEA, it must receive a CE Mark. The CE Mark is a symbol of adherence to
quality assurance standards and compliance with the EU's MDD.

         In order to obtain a CE Mark, a product must be manufactured,
analyzed and marketed in accordance with ISO 9000 standards and the
specific European standards (EN 46000) applicable to medical devices. The
ISO 9000 standards, which are published by the International Organization
for Standardization based in Geneva, Switzerland, and have been adopted by
the EU, comprise standards that provide quality management guidance and
quality assurance requirements for manufacturers and service providers. In
addition, a product must meet the Essential Requirements as defined under
the MDD relating to safety and performance, and the Company must
successfully undergo verification of its regulatory compliance ("conformity
assessment") by a "Notified Body" selected by the Company. There are
several European regulatory bodies in EU member countries whose
determinations are accepted for regulatory approval purposes in all 18
countries of the EEA and Switzerland and are designated as Notified Bodies.
The nature of any Notified Body's assessment will depend on the regulatory
class of the product. Depending on classification, the clinical data will
have to provide evidence that the product meets the performance
specifications claimed and sufficient evidence of adequate safety
assessment and that the benefits to the patients outweigh the risks
associated with the product. The Company will be subject to continued
supervision by the Notified Body and will have to report any serious
adverse incidents to the appropriate authorities. The Company will also
have to comply with additional national requirements that are beyond the
scope of the MDD.

         Biora received a CE Mark for Emdogain in 1995 from the British
Standards Institution ("BSI"), a Notified Body. The latest continuing
assessment by BSI was performed, without any nonconforming results, in
February 2000. Biora expects to continue to comply with the CE Mark
requirements. Failure to do so would mean that the Company would be unable
to sell its products in the EEA, which could have a material adverse effect
upon the Company's business, financial condition, prospects and results of
operations.

         The Company received the CE Mark for PrefGel in February 1998.

         The Company received approval for Emdogain Gel from BSI, a
notified body, in February 2000.


Japan

         Japan has medical device regulations similar to those of the EU
and the United States. Biora received the approval to market Emdogain in
Japan as a medical device in January 1998. Biora's Japanese distributor has
agreed to defray certain expenses relating to any post-marketing studies
that may be required by the MHW, the notified body for Japan. However, in
November, Seikagaku Corporation, Bioras marketing and sales partner in
Japan, recalled all deliveries of Emdogain to comply with the registration
authority's guidelines which required the same changes to be made to
the production process for deliveries to Japan as had previously been
implemented for other markets. Discussions with the Japanese registration
authority have resulted in the decision to accelerate the registration
process for Emdogain Gel. The application for registration of Emdogain Gel
was submitted to the Japanese registration authority during Q1 2001.


Rest of the World

         Biora expects that many authorities throughout the world will
regulate Emdogain as a medical device, and that these authorities will
acknowledge the precedential value of approvals already received in places
such as the United States, Europe and Japan. An exception is the Republic
of South Africa, where Emdogain is regulated as a dental pharmaceutical.

         The progress of harmonization efforts between the United States,
the EU and Japan in terms of tripartite International Conference on
Harmonization guidelines are expected to have beneficial consequences for
acceptance of foreign clinical trials and of inspections by foreign
regulatory authorities.


Item 5. Operating and Financial Review and Prospects

Overview

         The Company commenced operations in 1987 and, from 1991 through
1995, generated revenue primarily from contracts to freeze-dry medical
products developed by unaffiliated third parties at Biora's sterile
facilities. The Company entered into such contracts primarily to keep its
manufacturing facilities operational, as required by certain quality
control and manufacturing regulations applicable to the Company. In June
1995, the Company received approval in the EEA pursuant to a CE Mark to
market its initial product, Emdogain, and the Company began selling
Emdogain to dentists who participated in clinical trials on a test basis in
selected European countries later that year. In September 1996, the Company
received approval from the FDA to market Emdogain in the United States and
from the Ministry of Health and Welfare of Japan in January 1998 to market
the product in Japan. The Company received the CE Mark for PrefGel in
February 1998 and an amended marketing clearance from the FDA in May 1998
to market the product in the United States. From its inception until the
commercialization of its initial product, the Company was engaged primarily
in research and development activities, obtaining EU and FDA approval for
Emdogain, and establishing a sales and marketing organization.
Consequently, the Company has a limited operating history upon which an
evaluation of the Company's prospects and performance can be made. The
Company's prospects must be considered in light of the risks, expenses,
difficulties and delays frequently encountered in connection with the
formation and early phase of operation of a new business, the development
and commercialization of new products based on innovative technology and
the rapid technological change and the high level of competition in the
health care industry.

         The Company believes that sales of Emdogain will be its primary
source of revenues for the next several years. The Company intends to focus
its marketing efforts in order to increase sales of Emdogain in North
America, the most important markets in Europe and in Japan and complete
development of, and obtain approval for the marketing of, its new products.

         The Company has sustained losses in each year of its operations
and expects to incur additional losses over the next several years. The
Company's loss from operations for the year ended December 31, 2000, was
SEK 78,7 million ($8.0 million) as compared to SEK 91,8 million ($10.8
million) for the year ended December 31, 1999 due to the restructuring of
the European marketing organization, which has produced lower selling
expenses during the year while sales have increased by 21%. The increase in
the administrative expenses resulted from different business development
projects as well as severance compensation to the previous president. R&D
costs have decreased by about 2% after deduction for depreciation of
capitalized R&D. The Company's loss from operations for the first quarter
of 2001 was SEK 9.0 million ($0.9 million) compared to the loss from
operations of SEK 17.7 million ($2.1 million) for the first quarter of
2000.

         In February 1997 Biora completed the IPO of 7,475,000 Ordinary
Shares at a price to the public of SEK 60.13 per Ordinary Share. The is
using the proceeds to the Company, after deducting underwriting discounts
and offering expenses payable by the Company, were SEK 372 million ($43.7
million). The Company is using the net proceeds received from the IPO for
marketing and sales activities, research and product development, capital
expenditures and for working capital and general corporate purposes.

Capitalization of Research and Development Costs

         The Swedish Accounting Act (bokforingslagen) and Swedish GAAP
allow certain research and development costs and costs incurred in the
related product approval process to be capitalized if it is probable that
the product will generate future economic benefits. The Company has
capitalized research and development costs and costs related to the product
approval process incurred by the Company in connection with the development
of Emdogain, net of revenue from contract sales and research grants. The
capitalization of such costs commenced in connection with the completion of
clinical studies and the submission of the application by the Company to
regulatory authorities in the United States for approval for sale and
production of Emdogain. All research and development costs incurred in
earlier periods have been expensed as incurred.

         In addition, in 1996 the Company commenced the amortization of
capitalized research and development costs in line with projected levels of
sales subject to an amortization period not to exceed five years commencing
from the date of the commercialization of Emdogain in 1996. Research and
development costs (other than equipment expense which is capitalized for
the purpose of Swedish GAAP) incurred in connection with additional
products based on Emdogain technology and re-formulations of Emdogain are
expensed as incurred. Product approval costs are also expensed as incurred.
See Notes 1 and 23 of Notes to the Consolidated Financial Statements.

Results from Operations

Year Ended December 31, 2000  Compared to Year Ended December 31, 1999

         Net sales for the year ended December 31, 2000 equaled SEK 89.2
million ($8.3 million), an increase of 21 percent over net sales for the
year ended December 31, 1999, which equaled SEK 73.6 million ($6.8
million). The increase is attributable to increased of sales of Emdogain in
the U.S. market.

         Gross Profit equaled SEK 68.0 million ($ 6.3 million) for 2000
compared to SEK 58.1 million ($ 5.4 million) for the year 1999, a decrease
of profit margin from 79.0% to 76.3% between the two periods. The decrease
is explained by increased costs in connection with the initial
manufacturing of the new product Emdogain Gel.

         Loss from operations equaled SEK 78.7 million ($ 7.3million) for
the year ended December 31, 2000 compared to an operating loss of SEK 91.8
million ($ 8.5 million) for the period ended December 31, 1999. The reduced
loss from operations is due to the restructuring of the European marketing
organization, which has produced lower selling expenses during the year
while sales has increased by 21%. The increase of the administrative
expenses resulted from different business development projects as well as
severance pay compensation to the previous president. R&D costs have
decreased by about 2% after deduction for depreciation of capitalized R&D

         Net financial items equaled SEK 2.7 ($ 0.3 million) for the year
ended December 31, 2000 as compared to SEK 5.2 million ($ 0.5 million) for
the same period in 1999. Net financial items is mainly interest on the
Company's liquid assets in 2000. The reason for the decrease is less liquid
assets available to the Company.

         Net loss after tax equaled SEK 76.1 million ($ 7.1 million) for
the year 2000 as compared to a net loss of SEK 86.7 million ($ 8.0 million)
for the year ended December 31, 1999. The reasons for this improvement are
described above.

Year Ended December 31, 1999 Compared to Year Ended December 31, 1998

         Net sales for the year ended December 31, 1999 equaled SEK 73.6
million ($6.8 million), an increase of 47 percent over net sales for the
year ended December 31, 1998, which equaled SEK 50.1 million ($ 4.6
million). The increase is attributable to increased sales of Emdogain in
all markets in which the company operates, particularly in the United
States, which had an increase of sales of 88 percent.

         Gross Profit equaled SEK 58.1 million ($ 5.4 million) for 1999
compared to SEK 39.3 million ($ 3.6 million) for the year 1998, a slight
increase of profit margin from 78.3% to 79.0% between the two periods.

         Loss from operations equaled SEK 91.8 million ($ 8.5million) for
the year ended December 31, 1999 compared to an operating loss of SEK 71.5
million ($ 6.6 million) for the period ended December 31, 1998. In the
first quarter of 1998 a SEK 39.4 million ($ 3.7million) payment from
Seikagaku Corporation was included in the other operating income. This was
the payment for the right to represent Biora in the Japanese market. The
loss from operations, excluding this nonrecurring income was SEK 110.9
($10.3million) The reduction in loss is caused by increased sales and a
decrease in administrative expense partially offset by a slight increase in
R&D expense.

         Net financial items equaled SEK 5.2 ($ 0.5 million) for the year
ended December 31, 1999 as compared to SEK 11.6 million ($1.1 million) for
the same period in 1998, a decrease of 55 %. Net financial items mainly is
mainly interest on the Company's liquid assets in 1999. The reasons for the
decrease is less liquid assets available to the Company as well as lower
interest rates in Europe during 1999.

         Net loss equaled SEK 86.7 million ($8.0 million) for the year 1999
as compared to a net loss of SEK 60.0 million ($ 5.6 million) for the year
ended December 31, 1998. Excluding the one time SEK 39.4 million ($ 3.7
million) payment that Biora received from Seikagaku Corporation the
reduction of net loss equaled SEK 99.4 million ($ 9.2 million). The reasons
for this improvement are described above, with the addition of the change
in the financial net between the two years.

Liquidity and Capital Resources

         The Company's financial requirements for the three years prior to
the IPO in February 1997, were met primarily through funds generated by
issuances of equity securities (approximately SEK 16.0 million ($1.5
million), and convertible debt securities (approximately SEK 3.0 million
($0.3 million) (which were converted into Ordinary Shares in full in
January 1996), loans from the Swedish Industrial Fund (Industri-och
nyforetagarfonden) ("IF") aggregating a total of SEK 19 million ($1.8
million) and revenues relating to contract work for third parties. The
Company's loan from the IF was repaid from the proceeds of the IPO. Of the
approximately SEK 19 million ($1.8 million) in total equity and convertible
debt financing received by the Company during the three years prior to the
IPO, Euroventures Nordica provided an aggregate of SEK 11.2 million ($1.0
million) in both equity and debt financing to the Company, substantially
all of which was initially funded through loans to the Company and then
converted into equity or convertible debt. On September 30, 1996,
outstanding loans to the Company from Euroventures Nordica in the principal
amount of SEK 7,160,419 ($663,616), plus accrued interest were converted
into a conditional contribution to the shareholders' equity of Biora. To
the extent that the Company has funds available for dividends, and subject
to approval by the general shareholders' meeting of the Company, the
Company will make repayments out of such funds to Euroventures Nordica in
satisfaction of its conditional contribution prior to making any dividend
payments to other holders of Ordinary Shares or ADSs. The Company currently
has no outstanding loans from Euroventures Nordica. The company has a
conditional loan from Swedish Industrial Fund of SEK 2.4 million.

         The Company had SEK 53.8 million ($ 5.0 million) in cash at
December 31, 2000 compared to SEK 112.8 million ($10.5 million) at December
31, 1999.

         The Company generated negative cash flow of SEK 59.0 million ($5.5
million) during the year 2000. The negative net result for the year of SEK
74.2 million ($6.9 million) was compensated by the amortization of
capitalized R&D of SEK 10.5 million ($ 1.0 million) as well as by
depreciation of tangible assets and amortization of patents of SEK 8.9
million ($0.8 million). Cash flow during the full year 1999 was negative
SEK 74.2 million ($6.9 million).

         Biora's shareholders' equity equaled to SEK 50.9 million ($4.7
million) at December 31, 2000 as compared to SEK 127.4 million ($11.8
million) at December 31, 1999.

         Biora's capital expenditures for the year 2000 amounted to SEK 5.5
million ($0.5 million) compared to SEK 4.3 million ($ 0.4 million) for the
full year 1999. The reason for the low level of capital expenditure in
recent years is that all major capital expenditures for the present
capacity level of production, as well as the build up of sales offices were
mainly incurred in earlier years.

         Although Biora anticipates that revenue from sales of Emdogain and
its current cash balances will be sufficient to finance the Company's
operations through at least 2001, there can be no assurance that the
Company will not require additional financing. Based on its current
projections regarding its revenues and costs, the company believes that it
will break-even, from a cash-flow perspective, in the first quarter of
2002. However, while the company believes that current trends in its
revenues and costs support this projection, there can be no assurances that
such trends will continue. If the company's revenue and cost structure did
not change from their current structure and no additional financing was
raised, the company projects that it would run out of cash in the second
quarter of 2002. Biora's future liquidity and capital requirements and its
revenue and cost structure will depend upon numerous factors, including the
extent to which Emdogain gains market acceptance, the timing and cost
involved in the clinical testing of and obtaining regulatory approval for
its products under development, the cost and success of the Company's
strategy to divest or find a partner for Biora BioEx.

         At its annual meeting in May 2001, Biora's shareholders authorized
the company's board of directors, if deemed necessary and on market
conditions, to increase the company's share capital by a maximum of SEK
220,l00 through a new share issue of up to 5,500,000 shares at a nominal
value of SEK 0.04. The company currently does not have specific plans to
raise additional financing, although it is exploring options to do so with
several banks and investment banks. However, there can be no assurance that
the Company, if required, will be able to raise additional financing on
acceptable terms, or at all, the failure of either of which could have a
material adverse effect upon the Company's business, financial condition,
prospects and results of operations.

         As a step in ensuring long-term financing, the Annual General
Meeting has authorized the Board, if deemed necessary and on market
conditions, during the period before the next Annual General Meeting to
increase the company's share capital by a maximum of 220,000 SEK by a new
share issue of up to 5,500,000 shares, each at a nominal value of 4 ore
(0.04 SEK). If all authorized shares are issued this will equal 20.4% of
the company's share capital assuming exercise of all outstanding warrants.
According to the proposal, the Board shall have the authority to issue new
shares with or without giving existing shareholders priority rights to
purchase shares.


Impact of Currency Fluctuations and Inflation

         The Company expects to have significant export sales from Sweden
that are invoiced in currencies other than the krona. Also, the Company
will incur a significant portion of its expenses in kronor. Accordingly,
the Company's results of operations, expressed in kronor, may be adversely
affected by the fluctuations in the exchange rates between the krona and
any other currencies in which the Company invoices.

         In 2000, the year-end krona was about twelve percent lower against
the U.S. dollar the one year earlier and the average rate for 2000 was
about two percent lower than in 1999. In 2000, the year-end krona was about
three percent lower against the Euro the one year earlier and the average
rate for 2000 was about four percent higher than in 1999.

         The effects of inflation on Biora's results of operations have not
been significant. However, inflation in Sweden may have a negative effect
on the profitability of contracts under which the Company is to receive
payments in dollars or other non-Swedish currencies, unless such inflation
is offset by a depreciation of the krona against such currencies. During
the last couple of years the inflation has been reduced in Europe in
general. During 2000, the inflation rate in Sweden was 1.3 percent.

         To compensate for changes in the relative value of the krona
compared to other currencies in which the Company does business, the
Company has entered into forward currency exchange contracts with respect
to receivables denominated in non-Swedish currencies. The Company invested
the net proceeds of the IPO in investment grade, interest-bearing
obligations pending application of such proceeds. There can be no
assurance, however, that any such future activities undertaken by the
Company will eliminate the potential negative financial impact of currency
fluctuations.

Primary market risks and how they are managed

         The Company's consolidated cash flows and earnings are subject to
changes in foreign currency exchange rate. The Company attempts to limit
its exposure to changing foreign exchange rates through operational and
financial market actions.

         The Company sells its products, carries out research
collaborations and performs clinical trials in a number of locations around
the world, resulting in a diversified revenue and cost base that is exposed
to fluctuations in U.S. and European currencies. This diversified base of
foreign currency revenues and costs serves to create a natural hedge that
limits the Company's net exposure to fluctuations in these foreign
currencies.

         Short term exposures to changing currency exchange rates are
managed by financial market transactions, principally through the purchase
of forward exchange contracts, to offset the earnings and cash flow impact
of the nonfunctional currency denominated receivables, payables and
forecasted transactions of the Company's foreign subsidiaries. Foreign
exchange forward contracts are denominated in the same currency as the
receivable or payable being covered, and the term and amount of the foreign
exchange contract substantially mirrors the term and the amount of the
underlying receivable or payable. The Company covers the majority of all
known and measurable exposed receivables and payables denominated in
foreign currencies that have a liquid, cost effective forward exchange
market. The receivables and payables being covered arise from trade and
inter-company transactions of and among the Company's foreign subsidiaries
and inter-company loans between the Company and its foreign subsidiaries.

         The Company does not have any significant exposure, to
fluctuations in interest rates because of the low levels of marketable
securities and there are no debts on the Company's balance sheet. The
Company does not undertake any specific actions to cover its exposure to
interest rate risk and the Company is not party to any interest rate risk
management transactions.


Economic and Monetary Union

         On January 1, 1999 a single European currency, the Euro, was
introduced. While currently Sweden was not in the first group of countries
initially adopting the Euro, the Company is unable to predict the nature or
extent of the impact that the adoption of the Euro by other member states
of the European Union may have on the Company. So far no there have been no
noticeable effects. The Swedish currency "Kronor" started off very weak
against the Euro, since the Swedish government has been unclear about its
plans whether or not to join the monetary union. A few months after the
introduction of the Euro the Swedish currency has strengthened
approximately ten percent against the exchange rate as of January 1, 1999.
In the beginning of 2000 the Swedish currency continued to strengthen
against the Euro and from mid year weakened again. In 2001 it has continued
to weaken against the Euro as well as against the US dollar.


U.S. GAAP Reconciliation

         Biora prepares its Consolidated Financial Statements in accordance
with Swedish GAAP, which differs in certain significant respects from U.S.
GAAP. Under U.S. GAAP, the net loss for the year ended December 31, 2000
amounted to SEK 66.0 million ($6.1 million) as compared to SEK 76.1 million
($7.0 million) under Swedish GAAP. Net loss per Ordinary Share for the year
ended December 31, 2000 was SEK 3.11 ($0.29) under U.S. GAAP, compared with
SEK 3.59 ($0.33 ) under Swedish GAAP. Shareholders equity at December 31,
2000 under U.S. GAAP was SEK 44.2 million ($4.1 million) as compared to
shareholders equity of SEK 50.9 million ($4.7 million) under Swedish GAAP.

         The difference between net loss and shareholders' equity (deficit)
under U.S. GAAP and Swedish GAAP results primarily from differing
accounting treatments of research and development costs, the differing
accounting treatments of Euroventures Nordica's capital contribution and
the differing principles concerning amortization of patents. Under Swedish
GAAP, the Company has capitalized certain research and development costs
for Emdogain and related product approval costs incurred in 1993 and
subsequent periods. For U.S. GAAP purposes, such costs are expensed as
incurred. See Note 23 of Notes to Consolidated Financial Statements for a
reconciliation of results of operations and shareholders' equity in
accordance with Swedish GAAP to approximate results of operations and
shareholders' deficit in accordance with U.S. GAAP and for a description of
the differences between U.S. GAAP and Swedish GAAP that significantly
affect Biora.


