News Release

Acquisition of Berkeley Advanced Biomaterials LLC

Tokyo, Japan - August 1, 2017 - GNI Group Ltd. (TSE Mothers listed code: 2160, "GNI" or the "Company"), a leading biopharmaceutical company listed in Japan, announced today that the acquisition of a 70% stake of Berkeley Advanced Biomaterials LLC (BAB) by GNI USA, Inc. was completed on July 31, 2017 as scheduled. BAB will be a consolidated subsidiary of the Company.

BAB has developed a range of proprietary technologies to process biocompatible ceramics, polymers and human allograft tissue to manufacture biologic products used in orthopedic, spine and dental surgery. The first product platform (H-GENIN) distinguishes itself in the market by providing a 100% pure human allograft demineralized bone matrix putty solution to surgeons. BAB will soon release its Advanced Mineralized Graft (AMG) product line that will involve osteoinductive bone fiber technology. The second product platform (OSTETIC) includes conventional resorbable calcium-based bioceramics (e.g. hydroxyapatite, tri-calcium phosphate, and other calcium salts) sometimes combined with a flexible or injectable fibrilar collagen matrix and formulated to be easily applied in a variety of surgical settings. BAB plans to complement this platform of bone void fillers later this year with 45S5 bioactive glass.

While BAB continues to expand its valued relationship with existing customers and private label partners, the acquisition will help BAB expand its global reach in Asia. It may also begin to shift some development projects back to the area of drug delivery to increase the synergy with GNI's area of expertise.

GNI will manage its new subsidiary through BAB's current management. Dr. François Génin will continue as Chief Executive Officer and Tissue Bank Director and will retain significant ownership in BAB. Five Managers have been appointed to the Board of the LLC, with three Managers including the Chairman of the Board representing GNI USA, Inc., as well as Dr. Ping Luo and, Dr. François Génin.

For further information on the background on this acquisition transaction, please refer to earlier disclosures on April 18 and July 18, 2017.


GNI Group Ltd. is listed on the Tokyo Stock Exchange Mothers Market, Code 2160, with headquarters in Tokyo and subsidiaries in Hong Kong, Shanghai, Beijing and the United States. For further information, please visit www.gnipharma.com.

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This press release contains "forward-looking" statements, including statements related to the Group's plans to pursue development of product candidates and the timing thereof. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Words such as "continue," "expected to", "will" and similar expressions are intended to identify these forward-looking statements. There are a number of important factors that could cause the Group's results to differ materially from those indicated by these forward-looking statements, including risks associated with the timing and success of clinical trials and the commercialization of product candidates. The Group does not undertake any obligation to update forward-looking statements.