Preliminary Results

Oxford Biomedica PLC
10 March 2008


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For Immediate Release                                           10 MARCH 2008


                              OXFORD BIOMEDICA PLC

            PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2007


Oxford, UK - 10 March 2008: Oxford BioMedica (LSE: OXB), a leading gene therapy
company, today announces its preliminary results for the year ended 31 December
2007.


Operational highlights:

TroVax(R): cancer

   • Global collaboration with sanofi-aventis
   • Achieved two milestones under sanofi-aventis agreement
   • Three successful DSMB reviews of TRIST study in renal cancer
   • Further Phase II results in renal cancer suggest therapeutic potential


ProSavin(R): Parkinson's disease

   • Initiated Phase I/II trial in Parkinson's disease
   • Efficacy in ongoing preclinical studies exceeds 27 months


Hi-8(R) MEL: melanoma

   • Phase II follow-up confirms survival advantage in immune responders


Other development products

   • Recruitment progressing in Phase II trial of MetXia(R) in pancreatic
     cancer
   • Preclinical results with RetinoStat(R) in wet AMD confirm proof of
     concept
   • Preclinical results with StarGen(TM) in Stargardt's disease confirm proof
     of concept
   • Initiated EndoAngio-GT anti-cancer programme

Technology and corporate

   • Acquisition of Oxxon Therapeutics
   • Technology licensing agreement with major US biotech company
   • Secured rights to therapeutic use of Nobel Prize-winning RNAi technology


Financial highlights (audited financial results):

   • Payments from sanofi-aventis £25.8 million (2006: nil)
   • Revenue £7.2 million (2006: £0.8 million)
   • Research & development costs £22.1 million (2006: £19.5 million)
   • Loss for the year £15.3 million (2006: £17.6 million)
   • Positive operational cash flow £5.9 million (2006: cash burn £15.9
     million)
   • Net cash1 £38.1 million (31 December 2006: £28.5 million)


Commenting on the annual results, Oxford BioMedica's Chief Executive, Professor
Alan Kingsman said: '2007 has been a transformational year for Oxford BioMedica
with the achievement of our two main corporate objectives: a global alliance
with sanofi-aventis for TroVax; and the initiation of a Phase I/II trial with
ProSavin in Parkinson's disease. We have ended 2007 with four products in
clinical development; support for our lead product from a partner that is a
major player in oncology and vaccines; and a strengthened balance sheet. In
2008, we will maintain our focused and financially prudent strategy for growth.
Over the next 18 months, key clinical results are expected from trials of both
TroVax and ProSavin, which could dramatically enhance the value of these
programmes and could support the registration of our first therapeutic product.'


1.     Cash, cash equivalents and current financial assets

                                     -Ends-

For further information, please contact:

Oxford BioMedica plc:
Professor Alan Kingsman, Chief Executive            Tel: [phone]

JPMorgan Cazenove Limited:
James Mitford/ Gina Gibson                          Tel: [phone]

City/Financial Enquiries:
Lisa Baderoon/ Mark Court/ Mary-Jane Johnson        Tel: [phone]
Buchanan Communications

Scientific/Trade Press Enquiries:
Gemma Price/ Holly Griffiths/ Katja Stout           Tel: [phone]
College Hill Life Sciences

US Enquiries:
Thomas Fechtner                                          Tel: [phone]
The Trout Group LLC


Notes to editors


1. Oxford BioMedica

Oxford BioMedica (LSE: OXB) is a biopharmaceutical company specialising in
cancer immunotherapy and gene-based therapies. The Company was established in
1995, as a spin-out from Oxford University, and is listed on the London Stock
Exchange.


The Company has a platform of gene delivery technologies, which are based on
highly engineered viral systems. Oxford BioMedica also has in-house clinical,
regulatory and manufacturing know-how. The lead product candidate is TroVax(R),
an immunotherapy for multiple solid cancers, which is licensed to sanofi-aventis
for global development and commercialisation. TroVax is in Phase III
development. Oxford BioMedica has three other products in clinical development,
including ProSavin(R), a novel gene-based treatment for Parkinson's disease, in
a Phase I/II trial. The Company is underpinned by over 80 patent families, which
represent one of the broadest patent estates in the field. The Company has a
staff of approximately 85. Oxford BioMedica has collaborations with
sanofi-aventis, Wyeth, Sigma-Aldrich, MolMed and Virxsys. Technology licensees
include Biogen Idec, Merck & Co, GlaxoSmithKline and Pfizer.