Item 6. Directors, Senior Management and Employees

         Directors and Senior Management

         Under the Swedish Companies Act (aktiebolagslagen), the Board of
Directors of the Company (the "Board of Directors" or "Board") has ultimate
responsibility for the organization of the Company and the management of
the Company's affairs. The Company's Articles of Association provide for a
Board of Directors elected by its shareholders of not fewer than five nor
more than nine directors and not fewer than one nor more than three deputy
directors. In addition, pursuant to the Swedish 1987 Act on Board
Representation for Employees in Private Employment (lagen om
styrelserepresentation for de privatanstallda), the employees of the
Company, under certain conditions, may be represented on the Board. Under
Swedish law, the President and at least half of the Board members must be
resident in an EEA country unless the Swedish government or an authority
appointed by the Swedish government grants an exemption. All directors
(except directors elected by the employees, if any) are elected by
resolution of a general meeting of shareholders. The term of office of a
director (except directors elected by the employees, if any, whose term of
office must not be more than four fiscal years) is one year, but a director
may serve any number of consecutive terms. Directors may be removed from
office by a general meeting of shareholders at any time, and vacancies on
the Board, except when filled by a deputy director, may only be filled by
shareholder resolution. Each year, one director is elected Chairman of the
Board by resolution of the Board at the first meeting of the Board
following its appointment.

Directors and Executive Officers

         As of May 31, 2001, the directors and executive officers of the
Company are as follows:

Name                    Age         Position

Per Wahlstrom           54          Chairman of the Board of Directors
Svein Eskedal           49          Director
Dr. Lars Hammarstrom    64          Director
Per Lojdquist           52          Director
Lars Inglemark          52          Director
Tomas Hammargren        49          Director, President & Chief
                                    Executive Officer through August 8, 2000
Christer Testen         58          Director
Lennart Jacobsson       45          Deputy Director
Rickard Soderberg       43          Chief Executive Officer as of
                                    August 8, 2000
Anders Agering          50          Executive Vice President & Chief
                                    Financial Officer and Production
Dr. Stina Gestrelius    52          Vice President of Pre-Clinical
                                    Research & Development
Dr. Lars Heijl          56          Vice President of Clinical
                                    Research & Development and Medical Director
Helen Svahnqvist        34          Vice President of International
                                    Marketing and Sales
Tommie Johansson        49          Vice President Investor Relations and
                                    Corporate Communications
Kerstin Palsson         43          Group Controller

         Per Wahlstrom has served as the Chairman of the Board of Directors
of Biora since 1994 and as a Director since 1987. From 1986 through June
30, 1998, Mr. Wahlstrom has served as the Managing Director and Chairman of
the Board of Euroventures Management AB, an investment advisor for various
venture capital funds with over SEK 1,200 million under management. Prior
thereto, Mr. Wahlstrom was the Managing Director of six regional venture
capital companies within the Swedish Industry Establishing Company (Svetab)
group from 1982 through 1985. From 1980 to 1982, Mr. Wahlstrom served as
the Managing Director of Svetab Ost, a regional venture capital company
belonging to the Svetab group. Mr. Wahlstrom was the Chairman of the Board
of Euroventures Management AB until June 30, 1998. In addition, he is a
member of the boards of directors of Louis Gibeck AB, Studsvik Holding AB,
Studsvik AB, Studsvik Rad Waste AB, Kirk Acoustics AS, Swedestart
Management AB, Volvo Technology Transfer AB, JK Foundation and Euroventures
Advisors AS. As of June 1998, the investment advisor to Euroventures
Nordica will be Quintus, a company beneficially owned by Mr. Wahlstrom.

         Svein Eskedal has served as a Director of Biora since April 1997.
Mr. Eskedal is the owner of Eskedal Consult A/S and works as a consultant
specializing in mergers and acquisitions and corporate management on behalf
of major Norwegian and European shareholders and companies. Mr. Eskedal is
a Director of a number of Norwegian private companies and has previously
been a Director of such Norwegian public companies as Aker Brygge A/S, Hag
A/S and Bird Technology A/S.

         Lars Hammarstrom co-founded Biora in 1986 and has served as one of
its directors since that time. Dr. Hammarstrom also served as President of
Biora from 1990 to 1994. Dr. Hammarstrom was the director of COB at the
Karolinska Institute from 1992 to 1998, and he has served as professor of
Oral Pathology at the Karolinska Institute since 1975. Prior thereto, Dr.
Hammarstrom was the dean of the Dental School at the University of Lund
from 1974 through 1975. Dr. Hammarstrom holds a D.D.S. in Dentistry and a
Ph.D. in Pharmacology from the Karolinska Institute's School of Dentistry.

         Per Lojdquist has served as a Director of Biora since 1997. Mr.
Lojdquist is a member of the Group Executive Committee of AB Volvo and has
been the Head of Corporate Communication and Investor Relations of AB Volvo
since 1997. Prior to that he had a number of senior management positions
within AB Volvo.

         Lars Ingelmark is a Board member since 1999. He holds a graduate
in medicine and had from 1974 to 1984 several marketing and sales positions
in Ciba Geigy Pharmaceuticals, and was Head of the Pharmaceutical division
1983-84. From 1985 to 1986 he was CEO of Janssen Pharma in Sweden and
Norway. During 1987 and 1998 he held several positions in the Management
Group of Kabi, Kabi-Pharmacia and Pharmacia & Upjohn, such as deputy CEO,
Head of Pharmaceutical Division, Responsible for the Asian region and
Senior Vice President, Corporate Projects. Since 1998 he is Head of AP Life
Science Ventures at Swedish National Pensions Insurance Fund, 6th Fund
Board. Other Board positions: Board member of A+ Science Invest AB, Health
Cap AB, Clinical Data Care AB, KaroBio AB (publ), Meda AB, Molnlycke Health
Care AB and Nobel Biocare AB (publ).

         Tomas Hammargren has been a member of the board since 1994 and was
previously the President of Biora until August, 2000. Prior thereto, Mr.
Hammargren was the Industrial Counselor in the Swedish Ministry of Industry
and Commerce from 1991 to 1994. From 1989 to 1991, Mr. Hammargren was a
Strategic Management Consultant at SIAR-Bossard where he was responsible
for projects and strategy development in Japan and Europe. From 1986 to
1989, Mr. Hammargren was President of Nobel Medica AB, a pharmaceutical and
medical device production and distribution company within the Nobel Group
that also represented ten United States and European companies in the
Scandinavian markets. Mr. Hammargren served as Vice President of Pharmacia
KK (Japan) from 1983 through 1986, as well as Marketing Manager for
Pharmacia Ophthalmics, where he was responsible for the international
launch of Healon, from 1979 through 1983.

         Christer Testen has served as a member of the Board since May
2001. On the Board's behalf he is also responsible for marketing
matters. Christer Testen has extensive experience of the pharmaceutical
industri, most recently as head of Astra Australia (1995 - 1999). Between
1976 and 1994, he held several senior positions in marketing, strategic
planning and licensing within the Astra Group. Christer Testen is also
Chairman of the Board of Arexis AB and Berzelius Science Park AB.

         Lennart Jacobsson has served as a Deputy Director of Biora since
1987. Since 1986, Mr. Jacobsson has served as the Investment Manager of
Euroventures Management AB. Mr. Jacobsson has also been the Managing
Director of Swedestart AB since 1995. Prior thereto, Mr. Jacobsson was the
Investment Manager of Svetab Ost from 1983 to 1985, and in 1983 was head of
the accounting department of Stockholms Badhus. In addition, he is a member
of the Boards of Directors of Euroventures Management AB, Euroventures
Management AS, Euroventures Advisors AS, Selcom AB, 3i Systems AB, Cecap
AB, LG Products AB, Metronor AS, Read Soft AB, Universal Access AB and
Swedestart Management AB.

         Rickard Soderberg has been appointed President and Chief Executive
Officer of Biora starting Augst 8, 2000. Mr Soderberg is currently holding
the position as President of Hassle Lakemedel, a company in the Astra
Zeneca group since 1997. 1996-1997 Mr Soderberg served as President of
Pharmacia & Upjohn in Austria. Prior therto Mr Soderberg held various
senior management positions in the Pharmacia and Kabi organizations,
predominantly in marketing and sales.

         Anders Agering has served as Executive Vice President and Chief
Financial Officer since May 1, 1998. From 1990 through May 1998, Mr.
Agering served as Chief Financial Officer and other financial and operating
responsibilities in the Business Area Rail of the Cardo Group. From 1988 to
1990, Mr. Agering was Group Controller at Provendor AB (Volvo's Food Group)
and from 1980 to 1988, was the Group Controller at Scan Coin AB.

         Stina Gestrelius has served as the Vice President of Pre-Clinical
Research & Development and Production of Biora since 1990, as the Head of
Research & Development and Production from 1988 as well as a Deputy
Director of Biora from 1988 through 1997. From 1983 to 1988, Dr. Gestrelius
was the Section Head of Peptide Synthesis Research at Ferring
Pharmaceuticals in Malmo, Sweden, and from 1977 to 1982 was the Section
Head of Enzyme Immobilization R&D at Novo Nordisk A/S in Copenhagen,
Denmark. Dr. Gestrelius holds a Master of Sciences in Chemical Engineering
as well as a Ph.D. in Biochemistry from the University of Lund. Dr.
Gestrelius is the Swedish expert and delegate of CEN/Technical Committee
316, which writes European standards for tissue-derived medical devices.
Dr. Gestrelius received the Gosta Virding Award for Entrepreneur of the
Year in 1995 relating to her work at Biora with Emdogain. Dr. Gestrelius
has also served as a member of the Board of COB since 1993.

         Lars Heijl has served as the Vice President of Clinical Research &
Development and Medical Director of Biora since 1996. Dr. Heijl has also
acted as a Dental Consultant at Astra Pain Control AB since April 1996.
Prior thereto, Dr. Heijl served as a Dental Medical Advisor and Project
Leader at Astra Pain Control AB from March 1993 through March 1996 and the
Project Leader at Astra Pain Control AB from January 1990 through February
1993. From 1986 to 1989, Dr. Heijl served as Associate Director of
Toxicology at Astra Hassle AB. Prior to 1986, Dr. Heijl also held
appointments as an Associate Professor in the School of Dental Hygiene and
the Department of Periodontology at the University of Gothenburg in Sweden
and was an instructor in periodontology from 1975 to 1976 with the
Department of General Dentistry at the Eastman Dental Center in Rochester.
Dr. Heijl received his D.D.S. from the University of Gothenburg, his M.Sc.
in Dental Research from the University of Rochester and his Ph.D. in
Odontology from the University of Gothenburg.

         Tommie Johansson has served as Vice President Invetor Relations
and Corporate Communication at Biora since November 2000. He has been
active for more than 20 years in the pharmaceutical industry. During 1997-
1998 he served as Director Investor Relations Pharmacia&Upjohn and during
1998-2000 he served as Global Brand Director at AstraZeneca.

         Helen Svahnqvist has served as International Marketing Manager of
Biora since January 1, 2000. Prior thereto, Ms. Svahnqvist served as
marketing manager for the Nordic area within Biora since 1995. Previously
she has been a pharmaceutical consultant with Jansen-Cilag AB.

         Kerstin Palsson has served as Group Controller since March 1997.
Prior thereto, Ms Palsson served as Public Accountant with the BDO audit
group from October 1980 and as a Chartered Public Accountant from 1986
until February 1997 with the same company.

Other Key Personnel

Name                           Age        Position

Donna Janson (prev. Jenks)     46         President, Biora Inc., USA
Vartan Gianighian              54         President, Biora S.r.l, Italy
Ann-Christin Johansson         44         Quality Assurance Manager, Biora AB
Wolfgang Muller                36         General Manager, Germany and Austria


         Donna Janson (prev. Jenks) has been the Chief Executive Officer of
Biora USA since August 1996. Prior thereto, Ms. Janson acted as the Vice
President of Marketing at Nobel Biocare USA Inc. from 1993 through August
1996, the Vice President and General Manager of the Central Division for
Nobelpharma USA from 1991 through 1993 and the National Sales Manager for
Nobelpharma Canada Inc. from 1987 through 1991.

         Vartan Gianighian has served as the President of Biora S.r.l.,
Italy since April 1997. Prior thereto, Mr. Gianighian was the Managing
Director of Amgen in Italy from 1996 to 1997. From 1991 to 1995 he was the
Executive Vice President of Pharmacia's Pharmaceutical Products division.
From 1989 to 1990, he was the Director of the Pharmaceutical Division of
Formenti, a family owned Italian company.

         Ann-Christin Johansson has served as Quality Assurance Manager of
Biora since 1990 and as a research chemist with Biora since 1988. Prior
thereto, Ms. Johansson was employed as a research chemist at Ferring
Pharmaceuticals in Malmo. Ms. Johansson holds a Master of Sciences in
Chemical Engineering from the University of Lund.

         Wolfgang Muller was appointed General Manager for Biora GmbH in
June 2000. He rejoined Biora after one year in the real estate business.
Previous to that he served as Sales and Marketing Director for Biora
Germany and Austria for three years.

Audit Committee

         The Company's audit committee consists of 3 directors who are not
officers or employees of the Company (Svein Eskedal, Toni Weitzberg and
Bertil Koch) and generally advises the Company's board of directors in
matters relating to the adequacy of the Company's financial reporting and
internal controls, reviews the Company's financial statements and other
financial information (including information filed with or furnished to the
United States Securities and Exchange Commission), consults with and
reviews the compensation of the Company's independent auditors and reviews
and proposes changes to the Company's accounting and financial reporting
policies.

Compensation

         The following table sets forth the aggregate compensation paid to
or accrued on behalf of all directors and officers of Biora as a group for
the year ended December 31, 2000:


                                      Salaries,                 Pension,
                                   Director's Fees             Retirement
                                     Commissions               and Similar
                                     and Bonuses                Benefits
                                ------------------------- ---------------------
                                     SEK in thousands        SEK in thousands

All non-executive directors
as a group (8 persons)                    1,972                    0

All executive officers
as a group (7 persons)                    5,371                   1,702

                                ------------------------- ---------------------

         Total                            7,343                   7,702

         In 2000, the Chairman of the Board of Directors received a fee of
SEK 150,000, and the non-executive Directors received a fee of SEK 100,000,
and the Deputy Director a fee of SEK 50,000. In addition to the director's
fee, Bertil Koch received SEK 25,000, Toni Weitzberg SEK 25,000 and Svein
G. Eskedal received SEK 40,000 as compensation for their services as
members of the Audit Committee. Lars Hammarstrom received a research and
development consultation fee of SEK 205,000 and Eskedal Consult A/S
received SEK 1,082,000 for consultancy assignments.

         Mr. Tomas Hammargren, the President of Biora until August 13, 2000
received SEK 2,506,000 in salary including severance pay of SEK 1,758,000
In addition, he received pension benefits of SEK 738,000 paid by Biora in
accordance with an individual plan.

         Mr Rickard Soderberg, President of Biora since August 14, 2000.
The remuneration amounted to SEK 650,000. In addition, he received pension
benefits paid by Biora in accordance with an individual plan for which the
company expended SEK 135,000.In accordance with the employment contract,
Rickard Soderberg is entitled to a six months mutual period of notice and
in addition a severance pay equal to 18 months salary. Mr Soderberg is also
entitled to a company car.

Management Employment Agreements

The Company has entered into employment agreements with each of Mr.
Soderberg, Mr. Agering, Dr. Gestrelius, Dr. Heijl, Mrs. Svahnquist, Mr.
Johansson and Mrs Palsson. These agreements are continuously in force until
terminated by (i) the individual party thereto, at which point the
individual would be required to remain employed as an officer of the
Company for a period ranging from three to six months or (ii) the Company,
at which point the individual would be permitted to remain employed as an
officer of the Company for a period ranging from 5 to 18 months. Among
other items, these agreements contain non-compete and confidentiality
provisions. According to the terms of the non-compete clause, such officers
agreed not to conduct any business directly competing with the Company's
during the term of the employment agreement (with the exception of Messrs.
Heijl and Mrs. Palsson) and for an additional year thereafter without the
Company's prior written consent.

Key Employee Incentive Plan

         On January 24, 1997, the Company's Board of Directors, acting in
accordance with the authorization of the shareholders of the Company,
approved the issuance of an aggregate of SEK 500,000 principal amount of
subordinated debentures at an interest rate of 7 percent with 560,000
accompanying warrants to Euroventures Nordica at a premium which reflects
the value of the accompanying warrants. On the same date, Biora and
Euroventures Nordica entered into an agreement (the "Key Employee Incentive
Plan") pursuant to which Euroventures Nordica agreed to offer all the
warrants at a price which reflects the premium to officers and other key
employees of Biora and certain of its subsidiaries (the "Participants") to
provide them with appropriate incentives to encourage them to continue in
the employ of Biora and to acquire a proprietary interest in the long-term
success of Biora. Each warrant entitles the holder to acquire one Ordinary
Share of the Company, at an exercise price of SEK 70.00. Under Swedish law
a corporation cannot issue warrants separately from debentures, but
accompanying warrants may be detached from the debentures. The principal
amount of the debentures issued was de minimis in comparison to the
estimated value of the attached warrants. As of June 15, 1998, all of the
560,000 warrants issued to Euroventures Nordica had been subscribed for by
the Participants. The warrants were exercisable for Ordinary Shares at any
time up until January 31, 2001.

         The warrants have been granted to the following board members and
employees of the Company:

         Name                                                   Number

         Donna Janson                                           150,000
         Stina Gestrelius                                       100,000
         Tomas Hammargren                                        50,000
         Bengt Sahlberg                                          50,000
         Lars Heijl                                              40,000
         Anders Larsson                                          40,000
         Vartan Gianighian                                       40,000
         Magnus Pelles                                           40,000
         Anders Agering                                          20,000
         Stefan Edgren                                           10,000
         Mikael Sjoblom                                          10,000
         Per Lojdquist                                            4,000
         Kerstin Palsson                                          3,000
         Mats G. Ringesten                                        2,000
         Toni Weitzberg                                           1,000

         Total                                                  560,000

         Issued warrants expired unexercised on January 31, 2001.

Warrant Program 2002

         At a meeting on April 23, 1998, the Company's shareholders
approved the issuance of an aggregate of SEK 50,000 principal amount of
subordinated debentures with 200,000 accompanying warrants to Biora Option
AB (the "Warrant Program"), a wholly-owned subsidiary of Biora, at a
premium which reflects the value of the accompanying warrants. On the same
date, Biora and Biora Option AB entered into an agreement pursuant to which
Biora Option AB agreed to offer all the warrants at a price which will
reflect the fair market value of the warrant to certain employees of Biora
and its subsidiaries (who are determined by the Company's Board of
Directors) (the "Participants") to provide them with appropriate incentives
to encourage them to continue in the employ of Biora and to acquire a
proprietary interest in the long-term success of Biora. Each warrant
entitles the holder to acquire one Ordinary Share of the Company, at an
exercise price of SEK 130.00. Under Swedish law a corporation cannot issue
warrants separately from debentures, but accompanying warrants may be
detached from the debentures. The principal amount of the debentures issued
were de minimis in comparison to the estimated value of the attached
warrants. Of the 200,000 warrants issued to Biora Option AB, 89,250 have
been subscribed for by 59 employees. All employees in the group, that did
not previously hold any options or warrants in the company, were invited to
participate in the warrant program. The warrants are exercisable for
Ordinary Shares at any time during May 2002.

Warrant Program 2004

At a meeting on May 3, 2001, the Company's shareholders approved the
issuance of promissory notes connected to warrants as well as approval to
issue warrants to employees of Biora.

The reason is to implement an incentive program for executives and
employees within the group pursuant to which they can be offered the
opportunity to become shareholders of Biora AB. The degree of dilution
assuming issuance of all notes and exercise of all outstanding options
corresponds to about 3.6% of the share capital. The dilution effect of all
incentive programs in the form of options is 4.5% after giving effect pro
forma to the exercising of all options. The program is intended for
European employees only.

Employees

As of March 31, 2001, the Company had 75 full-time employees, including
nine in administration and finance, 45 in marketing and sales, ten in
research and development and eleven in manufacturing and quality assurance.
As is standard in Sweden, many of the Company's employees are members of
trade unions. The significant majority of the Biora employees in Sweden are
party to or effected by collective bargaining agreements. Biora pays
certain health and welfare charges, known as social costs, for its
employees. The Company has never experienced a work stoppage and believes
its employee relations to be good.

         The Company's future success will depend on its ability to
attract, train, retain and motivate highly qualified employees. The Company
is particularly reliant for its continued success on the services of
several key employees.


Share Ownership

         In order to be entitled to attend and vote at a general meeting of
shareholders, a shareholder must be registered in the register of
shareholders ten days prior to the date of the meeting. The Articles of
Association provide that the shareholder must give notice to Biora of the
intention to attend the meeting not later than the date specified in the
notice convening the meeting (a date not earlier than the fifth weekday -
including Saturday - preceding the meeting). A shareholder may attend and
vote at the meeting in person or by proxy. A person designated on the
register as a nominee (including the depositary of the ADRs) is not
entitled to vote at a general meeting, nor is a beneficial owner whose
share is registered in the name of a nominee (including the depositary of
the ADRs) unless the beneficial owner first arranges to have such owner's
own name entered in the register of shareholders. At any general meeting,
each shareholder may cast the full number of votes represented by such
holder's shares.

         There are no Swedish governmental laws, decrees or regulations
that restrict the export or import of capital or that affect the remittance
of dividends or other payments to non-residents of Sweden who hold Biora
shares. There have been no limitations imposed by Swedish law or Biora's
Articles of Association on the right of non-residents of Sweden or
non-citizens of Sweden to hold or vote Biora shares.

