Re Agreement

Phytopharm PLC
26 June 2007


Company Contact:                                            U.K. Investor Relations Contact:
Phytopharm plc                                              FD
Dr Daryl Rees CEO                                           David Yates
Mr Piers Morgan CFO                                         Ben Atwell
[phone]                                            [phone]
www.phytopharm.com



Collaboration and Licence Agreement with The Beijing Institute for novel memory
and concentration product



GODMANCHESTER, Cambridgeshire, U.K. (26 June 2007) - Phytopharm plc (LSE: PYM)
('Phytopharm' or the 'Company') announces today a Collaboration and Licence
Agreement with The Beijing Institute, Academy of Military Medical Sciences ('The
Beijing Institute') for the development of novel functional foods and
pharmaceuticals, including a product for memory and concentration.



Under the terms of the Collaboration and Licence Agreement, Phytopharm and The
Beijing Institute will collaborate to progress The Beijing Institute's lead
product for memory and concentration selected from its library of patented
compounds derived from Traditional Chinese Medicine.  The Collaboration and
Licence Agreement also extends to certain other patented compounds that may have
utility in other disease areas including vascular disorders and stroke.
Phytopharm has been granted an exclusive licence from The Beijing Institute to
develop and commercialize these products globally in return for royalty and
milestone payments to The Beijing Institute upon the achievement of certain
pre-defined goals.  Financial terms of the agreement are not disclosed.



Traditional Chinese Medicines have been used for thousands of years and over
that time a wealth of knowledge and expertise in the medicinal use of plants has
built up.  The Beijing Institute scientists have extensive knowledge of
Traditional Chinese Medicines and their research over the last 10 years has led
to the identification of a lead product that has the potential to improve memory
and concentration.  Phytopharm will develop this lead product through further
pre-clinical testing and progress into clinical trials.



Commenting on today's announcement, Dr Xiaoming Yang, Head of The Beijing
Institute, said:  'We are delighted to be working with Phytopharm and proud that
The Beijing Institute's extensive expertise and experience in Traditional
Chinese Medicine has been recognized by Phytopharm and we look forward to a long
and fruitful collaboration.'



Commenting on today's announcement, Dr Daryl Rees, Chief Executive Officer of
Phytopharm, said: 'We are excited about the Collaboration and Licence Agreement
with The Beijing Institute as it fulfils one of our strategic objectives of
expanding our product portfolio with a novel functional food candidate for
memory and concentration, an area in which we have established expertise.  The
Beijing Institute's scientists bring significant knowledge on Traditional
Chinese Medicine and we look forward to working with them to advance the lead
product through clinical development.'



                                     -Ends-



                                Notes to Editors



Phytopharm plc

Phytopharm is a pharmaceutical development and functional food company whose
product leads are generated from medicinal plants.  The Company's strategy is to
develop these products through 'proof of principle' clinical testing, and then
secure partners for late stage development, sales and marketing. Laboratory,
manufacturing and clinical work is outsourced to selected specialists, operating
under expert in-house management.  This operational structure allows access to
the best external research facilities whilst maintaining low fixed overheads and
a lower development cost structure.



Beijing Institute

The Beijing Institute (Institute of Radiation Medicine, the Academy of Military
Medical Sciences, Beijing) has over the past 50 years developed its research
strengths from radiobiology into a wide range of scientific fields, including
biotechnology, biochemistry, molecular biology, pharmaceutical chemistry,
pharmacology, toxicology, experimental pathology, experimental haematology,
genomics and proteomics.  These groups were set up to provide the quality
control for Traditional Chinese Medicine products and the identification and
development of extracted active compounds.  The Institutes considerable
expertise and experience in the extraction of active compounds from Traditional
Chinese Medicine has resulted in several pharmaceutical products being
successfully developed for the Chinese market.



Functional Foods

Functional foods are foodstuffs that provide health or physiological benefits
above their nutritional value and have a health claim on the packaging.
Currently gut and heart health products dominate with new interest in areas of
weight control, memory and concentration, immune system function and skin
health. The global value of functional foods is estimated to be up to $65bn.
The growth potential is predicted to be 50% from 2005-2010 with an accelerating
trend for new products.


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            The company news service from the London Stock Exchange