Further information is available at www.oxfordbiomedica.co.uk

CHAIRMAN'S STATEMENT


2007 has been a transformational year for Oxford BioMedica with the achievement
of our two main corporate objectives. Firstly, the global alliance with
sanofi-aventis for TroVax, signed in March 2007, is one of the most valuable
licensing agreements for an active cancer immunotherapy and provides both near
and long-term value for Oxford BioMedica. TroVax will benefit from
sanofi-aventis' substantial development expertise in oncology and vaccines as
well as its global commercial infrastructure. Together with sanofi-aventis, we
are preparing for commercialisation of TroVax, with the first of three planned
Phase III trials progressing well. Secondly, in December 2007, we initiated a
Phase I/II trial of ProSavin, which is a potentially revolutionary treatment for
Parkinson's disease. This is the first clinical trial of a product that utilises
our proprietary LentiVector technology, which is the backbone of multiple
product candidates in our pipeline and various licensing deals. The start of
this trial is the culmination of over ten years of research at Oxford BioMedica.
In summary, we ended 2007 stronger than ever in terms of our development
pipeline, and our financial position has also been strengthened following the
initial payments from sanofi-aventis.


Strategic focus

Owing to the current risk-adverse capital markets, we have reassessed our
development priorities to ensure that internal efforts are focused on those
product candidates that offer the greatest potential value to Oxford BioMedica.
The strategic purpose of this review was to ensure that the Company continues to
grow and expand, but maintains prudent management of its financial resources. We
own some exceptional assets in the field of cancer immunotherapy and gene-based
medicines with a deep and robust pipeline of product candidates. The strength of
these assets means that we are well positioned to pursue our strategy of
partnering certain assets to access additional resources, while investing in the
further development of key programmes.


As part of our strategy, we have sought to broaden our technology platform
creating opportunities both for near-term revenue streams from licensing and
also new in-house development programmes. In 2007 we acquired Oxxon
Therapeutics, which has brought complementary intellectual property in
immunotherapy and a novel vaccine for melanoma in Phase II development.
Furthermore, in January 2008, we secured exclusive rights to use Nobel
Prize-winning RNA interference (RNAi) technology in therapeutic approaches where
the active RNAi molecules are delivered using our LentiVector technology. RNAi
represents a new treatment approach based on turning off gene expression (gene
silencing).


We will continue to evaluate new opportunities that are consistent with our
strategy and can accelerate the growth of our business. Our core strategic
themes are described in the Strategy section of the Business Review.


People

Our employees are crucial to the success of Oxford BioMedica and we are
committed to the development of a motivated and professional workforce. It is
their skill and expertise that has enabled us to achieve our progress to date.
In 2007, we expanded our staff count to 82 from 73. We will continue to add to
our existing team, as we broaden our activities and move towards the
commercialisation of our first product, to ensure that we have the appropriate
skill base to address these challenges. On behalf of the entire Board, I would
like to thank our staff for their hard work in 2007 and their continued support
and commitment.


Looking Ahead

The fundamentals of the biotechnology industry remain strong, particularly for
companies that are developing novel biological therapies for major unmet medical
needs. The pharmaceutical industry is under pressure to improve its research and
development productivity and many of the major pharmaceutical firms have raised
their targets for revenue from in-licensed and biological products within the
next few years. Oxford BioMedica aims to be the leading company in the
specialised areas of cancer immunotherapy and gene-based medicines. During 2007,
the pharmaceutical industry showed increased interest in these fields and made
some significant investments, as evidenced by several recent collaborations,
including our alliance with sanofi-aventis. Over the next few years, we expect
to benefit from further convergence between the pharmaceutical industry and
innovative biotechnology companies. In 2008, as TroVax moves towards
commercialisation and data emerge from the Phase I/II trial of ProSavin, we will
maintain our focused and financially prudent strategy for growth.