Item 7. Major Shareholder and Related Party Transaction

Major Shareholders

         The Company has been informed that The Swedish 6th Pension Fund
owns 22.2 percent and Euroventures Nordica owns of 19.2 percent of the
outstanding Ordinary Shares. The Company does not believe that it is
directly or indirectly controlled by the Swedish 6th Pension Fund,
Euroventures Nordica or by any other corporation or by any foreign
government as of June 15, 20000.

         The following table sets forth certain information regarding the
beneficial ownership of the Ordinary Shares known by the Company as of
March 1 2001. The Company believes, based on information furnished by such
owners, that, except as otherwise indicated, the owners listed below have
sole investment and voting power with respect to such shares.

-------------------------------------------------------------------------------

                                                     Number of
                                                     Ordinary Shares   Percent
                                                     Owned             of Class
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

 Principal Shareholders/ Investment holders:
-------------------------------------------------------------------------------

Swedish 6th Pension Fund                             4,715,940         22,24
Euroventures Nordica I BV(i)                         4,074,140         19,21
Lars Hammarstrom and family                          815,9001           3,80
Bank of New York                                     717 142            3,38
Arosmaizels                                          418,900            1,97
Clearstreaming Banking                               329 602            1.55
Danske Andelskasse                                   308 050            1.45
Passionskassan for Varksteds                         300,000            1.41
Reabourne Melin Life Science                         250,000            1,18
BG Bank                                              216 935            1,02
All directors and officers as
a group (fourteen persons)                           1,183 170(ii)      5,6

         (i) Euroventures Nordica is a venture capital fund managed by
         Quintus Management Ltd. ("Quintus") The board of management of
         Euroventures Nordica has the power to vote and dispose of the
         4,074,140 Ordinary Shares held by Euroventures Nordica. On May
         16th 2001, the investment fund Euroventures Nordica I BV made a
         distribution in kind to its shareholders of all the found's shares
         in Biora. The shareholders of Euroventures Nordica I BV are
         Carlsberg, Christiania Bank, Den Danske Bank, Norsk Hydro, Nokia,
         Fortum Oil, Storebrand, Euroventures BV and Skytrack Investment.

         (ii) Includes (i) 815,900 Ordinary Shares beneficially held by
         Lars Hammarstrom (ii) 142,000 Ordinary Shares benefically held be
         Svein G Eskedal (iii) 138,220 Ordinary Shares held by Thomas
         Hammargren (iv) 63,400 Ordinary Shares held by Stina Gestrelius
         (iv) 20,000 Ordinary Shares beneficially held by Vartan
         Ghianighian and (v) 13,650 Ordinary Shares held by other Board of
         Directors or Biora Senior Management

         The Company does not know of any arrangements that might result in
a change of control.

         As of May 2001, the Company had 21,203,800 Ordinary Shares
outstanding.


Agreement with Astra

         From 1989 through 1992, Astra was a principal shareholder in Biora
and participated in the funding of the early research and development of
Emdogain. On December 31, 1992, Biora, Astra and certain shareholders of
Biora entered into an agreement pursuant to which Astra terminated its
commitment to fund the research and development of products relating to
Emdogain as well as all licensing agreements which Biora and Astra had
previously entered into. Under the terms of the agreement, Astra also
transferred all of the Ordinary Shares held by it in Biora to certain other
principal shareholders of Biora. As part of the agreement, Astra was
granted a royalty, up to and including December 31, 2009, of 2.5 percent of
commercial income (other than deductions for VAT and customs duties) from
the dental application of two patents held by the Company relating to
Emdogain: "binding-inducing composition" and "composition inducing a
binding." The Company will reflect costs incurred pursuant to the terms of
the royalty agreement as an expense in its statements of operations. See
"Description of Business--Patents and Proprietary Rights."

2001 Authorization to issue new shares

As a step in ensuring long-term financing, the Annual General Meeting
authorized the Board, if deemed necessary and on market conditions, during
the period before the next Annual General Meeting to increase the company's
share capital by a maximum of 220,000 SEK by a new share issue of up to
5,500,000 shares, each at a nominal value of 4 ore (0.04 SEK). If all
authorized shares are issued this will equal 20.4% of the company's share
capital assuming exercise of all outstanding warrants. According to the
proposal, the Board shall have the authority to issue new shares with or
without giving existing shareholders priority rights to purchase shares.

Capital Contribution from Euroventures Nordica

         On September 30, 1996, Euroventures Nordica made a conditional
contribution to the shareholders' equity of Biora in the amount of SEK
7,510,052 through the conversion of outstanding loans, including accrued
interest, to Biora in the aggregate principal amount of SEK 7,160,419 and
accrued interest of SEK 349,633. The amount of the conditional contribution
was treated as unrestricted equity. The contribution was made to increase
total shareholders' equity as the change in the Company's accounting policy
with respect to the capitalization of costs related to the development of
Emdogain decreased statutory shareholders' equity. The contribution is
deemed "conditional" in that it is to be repaid to Euroventures Nordica
only to the extent that the Company has sufficient unrestricted equity
otherwise available for dividends, and such repayment is further subject to
the approval of any repayment by the general shareholders' meeting of the
Company. There can be no assurance, however, that the Company will ever be
profitable or that the Company will have sufficient positive unrestricted
equity to repay Euroventures Nordica's conditional contribution.

Local Hard Tissue Formation Research Agreement with COB

         In June 1997, the Company and COB entered into an agreement under
which COB was to conduct research regarding local hard tissue formation. As
a result of the departure of Dr. Hammarstrom from COB, the Company and COB
amended the agreement in May 1998. Under the amended agreement, the Company
paid COB for research conducted from July 1997 through December 1998 as
follows: SEK 275,000 was paid upon the signing of the amendment, SEK
275,000 on March 31, 1998, and SEK 275,000 was paid on September 30, 1998
(prior to the amendment, Biora was to pay COB SEK 2,050,000 per year for
research services).


Item 8. Financial Information

The information called for by this item commences on page F-1.

Item 8. a 7   Legal Proceedings

From time to time, the Company may become involved in legal proceedings
arising out of the ordinary course of its business. The Company is not
aware of any pending or threatened legal proceedings to which the Company
is a party or t


Item 9. The Offer and Listing

         The principal non-United States trading market for Biora's
Ordinary Shares is the Stockholm Stock Exchange. American Depositary Shares
("ADSs"), each representing two Ordinary Shares, are quoted on the Nasdaq
National Market under the symbol "BIORY". The ADSs are evidenced by
American Depositary Receipts ("ADRs") issued by The Bank of New York, as
depositary (the "Depositary"). The Depositary has advised Biora that as of
April 30, 2001, there were 355,371 ADSs outstanding. Additionally, the
Depositary has advised Biora that as of April 30, 2001, there were 16
holders of record. A significant number of the ADSs are held of record by
broker nominees. The number of beneficial owners is unknown but is
considered to be materially higher than the 16 record holders. On the basis
of this information, the ADSs held on such date in the United States
represented approximately 3.3 percent of Biora's outstanding Ordinary
Shares.

Trading on the Stockholm Stock Exchange

         Shares traded on the Stockholm Stock Exchange (the "SSE") comprise
shares quoted on three different lists; the "A-list," the "OTC-list" and
the "O-list," the latter being primarily intended for smaller companies,
companies with a short track record and companies wishing to be listed on
the A-list in the future but which temporarily do not satisfy the
requirements for such listing. Biora's Ordinary Shares are listed on the
O-list. The requirements for a listing on the O-list, are, inter alia, at
least 300 shareholders, each of whom holds shares of a value not less than
one round lot (approximately SEK 9,000) and an ownership structure under
which at least ten percent of the shares and voting rights of the company
are held by the general public.

         Trading on the SSE is conducted on behalf of clients by banks and
brokers. While banks and brokers are permitted to act as principal in
trading both on and off the SSE, they generally engage in transactions as
agent. There are no market maker or specialist systems on the SSE.

         Trading on the SSE begins each morning at 9:00 a.m. (Stockholm
time) at an opening price determined by the Stockholm Automated Exchange
System ("SAX"), a computerized order-matching system, based on orders
entered by SSE members, and continues at prices based on market demand
until 8.00 p.m. (Stockholm time). Buy and sell orders are registered on the
system in round lots, typically of 100, 200 or 500 shares, and odd lots are
matched separately at the last price for round lots.

         The SSE is a fully electronic marketplace. Member firms of the SSE
are able to operate from an optional geographic location via advanced data
communications. The brokers' representatives are able to trade via work
stations that have been developed by the SSE or via their own electronic
data processing systems which are linked to SAX.

         In addition to official trading on the SSE, there is also trading
off the SSE during and after official trading hours. Trades in excess of 20
round lots can be effected off the SSE if the transaction price lies within
the spread then appearing on SAX, and trades in excess of 500 round lots
(for shares on the "Most Traded Shares" list of the SSE) or 250 round lots
(for all other shares) may, however, be effected off the SSE without regard
to such spread. Trades after official SSE trading hours must normally be
effected at a transaction price that lies within the spread appearing on
SAX at the time of the closing. If there are no orders in SAX at such time,
the trade may be effected at a price that otherwise reflects the market
situation at such time. If the market situation changes after the closing
of SAX, trades may be effected outside the spread, provided that it can be
shown that the transaction price reflected the market situation prevailing
at the time of the trade. Trading on the SSE tends to involve a higher
percentage of retail clients, while trading off the SSE whether through
intermediaries or directly often involves larger Swedish institutions,
banks arbitrating between the Swedish market and foreign markets, and
foreign buyers and sellers purchasing shares from or selling shares to
Swedish institutions.

         The table below sets forth, for the periods indicated, the high
and low sales prices for the Ordinary Shares on the SSE, as reported by the
SSE.

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------
                                                                    Price Per Ordinary Share
--------------------------------------------------------------------------------------------------------------------
                                                                                                     Quarter's
                                                                    High             Low             Close
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

Calendar Period                                                     SEK
--------------------------------------------------------------------------------------------------------------------
1997
--------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>              <C>             <C>
First Quarter (from February 10, 1997)                              91.0             66.0            79.5
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                      79.5             67.5            72.0
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                       76.0             63.0            71.0
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                      85.0             67.0            82.0
--------------------------------------------------------------------------------------------------------------------
1998
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                       106.0            74.0            102.0
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                      145.0            99.0            105.0
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                       119.0            70.0            80.0
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                      76.0             46.0            54.5
--------------------------------------------------------------------------------------------------------------------
1999
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                       69.5             48.0            57.5
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                      58.0             48.5            51.5
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                       50.0             25.1            41.5
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                      48.0             29.1            43.4
--------------------------------------------------------------------------------------------------------------------
2000
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                       86.0             35.0            67.0
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                      69               30.5            31.5
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                       36               19.5            25.7
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                      28                7              8.15
--------------------------------------------------------------------------------------------------------------------
2001
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                       30                8              13
--------------------------------------------------------------------------------------------------------------------
</TABLE>


         The average daily volumes of Ordinary Shares traded in the SSE
from January 1, 2000 through April 2001 was 166,154 based on total turnover
statistics (supplied by the Stockholm Stock Exchange).

Trading on the Nasdaq National Market

         The table below sets forth for the periods indicated the high and
low sales prices quoted for the ADSs on the Nasdaq National Market:

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------
                                                                 Price Per ADS
--------------------------------------------------------------------------------------------------------------------
                                                                                                    Quarter's
                                                                 High             Low               Close
--------------------------------------------------------------------------------------------------------------------

                                                                 US$

Calendar Period
--------------------------------------------------------------------------------------------------------------------
1997
--------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>              <C>               <C>
First Quarter (from February 4, 1997)                            22.875           17.750            20.000
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                   20.875           17.750            17.875
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                    19.000           16.250            18.750
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                   21.750           18.375            20.750
--------------------------------------------------------------------------------------------------------------------
1998
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                    26.500           18.375            25.000
--------------------------------------------------------------------------------------------------------------------
Second Quarter (through May 29, 1998)                            36.125           24.750            26.250
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                    30.625           17.250            20.875
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                   20.250           10.625            13.000
--------------------------------------------------------------------------------------------------------------------
1999
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                    19.000           11.500            13.130
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                   14.00            7.88              8.00
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                    12.13            6.5               10.00
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                   11.75            7.00              9.00
--------------------------------------------------------------------------------------------------------------------
2000
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                    36.42            7.63              14.75
--------------------------------------------------------------------------------------------------------------------
Second Quarter                                                   16               7.00               7.00
--------------------------------------------------------------------------------------------------------------------
Third Quarter                                                    8.75             3.88              5.00
--------------------------------------------------------------------------------------------------------------------
Fourth Quarter                                                   5.75             1.31              1.44
--------------------------------------------------------------------------------------------------------------------
2001
--------------------------------------------------------------------------------------------------------------------
First Quarter                                                    7.75             1.50              2.19
--------------------------------------------------------------------------------------------------------------------
Second Quarter    (through April 30, 2001)                       2.63             1.80              2.45
--------------------------------------------------------------------------------------------------------------------
</TABLE>

         The average daily volumes of ADS from January 1, 2000 through
April 30, 2001 was 6,221

         The Depositary for the Company's ADSs has advised the Company that
as of April, 2001, there were 355,371 ADSs outstanding. Additionally, the
Depositary has advised the Company that as of April 30, 2001, there were 16
holders of record. A significant number of the ADSs are held of record by
broker nominees. The number of beneficial owners is unknown but is
considered to be materially higher than the 16 record holders. On the basis
of this information, the ADSs held on such date in the United States
represented approximately 3.3 percent of the Company's outstanding Ordinary
Shares.


Item 10. Additional Information

Taxation

         This summary sets forth the material Swedish and United States
federal income tax consequences that are applicable to the following
holders of ADSs or Ordinary Shares who hold such ADSs or Ordinary Shares as
capital assets ("U.S. Holders"): (i) individuals who are citizens or
residents of the United States for U.S. federal income tax purposes; (ii)
corporations created or organized in or under the laws of the United States
or any political subdivision thereof; (iii) estates the income of which is
includible in gross income for United States federal income tax purposes
regardless of source; and (iv) trusts if a court within the United States
is able to exercise primary supervision over the administration of the
trusts and one or more U.S. persons have the authority to control all
substantial decisions of the trusts. This discussion does not consider (a)
all aspects of United States federal income taxation that may be relevant
to particular U.S. Holders based on their particular circumstances
(including potential application of the alternative minimum tax), (b)
certain U.S. Holders subject to special treatment under the United States
federal income tax laws or foreign individuals or entities, for example, an
investor subject to special tax rules (e.g., partnerships, banks, thrifts,
real estate investment trusts, regulated investment companies, insurance
companies, dealers in securities or currencies, expatriates, tax-exempt
investors or holders whose functional currency is not the U.S. dollar), (c)
U.S. Holders owning directly or by attribution 10 percent or more of the
Ordinary Shares, or (d) any aspect of United States federal estate or gift
taxation or of state, local or tax laws of a country other than the United
States or Sweden.

         The statements of Swedish and United States federal income tax
laws set forth below are based on the laws in force as of the date of this
Annual Report, including the United States Internal Revenue Code (the
"Code") and the conventions presently in force between the United States
and Sweden for the avoidance of double taxation with respect to income
taxes (the "Income Tax Treaty") and with respect to estate, inheritance and
gift taxes (the "Estate Tax Treaty"), and may be subject to subsequent
changes in U.S. or Swedish law or in any of the conventions. In addition,
the following discussion assumes that the Depositary will perform its
obligations in accordance with the terms of the Deposit Agreement and any
related agreements.

         In general, for purposes of the Code, the Income Tax Treaty and
the Estate Tax Treaty, a U.S. Holder of ADSs will be treated as the owner
of the Ordinary Shares represented by those ADSs.

Swedish Taxation


Taxation of Dividends

         In general, under Swedish tax law, dividends paid by a Swedish
corporation such as the Company to non-residents of Sweden are subject to
Swedish withholding tax at a rate of 30 percent. Pursuant to the Income Tax
Treaty, however, dividends paid by the Company to a U.S. Holder will
generally be subject to Swedish withholding tax at a reduced rate of 15
percent, provided that the U.S. Holder is a resident of the U.S. pursuant
to the Income Tax Treaty and does not have a permanent establishment or a
fixed base in Sweden. U.S. Holders of ADSs or Ordinary Shares may be
required to provide documentary evidence that such holder is entitled to
the reduced 15 percent withholding tax rate under the Income Tax Treaty.
The Depositary or the Custodians will, to the extent practicable,
facilitate all administrative actions necessary to obtain the reduced 15
percent Swedish withholding tax rate at source or obtain refunds of Swedish
withholding taxes for U.S. Holders of ADSs.


Tax on Sale or Other Disposition of Ordinary Shares or ADSs

         In general, under Swedish tax law, a U.S. Holder will not be
subject to Swedish tax on any gains derived from the sale or other
disposition of Ordinary Shares or ADSs, provided that the U.S. Holder is
not a resident of Sweden and does not have a permanent establishment or a
fixed base in Sweden. Special rules may, however, apply to individuals who
have been residents of Sweden at any time within the ten-year period
immediately preceding such sale or other disposition.


Estate and Gift Taxes

         Under Swedish tax law, a transfer of an Ordinary Share or an ADS
by gift or by reason of the death of the owner may be subject to Swedish
gift or inheritance tax, respectively, with the applicable progressive
rates varying from 10 percent to 30 percent of the taxable amount
(determined after certain deductions), depending on the relationship of the
donee or beneficiary to the donor or decedent. Transfers of Ordinary Shares
or ADSs will be subject to Swedish inheritance tax if the decedent at the
time of death is a resident in Sweden or, if not resident in Sweden, is a
Swedish citizen or is married to a Swedish citizen and has emigrated from
Sweden within ten years prior to death. Transfers of Ordinary Shares or
ADSs will also be subject to gift tax if, at the time of gift, the donor or
donee is resident in Sweden or, if not resident in Sweden, is a Swedish
citizen or is married to a Swedish citizen and has emigrated from Sweden
within ten years prior to the gift. Gifts of Ordinary Shares or ADSs made
by or to Swedish legal entities are also subject to gift tax.

         Under the Estate Tax Treaty, the transfer of an Ordinary Share or
an ADS by an individual U.S. Holder, by gift or by reason of the death of
such holder, will not be subject to Swedish gift or inheritance tax,
provided that the U.S. Holder is domiciled in the U.S. pursuant to the
Estate Tax Treaty and the Ordinary Share or ADS does not form part of the
business property of a permanent establishment in Sweden or pertain to a
fixed base in Sweden used for the performance of independent personal
services. In cases where such a transfer is subject to both Swedish
inheritance or gift tax and U.S. estate or gift tax, the Estate Tax Treaty
generally provides that the United States will allow as a credit against
the U.S. tax an amount equal to the tax paid to Sweden.


Transfer and Net Wealth Taxes

         Currently there are no Swedish transfer taxes or similar taxes
imposed on sales of Ordinary Shares.

         A U.S. Holder who is not an individual is not subject to Swedish
net wealth tax. A U.S. holder who is an individual, and who is not resident
in Sweden at the end of the taxable year is not subject to Swedish net
wealth tax, with respect to its Ordinary Shares or ADSs.

United States Taxation


Taxation of Dividends

         Distributions made by the Company (other than certain pro rata
distributions of Ordinary Shares or Ordinary Share rights) with respect to
the Ordinary Shares or ADSs (including the amount of any Swedish taxes
withheld therefrom) will generally be includible in the gross income of a
U.S. Holder as foreign source dividend income to the extent that such
distributions are paid out of the Company's current or accumulated earnings
and profits as determined for U.S. federal income tax purposes.
Distributions in excess of the Company's current and accumulated earnings
and profits will be applied against and will reduce the U.S. Holder's tax
basis in its Ordinary Shares or ADSs to the extent thereof, and, to the
extent in excess of such tax basis, will be treated as capital gain from
the sale or exchange of property. The amount of any cash distribution paid
in Swedish kronor will be equal to the U.S. dollar value of the kronor on
the date of receipt (which, in the case of ADSs, will be the date of
receipt by the Depositary) regardless of whether the payment is in fact
converted into U.S. dollars at that time. After such date of receipt, gain
or loss, if any, realized by a U.S. Holder on a sale or other disposition
of kronor will generally be treated as United States source ordinary income
or loss. Distributions by the Company will not qualify for the
dividends-received deduction available to corporations.

         Subject to certain limitations, the 15 percent Swedish tax
withheld in accordance with the Income Tax Treaty will be eligible for
credit against a U.S. Holder's United States federal income tax liability.
The limitation on foreign taxes eligible for credit is calculated
separately with respect to specific classes of income. For this purpose,
dividends paid with respect to Ordinary Shares or ADSs will generally
constitute "passive income" or, in the case of certain U.S. Holders,
"financial services income." Because the rules relating to the
determination of such foreign tax credits are complex, a U.S. Holder should
consult its tax advisor to determine whether and to what extent he would be
entitled to a credit. A U.S. Holder that does not elect to claim a foreign
tax credit may instead claim a deduction for Swedish income tax withheld if
the U.S. Holder takes this approach with respect to all foreign income
taxes paid during that tax year.


