Holding in Company

Phytopharm PLC
3 January 2001



            Phytopharm plc ('the company') received the following letter of
            notification today from M & G Investment Management Limited:



            Companies Act 1985 (as amended) (the 'Act')

            Disclosure of interests In Shares

            'For the purpose of this and future notifications pursuant to Part
            VI of the Act, we write to inform you that with effect from close
            of business on 31 December 2000, the regulated business of M&G
            Investment Management Limited ('MAGIM') was transferred to
            Prudential Portfolio Managers Limited ('PPM'). The latter has
            today been renamed as M&G Investment Management Limited.
            Consequently, you will observe in the current notification (and in
            all future notifications henceforth) that the PPM name has in all
            instances been replaced by that of M&G.

            We also write to inform you that with effect from 28 December
            2000, the life and pensions business of M&G Life Assurance Company
            Limited and M&G Pensions and Annuity Company Limited respectively
            was transferred to Scottish Amicable Life plc. From the date
            hereof, all notifications will therefore identify Scottish
            Amicable Life plc as the operator of all-former M&G life and
            pension funds.

            In view of the above, we attach a schedule detailing those
            interests currently held by Prudential plc and certain of its
            subsidiary companies, which reflects the recent changes to the
            Investment management business at M&G. You should be aware that
            all notifications will now be made by M&G Investment Management
            Limited on behalf of all companies within the Prudential plc group
            of companies.

            For the purpose of S210 of the Act the address for those companies
            identified in the attached schedule is Laurence Pountney Hill,
            London, EC4R OHH.

            In order to assist us to comply with our notification obligations
            under the Banking Act, Insurance Companies Act and Investment
            Services Regulations, we would appreciate it if you would notify
            us of any future changes within your group structure relating to
            the formation acquisition or disposal of any of the following: (I)
            a bank, (11) an Insurance company and/or (iii) an authorised
            Investment firm'.

            Subsequently the resultant holding of M&G Investment Management
            Limited is now 1,967,500 ordinary shares representing 5.16% of the
            issued share capital of the company.