Dr Peter Johnson

CHAIRMAN


STRATEGY


Our goal is to create a profitable biopharmaceutical company through the
commercialisation of novel safe and effective gene-based medicines to treat
unmet medical needs. To mitigate the inherent risks of drug development, we have
adopted a hybrid business model that combines in-house and collaborative
research and development, enabling us to establish a portfolio of product
candidates that address multiple therapeutic areas. We also actively out-license
our proprietary technologies for use in research or drug development to generate
near-term revenue streams and, in some cases, royalties on product sales. In
2007, we undertook a review of our pipeline to prioritise our development
efforts and maximise the potential return from our in-house investment. With
rigorous financial management, we aim to deliver sustained growth and value for
our shareholders and other stakeholders.


OPERATIONAL REVIEW


ADVANCED CANDIDATES


TROVAX(R)

Development of our lead product candidate, TroVax, is progressing in multiple
cancer types. The product is one of the most advanced therapeutic cancer
vaccines in development. Therapeutic vaccines have the potential to play a
significant role in cancer therapy as additive treatment options for patients.
We believe that TroVax could be one of the first registered products in this
field.


Sanofi-aventis Collaboration

In March 2007, we secured a licensing agreement with sanofi-aventis for the
global development and commercialisation of TroVax. The agreement is one of the
largest alliances in the field of cancer immunotherapy.


Oxford BioMedica received payments from sanofi-aventis totalling €38 million in
2007, comprising an initial payment of €29 million and an early development
milestone payment of €9 million. A further milestone payment of €10 million was
triggered in February 2008 following the third successful interim analysis of
the TRIST study by the Data Safety Monitoring Board. Further development and
regulatory milestone payments could yield up to €470 million if TroVax is
approved for a small number of defined cancer types. Oxford BioMedica is
entitled to additional milestone payments for other cancer types, commercial
milestone payments when sales reach certain targets and tiered escalating
royalty income on global sales.


The Phase III TRIST study of TroVax in renal cancer is being managed by Oxford
BioMedica and co-funded with sanofi-aventis. All other TroVax activities,
including development, registration and commercialisation, will be funded by
sanofi-aventis. As part of the agreement, sanofi-aventis is committed to the
rapid initiation of a Phase III trial in colorectal cancer. In terms of
commercialisation, Oxford BioMedica retains an option to participate in the
promotion of TroVax in the USA and the European Union.


Phase III TRIST Study Progress

The Phase III TRIST (TroVax Renal Immunotherapy Survival Trial) study is
progressing well. We are approaching full recruitment of 700 patients. The rate
of recruitment has been encouraging. Over 100 centres are participating in the
USA, Western Europe and Eastern Europe. It is rare for such a large trial to
recruit to plan. One factor that affects the rate of recruitment, but is
difficult to predict at the outset of a multi-centre trial, is clinicians'
enthusiasm for the product. Clinicians have been highly supportive of the trial,
which reflects TroVax's excellent safety profile and potential to improve
patients' survival and quality of life.


The trial has been recruiting at a rate of about 50 patients per month. This is
comparable to the recruitment rate for the Phase III trial of Pfizer's Sutent(R)
(sunitinib), which was one of the recently launched targeted agents for renal
cancer that has had rapid uptake in terms of commercial sales. In January 2007,
the UK National Cancer Research Network (NCRN), which provides the UK National
Health Service (NHS) with the infrastructure to support cancer clinical trials,
agreed to adopt the trial. The NCRN's adoption of TRIST means that multiple NHS
centres are participating in the study. In reaching its decision to adopt the
TRIST trial, the Renal Cancer Clinical Studies Group of the NCRN evaluated
TroVax and the trial design and concluded that the product offers potential
improvement in care for patients within the NHS.


The study is being conducted in patients with locally advanced or metastatic
clear cell renal carcinoma. It is a randomised, placebo-controlled, two-arm
study comparing TroVax in combination with standard of care to placebo with
standard of care. The standard of care therapy can be sunitinib,
interferon-alpha or interleukin-2. The protocol stratifies treatment between the
three standards of care to ensure that the allocation of TroVax and placebo is
rigorously balanced. The primary endpoint for the trial is overall survival;
secondary endpoints include the percent of patients with progression-free
survival at week 26, tumour response rates and quality-of-life scores. The trial
is being conducted under a Special Protocol Assessment (SPA) agreement from the
FDA. The SPA specifies the design, conduct, analysis and endpoints of the trial.
With this in place, this single comparative trial may be used to support an
efficacy claim in a regulatory submission to the FDA.