Disposition of ADSs or Ordinary Shares

         A U.S. Holder that sells or otherwise disposes of ADSs or Ordinary
Shares (including as a result of a sale of Ordinary Shares by the
Depositary) will generally recognize gain or loss in an amount equal to the
difference between the amount realized by the U.S. Holder and the U.S.
Holder's tax basis in the ADSs or Ordinary Shares. Such gain or loss will
be a capital gain or loss and will be long-term if the U.S. Holder has held
such ADSs or Ordinary Shares for more than one year. Long-term capital
gains of individuals are eligible for reduced rates of U.S. taxation. Under
most circumstances, any gain recognized will be treated as United
States-source for foreign tax credit purposes, losses will generally be
allocated against U.S. source income.


Passive Foreign Investment Company Considerations

         For United States federal income tax purposes, the Company will be
considered a "passive foreign investment company" (a "PFIC") beginning in
any taxable year in which either (i) 75 percent or more of the Company's
gross income is passive income or (ii) the average value of the Company's
"passive assets" (generally assets that produce passive income or are held
for the production of passive income) is 50 percent or more of the average
value of all of the Company's assets for such year. For this purpose,
passive income includes dividends, interest, certain royalties, rents,
annuities and the excess of gains over losses from the disposition of
assets which produce passive income.

         Based on the Company's current and projected income, assets and
activities, the Company believes that it will not be classified as a PFIC
for its taxable year ending December 31, 2000 or any subsequent taxable
year. However, there can be no assurances that the Company will not in fact
be considered a PFIC for its taxable year ending December 31, 2000 or any
subsequent taxable year because (i) the determination of whether or not the
Company is a PFIC will be based on the composition of the income and assets
of the Company and can be definitively made only after the end of each
taxable year, and (ii) the application of the relevant rules is not
entirely clear in all respects.

         Unless a U.S. Holder makes a mark-to-market election as discussed
below, if the Company becomes a PFIC for any taxable year, then (i) a U.S.
Holder would be required to allocate income recognized upon the receipt of
certain excess dividends and gain recognized upon the disposition of such
U.S. Holder's ADSs or Ordinary Shares ratably over the U.S. Holder's
holding period for the ADSs or Ordinary Shares, (ii) the amount allocated
to each year other than the year of the excess dividend payment or
disposition would be subject to tax at the highest rate of individual or
corporate tax, as the case may be, and an interest charge for the deemed
deferral benefit would be imposed with respect to the resulting tax
attributable to each such year, and (iii) gain recognized upon the
disposition of ADSs or Ordinary Shares would be taxable as ordinary income.

         If the Company becomes a PFIC for any taxable year and a U.S.
Holder makes a mark-to-market election with respect to its ADSs or Ordinary
Shares, in lieu of the tax treatment described in the preceding paragraph,
the U.S. Holder generally will include in income each year an amount equal
to the excess, if any, of the fair market value of the ADSs or Ordinary
Shares as of the close of the taxable year over the U.S. Holder's adjusted
tax basis therein. In the event that the U.S. Holder's adjusted tax basis
in the ADSs or Ordinary Shares exceeds their fair market value at the close
of the taxable year, the U.S. Holder may take a deduction in an amount
equal to such excess. Such deduction, however, will be limited to the net
mark-to-market gains that the U.S. Holder has included in income with
respect to such ADSs or Ordinary Shares in prior years. A U.S. Holder's
adjusted tax basis in its ADSs or Ordinary Shares will be adjusted to
reflect amounts included or deducted under this election.

         Amounts included in income pursuant to a mark-to-market election,
including gain on the actual sale or other disposition of ADSs or Ordinary
Shares, are treated as ordinary income. Ordinary loss treatment also
applies to the deductible portion of any mark-to-market loss on the ADSs or
Ordinary Shares, including any loss realized on the actual sale or other
disposition of such ADSs or Ordinary Shares to the extent that the amount
of such loss does not exceed the net mark-to-market gains previously
included in income with respect to such ADSs or Ordinary Shares.


Information Reporting and Backup Withholding

         Dividend payments in respect of the Ordinary Shares or ADSs and
payments from the sale of Ordinary Shares may be subject to information
reporting to the United States Internal Revenue Service and possibly United
States backup withholding tax. Backup withholding will not apply, however,
to a holder who furnishes a correct taxpayer identification number or
certificate of foreign status and makes any other required certification or
who is otherwise exempt from backup withholding. Generally, a U.S. Holder
will provide such certification on Form W-9 (Request for Taxpayer
Identification Number and Certification) and other holders will provide
such certification on Form W-8 BEN (Certificate of Foreign Status). The
Treasury Department has issued new regulations which make some modification
to the withholding and information reporting rules. The new regulations
attempt to unify certifications requirements and modify reliance standards
and will generally be effective for payments made after December 31, 2000,
subject to some transition rules. Prospective investors are urged to
consult their tax advisors regarding the new regulations.


10(b)    Memorandum and Articles of Association

         Biora AB is a public company incorporated under the laws of
Sweden. The company is registered with the Swedish Patent and Registration
Office, with the corporate identity number 556289-8998. The company's
purpose is to develop, manufacture and market pharmaceuticals and treatment
equipment as well as pursue other compatible business.

         An annual General Meeting of shareholders must be convened at
least once per year on a date set by the company's board of directors. A
notice convening an General Meeting must be published in the Swedish
Official Gazette (Post- och Inrikes Tidningar), Sydsvenska Dagbladet and in
Svenska Dagbladet or Dagens Nyheter. A notice convening an Ordinary General
Meeting and an Extraordinary General Meeting to decide upon the alteration
of the Articles of Association must take place at the earliest six and at
the latest four weeks prior to the meeting. A notice convening another
extraordinary general meeting must take place at the earliest six and at
the latest two weeks prior to the meeting. A notice convening an
Extraordinary General Meeting must take place by mailed letters to all
shareholders registered in the share register, at the earliest four and at
the latest two weeks prior to the meeting. The General Meeting must be held
in Malmo, Sweden.

         A shareholder who wants to take part of a General Meeting must be
registered in a transcript of the share register relating to the facts that
were recorded ten days before the General Meeting and must give notice to
the company not later than the day mentioned in the notice convening the
meeting, before 4 p.m. The last-mentioned day must not be a Sunday, any
other public holiday, a Saturday, Midsummer Eve, Christmas Eve or New
Year's Eve and must not fall earlier than on the fifth weekday (Sw. vardag)
before the General Meeting. At the General Meeting, a shareholder is
entitled to be accompanied by one or two assistants; however, only if the
shareholder gives notice hereof to the company according to what is
prescribed in the notice.


         Biora Articles of Association do not have any provisions relating
to voting by directors where there is a potential conflict of interest, and
there is no requirement that individuals disclose there percentage
ownership of Biora owning stock once they reach a percentage. All votes
affecting the rights of shareholders, including the creation of new classes
of stock, is by majority vote.


         There are no Swedish governmental laws, decrees or regulations
that restrict the export or import of capital or that affect the remittance
of dividends or other payments to non-residents of Sweden who hold Biora
shares. There have been no limitations imposed by Swedish law or Biora's
Articles of Association on the right of non-residents of Sweden or
non-citizens of Sweden to hold or vote Biora shares.

10.d    Exchange controls

There are no Swedish governmental laws, decrees or regulations that
restrict the export or import of capital or that affect the remittance of
dividends or other payments to non-residents of Sweden who hold Biora
shares. In addition, since January 1, 1993, there have been no limitations
imposed by Swedish law or Biora's Articles of Association on the right of
non-residents of Sweden or non-citizens of Sweden to hold or vote Biora
shares.

10.h    Documents on Display

         Documents made public by the company are available for inspection
at the registered office of the company at SE 205 12, Malmo, Sweden during
normal business hours.

10.i    List of Subsidiaries

                                                              percent holding

Bioventures B.V.,              Amsterdam, Netherlands           100%

Biora Benelux Dental
Products B.V.                  Amsterdam, Netherlands           100%

Biora GmbH                     Bad Homburg, Germany             100%

Biora S.A.                     Johannesburg, South Africa       100%

Biora Inc.                     Chicago, IL, U.S.A.              100%

Biora S.r.l.                   Milano, Italy                    100%

Biora Limited                  London, United Kingdom           100%

Biora AG                       Zurich, Switzerland              100%

Biora Option AB                Malmo, Sweden                    100%

Biora BioEx AB                 Malmo, Sweden                    100%


Item 11. Quantitative and Qualitative Disclosures about Risks

Major Risks

Sensitivity of market risks and disclosures about model and its limitations

         The following tables provides information about the Company's
derivative financial instruments and related balance sheet items by foreign
currency and presents such information in Swedish kronor equivalents. The
tables summarizes information on instruments and related underlying
transactions, including forecasted transactions, that are sensitive to
foreign currency exchange rates, including foreign currency forward
exchange contracts, inter-company borrowings and nonfunctional foreign
currency denominated receivables and payables. The net amount that is
exposed to changes on foreign currency rates then is subjected to a
specific change in the value of the foreign currency versus Swedish kronor
calculated over a period not exceeding the average expected maturity of the
related foreign exchange contract. This selected change in the value of
foreign currencies is expected to reflect reasonably possible near term
changes in the foreign currencies' exchange rates. If the actual change in
the value of foreign currencies is substantially different than expected,
the net impact of foreign currency exchange rate risk on the Company's
earnings may be materially different than that disclosed below. If the
amounts of the actual nonfunctional foreign currency denominated forecasted
transactions is materially different than that estimated by the Company,
the net impact of the foreign currency exchange rate risk on the Company's
earnings may be different than that disclosed.Table I presents the impact
on the Company's earnings of a 10% appreciation and a 10 % depreciation of
the Swedish kronor against the indicated foreign currencies.

<TABLE>
<CAPTION>

                                Table I
                         At December 31, 2000

                        Swedish kroner      Net underlying       Net Exposure    Foreign            Foreign
                        Value of Net        Foreign currency     Currency        Exchange(Loss)/    Exchange (Loss)/
                        Foreign exchange    Transaction          Position        Gain from          Gain from
                        Assets (Liability)  Exposure                             Depreciation       Appreciation
                        Contracts                                                Swedish kroner     Swedish kroner
                                            -----------------
                                            SEK in millions

Currency


<S>                         <C>                <C>              <C>               <C>                 <C>
U.S. Dollar.........        (9.5)              6.2              (3.3)             (0.3)               0.3
Euro................        (8.0)              4.4              (3.6)             (0.4)               0.4
Pound Sterling......          0                0.5               0.5               0.1               (0.1)
Swiss Francs........          0                0.5
Japanese yen........       (11.6)              8.7              (2.9)             (0.3)               0.3
Total...............       (29.1)             20.3              (8.8)             (0.9)               0.9


</TABLE>



                                 SIGNATURES

         Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant certifies that it meets all of the
requirements for filing on Form 20-F and has duly caused this Annual Report
to be signed on its behalf by the undersigned, thereunto duly authorized.



Date:  July 18, 2001                     BIORA AB

                                         By:    /s/ Rickard Soderberg
                                            -------------------------------
                                              Rickard Soderberg
                                              President & CEO


                                         By:  /s/ Anders Agering
                                            -------------------------------
                                              Anders Agering
                                              Chief Financial Officer




KPMG Logo



                         Biora AB and Subsidiaries

                     REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Directors and Shareholders of
BIORA AB

We have audited accompanying consolidated balance sheets of Biora AB and
its subsidiaries as of December 31, 1998, December 31, 1999 and December
31, 2000 and the related consolidated statements of operations and cash
flows for the years then ended. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.

We conducted our audit in accordance with Swedish and United States
generally accepted auditing standards. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement, An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.

In our opinion, the accompanying consolidated financial statements present
fair1y, in all material respects, the financial position of Biora AB and
its subsidiaries at December 31, 1998, December 31, 1999 and December 31,
2000, and the result of their operations and cash flows for the years then
ended in conformity with Swedish generally accepted accounting principles.

Generally accepted accounting principles in Sweden vary in some respects
from generally accepted accounting principles in the United States.
Application of generally accepted accounting principles in the United
States would have affected results of operations and shareholders equity as
at and for the years ended December 31, 1998, December 31, 1999 and
December 31, 2000 to the extent summarized in Note 23 to the consolidated
financial statements.

Ma1mo, Sweden

March 22, 2001


/s/ Alf Svensson
    ------------
    Alf Svensson
    Authorized Public Accountant
    KPMG Bohlims AB
    Member of KPMG international



<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF OPERATIONS



                                                                               Year Ended December 31,
                                                                 --------------------------------------------------
                                                                     1998         1999         2000             2000
                                                                 --------------------------------------------------
                                                                      SEK          SEK          SEK     U.S. Dollars    10.79
                                                                                                            (Note 1)
                                                                     (In thousands except per share amounts)
                                                                                                          (Unaudited)
<S>                                                  <C>           <C>          <C>          <C>               <C>
Net sales                                                          50,119       73,556       89,160            8,263
Cost of goods sold                                   Note 5       -10,864      -15,470      -21,148           -1,960
                                                                 ----------------------------------------------------
Gross profit                                                       39,255       58,086       68,012            6,303

Selling expenses                                     Note 5       -89,622      -90,783      -78,387           -7,265
Administrative expenses                              Note 5       -22,133      -18,505      -25,437           -2,357
Research and development costs                       Note 4,5     -39,980      -41,597      -42,789           -3,966
Other operating income                               Note 6        42,898        4,001          643               60
Other operating expenses                             Note 6        -1,946       -3,007         -753              -70
                                                                 ----------------------------------------------------
Loss from operations                                 Note 2,3     -71,528      -91,805      -78,711           -7,295

Interest income and similar profit/loss items                      11,576        5,231        3,095              287
Interest expense and similar profit/loss items                         -4          -11         -365              -34
                                                                 ----------------------------------------------------
Loss before income taxes                                          -59,956      -86,585      -75,981           -7,042

Income taxes                                         Note 7           -42         -154         -168              -16
                                                                 ----------------------------------------------------
Net loss                                                          -59,998      -86,739      -76,149           -7,057
                                                                 ====================================================

Net loss per Ordinary Share                          Note 1         -2.83        -4.09        -3.59            -0.33
                                                                 ====================================================

The accompanying notes are an integral part of these Consolidated Financial
Statements.
</TABLE>


<TABLE>
<CAPTION>

CONSOLIDATED BALANCE SHEETS



ASSETS                                                                            As of December 31,
------                                                            ----------------------------------------------------
                                                                      1998         1999         2000             2000
                                                                  ----------------------------------------------------
                                                                       SEK          SEK          SEK     U.S. Dollars
                                                                                                              (Note 1)
                                                                   (In thousands)
<S>                                                  <C>               <C>          <C>         <C>         <C>
Long-term assets                                     Note 9                                                (Unaudited)
----------------
Intangible assets
Capitalized research and development costs                          19,109       10,514            -                -
Patents                                                              6,228        6,059        7,112              659
                                                                  ----------------------------------------------------
Total intangible assets                                             25,337       16,573        7,112              659

Tangible assets
Plant and machinery                                                  1,937        2,248        2,160              200
Equipment, tools, fixtures and fittings                             10,332        8,253        4,282              397
Advance payments for tangible assets                                     -          342            -                -
                                                                  ----------------------------------------------------
Total tangible assets                                               12,269       10,843        6,442              597

Financial assets
Other long-term receivables                          Note 10         2,571        2,534        2,553              237
                                                                  ----------------------------------------------------
Total financial assets                                               2,571        2,534        2,553              237
                                                                  ----------------------------------------------------
Total long-term assets                                              40,177       29,950       16,107            1,493
                                                                  ----------------------------------------------------

Current assets
Inventories
Raw materials and consumables                                        1,064        1,200        1,172              109
Work in progress                                                     1,543        2,761          666               62
Finished products                                                    1,567        1,214        5,040              467
                                                                  ----------------------------------------------------
Total inventories                                    Note 11         4,174        5,175        6,878              637

Current receivables
Accounts receivable - trade                          Note 12         6,313        9,281        9,173              850
Other current receivables                            Note 13         2,417        2,769        2,618              243
Prepaid expenses and accrued income                  Note 14         7,057        2,757        2,693              250
                                                                  ----------------------------------------------------
Total current receivables                                           15,787       14,807       14,484            1,342

Bank deposits                                        Note 15       148,050       90,000       40,000            3,707
Cash and banks                                       Note 15        38,998       22,804       13,755            1,275
                                                                  ----------------------------------------------------
Total current assets                                               207,009      132,786       75,117            6,962
                                                                  ----------------------------------------------------

Total assets                                                       247,186      162,736       91,224            8,454
                                                                  ====================================================


The accompanying notes are an integral part of these Consolidated Financial
Statements.
</TABLE>


<TABLE>
<CAPTION>

SHAREHOLDERS' EQUITY AND LIABILITIES                                      As of December 31,
------------------------------------                             ----------------------------------------------------
                                                                     1998         1999         2000             2000
                                                                 ----------------------------------------------------
                                                                      SEK          SEK          SEK      U.S.Dollars
                                                                                                             (Note 1)
                                                                  (In thousands)
<S>                                                  <C>               <C>          <C>          <C>       <C>
Shareholders' equity                                 Note 16                                              (Unaudited)
--------------------
Restricted equity
Share capital                                                         848          848          848               79
Share premium reserve                                             325,526      222,386      144,559           13,397
Other restricted equity                                             1,808          173          303               28
                                                                 ----------------------------------------------------
Total restricted equity                                           328,182      223,407      145,710           13,504
                                                                 ----------------------------------------------------

Accumulated loss
Accumulated loss                                                  -54,214       -9,262      -18,646           -1,728
Net loss for the year                                             -59,998      -86,739      -76,149           -7,057
                                                                 ----------------------------------------------------
Total accumulated loss                                           -114,212      -96,001      -94,795           -8,785
                                                                 ----------------------------------------------------
Total shareholders' equity                                        213,970      127,406       50,915            4,719
                                                                 ----------------------------------------------------

Provisions
Provisions for pensions                                               268          248          233               22
Other provisions                                                      129          196           28                3
                                                                 ----------------------------------------------------
Total provisions                                                      397          444          261               24
                                                                 ----------------------------------------------------

Long-term liabilities
Liabilities to credit institutions                                      -            -        2,400              222
Other long-term liabilities                          Note 18        5,475        5,505        5,506              510
                                                                 ----------------------------------------------------
Total long-term liabilities                                         5,475        5,505        7,906              733
                                                                 ----------------------------------------------------

Current liabilities
Accounts payable - trade                                            8,742        7,600        8,973              832
Income tax liability                                                    -            -          150               14
Other current liabilities                            Note 19        3,508        2,285        2,150              199
Accrued expenses                                     Note 20       15,094       19,496       20,869            1,934
                                                                 ----------------------------------------------------
Total current liabilities                                          27,344       29,381       32,142            2,979
                                                                 ----------------------------------------------------

Total shareholders' deficit / equity and
liabilities                                                       247,186      162,736       91,224            8,454
                                                                 ====================================================

Pledged assets and contingent liabilities            Note 27
Pledged assets                                                       None         None         None             None
Contingent liabilities                                             10,415       10,201        9,136              847


The accompanying notes are an integral part of these Consolidated Financial
Statements.

</TABLE>


<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                          Year Ended December 31,
                                                                       ----------------------------------------------------
                                                                       ----------------------------------------------------
                                                                           1998         1999         2000             2000
                                                                       ----------------------------------------------------
                                                                       ----------------------------------------------------
                                                                            SEK          SEK          SEK     U.S. Dollars
                                                                                                                   (Note 1)
                                                                        (In thousands)
<S>                                                                      <C>          <C>          <C>               <C>
Cash flows from operating activities                                                                            (Unaudited)
Net loss                                                                -59,998      -86,739      -76,149           -7,057
Adjustments to reconcile net loss to
net cash flows from operating activities
Depreciation of tangible assets and
and amortization of patents                                               5,156        5,552        8,852              820
Change in capitalized research and
development costs                                                         2,924        8,595       10,514              974
Capital loss                                                                 44          221          257               24
Changes in other long-term receivables                                      -11           49          -16               -1
Prepaid nonrecurring revenue                                            -39,375            -            -                -
Changes in provisions                                                       167           87         -190              -18
Changes in long-term liabilities concerning option premium received           -           30            1                0
Current tax                                                                   -          154          168               16
Deferred tax                                                                 41            -            -                -
Change in assets and liabilities
Accounts receivable - trade                                              -3,405       -3,137          616               57
Inventories                                                              -1,613       -1,031       -1,340             -124
Other current assets                                                     -3,487        3,707          284               26
Accounts payable and other current liabilities                            5,684        2,908          545               51
                                                                       ----------------------------------------------------
Net cash used in operating activities                                   -93,873      -69,604      -56,458           -5,232
                                                                       ----------------------------------------------------
Cash flows from investing activities
Capital expenditures (tangible assets and patents)                       -6,225       -4,024       -5,740             -532
Proceeds from sales of tangible assets                                      218           32          242               22
Advance payments for tangible assets                                        165         -342            -                -
Payments concerning other long-term receivables                               7          -29            6                1
                                                                       ----------------------------------------------------
Net cash used in investing activities                                    -5,835       -4,363       -5,492             -509
                                                                       ----------------------------------------------------
Cash flows from financing activities
Issuance of new shares                                                       72            -            -                -
Payments of debt                                                           -123            -            -                -
Issuance of debt                                                            155            -        2,400              222
                                                                       ----------------------------------------------------
Net cash from financing activities                                          104            -        2,400              222
                                                                       ----------------------------------------------------
Effect of exchange rate changes on cash and
cash equivalents                                                            342         -277          501               46
                                                                       ----------------------------------------------------
Net change in cash and cash equivalents                                 -99,262      -74,244      -59,049           -5,473
                                                                       ====================================================

Cash and cash equivalents, beginning of year                            286,310      187,048      112,804           10,454
Cash and cash equivalents, end of year                                  187,048      112,804       53,755            4,982
                                                                       ----------------------------------------------------
Net change in cash and cash equivalents                                 -99,262      -74,244      -59,049           -5,473
                                                                       ====================================================

Cash received for interest                                                7,716        8,806        2,926              271
Cash paid for interest                                                        3           11          392               36
Cash paid for taxes                                                          19           41           42                4

The accompanying notes are an integral part of these Consolidated Financial
Statements.

