Biotie Therapies - Company Announcement

Biotie proposes to strengthen its capital structure by approximately EUR 95 million through a directed issue of convertible notes and warrants and a US Public Offering

BIOTIE THERAPIES CORP.                   STOCK EXCHANGE RELEASE            23
April 2015 at 10.16 am

Not for release, publication or distribution, directly or indirectly, in whole
or in part, in or into the United States, Australia, Canada, Japan or South
Africa.

Biotie proposes to strengthen its capital structure by approximately EUR 95
million through a directed issue of convertible notes and warrants and a US
Public Offering to finance a Phase 3 trial of tozadenant in Parkinson's disease

Biotie Therapies Corp. ("Biotie" or the "Company") announces plans to strengthen
its capital structure to finance a Phase 3 double-blinded clinical trial,
including the open label extension, of its lead product candidate tozadenant
(the "Tozadenant Phase 3 Trial") by in aggregate approximately EUR 95 million
through a directed issue of up to EUR 42.5 million convertible promissory notes
(the "Convertible Notes") and other equity-based instruments (the "Warrants") to
certain US investors and certain existing shareholders, as well as a US public
offering (the "US IPO") and potential other offerings in connection with the US
IPO. The issue of the Convertible Notes and Warrants, as well as the US IPO, is
conditional on the granting of necessary authorizations and election of new
Board members by an Annual General Meeting of Biotie expected to be held in May
2015 (the "AGM").

Investment by US investors and existing shareholders

Biotie has on 23 April 2015 entered into an agreement (the "Agreement") with
certain US based investors, including Vivo Capital, OrbiMed, Versant Ventures
and investment funds managed by the Baupost Group (the "Investors") whereby the
Investors will make an initial investment as a convertible loan in the Company
by means of subscribing for Convertible Notes in an aggregate principal amount
of approximately EUR 27.5 million. Each Convertible Note would entitle the
holder to convert such Convertible Note into one new share in the Company. The
subscribers of the Convertible Notes will for each Convertible Note also receive
one Warrant entitling the holder to subscribe for one new or treasury share in
the Company.

Further, certain existing shareholders of the Company have indicated that they
will subscribe for a minimum of EUR 0.5 million each and in aggregate up to EUR
15 million of the Convertible Notes, and will also receive Warrants, on the same
terms as the Investors.

The convertible loan, represented by the Convertible Notes, will be subscribed
for and the proceeds thereof will be paid to the Company shortly after the AGM
and each Convertible Note will have a conversion price of EUR 0.15 per share.
The Convertible Notes can be converted by their holders at any time prior to the
repayment of the Convertible Notes. The Convertible Notes automatically convert
into new shares in the Company upon completion of the US IPO and, should the US
IPO not take place, the Company can force the conversion of the Convertible
Notes at any time after 1 May 2016. The Convertible Notes can be repaid by the
Company after 1 May 2035 if, and to the extent, they have not been converted.
The Investors may also declare the Convertible Notes to be repaid in the event
of certain defaults by the Company, including but not limited to the event that
the aggregate gross proceeds of the Convertible Notes, the US IPO and potential
other offerings prior to the completion of the US IPO would exceed USD 95
million.

Each Warrant entitles the holder to subscribe for one new or treasury share in
the Company at a subscription price of EUR 0.17. The Warrants, irrespective of
the contemplated US IPO, may be exercised for a period of five (5) years from a
date falling five (5) months after issuance of the Warrants.

The conversion price of the Convertible Notes and exercise price of the Warrants
have been determined by considering the share price of the Company's shares in
public trading on NASDAQ OMX Helsinki Ltd, the non-secured and interest free
nature of the Convertible Notes as well as availability and terms of possible
other financing alternatives.

The maximum number of shares in the Company to be issued under the Convertible
Notes and Warrants amounts to 562,000,000 shares representing approximately 123
per cent of the existing shares and votes in the Company, half of which will be
used for the short-term Convertible Notes and the other half for the long-term
Warrants.

As part of the Agreement, the election of two (2) new members of the Board of
Directors will be proposed to the AGM, the election of whom is a condition to
the obligations of the Investors to subscribe for the Convertible Notes.