The independent DSMB for the TRIST study has completed three scheduled interim
analyses, the most recent one being in February 2008. Following each review, the
DSMB concluded that the trial should continue as planned without modification.
The role of the DSMB is to evaluate unblinded data from the ongoing trial to
determine whether there are safety or efficacy issues that would warrant
modification of the protocol or early termination of the study. The DSMB is
independent of Oxford BioMedica and sanofi-aventis. To preserve the study
blinding, the DSMB provides no additional information other than its
recommendation.


Based on the current progress, we expect the trial to reach its primary endpoint
in the first half of 2009, which is aligned with our expectations at the outset
of the study. If the primary endpoint is achieved, sanofi-aventis could file its
first regulatory submission for registration of TroVax in renal cancer within a
few months of the trial results. With Priority Review from the FDA, the
regulatory review period could be six months from submission.


Colorectal Cancer Phase III Trials Starting

Sanofi-aventis is starting an international, randomised, placebo-controlled
Phase III trial of TroVax in colorectal cancer. The Phase III trial, which has
been named FLAMENCO, is designed to assess TroVax as a first line treatment of
patients with Stage IV metastatic colorectal cancer. It is expected to enrol
approximately 1,300 patients. The trial design is similar to the TRIST study, in
that it will evaluate TroVax in combination with standard of care versus placebo
plus standard of care. The standard treatment will be chemotherapy with or
without Avastin(R) (bevacizumab), which will be stratified between the two arms
of the study. The primary endpoint will be overall survival and the trial will
include an interim analysis to evaluate time to disease progression. The trial
will be conducted under a SPA with the FDA and patient recruitment is expected
to start in mid-2008. Results from the interim analysis are anticipated in 2010.


In addition to the Phase III trial in metastatic colorectal cancer, the UK
clinical trials network QUASAR is starting a trial of TroVax in early-stage
colorectal cancer. This trial is supported by both sanofi-aventis and Oxford
BioMedica. Sanofi-aventis will act as the US regulatory agent for the trial,
which has been submitted to the US and UK regulatory authorities. The trial will
assess TroVax in patients with Stage II/III colorectal cancer who have had
surgical resection of their primary tumours and been treated with adjuvant
chemotherapy. It is expected to enrol approximately 3,000 patients and has been
designed with a primary endpoint of three-year disease-free survival. The
funding of the QUASAR trial derives from a variety of sources, including the UK
Medical Research Council and the Department of Health as well as Oxford
BioMedica and sanofi-aventis. Patient recruitment is expected to commence in
mid-2008.


Update on US-sponsored Breast Cancer Trial

Over the last two years, we have been liaising with the SouthWest Oncology Group
(SWOG), which is one of the largest cancer clinical trials cooperative groups in
the USA, funded by research grants from the US National Cancer Institute, part
of the National Institutes of Health. SWOG was planning to conduct a Phase II
trial of TroVax in patients with advanced breast cancer. Since TroVax is being
evaluated in a major Phase III programme, SWOG, Oxford BioMedica and
sanofi-aventis have now concluded that an open-label Phase II study of TroVax to
evaluate safety and immunology in this patient group is no longer necessary.
SWOG remains committed to the TroVax programme, and we are working with the
organisation to design a larger study of TroVax in breast cancer.


Encouraging Results from Phase II Trials in Renal Cancer

At the Annual Meeting of the American Society of Clinical Oncology (ASCO) in
June 2007, new data were reported from two Phase II trials of TroVax in renal
cancer. TroVax was well tolerated with no serious adverse events attributable to
the treatment and the product induced anti-5T4 antibody responses in 91% of
patients. Twenty-four of 35 evaluable patients with clear cell renal carcinoma
(68%) showed disease control. Two patients had complete responses (i.e. their
tumours were completely eradicated), three had partial responses (i.e. tumour
shrinkage) and 19 had stable disease for periods exceeding three months,
including three patients that were stable for more than 17 months. Preliminary
analysis of clinical benefit showed a statistically significant relationship
between reduction in tumour burden in patients with clear cell renal carcinoma
and patients' anti-5T4 antibody responses (p=0.028). These encouraging new data
support the hypothesis that the 5T4-specific immune response induced by TroVax
has therapeutic benefit.


