VASTox - Intention to Float

IP2IPO Group PLC
30 September 2004


For immediate release                                   30 September 2004


VASTOX ANNOUNCES ITS INTENTION TO FLOAT ON THE ALTERNATIVE INVESTMENT MARKET OF
                           THE LONDON STOCK EXCHANGE


IP2IPO Group plc (AIM: IPO) ('IP2IPO'), the intellectual property company that
commercialises university technology, is pleased to announce that VASTox Plc ('
Vastox'), a spin-out company from the University of Oxford's chemistry
department that specialises in drug discovery and services focused on chemical
genomics, has today announced its intention to float on the AIM market of the
London Stock Exchange plc by way of a placing. IP2IPO holds a 20% equity stake
in Vastox.

The press release issued today by Vastox is enclosed below:

For immediate release                                         30 September 2004

                                  VASTOX PLC
                          ('VASTox' or the 'Company')

            Intention to float on the Alternative Investment Market
                          of the London Stock Exchange

VASTox plc, the Oxford-based drug discovery and services business focused on
chemical genomics, announces its intention to join the Alternative Investment
Market (AIM) by way of a Placing.

The Company has early-stage proprietary research programmes in Duchenne Muscular
Dystrophy and Tuberculosis and also has revenue-generating contracts for the
provision of drug discovery services with several pharmaceutical and
biotechnology companies via its chemical genomics platform.

VASTox was formed as a spin-out company in January 2003 by a prestigious team of
scientific founders from the University of Oxford headed by Professor Steve
Davies, the chemistry professor who in 1992 founded Oxford Asymmetry, a business
that was eventually sold for £316 million.

Professor Steve Davies is VASTox's Non-executive Chairman and its Chief
Executive Officer is Dr Steven Lee, the former executive director of Life
Sciences at IP2IPO Group plc.

VASTox scientific founders/Scientific Advisory Board

Professor Steve Davies, Professor of Organic Chemistry, University of Oxford

Professor Kay Davies FRS, CBE, Head of the Department of Human Anatomy and
Genetics, University of Oxford

Professor Edith Sim, Head of the Department of Pharmacology, University of
Oxford

Professor Graham Richards CBE, Chairman of the Department of Chemistry,
University of Oxford

Dr Derek Stemple, Wellcome Trust Sanger Institute, Cambridge

Dr Jean-Paul Vincent MRC National Institute for Medical Research, London

Dr Bob Sim, Medical Research Council ImmunoHistochemistry Unit, University of
Oxford

VASTox is based at the University of Oxford Chemistry department, which offers
some of the  world's most advanced research facilities.

KBC Peel Hunt Ltd is the Company's Nominated Advisor and Broker.

Background

During the past four years, VASTox's scientific founders whose experience brings
together chemistry and biology in an effort to find new treatments for human
disease, have collaborated extensively in the development of chemical genomics,
the use of small molecule drugs to influence complex cellular pathways. Through
its founders, the Company has extensive expertise in the use and understanding
of small animal models, in particular Danio rerio (zebrafish) and Drosophila
(fruitflies), and applying this to human disease.

Chemical genomics

The Company's chemical genomics platform encompasses a 'screen-to-gene'
approach, in that no assumptions are made regarding the therapeutic target.
Rather than starting with a disease or target, chemical libraries are probed
sequentially in high-content in vivo phenotypic screens that utilise both
vertebrate and invertebrate whole organisms. The chemical genomics platform
utilises specifically the zebrafish in primary screening and fruitfly in
secondary screening.

Over the last few years, zebrafish have emerged as the model of choice for in
vivo functional genomics studies by virtue of:

-          being a vertebrate;
-          having rapid embryogenesis (one cell to fully laid down body plan
           with organs such as heart, brain, eye and vasculature system 
           recognisable by 24 hour post fertilisation);
-          optical clarity (the embryo is transparent as it develops such that
           one can observe specific developmental events under a dissecting 
           microscope);
-          excellent genetics and genomics (the whole zebrafish genome sequence
           is expected by the end of 2005);
-          high fecundity (200-300 eggs per adult female, per week); and
-          ease of functional genomic studies using morpholino oligonucleotide
           gene knockdown techniques.

Presently, there are in excess of 1,000 developmental phenotypes characterised
in zebrafish, many of which have been closely associated with molecular pathways
and specific gene disruptions. Such is the potential of the zebrafish model for
biomedical research, the National Institute of Health in the US ranks the
zebrafish as the third most important animal after human and mouse models.

For fruitflies, the advantages lie mainly in the unparalleled ability to
manipulate the genome in terms of generating transgenics, mutations or
deletions, particularly employing gene-silencing techniques such as ribonucleic
acid interference ('RNAi').

Due to the high volume, high content nature of the Company's chemical genomics
platform, data is expected to be recorded from hundreds to thousands of
fruitflies and zebrafish prior to the requirement for testing on mammals,
including humans. The data collected will enable the drug development to be more
focused on the biochemical pathways and molecular targets thus increasing the
probability of the successful development of a drug and reducing the
developmental costs.