</TABLE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in SEK 000s where not otherwise indicated)

----------------------------------------------------------------------------
Note 1 Basis of presentation
----------------------------------------------------------------------------

Nature of operations
--------------------
Biora is a Swedish biotechnology company that develops, manufactures,
markets and sells products for treatment primarily of diseases in the mouth.
The principal product, Emdogain promotes the regain of tooth-supporting
tissues which have been lost due to a periodontal disease. Emdogain is
marketed in Europe, North and South America and Asia.

The accompanying Financial Statements present the financial position,
results of operations and cash flows of Biora AB (publ) ("Biora") and its
subsidiaries (Biora AB and subsidiaries collectively referred to as the
"Company") and have been prepared according to the Swedish Annual Accounts
Act, and the Swedish Financial Accounting Standards Council's
recommendations, which represent generally accepted accounting principles in
Sweden ("Swedish GAAP"). These accounting principles differ in certain
significant respects from generally accepted accounting principles in the
United States ("U.S. GAAP"). See note 23 for a discussion of the principal
differences between Swedish GAAP and U.S. GAAP affecting the Company's
results of operations and shareholders' equity.

Financial Statements expressed in U.S. dollars
----------------------------------------------
The consolidated financial statements are presented in Swedish kronor
("SEK"), and for the year 2000 are also presented in U.S. dollars, (the
latter being) which presentation is unaudited and being presented solely for
convenience of the reader, at the rate of SEK 10.7900 = USD 1.00, the Noon
Buying Rate of the U.S. Federal Reserve Bank of New York on May 31, 2001.
Amounts may not total due to rounding.

Changes in the accounts
-----------------------
2.5 % royalty to Astra on sales of Emdogain (see note 22) has been
reclassified from research and development costs to costs of goods sold in
1998, since the royalty expense is directly variable with sales. In the
annual accounts of 1999 the part of option premiums received, earlier
disclosed as current liability, was disclosed as long-term liability. The
comparative figures have been adjusted accordingly. In all other respects
the accounting principles have been kept unchanged as compared to the
earlier year.

Consolidation principles
------------------------
The Consolidated Financial Statements comprise the financial accounts for
the Company. The Consolidated Financial Statements have been prepared in
accordance with the Swedish Financial Accounting Standards Council's RR 1:96
recommendation. Consolidation has been carried out in accordance with the
acquisition accounting method. Inter-company transactions have been
eliminated in the consolidation.

Translation of the accounts of foreign subsidiaries
---------------------------------------------------
The Company applies the Current Method, which means that the Balance Sheets
of the foreign operations have been translated at the average of the buy
and sell exchange rates prevailing at the end of the year, and their
Statements of Operations have been translated at the average exchange rate
for the fiscal year. Resulting translation differences have been recorded
directly to shareholders' equity, see note 16.

Revenue recognition
-------------------
Revenue from the sale of goods is recorded upon delivery.

Cost of goods sold
------------------
With Emdogain becoming fully commercially available in 1996 the Company,
beginning in 1996, has accounted for production costs as costs of goods
sold, with the exception of costs directly related to research and
development.

Cost of goods sold also includes 2.5% royalty to Astra on sales of Emdogain
(see note 22).

Research and development (R&D) costs
------------------------------------
R&D costs consist of all costs attributable to the preclinical and clinical
divisions in Biora, including product development, costs relating to product
registration and costs for clinical studies. R&D costs also include
amortization of capitalized R&D costs and patents and depreciation of
equipment used for R&D purposes.

Capitalized research and development (R&D) costs
------------------------------------------------
The Swedish Accounting Act (bokforingslagen) and Swedish GAAP allow certain
research and development costs and costs incurred in the related product
approval process to be capitalized if it is probable that the product will
generate future economic benefits. The Company has capitalized research and
development costs and costs related to the product approval process incurred
by the Company in connection with the development of Emdogain, net of
revenue from contract sales and research grants. The capitalization of such
costs commenced in connection with the completion of clinical studies and
the submission of an application by the Company to the Food & Drug
Administration (the "FDA") in the United States for approval for sale and
production of Emdogain. All R&D costs previously incurred by the Company
were charged to the Statement of Operations.

The Company reviews the recoverability of the capitalized costs based upon
projected future undiscounted cash flows of the related product.

The capitalized costs are fully amortized in connection with the year end
closing 2000. They have been amortized over a five-year period, based on the
estimated sales revenue beginning in 1996 when Emdogain became fully
commercially available.

Research and development costs (other than equipment expense which is
capitalized for the purpose of Swedish GAAP) incurred in connection with
other products based on the Emdogain technology and to new formulations of
Emdogain are expensed as incurred. Product approval costs are expensed as
incurred.

Patents
-------
Patents are reported at original acquisition cost less accumulated
amortization. Patents are amortized over the estimated ecomomic life of the
product to which the patent refers, which normally exceeds 5 years,
commensing when the product becomes fully commercially available. The
amortization period does not exceed 10 years nor does it exceed the period
of validity of the various patents.

Machinery and equipment
-----------------------
Machinery and equipment are reported at original acquisition cost less
accumulated depreciation. Maintenance and repair costs are expensed as
incurred. New investments, improvements and major repurchases are
capitalized. Computer equipment is depreciated over an estimated useful life
of three years. Other machinery and equipment are, as before, depreciated
over an estimated useful life of five years.

Leasing agreements
------------------
The Company leases certain machinery and equipment under operating leases.

Receivables
-----------
Receivables are recorded at their expected net realizable value.

Inventories
-----------
Inventories are reported at the lower of cost and net realizable value. The
"first-in, first-out" ("FIFO") method has been applied for all inventories.
Provision has been made for obsolete inventories.

Cash equivalents
----------------
The Company considers Cash and banks and Bank deposits to be cash
equivalents. The cash equivalents have an original maturity of 90 days or
less.

Income taxes
------------
Deferred income taxes reflect the impact of temporary differences between
the amount of assets and liabilities recognized for financial reporting
purposes and such amounts recognized for tax purposes. Deferred tax assets
are recognized to the extent that they can be realized from reversing
deferred tax liabilities. Remaining deferred tax assets, which include the
tax effect of tax loss carried forward, are reduced by a valuation allowance
to the amount that it is "more likely than not" to be realized.

Tax legislation in Sweden offers companies the opportunity to defer their
current tax liability by making tax deductible allocations to untaxed
reserves. (See note 7 and 23 e).

Receivables and liabilities in foreign currency
-----------------------------------------------
Assets and liabilities denominated in foreign currencies have been
translated at the year-end exchange rate. Currency-hedged balances have been
translated at the spot rate when the balance occured with adjustment for the
accrued deduction or addition agreed upon in the hedge contract.

Exchange gains / losses pertaining to operating assets and liabilities are
included in Other operating income by 3,147 in 1998, 3,987 in 1999 and 198
in 2000 and in Other operating expenses by 547 in 1998, 2,770 in 1999 and
and 484 in 2000. Exchange gains pertaining to current financial assets have
been included in Interest income by 872 in 1998, 312 in 1999 and 127 in
2000.

Net loss per share
------------------
Net loss per Ordinary Share - Basic (i.e., undiluted) is computed by
dividing net loss by the weigthed average number of Ordinary Shares
outstanding for each year (21,203,800 for 1998, 1999 and 2000).

The effect of the Company's Warrants has not been included in the
computation of Net loss per Ordinary Shares as it would be anti-dilutive.

Hedging of future cash flows
----------------------------
Certain future cash flows in foreign currency concerning anticipated
transactions are hedged using forward exchange contracts. Unrealized gains
and losses on such financial instruments that are designated as a hedge are
deferred and are recognized as an adjustment of the measurement of the
transaction when it actually occurs. It is the policy of Biora to hedge 75%
of anticipated, budgeted future cash inflows in foreign currency for the
following twelve months.

Additionally part of the anticipated cash inflows in YEN in the year 2001
was hedged as per December 31, 1999, after decision by the Board of
Directors.

To avoid currency risks in the net receivables from the subsidiaries
(receivables after deduction of write-downs made) the Biora has, in
accordance with this policy, hedged the main part of the net receivables in
accordance with forward exchange contracts. The forward exchange contracts
prevailing on December ber 31, 2000, had a duration up until March 30, 2001.

During 1999 and 2000 budgeted inflows in YEN were hedged by foreign exchange
contracts. The corresponding inflows budgeted for the year 2001 have been
hedged by foreign exchange contracts.

Financial instruments
---------------------
In order to qualify for deferral accounting of unrealized gains and losses
on financial instruments, such instruments must be designated as and
effective as a hedge of an underlying asset or liability, firm committment
or anticipated transaction. Management reviews the correlation and the
effectiveness of its financial instruments on a periodic basis. Financial
instruments that do not meet the criteria for hedge accounting treatment are
marked- to-market with the resulting unrealized gain or loss recorded as
foreign exchange gain or loss in the income statement.

It is the Company's policy that terms and contractual maturities of
financial instruments that are designed to hedge foreign currency exposures
correspond to the terms and, where appropriate, the maturities of the under-
lying hedged transactions.

Realized gains and losses that result from the early termination of
financial instruments used for hedging purposes are deferred and are
included in (i) the determination of the carrying value of the underlying
asset or liability in the consolidated balance sheet or (ii) the income
statement when the anticipated transaction actually occurs. If an underlying
asset or liability is sold or settled, any unrelated financial instrument is
then marked- to-market and the resulting unrealized gain or loss is recorded
as part of gain or loss on sale or settlement of the underlying item.

Premiums paid for the sale of foreign currency are recorded among current
receivables or liabilities in the consolidated balance sheet and are
amortized as an adjustment of the underlying revenue or expense item.

Foreign exchange rate risk management
-------------------------------------
Forward exchange contract - Assets and liabilities that are covered by
qualifying hedges are translated at the rate specified in the forward
exchange contract.

Use of estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

A significant estimate made by management is in respect of the
capitalization and amortization of capitalized research and development
costs. The Company's accounting policy for the amortization of capitalized
research and development costs and the method used by management to
periodically assess the recoverability of such costs is described above in
this note under caption "Capitalized research and development (R&D) costs".
The estimate of future cash flows from the Company's primary product is
subject to inherent uncertainties. Significant factors which can affect
management's projections of future cash flows include, among other items,
the degree of acceptance of the Company's products in the dental community,
the pace of significant technological change in the health care industry,
the possible development by competitors of more effective technologies and
products, the inherent unpredictability of the Company's patent protection
for its products and change in government regulations applicable to the
Company's products. While the management of the Company believes that its
estimate of future cash flows and the estimated economic life of Emdogain
used in the determination of the capitalization and amortization of
capitalized research and development costs are reasonable, such estimates of
future cash flows and the remaining economic life of assets are affected by
the factors described above.

----------------------------------------------------------------------------
Note 2 Personnel
----------------------------------------------------------------------------

The average number of employees during the respective fiscal year at each
working site:

<TABLE>
<CAPTION>



                                                    Year Ended December 31,
                         ---------------------------------------------------------------------------------
                                   1998                        1999                          2000
                         -----------------------      -----------------------     ------------------------
                         Number of      Of which      Number of     Of which       Number of     Of which
                         employees       men %        employees       men %        employees       men %
                        ----------------------------------------------------------------------------------
<S>                       <C>            <C>          <C>            <C>            <C>           <C>
Biora:                      37            32             40             26            38             24
                        ----------------------------------------------------------------------------------
Subsidiaries:
Germany                     16            51             18             45            13             48
Switzerland                 -             -               0             50             -              -
U.S.                        19            61             22             59            26             54
Italy                        2            67              2             50             1              7
Netherlands                  2            43              3             47             4             54
UK                           2            21              2              0             -              -
                         ----------------------------------------------------------------------------------
Total subsidiaries          41            54             47             50            44             51
                         ----------------------------------------------------------------------------------
Consolidated                78            43             87             39            82             38
                         ==================================================================================

</TABLE>



Wages, salaries, other remuneration and social insurance costs during the
fiscal year:

<TABLE>
<CAPTION>

                                                    Year Ended December 31,
                      -------------------------------------------------------------------------------------
                                   1998                        1999                          2000
                      --------------------------      -----------------------     -------------------------
                        Wages,         Social         Wages,         Social         Wages,        Social
                       salaries       insurance      salaries       insurance      salaries      insurance
                       and other      expenses       and other      expenses      and other      expenses
                        remune-       (of which       remune-       (of which      remune-       (of which
                        ration         pension        ration         pension        ration        pension
                                       costs)                        costs)                       costs)
                      -------------------------------------------------------------------------------------
<S>                     <C>            <C>           <C>            <C>           <C>             <C>
Biora                   18,482          9,061         18,712          9,203        17,721          9,225
                                       (3 485)*                      (3 695)*                     (3 490)*
Subsidiaries            24,462          4,083         29,346          4,765        25,157          3,071
                                         (980)                         (897)                        (715)
                      -------------------------------------------------------------------------------------
Consolidated            42,944         13,144         48,058         13,968        42,878         12,296
                                       (4 465)**                     (4 592)**                    (4 205)**
                      =====================================================================================
</TABLE>

*622 for 1998, 781 for 1999 and 1,434 for 2000 of Biora's pension cost refer
to the category Board of Directors and President. Biora did not have any
outstanding pension obligations neither at December 31, 1998 nor December
31, 1999 nor December 31, 2000.

** 1,198 for 1998, 1,260 for 1999 and 1,623 for 2000 of the consolidated
pension cost refer to the category Board of Directors and President. The
consolidated outstanding pension obligations to this category amounted to
268 as at December 31, 1998, 248 as at December 31, 1999, and 233 as at
December 31, 2000.



Wages, salaries and other remuneration at each working site distributed
between Biora and the Subsidiaries and between Board members, etc., and
other employees:


<TABLE>
<CAPTION>


                                                    Year Ended December 31,
                      -------------------------------------------------------------------------------------
                                   1998                        1999                          2000
                      --------------------------      -----------------------     -------------------------
                        Board of       Other         Board of        Other         Board of        Other
                        Directors    employees      Directors      employees      Directors      employees
                           and                         and                           and
                        President                   President                     President
                      -------------------------------------------------------------------------------------
<S>                     <C>            <C>           <C>            <C>           <C>             <C>
Biora:                    3,224        15,258         3,165          15,547         4,893         12,828
Subsidiaries:
Sweden                        -             -            25               -             -              -
Germany 1)                1,443         7,097         2,600           8,435          -135          5,528
Switzerland                   -             -           340             182             -              -
U.S.                      1,529        10,613         1,623          12,408         1,800         14,895
Italy 2)                  1,077           114           972             189            81            175
Netherlands 3)              721           785           843             782         1,916            897
UK                          331           752             -             947             -              -
                      -------------------------------------------------------------------------------------
Total subsidiaries        5,101        19,361         6,403          22,943         3,662         21,495
                      -------------------------------------------------------------------------------------
Consolidated              8,325        34,619         9,568          38,490         8,555         34,323
                      =====================================================================================
</TABLE>


1) Severance pay amounting to 1,382 was included in the remuneration to the
   President in Germany 1999. The final settlement resulted in two in stead
   of twelve months severance pay. Accordingly the year 2000 remuneration to
   the President has been reduced by 1,105.

2) The employment contract with the President in Italy was transformed into
   a consultancy agreement as from February 1, 2000.

3) Severance pay amounting to 1,316 is included in the year 2000 remuneration
   to the employees in Holland, including 1,154 for the President.



Information below regarding benefits expensed for senior executives refers
to 2000 and has been reported in accordance with the recommendation of the
Swedish Industry and Commerce Stock Exchange Committee.

A fee of 150 has been expensed regarding Per Wahlstrom, Chairman of the
Board of Biora.

In addition to their ordinary fee three Board members have received
remuneration for their services as members of the Audit Committee of Biora
as follows: Svein G. Eskedal 40, Bertil Koch Konsult 25, Toni Weitzberg 25.
Additionally Eskedal Consult A/S has received 1,082 for consultancy
assignments.

The salary expensed for Tomas Hammargren, President of Biora through August
13, 2000, amounted to 2,506, including severance pay of 1,758. In addition
he received pension benefits paid by Biora in accordance with an individual
plan prepared by Forsakrings AB Skandia, for which the Company expensed 738,
including 522 concerning the severance pay. In accordance with the
employment contract, Tomas Hammargren was entitled to severance pay equal to
18 months' salary.

The salary expensed for Rickard Soderberg, President of Biora commencing
August, 14, 2000, amounted to 650. In addition he received pension benefits
paid by Biora in accordance with an individual plan prepared by Forsakrings
AB Skandia, for which the Company expensed 135. In accordance with the
employment contract, Rickard Soderberg is entitled to a 6-month mutual
period of notice. In addition he is entitled to a severance pay equal to 18
months' salary. Rickard Soderberg is also entitled to the customary company
car.

The salary expensed for Anders Agering, Executive Vice President of Biora,
amounted to 882. In addition he received pension benefits paid by Biora in
accordance with an individual plan prepared by SPP Liv, for which the
Company expensed 286. In accordance with the employment contract, Anders
Agering is entitled to severance pay equal to one year's salary plus a
further six months salary after the age of 50.

Other senior executives employed by the Parent Company are also entitled to
a severance pay not exceeding 18 months' salary. Future pension benefits are
based on individual plans.


----------------------------------------------------------------------------
Note 3 Remuneration to the auditors of the Company
----------------------------------------------------------------------------

The following remuneration to the auditors of the Company, KPMG, are
included in the Consolidated Loss from operations:

<TABLE>
<CAPTION>
                                        Year Ended December 31,
                                  ---------------------------------
                                    1998         1999        2000
                                  ---------------------------------
<S>                                  <C>         <C>         <C>
Audit assignments                    785         461         423
Other assignments                    948         658         338
                                  ---------------------------------
Total                               1,733       1,119        761
                                  =================================
</TABLE>



----------------------------------------------------------------------------
Note 4 Research and development (R&D) costs
----------------------------------------------------------------------------

In the Statements of Operations, R&D costs have been reported as net
amounts, after deductions for costs capitalized during the year, in
accordance with the following:

<TABLE>
<CAPTION>
                                                          Year Ended December 31,
                                                     ---------------------------------
                                                      1998          1999         2000
                                                     ---------------------------------
<S>                                                   <C>           <C>         <C>
Total research and development costs                  39,980        41,597      42,789
Capitalized research and development costs                 -             -           -
                                                     ---------------------------------
Net                                                   39,980        41,597      42,789
                                                     =================================
</TABLE>


In research and development costs 1998 are included SEK 6.3 million in
remuneration to Eastham Corporation Ltd in connection with the registration
of Emdogain in the U.S.

Concerning progressive amortization of capitalized R&D costs included in
research and development costs, see note 5.


----------------------------------------------------------------------------
Note 5  Depreciation / amortization
----------------------------------------------------------------------------

In the Statements of Operations, the following depreciation / amortization
has been included in the cost of goods sold, selling expenses,
administrative expenses and research and development costs:

<TABLE>
<CAPTION>
                                                  Year Ended December 31,
                                            ----------------------------------
                                              1998         1999          2000
                                            ----------------------------------
<S>                                          <C>           <C>        <C>
Cost of goods sold                             724          844          1,072
Selling expenses                             1,920        2,049          3,235
Administrative expenses                        309          358            552
Research and development costs               5,128       10,896         14,507
                                            ----------------------------------
Total                                        8,081       14,147         19,366
                                            ==================================
</TABLE>

Included in depreciation / amortization accounted for as research and
development costs are amortization of capitalized R&D costs amounting to
2,924 for 1998, 8,595 for 1999 and 10,514 for 2000.

In the year 2000 depreciation / amortization is included a write-down of the
Amelin-patent by 1,430.

Due to the computer equipment being depreciated over an estimated useful
life of 3 years as from 2000, the depreciations are approximately SEK 1.7
million larger year 2000 than would have been the case if the useful life
had still been estimated to 5 years.

See note 9 concerning the distribution of depreciation / amortization
between the different kinds of long-term assets.


----------------------------------------------------------------------------
Note 6 Other operating income and Other operating expenses
----------------------------------------------------------------------------

A conditional advance from Seikagaku Corporation, who has been appointed
Biora's exclusive distributor of Emdogain in Japan, was received in 1996.
The advance amounted to USD 5 million.