Presentation of Final Phase II Results

Together with sanofi-aventis, we aim to present final data from all four
open-label Phase II trials of TroVax in renal cancer at ASCO in May/June 2008.
The trials evaluated TroVax as a single agent and in combination with high-dose
interleukin-2, low-dose interleukin-2 or interferon-alpha.


Separately, we plan to report results from the completed Phase II trial of
TroVax in prostate cancer at the Targeted Anticancer Therapies meeting, 20-22
March 2008, in the USA. The trial, in 27 patients with hormone-refractory
prostate cancer, evaluated TroVax as a single agent and in combination with the
standard therapy, granulocyte-macrophage colony-stimulating factor (GM-CSF).
Preliminary data from this trial were previously reported in April 2007 at the
Annual Meeting of the American Association for Cancer Research, showing that
TroVax was well tolerated and all patients developed anti-5T4 antibody
responses.


Pre-commercialisation Plan

The presentation of clinical data at upcoming conferences is part of the
pre-commercialisation plan for TroVax ahead of the Phase III TRIST study results
and potential registration in 2009. Sanofi-aventis is implementing a
communications initiative to inform and educate the oncology community with
regards to TroVax ahead of its potential launch.


The companies have secured manufacturing for commercial launch, together with
material for the Phase III trials in colorectal cancer. Discussions are ongoing
with sanofi-aventis and our contract manufacturer regarding longer-term supply.
Sanofi-aventis is evaluating its manufacturing strategy, which may include an
in-house manufacturing facility for TroVax.


Summary

We are delighted by the progress of the TroVax programme and by the commitment
of our partner, sanofi-aventis. By combining Oxford BioMedica's expertise in
cancer immunotherapy and the experience of sanofi-aventis in clinical
development and commercialisation of oncology products, we hope to be able to
bring this innovative and potentially valuable medicine to patients as soon as
possible.


PROSAVIN(R)

The first clinical trial of ProSavin in Parkinson's disease is underway in
France. It is the first trial using our proprietary LentiVector technology and,
as such, represents a major event for Oxford BioMedica and the future of the
pipeline of products that use the same technology. The superior efficacy of
ProSavin combined with the absence of side effects in preclinical studies
suggest that ProSavin could be used to replace standard L-DOPA therapy in
patients with moderate to late-stage Parkinson's disease. Following our
discussions with the regulatory agency in France, we have started preparations
to move from this Phase I/II trial directly into a Phase III trial, which could
start at the end of 2009 or early 2010.


Phase I/II Trial Initiated

In December 2007, we opened the Phase I/II trial of ProSavin, having received
regulatory clearance from the French Health Products Safety Agency (AFSSAPS) for
our Clinical Trial Application (CTA). The CTA was submitted in July 2007.
Patient recruitment is underway at the Henri Mondor Hospital in Paris, which is
a European centre of excellence for neurosurgery and a member of the Assistance
Publique Hopitaux de Paris (APHP) in France. Several patients are undergoing
detailed evaluation of their baseline Parkinsonian status prior to surgical
administration of ProSavin. Treatment of the first patient is imminent.


The primary objectives of the trial are to assess the safety and efficacy of
ProSavin. The analyses of patients will include the application of advanced
non-invasive neuro-imaging techniques.


Phase I/II Trial Design

Patients in the trial will have been diagnosed with Parkinson's disease and will
be failing on current treatment with L-DOPA but they will not have progressed to
experiencing drug-induced movement disorders (dyskinesias). It is a two-stage
study. The first stage is an open-label dose escalation to evaluate two dose
levels of ProSavin in cohorts of three patients each. In the second stage of the
trial, a further 12 patients will be recruited. Four of the 12 patients will act
as a control group and only receive 'sham' surgery.


ProSavin is administered locally to the brain, converting the target cells into
a dopamine factory, thus replacing the patient's own lost source of the
neurotransmitter. The surgical procedure for administration of ProSavin entails
stereotactic bilateral injection into the striatum of the brain under general
anaesthesia using MRI-imaging and mapping. The procedure is designed to be
non-destructive to tissue and does not leave any device in the brain.

