In  connection  with  Latvia  joining  the European Union, Grindeks has

commenced  a  target-oriented  expansion of its business by forming the

first  pharmaceutical  group of companies in the Baltics. The long-term

strategy  of  PJSC Grindeks provides that the formation of the group of

companies  is  to  be  implemented  by  merger and consolidation of the

capital  of a number of companies. This will allow optimizing costs and

investments  for the development of activity in the directions with the

greatest potential. Accordingly, the most beneficial co-operation forms

with  other  pharmaceutical manufacturers in the Baltics and Europe are

being sought.



 In  accordance  with  the  Riga  Stock  Exchange  Regulations  for the

Quotation  of  Financial Instruments , we inform that during the period

from  12  to 14 May, Grindeks has concluded two co-operation agreements

as well as registered its subsidiary in Estonia.



   1.  Regarding  a  pre-contract  agreement  with  JSC  Kalceks on the

purchase of shares . 



On  14  May  2004,  Grindeks  signed  a pre-contract agreement with JSC

Kalceks  on the purchase of shares, which provides for purchasing 100 %

of  the  JSC  Kalceks  shares.  This  pre-contract  agreement  has been

concluded  with  the aim of taking over the real estate and the product

portfolio of Kalceks .



Real  estate  owned by JSC K alceks at Zala iela No. 6/8 and No.9, Riga

are  of  high  market value, determined by its advantageous location in

the  historic  central  area  of  Riga.  Therefore  the  transaction is

estimated as financially gainful.



In  relation  to  the  takeover  of  the  product portfolio of Kalceks,

Grindeks  plans to accommodate manufacturing of Kalceks products in the

facilities of its partners in Lithuania, Poland and the Commonwealth of

Independent  States  (CIS).   It  will  enable  the  company to use the

production  capacities more efficiently as well as guarantee conformity

of  the  Kalceks  production  with the principles of Good Manufacturing

Practice (GMP).



2. Regarding the contract with the pharmaceutical manufacturer Jelfa of

Poland . 



On  12  May  2004,  a  contract  manufacturing  agreement was concluded

between  PJSC  Grindeks  and  the  pharmaceutical manufacturer Jelfa of

Poland.   The   agreement   provides   that  part  of  the  injectables

manufacturing  will be transferred to Poland. Such a co-operation model

allows  diversification  of  contract  manufacturing  and optimising of

production  costs, and will provide for Grindeks additional investments

for acquiring new technologies, as well as development of products with

good prospects.



As  it  is  already  known,  as  of  now,  the  injectable  form of the

proprietary  product  Mildronate  has  been  produced by the Lithuanian

pharmaceutical manufacturer Sanitas upon commission by Grindeks . 



3. Regarding opening of subsidiary of PJSC Grindeks in Estonia. 



With  an  aim  to strengthen its positions in the Baltic market, in May

2004  Grindeks  registered  its  subsidiary  in Tallinn, the capital of

Estonia.  The  main  tasks  of  the  subsidiary  are connected with the

promotion  of  products  of  Grindeks  and its daughter company Tallinn

Pharmaceutical  Plant  (TPP)  in  the  Estonian  market.  This includes

marketing and sale activities as well as product registration.



Presently,  the  sales  representative offices of Grindeks successfully

operate in 9 countries - the Baltics, Russia, and the CIS.



Comments  by  Valdis  Jakobsons, Chairman of the Board of PJSC Grindeks

regarding the business transactions: 



"As  we  are  in  the  European  Union, we strive for adoption the best

possible  structure  for  the  group of companies following the world's

practice  and  trends,  e.g.  globalization,  specialization  and  wide

network of sales representatives in the most essential markets. Only if

we  respect  these  trends,  will  we  gain  respect  of pharmaceutical

products  manufactured  in Latvia, which are qualitative, effective and

secure medicines."    



Information prepared by:

Jana Semerikova

Head of the Public Relations Section of the PJSC Grindeks

Tel.: 7083448; 9277837;

email: jana_semerikova@grindeks.lv