Since Emdogain was approved for sale in Japan in January 1998, the
nonrecurring revenue of SEK 39.4 million is included in the 1998 Other
operating income and royalty expense to Astra of SEK 1.0 million on this
revenue is included in the 1998 Other operating expenses. With the 1998
approval for sale of Emdogain in Japan the payment is nonrefundable and is
not tied to any performance measures or any other contingencies that would
require repayment.

A pensionfee surplus at SPP of 446 has been recorded as Other operating
income during year 2000.

Concerning exchange rate differences, see note 1.


----------------------------------------------------------------------------
Note 7 Income taxes
----------------------------------------------------------------------------

The loss before income taxes consists of the following:

<TABLE>
<CAPTION>
                                       Year Ended December 31,
                                 ------------------------------------
                                   1998         1999          2000
                                 ------------------------------------
<S>                               <C>           <C>        <C>
Sweden                            -18,207      -87,649       -88,449
Foreign                           -41,749        1,064        12,468
                                 ------------------------------------
Total                             -59,956      -86,585       -75,981
                                 ====================================
</TABLE>


Income taxes are distributed as follows:

<TABLE>
<CAPTION>
                                       Year Ended December 31,
                                 ------------------------------------
                                   1998         1999          2000
                                 ------------------------------------
<S>                               <C>           <C>           <C>
Current
-------
Sweden                               21            -             -4
Foreign                             -22         -154           -164
                                 ------------------------------------
Total                                -1         -154           -168
                                 ====================================
Deferred
--------
Sweden 1)                           395            0              -
Foreign                            -436            -              -
                                 ------------------------------------
Total                               -42         -154           -168
                                 ====================================
</TABLE>


1) Deferred tax liability concerning untaxed reserves has been resolved by
   430 in 1999. In 1998 this deferred tax liability was netted against
   deferred tax asset from non utilized tax losses carried forward.
   See also note 23(e).



The foreign income taxes are state taxes and federal "Alternative Minimum
Tax" in the U.S. and local tax ("IRAP") in Italy.

Deferred tax assets on losses have not been recorded.



A reconciliation of the nominal tax expected, 28 %, compared with the
Company's effective tax is shown below:

<TABLE>
<CAPTION>
                                                                  Year Ended December 31,
                                                           ------------------------------------
                                                             1998         1999          2000
                                                           ------------------------------------
<S>                                                         <C>           <C>           <C>
Expected income tax benefit 1)                              16,788        24,244        21,275
Effect of:
Difference in tax rates for foreign subsidiaries             4,365          -369        -1,645
Losses not currently utilized                              -19,856       -24,825       -23,091
Utilized losses from earlier years                               -         2,065         5,585
Non-deductible items                                        -1,732        -1,273        -2,294
Non-taxable income                                             434             4             2
Deferred tax                                                   -41             -             -
                                                           ------------------------------------
Actual tax according to Statements of Operations               -42          -154          -168
                                                           ====================================
</TABLE>

1) Expected income tax benefit is determined by applying the statutory
   federal Swedish tax rate of 28% to the net loss before tax.



The Company had tax loss carried forward in The Netherlands, Germany, Italy,
UK, Switzerland and U.S., that amounted to 176,864 at December 31, 2000.
These tax losses carried forward are, however, still subject to audit and
approval by the relevant tax authorities.

The applicable tax rates for the foreign subsidiaries are 35% in The
Netherlands, 37% in Germany, 40,5% in Italy, 30% in UK, 25% in Switzerland
and 42% in U.S.

The Company had tax loss carried forward in Sweden that amounted to 260,519
at December 31, 2000. This tax loss carried forward is, however, also
subject to audit and approval by the Swedish tax authorities.

Under the tax laws of The Netherlands, Germany, Italy, UK and Sweden tax
losses carried forward do not expire. For Switzerland the time limit is 7
years and for U.S. 15 years.



----------------------------------------------------------------------------
Note 8 Minority interest
----------------------------------------------------------------------------

During 1996 a joint company was formed in South Africa by Biora (50%) and
Arne and Lena Widerstrom (50%). The minority interest in the loss of 1998,
1999 and 2000 was none.

The minority interest in equity was none for 1998, 1999 and 2000.

The minority interest consisted of Arne and Lena Widerstrom's participation
in Biora S.A, Ltd, South Africa.

In September 1998 Biora acquired the remaining 50% of the shares (180,000)
in Biora SA Ltd for a price of SEK 0. At the same time the marketing
activities in South Africa were transferred to an external distributor.


---------------------------------------------------------------------------
Note 9 Acquisition value of Long-term assets, etc.
---------------------------------------------------------------------------

Capitalized R&D costs

<TABLE>
<CAPTION>

Capitalized R&D costs
---------------------
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998         1999          2000
                                                                   ------------------------------------
<S>                                                                 <C>           <C>           <C>
Accumulated acquisition cost, beginning and end of year             23,094        23,094         23,094
                                                                   ------------------------------------
Accumulated amortization, beginning of year                         -1,061        -3,985        -12,580
Amortization for the year                                           -2,924        -8,595        -10,514
                                                                   ------------------------------------
Accumulated amortization, end of year                               -3,985       -12,580        -23,094
                                                                   ------------------------------------
Net book value, end of year                                         19,109        10,514              -
                                                                   ====================================



Patents
-------
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998         1999          2000
                                                                   ------------------------------------
Accumulated acquisition cost, beginning of year                      6,376         7,571          8,463
Capital expenditures for the year                                    1,300         1,040          3,589
Sales / Disposals                                                     -214             0              0
Translation differences for the year                                   109          -148             32
                                                                   ------------------------------------
Accumulated acquisition cost, end of year                            7,571         8,463         12,084
Accumulated amortization, beginning of year                           -435        -1,343         -2,404
Disposals                                                              214             -              -
Amortization for the year                                           -1,100        -1,103         -1,132
Write-downs for the year                                                 -             -         -1,430
Translation differences for the year                                   -22            42             -6
                                                                   ------------------------------------
Accumulated amortization, end of year                               -1,343        -2,404         -4,972
                                                                   ------------------------------------
Net book value, end of year                                          6,228         6,059          7,112
                                                                   ====================================



Plant and machinery
-------------------
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998         1999          2000
                                                                   ------------------------------------
Accumulated acquisition cost, beginning of year                      3,911         4,931          6,013
Capital expenditures for the year                                    1,089         1,181            984
Sales / disposals                                                      -69          -134            -50
Reclassification                                                         -            35             -7
                                                                   ------------------------------------
Accumulated acquisition cost, end of year                            4,931         6,013          6,940
                                                                   ------------------------------------
Accumulated depreciation, beginning of year                         -2,337        -2,994         -3,765
Sales / disposals                                                       68            87             50
Reclassification                                                         -           -14              7
Depreciation of the year                                              -725          -844         -1,072
                                                                   ------------------------------------
Accumulated depreciation, end of year                               -2,994        -3,765         -4,780
                                                                   ------------------------------------
Net book value, end of year                                          1,937         2,248          2,160
                                                                   ====================================



Equipment, tools, fixtures and fittings
---------------------------------------
                                                                        Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998         1999          2000
                                                                   ------------------------------------
Accumulated acquisition cost, beginning of year                     13,688        17,463         18,507
Capital expenditures for the year                                    3,967         1,802          1,510
Sales / disposals                                                     -441          -688         -1,217
Reclassification                                                         -           -35              7
Translation differences for the year                                   249           -35            735
                                                                   ------------------------------------
Accumulated acquisition cost, end of year                           17,463        18,507         19,542
                                                                   ------------------------------------
Accumulated depreciation, beginning of year                         -3,859        -7,131        -10,254
Sales / disposals                                                      181           464            718
Reclassification                                                         -            14             -7
Depreciation of the year                                            -3,396        -3,586         -5,218
Translation differences for the year                                   -57           -15           -499
                                                                   ------------------------------------
Accumulated depreciation, end of year                               -7,131       -10,254        -15,260
                                                                   ------------------------------------
Net book value, end of year                                         10,332         8,253          4,282
                                                                   ====================================
</TABLE>



---------------------------------------------------------------------------
Note 10 Other long-term receivables
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998         1999          2000
                                                                   ------------------------------------
<S>                                                                 <C>           <C>           <C>
Opening balance                                                      2,554         2,571          2,534
Deposits repaid                                                        -57           -39             -6
Deposits expensed                                                        -           -51            -14
Capital value of paid pension insurance fees in Germany                 68            68             30
Translation differences for the year                                    19           -15              9
Reclassification                                                       -13             -              -
                                                                   ------------------------------------
Closing balance                                                      2,571         2,534          2,553
                                                                   ====================================

</TABLE>



---------------------------------------------------------------------------
Note 11 Inventories
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998          1999          2000
                                                                   ------------------------------------
<S>                                                                 <C>           <C>           <C>
Raw materials                                                        1,097         1,237         1,208
Work in progress                                                     1,591         2,846           687
Finished products                                                    1,613         1,223         5,183
                                                                   ------------------------------------
                                                                     4,301         5,306         7,078
Obsolescence reserve                                                  -127          -131          -200
                                                                   ------------------------------------
Total                                                                4,174         5,175         6,878
                                                                   ====================================
</TABLE>


Schedule of movements in the inventory obsolescence reserve in the Biora
Group for the years ended December 31, 1998, 1999 and 2000:

<TABLE>
<CAPTION>


Year              Balance at     Charged         Charged        Additions       Balance at
                  beginning     (credited)      (credited)      or              at end
                  year           to costs and    to other       Deductions      of period
                                 expenses        accounts
--------------------------------------------------------------------------------------------
<S>                <C>            <C>            <C>             <C>             <C>
1998                 67              60              -               -            127
1999                127               4              -               -            131
2000                131              69              -               -            200

</TABLE>



---------------------------------------------------------------------------
Note 12 Accounts receivable - trade
---------------------------------------------------------------------------

Schedule of movements in allowance for doubtful accounts and reserves in
the Company for the years ended December 31, 1998, 1999 and 2000:

<TABLE>
<CAPTION>

Year              Balance at     Charged         Charged        Additions       Balance
                  beginning     (credited)      (credited)      or              at end
                  year           to costs and    to other       Deductions      of period
                                 expenses        accounts
--------------------------------------------------------------------------------------------
<S>                <C>            <C>            <C>             <C>             <C>
1998                  -             746             35            -127            654

1999                654              76            -46             -43            641

2000                641            -171             24              43            537
                                                   (A)             (B)

(A) Foreign exchange differences
(B) Write-offs and collections of bad debts as well as additional accruals

</TABLE>



---------------------------------------------------------------------------
Note 13 Other current receivables
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998          1999          2000
                                                                   ------------------------------------
<S>                                                                 <C>           <C>           <C>
Tax receivables                                                        174           292          678
V.A.T.                                                               1,866         2,133        1,548
Receivables from employees                                             103            77           59
Receivable from SPP                                                      -             -          250
Other current receivables                                              274           267           83
Total                                                                2,417         2,769        2,618

</TABLE>


---------------------------------------------------------------------------
Note 14 Prepaid expenses and accrued income
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998          1999          2000
                                                                   ------------------------------------
<S>                                                                 <C>           <C>           <C>
Prepaid leasing and property rental expenses                        1,226           947          1,012
Prepaid insurances                                                    665           674            482
Prepaid marketing expenses                                            626           579            352
Prepaid travel expenses                                               112           144             60
Other prepaid expenses                                                519           405            739
Accrued interest income                                             3,909             8             48
Total                                                               7,057         2,757          2,693

</TABLE>



---------------------------------------------------------------------------
Note 15 Cash and Cash equivalents
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                   ------------------------------------
                                                                     1998          1999          2000
                                                                   ------------------------------------
<S>                                                                 <C>           <C>           <C>
Bank deposits                                                      148,050         90,000        40,000
Cash and banks                                                      38,998         22,804        13,755
Total                                                              187,048        112,804        53,755

</TABLE>


As at December 31, 2000, the following amounts were invested short-term at
a fixed rate of interest:

<TABLE>
<CAPTION>

Currency                           Period                                      Amount
--------                           ------                                      ------
<S>                                <C>                                         <C>
Handelsbanken Markets              December 22, 2000 - January 2, 2001         40,000
                                                                               ------
Total                                                                          40,000
                                                                               ======
</TABLE>


As at December 31, 1998 TSEK 140,000 plus TUSD 1,000 were invested
short-term with Svenska Handelsbanken AB at a fixed rate of interest.

As at December 31, 1999 TSEK 80,000 were invested short-term with Svenska
Handelsbanken AB and TSEK 10,000 were invested short-term with Nordbanken
(certificate of deposit), both at a fixed rate of interest.

As at December 31, 2000 as well as at December 31, 1999 Biora GmbH had
unutilized bank overdraft facilities amounting to TDEM 30.




---------------------------------------------------------------------------
Note 16 Shareholders' equity
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                      Restricted equity                     Accumulated Loss
                                               -------------------------------    -------------------------------------

                                                             Share      Other
                                 Number of     Share      premium   restricted    Translation   Accumlated   Translation
                                  shares      capital     reserve     equity      differences      loss      differences    Total
                               ---------------------------------------------------------------------------------------------------
<S>                               <C>          <C>         <C>       <C>           <C>           <C>             <C>      <C>
Balance at December 31, 1997     21,203,800     848      371,976       1,016          91         -95,979          -17     277,935
Adjustment of issue expenses                                  72                                                               72
Disposition of loss in the
   Parent Company                                        -46,522                                  46,522                        0
Equity part of change in
   foreign exchange reserve                                               89                         -89                        0
Change in translation
    differences                                                                      612                       -4,651      -4,039
Net loss for the year                                                                            -59,998                  -59,998
Balance at December 31, 1998     21,203,800     848      325,526       1,105         703        -109,544       -4,668     213,970
Disposition of loss in the
   Parent Company                                       -103,140                                 103,140                        0
Equity part of change in
   foreign exchange reserve                                           -1,105                       1,105                        0
Change in translation
   differences                                                                      -530              15          690         175
Net loss for the year                                                                            -86,739                  -86,739
Balance at December 31, 1999     21,203,800     848      222,386           -         173         -92,023       -3,978     127,406
Disposition of loss in the
   Parent Company                                        -77,827                                  77,827                        0
Change in translation
   differences                                                                       130                         -472        -342
Net loss for the year                                                                            -76,149                  -76,149
Balance at December 31, 2000     21,203,800     848      144,559           -         303         -90,345       -4,450      50,915

</TABLE>


The par value of an Ordinary Share is SEK 0.04.

The Ordinary Shares are not restricted as to voting power or participation
in equity. Restricted equity is not available for distribution of dividends
but is required to be held to meet statutory requirements in Sweden.

Distribution of dividends is limited to the lesser of the unrestricted
shareholders' equity (unrestricted equity and current period net income)
included in either the consolidated or the Biora balance sheets after
proposed appropriations to restricted shareholders' equity (capital stock
and restricted equity).

As at December 31, 1998, 1999 and 2000 there was no unrestricted equity
available for dividends.

On January 24, 1997, the Company's Board of Directors, acting in accordance
with the authorization of the shareholders of the Company, approved the
issuance of an aggregate of 500 principal amount of subordinated debentures
at an interest rate of 7% with 560,000 accompanying warrants to
Euroventures Nordica. On the same date, Biora and Euroventures Nordica
entered into an agreement (the "Key Employee Incentive Plan") pursuant to
which Euroventures Nordica agreed to offer all the warrants to officers and
other key employees of the Company. These key employees were required to
purchase the warrants at their fair value at the grant using the
Black-Sholes valuation model. All of the 560,000 warrants have been
subscribed for. Also non-employee members of the Board of Directors hold
warrants. Each warrant entitles the holder to acquire one Ordinary Share of
the Company, at an exercise price of SEK 70.00. Under Swedish law a
corporation cannot issue warrants separately from debentures, but
accompanying warrants may be detached from the debentures.

The warrants were exerciseable for Ordinary Shares at any time up until
January 31, 2001. None of the warrants were exercised. See also note 18.

On April 23, 1998, the Company's Board of Directors, acting in accordance
with the authorization of the shareholders of the Company, approved the
issuance of an aggregate of 50 principal amount of subordinated debentures
with 200,000 accompanying warrants to Biora Option AB. On the same date,
Biora and Biora Option AB entered into an agreement pursuant to which Biora
Option AB agreed to offer all the warrants at a price which reflects the
premium to employees of the Company to provide them with appropriate
incentives to encourage them to continue in the employ of the Company and
to acquire a proprietary interest in the long-term success of Biora.
Accordingly the employees were required to purchase the warrants at their
fair value at the grant using the Black-Sholes valuation model. Employees
of the Company have subscribed for 89,250 (71,250 as at December 31, 1999
and 59,750 as at December 31, 1998) warrants of this program. Each warrant
entitles the holder to acquire one Ordinary Share of the Company, at an
exercise price of SEK 130.00.

The warrants are exerciseable for Ordinary Shares at any time during May
2002. If all of these warrants are fully exercised, the total number of
shares outstanding will increase to 21,403,800. See also note 18.


---------------------------------------------------------------------------
Note 17 Pension plans
---------------------------------------------------------------------------

The majority of the Company's employees participate in a state-sponsored
multiemployer pension plan that provides defined benefits to its employees
as well as certain disability and survivor benefits.

Payments are made through non-participating insurance arrangements.

The Company's pension costs for the years ended December 31, 1998, 1999 and
2000, respectively, are shown in the following table.

<TABLE>
<CAPTION>
                                                   Year Ended December 31,
                                                 -----------------------------
                                                 1998          1999       2000
                                                 -----------------------------
<S>                                              <C>           <C>        <C>
Social security                                  2,345       1,452      2,204
Swedish national multi-employer plan             1,091       1,364        901
Individual                                       3,293       3,145      3,194
                                                 -----------------------------
Total pension costs                              6,729       5,961      6,299
                                                 =============================
</TABLE>

Payments for individual pensions are also made to insurance companies. The
Company has no further obligations once such payments are made.


---------------------------------------------------------------------------
Note 18 Other long-term liabilities
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                   Year Ended December 31,
                                                 -----------------------------
                                                 1998          1999       2000
                                                 -----------------------------
<S>                                              <C>           <C>        <C>
Liabilities to credit institutions (a)              -            -        2,400
Other long-term liabilities (b)                 5,475        5,505       5,506
Total                                           5,475        5,505       7,906

</TABLE>

(a)  The liabilities to credit institutions are the only interest
     bearing liabilities of the Company, amounting to SEK 2,400,000 on
     December 31, 2000 (0 on December 31, 1999 and 1998). This amount
     is the first payment of the total conditional loan of SEK 15
     million, granted by the Swedish Industrial Fund for the project
     "Emdogain for extra-oral woundhealing applications". SEK 4
     million of the loan mature on December 30, 2004, SEK 5 million on
     December 30, 2005 and remaining amount on December 30, 2006. In
     addition to interest (at the official discount rate plus 2.5%)
     the Swedish Industrial Fund is entitled to royalty based on net
     sales as follows:

     '- 3% of the net sales from the product, from raw material, chemicals,
     components etc for the product and from services related to the
     product.

     '- 12% of all revenues from agreements concerning option to or
     concerning grant of licence to produce or sell the product,
     components, chemicals etc for the product as well as services related
     to the product. '- When the Parent Company has paid royalties
     totalling 167% of the loan obtained from the Swedish Industrial Fund
     the above mentioned royalty rates shall be reduced from 3 to 0,5% and
     from 12 to 2,4% respectively. '- The royalty right of the Swedish
     Industrial Fund expires four calendar years after the calendar year
     when the Company has repaid the outstanding loan including accrued
     interest, however not before December 30 2010.


(b)   On December 31, 1997, the consolidated liability to the minority
      owners of Biora SA Ltd amounted to approximately SEK 123,000.
      This liability has been amortized when Biora acquired the
      remaining 50% of the shares in September 1998. Other long-term
      liabilities amounting to SEK 5,320,000 as of December 31, 1998,
      1999 and 2000 apply to option premiums received from the warrant
      program approved in January 1997, 560,000 warrants a SEK 9.50.
      Other long-term liabilities amounting to approximately SEK
      155,000 as of December 31, 1998, approximately SEK 185,000 as of
      December 31,1999 and to approximately SEK 186,000 as of December
      31, 2000, apply to the warrants which so far have been subscribed
      for by the employees of the Company.


---------------------------------------------------------------------------
Note 19 Other current liabilities
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                   Year Ended December 31,
                                                 -----------------------------
                                                 1998          1999       2000
                                                 -----------------------------
<S>                                              <C>           <C>        <C>
Employee withholding taxes                       1,130      1,282       1,138
V.A.T.                                             327        418         767
Accrual accounting of forward cover              1,977          -           -
Liabilities to customers                            13        447         161
Other current liabilities                           61        138          84
Total                                            3,508      2,285       2,150

</TABLE>

When Emdogain was approved for sale in Japan in January 1998, the advance
was recorded as revenue, see note 6.

Biora did not have any short-term interest bearing liabilities neither on
December 31, 1998, on December 31, 1999 nor on December 31, 2000.