The efficacy of ProSavin will be assessed using the Unified Parkinson's Disease
Rating Score (UPDRS). Patients will be monitored at regular intervals, with the
primary endpoint being an efficacy assessment at six months after treatment. The
secondary objective of the trial is to asses the extent to which patients'
current therapy (L-DOPA) can be reduced or removed following administration of
ProSavin.


Sustained Efficacy in Preclinical Studies

We continue to assess the long-term efficacy data of ProSavin in a preclinical
setting. In the industry-standard preclinical model of Parkinson's disease,
known as the MPTP model, ProSavin induces almost complete recovery of movement
function and other behavioural measurements following a single administration.
In this model, the most recent time point shows that the therapeutic effect of
ProSavin has been maintained for over 27 months with no diminution. Efficacy was
similar to that expected with standard daily treatment with L-DOPA but with no
evidence of the dyskinesias associated with prolonged L-DOPA treatment.


Phase III Preparations

If the safety and efficacy observed in preclinical studies of ProSavin is
replicated in the Phase I/II trial, then we would aim to move directly to a
Phase III trial. Based on our anticipated timelines for the Phase I/II trial and
for scaling-up the manufacture of ProSavin for Phase III and commercialisation,
the Phase III trial could start in late 2009 or early 2010. The trial could be
completed within two years, supporting first product registration in 2012-13.


Summary

Current standard therapy for Parkinson's disease is only partially effective in
the mid to late stage of disease and can induce debilitating side effects after
long-term use. ProSavin has the potential to address this unmet medical need,
offering long-lasting benefit from a single administration with an excellent
safety profile. We are pleased to have started our first clinical trial of this
potentially important new treatment approach for Parkinson's disease. The
product could significantly expand the worldwide market for Parkinson's disease
therapies, which are estimated to generate sales in excess of US$3 billion, by
reducing the social care burden associated with the mid to late-stage of
disease.


The LentiVector system used within ProSavin is common to multiple preclinical
candidates in our pipeline. The infrastructure for ProSavin that relates to
manufacturing scale-up and safety testing can be applied across this portfolio.
Hence, the time invested in the ProSavin programme should benefit our other
LentiVector-based programmes.


HI-8(R) MEL

Hi-8 MEL is a therapeutic vaccine for metastatic melanoma, which was added to
the pipeline following the Company's acquisition of Oxxon Therapeutics in March
2007. Oxxon Therapeutics had previously evaluated Hi-8 MEL in two clinical
trials. These trials showed that the vaccine was well tolerated and produced
strong killer T-cell immune responses against the cancerous cells at certain
dose levels. The product has the potential to reduce mortality in patients with
advanced disease, and can be used alongside standard therapy without adding
significant toxicity. Hi-8 MEL is based on the same MVA vector technology as
TroVax, together with a DNA-based configuration of the vaccine. If melanoma is
treated early it can be cured by surgical resection. However, half of those with
metastatic melanoma die of the disease within five years. A melanoma vaccine
would offer new hope to such patients.


Encouraging Update on Phase II Trial in Melanoma

Updated results from a Phase II trial were presented at the American Association
of Immunologists Annual Meeting in May 2007. The trial, in 41 patients with
Stage III/IV melanoma, was designed to evaluate the immune and clinical
responses elicited by Hi-8 MEL. The product was highly immunogenic with 91% of
patients that received the optimal dose showing an antigen-specific immune
response. Eight patients (20%) showed periods of disease control. The
presentation included follow-up of one patient that exhibited a sustained
partial response for more than two years. The median survival for immune
responders was 100 weeks versus 37 weeks for non-responders (p < 0.001).


Strategy for future development

The Company believes information garnered from the ongoing TroVax studies will
provide additional useful information on how best to develop Hi-8 MEL, which is
a MVA-based tumour vaccine, like TroVax. We are reviewing the current
formulation and data generated by Oxxon to ensure that Hi-8 MEL is ready for
full development pending successful completion of the Phase III TRIST study of
TroVax.


Summary

Melanoma is one of only a few cancers in which the immune system appears to play
a prominent role. The 5T4 antigen, that is the basis of TroVax, is not found on
melanoma cells. Hence, Hi-8 MEL is an ideal complement to the potential
applications of TroVax in solid tumours. Through our experience with TroVax, we
have substantial expertise in cancer immunotherapy. We will apply this knowledge
to the further development of Hi-8 MEL.