The obligations of the Investors under the Agreement are subject to certain
additional conditions, including no material adverse change related to Biotie
and the validity of certain representations and warranties. In relation to the
issuance of Convertible Notes, the Agreement includes certain indemnification
undertakings in the event of a qualified breach of the Company's representations
and warranties, in which case Biotie would have an obligation to indemnify the
Investors against damages resulting from such breach in certain situations,
however, not to exceed a maximum amount corresponding to the Investors' total
investment in the issuance of Convertible Notes. In connection with the issue of
Convertible Notes and Warrants, the Company will undertake to enable certain
sales of the Company's shares under the U.S. Securities Act of 1933.

US IPO

Biotie also announces that it intends to conduct a US IPO and listing on the
Nasdaq Global Market of American Depositary Receipts representing the Company's
shares. The Company will remain a Finnish company, and its ordinary shares will
continue to be listed on NASDAQ OMX Helsinki Ltd.

The maximum number of new shares in the Company to be issued in the US IPO and
potential other offerings in connection with the US IPO amounts to 530,000,000
shares representing approximately 42 per cent of the shares and votes in the
Company after such US IPO and potential other offerings in connection with the
US IPO (including the dilution resulting from the automatic conversion of the
Convertible Notes at the US IPO, but excluding the dilution resulting from the
potential exercise of the Warrants).

Use of Proceeds

The Company intends to use the proceeds of the Convertible Notes and the US IPO
and potential other offerings in connection with the US IPO, together with its
current liquid assets and future revenue from Lundbeck in respect of Selincro to
finance the Tozadenant Phase 3 Trial at least through to the next major
milestone, namely top-line data on the primary endpoint at 24 weeks, which is
currently expected by the end of 2017. Further information on the contemplated
Tozadenant Phase 3 Trial may be found from the Company's release of 23 April
2015.

Rationale for the transaction and shareholder support

The Board of Directors, having considered various strategies for financing the
Tozadenant Phase 3 Trial, has concluded that the issuance of the Convertible
Notes and Warrants, and the carrying out of the US IPO and potential other
offerings in connection with the US IPO, is the most favorable option for the
Company to raise the large amount of capital required to conduct such a study.
This strategy will enable the product to move quickly into clinical trials for
the benefit of patients, and consequently, to maximize the value of tozadenant
to the Company and its shareholders. There are, therefore, weighty financial
reasons from the Company's perspective for deviating from shareholders' pre-
emptive subscription rights in the issuance of Convertible Notes and Warrants,
and shares in the US IPO.

The Board of Directors will convene the AGM to decide on the necessary
authorizations and election of new Board members relating to the transaction
announced herein. Existing Biotie shareholders representing in aggregate more
than 50 per cent of the Company's total number of shares and votes have
indicated that they will support the granting of such authorizations and the
election of new Board members at the AGM.

The Board will decide on the detailed terms and conditions of the issuance of
Convertible Notes and Warrants pursuant to the Agreement as well as the detailed
terms and conditions of the US IPO and potential other offerings in connection
with the US IPO provided that the AGM grants the necessary authorizations.

The issuance of the Convertible Notes and Warrants is expected to take place
shortly after the AGM, and the US IPO is expected to complete by the middle of
2015, which would allow the recruitment into the Tozadenant Phase 3 Trial to
commence as planned.

Timo Veromaa, President and Chief Executive Officer of Biotie commented: "We are
delighted to have these leading investors contributing to the finance of the
clinical development of our lead product candidate tozadenant, for which we have
worldwide rights. Parkinson's disease remains an area of high unmet medical need
and these funds, together with the proposed US IPO, will allow us to commence a
pivotal Phase 3 clinical trial that we believe could form the basis for approval
of tozadenant by the FDA as an adjunctive treatment to levodopa in Parkinson's".

Biotie Therapies Corp.
Timo Veromaa
President and CEO

For further information, please contact:
Virve Nurmi, Investor Relations Manager, Biotie Therapies Corp.

tel. +358 2 274 8900, e-mail: virve.nurmi@biotie.com
www.biotie.com

DISTRIBUTION:
NASDAQ OMX Helsinki Ltd
Main Media

About Biotie

Biotie is a specialized drug development company focused on products for
neurodegenerative and psychiatric disorders. The current development products
include tozadenant for Parkinson's disease, which is transitioning into Phase 3
development, and two additional compounds which are in Phase 2 development for
cognitive disorders including Parkinson's disease dementia, and primary
sclerosing cholangitis (PSC), a rare fibrotic disease of the liver. Biotie's
development has already delivered Selincro (nalmefene) for alcohol dependence,
which received European marketing authorization in 2013 and is currently being
rolled out across Europe by partner Lundbeck.