---------------------------------------------------------------------------
Note 20 Accrued expenses
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                   Year Ended December 31,
                                                 -----------------------------
                                                 1998          1999       2000
                                                 -----------------------------
<S>                                              <C>           <C>        <C>
Accrued personnel-related expenses               4,612      8,879       8,971
Accrued administrative expenses                  1,015      2,604       2,574
Accrued R&D costs                                3,363      3,794       2,104
Accrued marketing expenses                       3,187      1,845       2,477
Accrued royalty expenses                         2,397      1,737       4,062
Other accrued expenses                             520        637         681
Total                                           15,094     19,496      20,869

</TABLE>


---------------------------------------------------------------------------
Note 21 Operating leases
---------------------------------------------------------------------------

The Company leases certain plants and equipment in accordance with leasing
contracts which expire in the year 2005.

The most material leasing contracts concern rent of offices. The total
amount of future minimum rental commitments on December 31, 2000,
pertaining to office rental agreements are listed below.

Year
----

2001                                      5,072
2002                                        925
2003                                        652
2004                                        494
2005                                        391
Total                                     7,534


The corresponding office rent expenses amounted to approximately SEK
5,472,000 for the year ended December 31, 2000, approximately SEK 5,714,000
for the year ended December 31, 1999 and approximately SEK 5,259,000 for
the year ended December 31, 1998.

The office rental agreements include conditions concerning index regulation
of the rent and in some case regulation of the rent due to increase in
direct property expenses and taxes. There are possibilities to prolong all
office rental agreements.

There are no restrictions in consequence of the office rental agreements.

Remaining leasing contracts concern leasing of cars, copying machines and
other office equipment. The total amount of future minimum rental
commitments on December 31, 2000, pertaining to car and office equipment
leasing agreements are listed below.


Year
----

2001                                      1,174
2002                                        811
2003                                        491
2004                                        108
2005                                         30
Total                                     2,614


The corresponding leasing expenses amounted to approximately SEK 1,702,000
for the year ended December 31, 2000, approximately SEK 2,151,000 for the
year ended December 31, 1999 and approximately SEK 3,029,000 for the year
endedDecember 31, 1998.


---------------------------------------------------------------------------
Note 22 Commitments
---------------------------------------------------------------------------

In addition to the agreements concerning operating leases mentioned in note
22, the Company has entered into research and development agreements,
agreements with subcontractors and agreements concerning purchases of other
services.

The expenses for these agreements amounted to approximately SEK 17,505,000
for the year ended December 31, 2000, approximately SEK 14,085,000 for the
year ended December 31, 1999 and approximately SEK 21,395,000 for the year
ended December 31, 1998.

The total amount of future expense commitments on December 31, 2000,
pertaining to these agreements are listed below.


Year
----
2001                                     10,501
2002                                      3,249
2003                                        148
Total                                    13,898


From 1989 to 1992, Astra was a shareholder in the Company and contributed
to the financing of the initial research behind and development of
Emdogain. On December 31, 1992, Astra, the Company and certain of the
Company's other shareholders signed an agreement under the terms of which
Astra withdrew from its commitment to finance R&D for products relating to
Emdogain, as well as other license agreements between the Company and
Astra. As a part of the final settlement with Astra, it was agreed that,
until December 31, 2009, Astra would receive a royalty of 2.5% of all
commercial revenues (minus deductions for V.A.T. and customs duty) from the
dental application areas of the two patents pertaining to Emdogain owned by
the Company as at December 31, 1992. For 2000 the above royalty amounted to
approximately SEK 2,167,000 (1999 SEK 1,779,000 and 1998 SEK 1,234,000)
regarding normal sales of Emdogain and for 2000 to 0 (1999 0 and 1998
approximately SEK 1,007,000) regarding the non-recurring revenue from
Seikagaku.

In September 1998 Biora acquired the remaining 50% of the shares in Biora
SA Ltd for the price of SEK 0. Concurrently a royalty agreement with the
former minority owners was signed. It was agreed that the former minority
owners would receive a royalty of 15% of the invoiced sales of Biora to the
new external distributor in South Africa during the years 1999-2001 and 10%
royalty of these sales in the years 2002-2003. For 2000 this royalty
amounted to approximately SEK 16,000 (1999 SEK 12,000 and 1998 none).

During the year 2000 the Company acquired the rights to a patent-protected
pharmaceutical project for treating dry mouth (xerostomia). In the purchase
agreement the Company made a commitment to pay 3% royalty of the Net Sales
Price of the products based on the acquired rights. If the sales rights of
the products are out licensed, the royalty commitment of the Company
amounts to 3% of the Net Sales Price of the licensees.

See note 18 (a) concerning commitments in connection with the conditional
loan from the Swedish Industrial Fund.

Biora's activities are affecting the environment through the waste of
organic material and degradable solvent into water.

As a result, the Company falls under the jurisdiction of the County
Environmental Agency and is exposed to the possibility of judicial or
administrative actions for remediation and/or penalties brought by the
agency.

In connection with the change in environmental laws in Sweden in 1999,
Biora was required to apply for an environmental permit. The application
was submitted during 2000.

The Company has been and will be responsible for any costs related to its
compliance with, or remediation resulting from, environmental regulations.

There are currently no identified environmental projects of which the costs
can be reasonably estimated. However, the continuation of present
investigations, more extensive investigation over time, or changes in
regulatory requirements could result in future liabilities. The Company is
insured by third-party insurance companies for liabilities arising from its
operations, including loss of or damage to third-party property, death or
injury to third parties, statutory workers compensation protection, and
pollution caused by sudden and accidental occurrence. Although there can be
no assurance that the amount of insurance carried by the Company is
sufficient to protect the Company fully in all events, all such insurance
is carried at levels of coverage and deductibles that the Company considers
financially prudent. A successful liability claim for which the Company
would be underinsured or uninsured could have a material adverse effect on
the Company.


---------------------------------------------------------------------------
Note 23 U.S. GAAP Information
---------------------------------------------------------------------------

The accompanying consolidated financial statements have been prepared in
accordance with Swedish GAAP, which differs in certain significant respects
from U.S. GAAP. The following is a summary of the adjustments to the
reported consolidated net loss and shareholders' equity that would have
been required if U.S. GAAP had been applied instead of Swedish GAAP in the
preparation of the consolidated financial statements.

<TABLE>
<CAPTION>
                                                                     Year Ended December 31,
                                                               ----------------------------------
                                                                1998           1999         2000
                                                               ----------------------------------
<S>                                                            <C>           <C>        <C>
Net loss under Swedish GAAP                                    -59,998      -86,739      -76,149
Capitalization of certain R&D costs (a)                           -856         -462       -1,355
Reversal of R&D expenses (b)                                     3,607        9,406       11,349
Amortization of patents  (c)                                        -4            -            -
Hedging of future cash flows (g)                                     -         -652          378
Receivable on SPP concerning pensionfee surplus (i)                  -            -         -250
Net loss under U.S. GAAP                                       -57,251      -78,447      -66,027
Basic EPS (d)
Net loss per Ordinary Share                                      -2.70        -3.70        -3.11
Net loss per ADS                                                 -5.40        -7.40        -6.23
Diluted EPS (d)
Net loss per Ordinary Share                                      -2.70        -3.70        -3.11
Net loss per ADS                                                 -5.40        -7.40        -6.23



                                                                     Year Ended December 31,
                                                               ----------------------------------
                                                                1998           1999         2000
                                                               ----------------------------------
Shareholders' equity under Swedish GAAP                        213,970      127,406       50,915
Capitalization of certain R&D costs (a)                        -21,441      -12,497       -2,503
Amortization of patents (c)                                     -1,715       -1,715       -1,715
Conditional shareholders' contribution (f)                      -7,510       -7,510       -7,510
Hedging of future cash flows (g)                                     -         -652         -274
Option premiums received (h)                                     5,475        5,505        5,506
Receivable on SPP concerning pensionfee surplus (i)                  -            -         -250
Shareholders' equity under U.S. GAAP                           188,779      110,537       44,169

</TABLE>


Those differences which have a significant effect on the consolidated net
loss and shareholders' equity are described as follows:

(a) Capitalization of certain R&D costs

In accordance with Swedish GAAP, the Company has capitalized certain R&D
costs. Equipment solely intended for R&D purposes is reported as tangible
long-term assets. According to U.S. GAAP, R&D costs are expensed as
incurred.

(b) Reversal of R&D expenses

According to Swedish GAAP, capitalized R&D costs are amortized over their
estimated useful lives. Since such costs have been previously expensed for
U.S. GAAP purposes, amortization of capitalized R&D costs recorded for
Swedish GAAP puposes is reversed in the reconciliation to U.S. GAAP.

(c) Amortization of patents

The Company commences the amortization of patents when the products
relating to the patents are fully commercially available. Under U.S. GAAP
amortization of patents should commence at the date of acquisition

(d) Basic / Diluted EPS

In March 1997 the Financial Accounting Standards Boards ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share", which established new standards for computing and presenting
earnings per share. SFAS No. 128 has been applied in the computation of net
loss per Ordinary Share (basic EPS), net loss per ADS and net loss per
Ordinary Share (diluted EPS).

Net loss per Ordinary Share has been calculated on the basis of the
weighted average number of shares outstanding, 21,203,800 (the same number
of shares for 1998, 1999 and 2000).

Net loss per ADS is based upon a ratio of two Ordinary Shares to each ADS.

The impact of options (see note 16) has not been taken into consideration,
as the effect would be antidilutive.

(e) Income taxes

The Company does neither account for any deferred tax liability resulting
from untaxed reserves nor account for any other deferred taxes, since the
amounts concerned are immaterial. The Company has not recorded any deferred
tax benefits from tax loss carry forwards and does not have any deferred
tax liabilities recognized for Swedish purposes. Under U.S. GAAP, deferred
taxes are established on all differences between the book basis and the tax
basis of assets and liabilities. Deferred tax assets, which include the tax
effect of tax loss carried forward, are reduced by a valuation allowance to
the amount that is "more likely than not" to be realized.

There is no effect on earnings or shareholders' equity of the Company due
to differences between Swedish GAAP and U.S. GAAP for deferred income
taxes. A valuation allowance has been established for U.S. GAAP purposes
for all of the Company's gross potential deferred tax assets (including the
tax effect of U.S. GAAP adjustments) due to a history of losses from
operations of the Company. The following table summarizes the components of
the Company's deferred taxes for U.S. GAAP purposes:

<TABLE>
<CAPTION>
                                                                      Year Ended December 31,
                                                               ------------------------------------
                                                                1998           1999         2000
                                                               ------------------------------------
<S>                                                             <C>            <C>          <C>
Gross deferred tax assets:
Tax loss carried forward                                        88,002        110,273       136,916
Capitalized costs for tax purposes                               5,351          2,944             -
Total                                                           93,353        113,217       136,916
Less valuation allowance                                       -93,353       -113,217      -136,916
Net deferred tax assets                                       -                -                  -
</TABLE>


(f) Conditional shareholders' contribution

The conditional shareholders' contribution increases shareholders' equity
under Swedish GAAP. Under U.S. GAAP such shareholders' contribution is
classified outside of Shareholders' equity due to the conditional nature of
the potential repayment.

(g) Hedging of future cash flows

Under Swedish GAAP unrealized gains and losses on forward exchange
contracts that are used to hedge anticipated transactions are deferred and
are recognized as an adjustment of the measurement of the transaction when
it actually occurs. Under U.S. GAAP such unrealized gains and losses may be
deferred only for firm commitments.

(h) Warrant premiums received

Warrant premiums received are accounted for as long-term liabilities until
the options are exercised. Under U.S. GAAP warrant premiums are disclosed
as equity.

(i) Receivable on SPP concerning pensionfee surplus

A pensionfee surplus at SPP has been disclosed as Other operating income in
accordance with Swedish GAAP. Under U.S. GAAP such pensionfee surplus can
only be accounted for as income if cash has been received by the Company,
or the surplus is available to reduce contributions due by the Company or
the current fiscal year.

(j) Comprehensive income/loss

<TABLE>
<CAPTION>
                                                                              Accumulated
                                                                                 Other
                                                          Comprehensive      Comprehensive
                                                          income / loss      income / loss
                                                         --------------------------------------
<S>                                                        <C>                  <C>

Balance at December 31, 1997                                                         74
Comprehensive loss:
Net loss                                                     -59,998
Currency translation adjustment                                -4,039            -4,039
                                                              -------            ------
Total comprehensive loss                                     -64,037
                                                              ======

Balance at December 31, 1998                                                     -3,965
Comprehensive loss:
Net loss                                                     -86,739
Adjustment of currency translation adjustment                      -                -15
Currency translation adjustment                                   175               175
                                                              -------            ------
Total comprehensive loss                                     -86,564
                                                              ======

Balance at December 31, 1999                                                     -3,805
Comprehensive loss:
Net loss                                                     -76,149
Currency translation adjustment                                 -342               -342
                                                              -------            ------
Total comprehensive loss                                     -76,491
                                                              ======

Balance at December 31, 2000                                                     -4,147
                                                                                 ======
</TABLE>


---------------------------------------------------------------------------
Note 24 U.S. GAAP Condensed Information
---------------------------------------------------------------------------

As a result of the U.S. GAAP differences described in Note 23, certain
statement of operations and balance sheet captions in the Company's
Consolidated Financial Statements would be different on a U.S. GAAP basis.
The following schedules present the Condensed Consolidated Income
Statements and Balance Sheets of the Company in conformity with U.S. GAAP.

Condensed Consolidated Income Statements - U.S. GAAP Basis

<TABLE>
<CAPTION>
                                                                      Year Ended December 31,
                                                               ------------------------------------
                                                                1998           1999         2000
                                                               ------------------------------------
<S>                                                             <C>            <C>          <C>

Product sales                                                   50,119        73,556       89,160
Contract revenue                                                   224             -            -
Total revenues                                                  50,343        73,556       89,160

Cost of goods sold                                             -10,864       -15,470      -21,148
Gross profit                                                    39,479        58,086       68,012

Selling expenses                                               -89,622       -90,783      -78,387
Administrative expenses                                        -22,133       -18,505      -25,437
Research and development costs                                 -37,233       -32,653      -32,795
Other operating income                                          42,674         4,001          393
Other operating expenses                                        -1,946        -3,659         -375
Loss from operations                                           -68,781       -83,513      -68,589

Interest income                                                 11,576         5,231        3,095
Interest expense                                                    -4           -11         -365
Loss before income taxes                                       -57,209       -78,293      -65,859

Income taxes                                                       -42          -154         -168
Net loss                                                       -57,251       -78,447      -66,027



Condensed Consolidated Balance Sheets - U.S. GAAP Basis

ASSETS                                                                Year Ended December 31,
                                                               ------------------------------------
                                                                1998           1999         2000
                                                               ------------------------------------
Cash and cash equivalents                                      187,048        112,804     53,755
Accounts receivable - trade                                      6,313          9,281      9,173
Other current assets                                            13,648         10,701     11,939
Total current assets                                           207,009        132,786     74,867

Patents                                                          4,513          4,344      5,397
Property, machinery and equipment - net                          9,937          8,518      3,939
Other long-term receivables                                      2,571          2,876      2,553
Total long-term assets                                          17,021         15,738     11,889

Total assets                                                   224,030        148,524     86,756



LIABILITIES AND SHAREHOLDERS' EQUITY                                  Year Ended December 31,
                                                               ------------------------------------
                                                                1998           1999         2000
                                                               ------------------------------------
Accounts payable - trade                                         8,742          7,600      8,973
Other current liabilities                                       18,602         22,433     23,443
Total current liabilities                                       27,344         30,033     32,416

Other long-term liabilities                                      7,907          7,954     10,171
Total long-term liabilities                                      7,907          7,954     10,171

Shareholders' equity                                           188,779        110,537     44,169

Total liabilities and shareholders' equity                     224,030        148,524     86,756

</TABLE>


Note 25 Additional U.S. GAAP Disclosures

The Company's single operating segment is research, production and
marketing of products for treatment of diseases in the oral cavity. The
Company's manufacturing facilities are located in Sweden.

(i) Geographic Segment Information

The following geographic segment data is presented on a U.S. GAAP basis.
Sales are reported by location of customer.


-------------------------------------------------------------------------------
                          Year Ended December 31,
-------------------------------------------------------------------------------
                                                 1998      1999       2000
-------------------------------------------------------------------------------
Sales:
----------------------------------------------- --------- ---------- ----------
Sweden                                          2,536     2,215      2,546
----------------------------------------------- --------- ---------- ----------
Other Nordic countries                          2,037     2,544      2,516
----------------------------------------------- --------- ---------- ----------
Germany / Austria                               27,403    31,204     23,787
----------------------------------------------- --------- ---------- ----------
Switzerland                                     1,653     1,781      1,914
----------------------------------------------- --------- ---------- ----------
U.S.                                            25,865    47,773     67,656
----------------------------------------------- --------- ---------- ----------
Canada, Mexico                                  794       1,308      2,239
----------------------------------------------- --------- ---------- ----------
Italy                                           6,633     8,337      9,632
----------------------------------------------- --------- ---------- ----------
Benelux countries                               3,535     5,329      4,847
----------------------------------------------- --------- ---------- ----------
U.K.                                            860       1,357      1,914
----------------------------------------------- --------- ---------- ----------
Japan                                           4,036     6,902      6,034
----------------------------------------------- --------- ---------- ----------
Other countries                                 1,138     1,449      3,329
----------------------------------------------- --------- ---------- ----------
Inter-area elimination                          -26,147   -36,643    -37,254
----------------------------------------------- --------- ---------- ----------
Total sales                                     50,343    73,556     89,160
----------------------------------------------- --------- ---------- ----------




----------------------------------------------------------------------
                        Year Ended December 31,
----------------------------------------------------------------------
                                       1998       1999      2000
-------------------------------------- ---------- --------- ----------
Long-term assets:
-------------------------------------- ---------- --------- ----------
Sweden                                 10,602     10,586    8,803
-------------------------------------- ---------- --------- ----------
Germany / Austria                      1,653      1,470     944
-------------------------------------- ---------- --------- ----------
Switzerland                            -          -         -
-------------------------------------- ---------- --------- ----------
U.S.                                   2,865      2,254     1,150
-------------------------------------- ---------- --------- ----------
Italy                                  471        337       119
-------------------------------------- ---------- --------- ----------
Benelux countries                      1,322      1,040     873
-------------------------------------- ---------- --------- ----------
U.K                                    107        50        -
-------------------------------------- ---------- --------- ----------
Other countries                        1          -         -
-------------------------------------- ---------- --------- ----------
Total long-term assets                 17,021     15,737    11,889
-------------------------------------- ---------- --------- ----------




(ii) Export sales

Export sales from Sweden to unaffiliated customers by destination are as
follows:


------------------------------------------------------------------
                     Year Ended December 31,
------------------------------------------------------------------
                                     1998     1999       2000
------------------------------------ -------- ---------- ---------
Other Nordic countries               2,037    2,544      2,516
------------------------------------ -------- ---------- ---------
Canada and Mexico                    683      1,308      2,196
------------------------------------ -------- ---------- ---------
Greece                               241      265        383
------------------------------------ -------- ---------- ---------
U.K.                                 11       -          -
------------------------------------ -------- ---------- ---------
Israel                               31       231        705
------------------------------------ -------- ---------- ---------
Japan                                4,036    6,902      6,034
------------------------------------ -------- ---------- ---------
France                               688      320        1,218
------------------------------------ -------- ---------- ---------
Spain                                68       318        466
------------------------------------ -------- ---------- ---------
Poland                               43       207        246
------------------------------------ -------- ---------- ---------
Other countries                      15       108        290
------------------------------------ -------- ---------- ---------
Total export sales                   7,853    12,203     14,054
------------------------------------ -------- ---------- ---------




(iii) Major customers

------------------------------------------------
            Year Ended December 31,
------------------------------------------------
                   1998       1999      2000
---------------- ---------- --------- ----------
Customer A               -         -          -
---------------- ---------- --------- ----------
Customer B               -         -          -
---------------- ---------- --------- ----------



(iv) Financial Instruments and Risk Management

The Company has operations and assets in a number of countries.
Consequently the company's revenues and expenses are affected, when
measured in Swedish kronor, by fluctuations in foreign currency exchange
rates, primarily to the US dollars (USD), Euro (EUR) and Japanese Yen
(JPY). When the Swedish kronor appreciates against other currencies the
Company's income from foreign operations reported in Swedish kronor may
decrease. Likewise, when the Swedish kronor declines against other
currencies, the Company's profit from foreign operations reported in
Swedish kronor may increase. The Company addresses these risks through a
risk management program that includes the use of financial instruments. The
Company's hedging activities are initiated within the guidelines of risk
management policies.

Notional Amounts and Credit Exposure

The notional amounts of off-balance-sheet financial instruments presented
in this Note represent fact or contractual amounts and thus are not a
measure of the exposure of the Company through its use of such financial
instruments. The actual amounts exchanged are calculated on the basis of
the notional amounts and the other terms of the financial instruments,
which are related to foreign currency exchange rates.

The Company is exposed to credit related losses in the event that the
counterpart to the off-balance-sheet financial instruments do not perform
according to the terms of the contract. In the opinion of management, the
counterpart to the financial instruments is a creditworthy financial
institution and the Company does not expect any significant loss to result
from non-performance. The credit exposure of foreign exchange contracts is
represented by the fair value of contracts with a positive fair value at
the end of each period by the effects of master netting arrangements.