METXIA(R)

MetXia is potentially useful in the treatment of a number of solid tumours and
their metastases, particularly those where cyclophosphamide is commonly used as
a treatment. The product is being evaluated in a Phase II trial in pancreatic
cancer. The trial is a dose-escalation study to identify the optimal dose levels
for MetXia and cyclophosphamide. In 2007, we initiated commercial discussions
with potential partners for both MetXia and our associated technology for
Gene-Directed Enzyme Prodrug Therapy (GDEPT).


Patient Recruitment Progressing in Phase II Trial

We initiated the Phase II trial of MetXia in 2004 in patients with
non-resectable pancreatic tumours. The recruitment of patients has been
purposefully staged since each patient needs to be carefully reviewed for their
response to therapy prior to treatment of subsequent patients. However, the rate
of enrolment in this trial has been problematic due to the strict criteria for
patient suitability and the poor health of the majority of patients presenting
for surgery. The patients are at an advanced stage of their disease, and most
have previously failed to respond to other therapies.

To date, 23 patients have been treated in the study, in which MetXia and
cyclophosphamide are delivered directly to the pancreatic tumour via a catheter
inserted through an artery. Two dose levels of MetXia and five dose levels of
cyclophosphamide have been evaluated to assess the efficiency of P450 gene
transfer and to determine the maximum tolerated dose of the prodrug.


Preliminary Proof of Concept Results in Phase II Trial

Patients who received the optimal dose of MetXia and higher doses of
cyclophosphamide are still being assessed. Preliminary results suggest that
MetXia induces gene expression of P450 enzyme at the tumour site and that there
have been no unexpected adverse events when MetXia and cyclophosphamide are used
together in this manner.


To date, disease stabilisation has been evident in six of 12 evaluable patients
(50%). Patient survival is difficult to interpret for this heterogeneous patient
group but has ranged from four to almost 110 weeks. Median survival for the
evaluable patients is 26 weeks. Additional patients are being recruited at the
maximum tolerated dose to establish more efficacy data in this patient group. We
plan to report further data from this trial during 2008.

Initiated Commercial Discussions

Following our strategic review in 2007, we initiated discussions with potential
partners for further development and commercialisation of MetXia. This will
enable us to focus our resources on higher development priorities within the
pipeline. MetXia is the most advanced product candidate to derive from our
proprietary GDEPT technology. To maximise the commercial opportunity for MetXia
and our GDEPT technology, we are seeking industry partners to provide additional
resources and expertise.


Summary

Preliminary data from the Phase II trial in non-resectable pancreatic cancer are
encouraging and demonstrate proof of concept for our GDEPT technology. This
platform technology has the potential for broad application. With appropriate
investment, MetXia could be the first of multiple GDEPT-based products developed
for the treatment of localised, accessible tumours.


RETINOSTAT(R)

RetinoStat is designed to provide long-term inhibition of aberrant blood vessel
growth in the retina for the treatment of vision loss caused by conditions such
as wet age-related macular degeneration (AMD) and diabetic retinopathy (DR). We
have identified RetinoStat as our next LentiVector-based programme for clinical
development, behind ProSavin. Our aim is to conduct an initial clinical trial in
the USA, since the programme is supported by US organisations, namely Johns
Hopkins University and the Foundation Fighting Blindness with its support
organisation, the National Neurovision Research Institute.


New Proof of Concept Preclinical Results

In May 2007, Oxford BioMedica and our collaborators at Johns Hopkins University
in Baltimore presented encouraging preclinical data with RetinoStat at the
Association for Research in Vision and Ophthalmology Annual Meeting. The
presentation included preclinical proof of principle in an industry-standard
model of neovascular AMD.


Ongoing Clinical Preparations

We have initiated the scale-up process for manufacturing clinical material. We
have commissioned Good Manufacturing Practice (GMP) production of a key
component of RetinoStat and we aim to have final clinical material within the
next 12 months. With our US collaborators, we are conducting additional
non-clinical studies with RetinoStat that are required for our regulatory
submission to start clinical trials. During 2007, our internal resources for
LentiVector-based programmes were prioritised to ProSavin, which has extended
our anticipated timelines for RetinoStat. However, the development of RetinoStat
should benefit considerably from our investment in the manufacturing of
ProSavin. We expect to submit an Investigational New Drug (IND) application to
the FDA for the start of trials in patients with wet AMD during 2009.