About Tozadenant

Tozadenant is an oral, selective adenosine A2a receptor antagonist which has
previously reported positive data from a 420-patient Phase 2b study evaluating
tozadenant in Parkinson's patients experiencing levodopa related end-of-dose
'wearing-off'. Full data from this trial was published in Lancet Neurology in
2014. The trial met its primary endpoint of a highly significant decrease in"off" time vs. placebo, as well as demonstrating efficacy across multiple
secondary endpoints. The Phase 3 protocol will largely replicate that of the
Phase 2b study. Biotie expects that the published Phase 2b study will be
considered the first of two pivotal studies required for registration for
tozadenant in Parkinson's patients with end-of-dose 'wearing-off'.

Disclaimer

The information herein may not be distributed or sent into the United States,
Australia, Canada, Japan or South Africa. The information contained herein shall
not constitute an offer to sell or the solicitation of an offer to buy, nor
shall there be any sale of the securities referred to herein in any jurisdiction
in which such offer, solicitation or sale would be unlawful prior to
registration, exemption from registration or qualification under the securities
laws of any such jurisdiction.

In particular, the information contained herein is not for publication or
distribution, directly or indirectly, in or into the United States, Canada,
Australia, Hong Kong, South Africa or Japan, unless the Company in its sole
discretion determines otherwise. These written materials do not constitute an
offer of securities for sale in the United States, nor may the securities be
offered or sold in the United States absent registration or an exemption from
registration as provided in the U.S. Securities Act of 1933, as amended, and the
rules and regulations thereunder. Any public offering of securities to be made
in the United States will be made by means of a prospectus that may be obtained
from the issuer and that will contain detailed information about the company and
management, as well as financial statements.

The issue, exercise and/or sale of securities in the offerings are subject to
specific legal or regulatory restrictions in certain jurisdictions. The Company
assumes no responsibility in the event there is a violation by any person of
such restrictions. Investors must neither accept any offer for, nor acquire, any
securities to which this document refers, unless they do so on the basis of the
information contained in the applicable prospectus published or offering
circular distributed by the Company.

The Company has not authorized any offer to the public of securities in any
Member State of the European Economic Area. With respect to each Member State of
the European Economic Area other than potentially Finland and which has
implemented the Prospectus Directive (each, a "Relevant Member State"), no
action has been undertaken or will be undertaken to make an offer to the public
of securities requiring publication of a prospectus in any Relevant Member
State. As a result, the securities may only be offered in Relevant Member States
(a) to any legal entity which is a qualified investor as defined in the
Prospectus Directive; or (b) in any other circumstances falling within Article
3(2) of the Prospectus Directive. For the purposes of this paragraph, the
expression an "offer of securities to the public" means the communication in any
form and by any means of sufficient information on the terms of the offer and
the securities to be offered so as to enable an investor to decide to exercise,
purchase or subscribe the securities, as the same may be varied in that Member
State by any measure implementing the Prospectus Directive in that Member State
and the expression "Prospectus Directive" means Directive 2003/71/EC (and
amendments thereto, including the 2010 PD Amending Directive, to the extent
implemented in the Relevant Member State), and includes any relevant
implementing measure in the Relevant Member State and the expression "2010 PD
Amending Directive" means Directive 2010/73/EU.

This communication is directed only at (i) persons who are outside the United
Kingdom or (ii) persons who have professional experience in matters relating to
investments falling within Article 19(5) of the Financial Services and Markets
Act 2000 (Financial Promotion) Order 2005 (the "Order") and (iii) high net worth
entities, and other persons to whom it may lawfully be communicated, falling
within Article 49(2) of the Order (all such persons together being referred to
as "relevant persons"). Any investment activity to which this communication
relates will only be available to and will only be engaged with, relevant
persons. Any person who is not a relevant person should not act or rely on this
document or any of its contents.


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