The Company's chemical genomics process is as follows: zebrafish embryos at one
hour post fertilisation are robotically dispensed into 96 well microtitre plates
(four to five per well) and incubated with chemical libraries. The resultant
chemotypes (phenotypes produced by a small molecule) are then recorded and
scored. A significant developmental chemotype will give good clues as to the
molecular target and biological pathway for a specific compound, which is then
selected for further study in secondary assays using fruitflies. The Company has
access to a bank of transgenic fruitfly stocks which is an invaluable and
renewable resource for rapid identification of target pathways and genes. The
key point to note is that these signalling pathways and target genes are highly
conserved in humans, that is, many of the zebrafish or fruitfly genes identified
in this screening paradigm have a human orthologue. In principle, this approach
can be applied to any gene, thereby generating a vertebrate animal model for a
specific disease.

This high content in vivo screening facilitates the rapid and simultaneous
identification of:

-          the biochemical pathways and molecular targets for human disease that
           are by definition treatable by a drug;
-          potential new targets for off-patent and unsuccessful drugs;
-          potential drug-like compounds that modulate specific gene and protein
           families; and
-          lead compounds for that target.

Business model

The Company aims to leverage both its technology platform and extensive network
of academic and industry contacts to generate revenues by providing services to
pharmaceutical companies, and then, in time, migrate revenues to licensing
income and product sales. The Company's business operations are organised in
such a way that provision of services not only generates revenues but helps to
build the drug discovery infrastructure of the Company for proprietary
programmes.

Proprietary drug programmes

VASTox currently has two proprietary programmes: a gene-based approach to
Duchenne Muscular Dystrophy, a disease against which there is currently no known
cure; and a novel approach to overcoming antibiotic resistance to Tuberculosis.

Highlights of the Placing

  • VASTox is seeking to raise up to £15m in a Placing of shares to
    institutional shareholders.
  • The market capitalisation of VASTox after the Placing is expected to be
    £45m.
  • The proceeds will be used to fund a step change in the Company's
    operations and to increase working capital.
  • It is anticipated that VASTox's ordinary shares will begin trading on AIM
    in October 2004.

Commenting on the proposed flotation, Steven Lee, VASTox Chief Executive
Officer, said: 'VASTox has an outstanding group of world-leading scientific
founders which the Company aims to leverage, together with its unique technology
platform, to improve the productivity of drug development for pharmaceutical and
biotechnology partners.  We believe we can really make a difference and look
forward to progressing the Company with the aid of this IPO.'

                                      ENDS

For more information please contact:

IP2IPO
David Norwood, Chief Executive Officer                      020 7067 1651

Vastox
Steven Lee, Chief Executive Officer                         01865 316917

KBC Peel Hunt
Capel Irwin/David Anderson                                  020 7418 8900

Buchanan Communications
Tim Anderson/Mark Court/Mary-Jane Johnson                   020 7466 5000

Notes to editors

IP2IPO

About IP2IPO

IP2IPO is an intellectual property (IP) company that specialises in
commercialising university technology. The Company was founded in 2001 and
listed on AIM in October 2003.

IP2IPO's first partnership was with the University of Oxford. In return for an
investment of £20 million, IP2IPO has acquired 50 per cent of the University of
Oxford's equity in spin-out companies and technology licenses based on
intellectual property created at the Chemistry Department until 2015. In
November 2003, IP2IPO created a £5 million seed capital fund for investing in
spin-out companies across the University of Oxford, not just those originating
within the Chemistry Department.

In March 2002, IP2IPO entered into a second long-term partnership with the
University of Southampton.  Under the terms of this partnership, IP2IPO is
committed to working with the University of Southampton in the identification
and facilitation of spin-out companies from across the University of Southampton
and to investing £5 million in early-stage University of Southampton spin-out
companies over a four year period in return for equity stakes in those
companies.  In addition, IP2IPO also received a 20 per cent stake in Southampton
Asset Management Limited, a company that has been formed to hold the
University's equity stakes in its future spin-out companies. The partnership has
a term of at least 25 years.

IP2IPO entered into its third long-term partnership in May 2003 with King's
College London.  IP2IPO will work with King's College London to help identify
and progress commercialisation opportunities as well as invest £5 million in
seed capital in spin-out companies from King's College London over a five year
period in return for equity stakes in those companies.  In addition, IP2IPO will
receive 20 per cent of King's College London's equity in spin-out companies and
technology licenses.  The partnership has an initial term of 25 years.

In October 2003, IP2IPO announced a fourth partnership with the Centre for Novel
Agricultural Products ('CNAP'), based at the University of York. CNAP is a
flagship research centre that specialises in plant and microbial gene discovery.
Under the terms of the partnership a new company, Amaethon Limited, has been
created which has the right to commercialise CNAP's IP for 25 years. IP2IPO has
committed to invest £1.15m in Amaethon Limited in return for a one third equity
stake in Amaethon Limited (the remaining equity being owned by the University of
York) and will also invest in the spin-out companies based on CNAP's IP which
Amaethon Limited creates.

In July 2004, IP2IPO acquired a strategic 20% stake in Techtran Group Limited ('
Techtran'). Techtran has a long-term technology commercialisation contract with
the University of Leeds. Under the terms of the contract Techtran receives a
significant (30%) interest in spin-out companies created and technology licences
negotiated in return for the provision of technology transfer services to the
University.

In June 2004, IP2IPO acquired Top Technology Ventures Limited, an investment
adviser to early stage technology funds. This combines IP2IPO's expertise in the
creation of new ventures based on world leading university IP with Top
Technology's focus on making early stage venture capital investments.


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