Foreign Currency Risk Management

The Company is exposed to the risk of fluctuations in foreign currency
exchange rates due to the international nature and scope of its operations.
A substantial portion of the Company's revenues and expenses are
denominated in foreign currency. The Company's foreign currency risk arises
from fluctuations in foreign currency exchange rates on the value of the
Company's sales and purchases in foreign currencies (transaction exposure)
and certain financial assets and liabilities (translation exposure).
Management regularly reviews the Company's assets and liabilities that are
denominated in foreign currency and determines the net amount that is
subject to risk adverse foreign currency fluctuations. The Company uses
forward foreign exchange contracts to manage its foreign currency risk.

The following table presents the notional amounts and credit exposure of
financial instruments used for foreign currency risk management.


-------------------------------------------------------------------------------
                             As of December 31,
-------------------------------------------------------------------------------
         1998                    1999                    2000
-------------------------------------------------------------------------------
         Notional   Credit       Notional    Credit      Notional    Credit
         Amount     Exposure     Amount      Exposure    Amount      Exposure
-------------------------------------------------------------------------------
                                 (SEK in
                                 million)
-------------------------------------------------------------------------------
Forward       75          0          47           0         29        0
foreign
exchange
contracts
-------------------------------------------------------------------------------


The forward foreign exchange contracts described in the table above are
used by the Company primarily to manage its foreign currency risk with
respect to anticipated transactions and assets and liabilities denominated
in foreign currencies.

The following table summarizes by major currency the contractual amounts of
the Company's forward exchange contracts in Swedish kronor. Foreign
currency amounts are translated at rates prevailing at December 31, 2000.
The "buy" amounts represent Swedish kronor equivalents of commitments to
purchase foreign currencies, and the "sell" amounts represent the Swedish
kronor equivalent of commitments to sell foreign currencies. Amounts in the
table below include forward exchange contracts designed to hedge foreign
currency risks from both future cash flows from anticipated transactions
and the translation of receivables and liabilities denominated in foreign
currencies.


-------------------------------------------------------------------------------
                             As of December 31,
-------------------------------------------------------------------------------
           1998                    1999                   2000
---------------------- ----------- ----------- ---------- ----------- ---------
           Buy         Sell        Buy         Sell       Buy         Sell
---------------------- ----------- ----------- ---------- ----------- ---------
                                   (SEK in
                                   million)
---------------------- ----------- ----------- ---------- ----------- ---------
USD                 -          41           -         10           -         9
---------------------- ----------- ----------- ---------- ----------- ---------
DEM                 -          27           -          -           -         -
---------------------- ----------- ----------- ---------- ----------- ---------
EUR                 -           -           -         10           -         8
---------------------- ----------- ----------- ---------- ----------- ---------
JPY                 -           7           -         27           -        12
---------------------- ----------- ----------- ---------- ----------- ---------
Total               -          75           -         47           -        29
---------------------- ----------- ----------- ---------- ----------- ---------



(v) Fair Value of Financial Instruments

FASB Statement No. 107 "Disclosures about Fair Value of Financial
Instruments" requires the disclosure of estimated fair values for all
financial instruments, both on- and off-balance-sheet, for which it is
practicable to estimate fair value. At December 31, 1998, 1999, and at
December 31, 2000, the fair value of the Company's financial instruments
were insignificant.


(vi) New Accounting Pronouncements

In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" which establishes accounting
and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts and for hedging
activities. SFAS No. 133 was amended by SFAS 137 and 138. Statement 133, as
amended, requires companies to recognize all derivatives as either assets
or liabilities in the statement of financial condition and to measure those
instruments at fair value. The accounting for changes in the fair value of
a derivative depends on whether it has been designated and qualifies as
part of a hedging relationship and, if so, on the reason for holding it. If
certain conditions are met, the Company may elect to designate a derivative
instrument as a hedge of exposures to changes in fair values, cash flows,
or foreign currencies. If the hedged exposure is a fair value exposure,
changes in fair value are recognized in earnings in the period of change,
together with the offseting gain or loss on the hedged item. If the hedged
exposure is a cash flow exposure, the effective portion of the gain or loss
on the derivative instrument is reported initially as a component of other
comprehensive income and subsequently reclassified into earnings when the
forecasted transaction affects earnings. Any amounts excluded from the
assessment of hedge effectiveness as well as the ineffective portion of the
change in fair value are reported in earnings immediately. Accounting for
foreign currency hedges is similar to the accounting for fair value and
cash flow hedges. If the derivative instrument is not designated as a
hedge, the change in fair value is recognized in earnings in the period of
change. The Company adopted Statement 133, as amended, on January 1, 2001.
The Company expects that the adoption of Statement 133 will not have a material
impact on reported earnings and other comprehensive income.

In June 1999, the Swedish Financial Accounting Standards Council issued
Recommendation RR 9, "Income taxes". This recommendation establishes
accounting standards for income taxes, including taxes paid and deferred
taxes. The Company has established that the effects of adopting RR 9 will
not have a material impact on its financial position or result of
operations. The RR 9 recommendation was effective from the Company's first
quarter of fiscal year 2001.

In August 2000, the Swedish Financial Accounting Standards Council issued
Recommendation RR 18, "Earnings per share". This recommendation establishes
accounting standards for calculating and presenting earnings per share. The
Company has established that the effects of adopting RR 18, will not have a
material impact on its calculation and presentation of earnings per share.
The RR 18 recommendation was effective from the Company's first quarter of
fiscal year 2001.

In August 2000, the Swedish Financial Accounting Standards Council issued
Recommendation RR 20, "Interim reporting". This recommendation establishes
the minimum requirements for interim reporting together with what items
should be included and the valuation of such items. The Company has
established that the effects of adopting RR 18, will not have a material
impact on its interim reporting. Earnings per share and a note showing
movements in shareholders' equity will be added to the current interim
reporting format. The RR 20 recommendation was effective from the Company's
first quarter of fiscal year 2001.


-------------------------------------------------------------------------------
Note 26 U.S. GAAP Warrants
-------------------------------------------------------------------------------

In October 1995, Euroventures Nordica entered into separate option
agreements with certain officers, a former director, consultants and other
employees of the Company, pursuant to which Euroventures Nordica granted to
such persons warrants to purchase an aggregate of 990,000 of the Company's
Ordinary Shares from Euroventures Nordica. To be entitled to exercise such
options, the individuals' that were party to the warrant agreement had to
pay an amount equal to SEK 0.15 for each Ordinary Share subject to an
warrant under the agreement, which amount was payable no later than dates
ranging from May to December 1995. The warrants were exerciseable at any
time until March 31, 1997 and the purchase price per Ordinary Share upon
exercise of such warrants ranged from SEK 2.95 to SEK 8.00, payable to
Euroventures Nordica upon transfer of such Ordinary Shares to the
exercising warrant holder. The options have been exercised.

On January 24, 1997, the Company's Board of Directors, acting in
accordance with the authorization of the shareholders of the Company,
approved the issuance of an aggregate of SEK 500,000 principal amount of
subordinated debentures at an interest rate of 7% with 560,000 accompanying
warrants to Euroventures Nordica.

On the same date, Biora and Euroventures Nordica entered into an agreement
(the "Key Employee Incentive Plan") pursuant to which Euroventures Nordica
agreed to offer all the warrants to officers and other key employees of
Biora and certain of its subsidiaries (the "Participants"). These key
employees were required to purchase the warrants at their fair value at the
grant using the Black-Sholes valuation model. All of the 560,000 warrants
have been subscribed for. Also non-employee members of the Board of
Directors hold warrants.

Each warrant entitles the holder to acquire one Ordinary Share of the
Company, at an exercise price of SEK 70.00. Under Swedish law a corporation
cannot issue warrants separately from debentures, but accompanying warrants
may be detached from the debentures.

The warrants are exerciseable for Ordinary Shares at any time up until
January 31, 2001. None of these warrants have been exercised. See also note
16.

On April 23, 1998, the Company's Board of Directors, acting in accordance
with the authorization of the shareholders of the Company, approved the
issuance of an aggregate of SEK 50,000 principal amount of subordinated
debentures with 200,000 accompanying warrants to Biora Option AB. On the
same date, Biora and Biora Option AB entered into an agreement pursuant to
which Biora Option AB agreed to offer all the warrants at a price which
reflects the premium to employees of Biora and its subsidiaries (the
"Participants") to provide them with appropriate incentives to encourage
them to continue in the employ of the Company and to acquire a proprietary
interest in the long-term success of Biora. Accordingly the employees were
required to purchase the warrants at their fair value at the grant using
the Black-Sholes valuation model. Employees of the Company have subscribed
for 89,250 (71,250) warrants of this program. Each warrant entitles the
holder to acquire one Ordinary Share of the Company, at an exercise price
of SEK 130.00. Under Swedish law a corporation cannot issue warrants
separately from debentures, but accompanying warrants may be detached from
the debentures.

The warrants are exerciseable for Ordinary Shares at any time during May
2002. If also all these warrants are fully exercised, the total number of
shares outstanding will increase to 21,403,800. See also note 16.


<TABLE>
<CAPTION>

                                                       1998                                  1999                       2000
                                   ---------------------------------------------------------------------------------------------
                                      Options        Weighted Average  Options       Weighted Average  Options     Weighted Average
                                                     Exercise Price                  Exercise Price                Exercise Price
                                   ------------------------------------------------------------------------------------------------
<S>                                  <C>                   <C>        <C>                     <C>    <C>                 <C>
Outstanding at beginning
of year                               560.000                70.00    619.750                 75.78   631.250             76.77
Granted                                59.750               130.00     11.500                130.00    18.000            130.00
Exercised                                   -                    -          -                     -         -                 -
Forfeited                                   -                    -          -                     -         -                 -
                                   ---------------------------------------------------------------------------------------------
Outstanding at end of year            619.750                75.78    631.250                 76.77   649.250             78.25
                                   =============================================================================================
Exerciseable at end of year           560.000                70.00    560.000                 70.00   560.000             70.00
                                   =============================================================================================

Weighted average fair value of
options granted during the year                               2.60                             0.05                        0.05
                                   =============================================================================================

</TABLE>


<TABLE>
<CAPTION>
Warrants outstanding at December 31, 2000

                                              Warrants Outstanding                            Warrants Exercisable
                                   -----------------------------------------------------      -------------------------------
                                      Options         Remaining        Exercise Price           Options      Weighted Average
Exercise price                                       Contractual life                                         Exercise Price
                                   -----------------------------------------------------      -------------------------------

<S>                                  <C>               <C>                 <C>                 <C>              <C>
SEK 70.00                             560.000           0.08                70.00               560.000          70.00
SEK 130.00                             89.250           1.42               130.00

                                   -----------                                                ----------
                                      649.250                                                   560.000
                                   ===========                                                ==========

</TABLE>


Biora adopted the disclosure provisions of Statement of Financial
Accounting Standard 123, "Accounting for Stock-Based Compensation" but
continues to measure stock-based compensations cost in accordance with APB
Opinion 25 and its related interpretations. If Biora had measured
compensation cost for the Biora stock options granted in 1997 and 1998
under the fair value based method prescribed by FASB 123, net loss under
U.S. GAAP would have changed to the pro forma amounts set forth below. The
employees are required to purchase the warrants at their fair value at the
grant using the Black-Sholes valuation model. Accordingly, under the
provisions of FASB 123, no compensation expense results.

Net (Loss)                 1998                  1999                2000
                     -----------          ------------          ----------
Reported                (57,251)              (78,447)            (66,027)
Proforma                (57,251)              (78,447)            (66,027)



The fair value of the Biora warrants granted to Biora Employees used to
compute pro forma net loss disclosures were estimated on the date of the
grant using the Black-Sholes options-pricing model based on the following
weighted average assumptions by Biora:

                                  1998-10-19    1999-10-29   2000-12-12
                               -------------- -------------- -------------
Risk free interest                     4.55%         5.00%         5.00%
Expected life term                2002-05-31    2002-05-31    2002-05-31
Expected volatility                      26%           26%           26%
Expected dividend yield                   0             0             0


Note 27 Pledged assets and Contingent liabilities


On September 30, 1996, Euroventures Nordica made a conditional contribution
to the shareholders' equity of Biora in the amount of SEK 7,510,052 through
the conversion of outstanding loans, including accrued interest, in the
aggregate principal amount of SEK 7,160,419 and accrued interest of SEK
349,633. The amount of the conditional contribution was treated as
unrestricted equity. The contribution was made to increase total share-
holders' equity as the change in the Company's accounting policy with
respect to the capitalization of costs related to the development of
Emdogain decreased statutory shareholders' equity. The contribution is
deemed "conditional" in that it is to be repaid to Euroventures Nordica
only to the extent that the Company has sufficient unrestricted equity
otherwise available for dividends, and such repayment is further subject to
the approval of any repayment by the general shareholders' meeting of the
Company.


Note 28 Acquisitions of shareholdings in subsidiaries

The wholly-owned subsidiary Bioventures B.V., 's-Hertogenbosch, The
Netherlands, was established at the year-end 1988. Bioventures B.V. owns
the patents regarding Emdogain. The sales company Biora Benelux Dental
Products B.V., Amsterdam, The Netherlands, is a wholly-owned subsidiary of
Bioventures B.V., that was established in August 1995. The wholly-owned
subsidiary of Bioventures B.V. on the Netherlands Antilles has been
liquidated.

In October 1995 the wholly-owned subsidiary Biora GmbH, Bad Homburg,
Germany, was established to market and sell Emdogain on the German and
Austrian market.

In August 1996 the wholly-owned subsidiary Biora Inc, Chicago, U.S., was
established to market and sell the Company's main product on the North
American market.

In October 1996 50% of Biora S.A. Ltd., Johannesburg, South-Africa was
acquired. In September 1998 Biora acquired the remaining 50% of the shares.
See note 8.

In April 1997 the wholly-owned subsidiary Biora Srl, Milano, Italy, was
established to market and sell Emdogain on the Italian market.

In October 1997 the wholly-owned subsidiary Biora AG, Zurich, Switzerland,
was established to market and sell Emdogain on the Swiss market.

In December 1997 the wholly-owned subsidiary Biora Limited, London, U.K.,
was established to market and sell Emdogain on the markets within Great
Britain and Ireland.


In March 1998 the wholly-owned subsidiary Biora Option AB was established
in connection with the resolution by the general meeting of shareholders in
Biora on April 23, 1998, to give the employees of the Company opportunity
to subscribe for warrants in Biora. Biora Option AB shall subscribe for,
transfer and acquire warrants and other securities issued by the Company.

In February 1999 the wholly-owned subsidiary Biora BioEx AB was established
for research and development of products for treatment of wounds and
infections outside the oral cavity.


Note 29 Subsequent events - unaudited

FDA-approval Emdogain Gel

In January, 2001, the Company informed that the new formulation of its
prinicipal product Emdogain, named EmdogainGel, had been approved for sale
in the United States by FDA, the Fedral Food and Drug Administration.

Authorization share issue

In May, 2001 the Annual Shareholders Meeting authorized the Board of
Directors to issue a maximum of 5,500,000 shares if deemed necessary, at a
time and on market condition considered appropriate.

Warrant Program

At a meeting on May 3, 2001, the Company's shareholders approved the
issuance of promissory notes connected to warrants as well as approval to
issue warrants to employees of Biora. The reason is to implement an
incentive program for executives and employees within the group pursuant to
which they can be offered the opportunity to become shareholders of Biora
AB. The degree of dilution assuming issuance of all notes and exercise of
all outstanding options corresponds to about 3.6% of the share capital. The
dilution effect of all incentive programs in the form of options is 4.5%
after giving effect pro forma to the exercising of all options. The program
is intended for European employees only.

Results from studies of Emdogain in the treatment of mild periodontitis
without surgery

Biora has recently completed two European clinical studies concerning
Emdogain's effect in treating mild periodontitis (periodontal disease)
without surgical intervention. The studies aimed at widening the present
areas of indications for Emdogain. The patients in these studies had
shallow periodontal pockets.

After traditional cleaning of the dental root (scaling and root planing,
SRP), Emdogain was placed directly into the periodontal pocket. The
results show that Emdogain had no significantly improved effect on the
regeneration of bone and tooth supporting tissues compared to traditional
treatment of these mild defects. The studies confirmed the good wound
healing features of Emdogain.

Biora interprets these studies as a confirmation that the prime area for
periodontal treatment with Emdogain is on patients with medium to severe
defects, which usually are treated surgically, i.e. the present indications
of Emdogain.


<TABLE>
<CAPTION>

Condensed Consolidated Income Statements - U.S. GAAP Basis

-------------------------------------------------------------------------------------------
Year Ended December
31,
-------------------------------------------------------------------------------------------
                       1995       1996        1997       1998        1999        2000
-------------------------------------------------------------------------------------------
<S>                    <C>        <C>         <C>        <C>         <C>         <C>
Product sales          936        4,561       16,499     50,119      73,556      89,160
-------------------------------------------------------------------------------------------
Contract revenue       2,765      526            818        224         -            -
-------------------------------------------------------------------------------------------
Total revenues         3,701      5,087       17,317     50,343      73,556      89,160
-------------------------------------------------------------------------------------------
Cost of goods sold      -142     -4,513       -5,533    -10,864     -15,470     -21,148
-------------------------------------------------------------------------------------------
Gross profit           3,559        574       11,784     39,479      58,086      68,012
-------------------------------------------------------------------------------------------
Selling expenses      -6,081    -21,220      -64,830    -89,622     -90,783     -78,387
-------------------------------------------------------------------------------------------
Administrative        -7,490     -6,956      -18,173    -22,133     -18,505     -25,437
expenses
-------------------------------------------------------------------------------------------
Research and          -9,347    -11,157      -23,744    -37,233     -32,653     -32,795
development costs
-------------------------------------------------------------------------------------------
Other operating            0        376        1,550     42,674       4,001         393
income
-------------------------------------------------------------------------------------------
Other operating            0     -1,782       -2,843     -1,946      -3,659        -375
expenses
-------------------------------------------------------------------------------------------
Loss from operations  -19,359   -40,165      -96,256    -68,781     -83,513     -68,589
-------------------------------------------------------------------------------------------
Interest income          127        272       18,126     11,576       5,231       3,095
-------------------------------------------------------------------------------------------
Interest expense      -4,196     -2,066         -727         -4         -11        -365
-------------------------------------------------------------------------------------------
Loss before income    -23,428   -41,959      -78,857    -57,209     -78,293     -65,859
taxes
-------------------------------------------------------------------------------------------
Income taxes              -20       142         -101        -42        -154        -168
-------------------------------------------------------------------------------------------
Loss before minority  -23,448   -41,817      -78,958    -57,251     -78,447     -66,027
interest
-------------------------------------------------------------------------------------------
Minoroty interest           -       137          149          -           -           -
-------------------------------------------------------------------------------------------
Net loss              -23,448   -41,680      -78,809    -57,251     -78,447     -66,027
-------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>

Condensed Consolidated Balance Sheets - U.S. GAAP Basis

ASSETS                                           As of December 31,

                                          1995      1996     1997      1998      1999    2000
                                         -----     -----     ----      ----      ----    -----
<S>                                      <C>       <C>     <C>       <C>      <C>       <C>
Cash and cash equivalents                3,107     5,342   286,310   187,048  112,804   53,755
Accounts receivable - trade                560       476     2,600     6,313    9,281    9,173
Other current assets                     1,889    15,614     8,328    13,648   10,701   11,939
Total current assets                     5,556    21,432   297,238   207,009  132,786   74,867

Patents                                  2,158     4,515     4,230     4,513    4,344    5,397
Property, machinery,
equipm - net                             1,534     5,202     9,243     9,937    8,518    3,939
Other long-term receivables                345     2,719     2,571     2,876    2,553
Total long-term assets                   3,692    10,062    16,192    17,021   15,738   11,889

Total assets                             9,248    31,494   313,430   224,030  148,524   86,756

</TABLE>


<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS'

DEFICIT / EQUITY                    As of December 31,

                                             1995     1996     1997     1998      1999     2000
-----------------------------------------------------------------------------------------------
<S>                                         <C>     <C>        <C>      <C>      <C>      <C>
Accounts payable - trade                    1,549   12,501     5,026    8,742    7,600    8,973
-----------------------------------------------------------------------------------------------
Other current liabilities                   2,056    6,318    50,731   18,602   22,433   23,443
-----------------------------------------------------------------------------------------------
Total current liabilities                   3,605   18,819    55,757   27,344   30,033   32,416
-----------------------------------------------------------------------------------------------
Convertible loans                           5,487        0         0        0        0        0
-----------------------------------------------------------------------------------------------
Other long-term liabilities                13,139   61,075     7,832    7,907    7,954   10,171
-----------------------------------------------------------------------------------------------
Total long-term liabilities                18,626   61,075     7,832    7,907    7,954   10,171
-----------------------------------------------------------------------------------------------
Shareholders' equity / deficit            -12,983  -48,400   249,841  188,779  110,537   44,169
-----------------------------------------------------------------------------------------------
Total liab and shareholders'equity          9,248   31,494   313,430  224,030  148,524   86,756
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</TABLE>