Summary

We have had initial discussions with potential partners for further development
and commercialisation of RetinoStat. The industry is clearly interested in new
anti-angiogenic treatment strategies for wet AMD, which have potential for
superior efficacy and a lower injection frequency than the current standard
therapy, which is Novartis' Lucentis(R). Treatment with Lucentis requires
injections into the eye every one to two months. Given the long-term gene
expression capabilities of our LentiVector technology, a single administration
of RetinoStat could be effective for over a year.


EARLY-STAGE CANDIDATES


We have established a diverse early-stage pipeline that comprises eight
preclinical product candidates. The in-house programmes are all gene-based
therapies that utilise our LentiVector technology. In 2007, several of these
programmes benefited from financial support provided by disease-focused
charitable organisations through direct funding of studies or grants. During
2007, we initiated a new anti-cancer programme, EndoAngio-GT, and presented
preclinical proof-of-concept results with StarGen in Stargardt's disease.


Initiated EndoAngio-GT Anti-cancer Programme

In July 2007, we secured a licence from Children's Hospital Boston to the
anti-angiogenic genes that are utilised in our RetinoStat vision loss programme
for the treatment of cancer. This new anti-cancer programme, EndoAngio-GT, is
based on a similar construct to RetinoStat. In 2007, we initiated preclinical
optimisation of the product.


Presentation of StarGen(TM) Preclinical Results

StarGen is designed to deliver a normal functional gene to treat an inherited
ocular condition, Stargardt's disease. The programme is funded by the Foundation
Fighting Blindness, the National Neurovision Research Institute and a consortium
of associated investors. At the Association for Research in Vision and
Ophthalmology Annual Meeting in May 2007, we presented preclinical data with
StarGen, showing efficacy in an industry-standard model of the disease.
Additional preclinical studies are underway at Columbia University in New York,
which could support advancement to clinical development in this niche commercial
market.


In addition to our relationship around StarGen and RetinoStat, we are exploring
a commercial collaboration with the Foundation Fighting Blindness to develop
LentiVector-based therapeutic approaches for other ocular diseases.


TECHNOLOGY LICENSING


Our technology licensing activities exploit the potential of our suite of gene
delivery technologies by providing third-party access for research or specific
development applications. We have added two new industry partners to our list of
licensed LentiVector users and we entered the field of RNA interference using
our LentiVector system for genetic delivery. In addition, one of our partners
announced the start of a Phase III trial with a product that uses another of our
technologies, which triggered a milestone payment.


New LentiVector Licensing Agreement

In July 2007, another major US-based biotechnology company licensed the
LentiVector gene delivery technology for research activities in a joint
agreement with Sigma-Aldrich. Sigma-Aldrich is our strategic partner and
exclusive licensee for the commercialisation of the LentiVector technology for
research use. In addition, in March 2008, as part of a patent dispute
settlement, Open Biosystems acquired certain rights for use of our LentiVector
technology in research activities.


Expanding into Therapeutic RNA Interference

In January 2008, we signed a license agreement with the Carnegie Institution of
Washington and the University of Massachusetts Medical School that grants Oxford
BioMedica rights to key RNA interference (RNAi) technology invented by Nobel
Prize-winning scientists Andrew Z. Fire, PhD, and Craig C. Mello, PhD. The
licence is exclusive for therapeutic RNAi strategies using our LentiVector
technology. RNAi represents a potential new strategy for treating diseases by
gene silencing. We plan to develop LentiVector-based RNAi therapies
independently, but also offer this technology to our existing LentiVector
licensees and other industry players as part of our technology licensing
activities.


MolMed Initiates Phase III Trial

Also in January 2008, one of our partners, MolMed, received regulatory approval
to start a Phase III trial of its TK therapy. The Phase III trial is being
conducted in Italy in patients with high risk acute leukaemia who are receiving
haematopoietic stem cell transplantation. The product is a cell/gene-based
therapy that is designed to control the complications of graft versus host
disease associated with these transplantations. The product employs our ex vivo
retroviral gene delivery technology. The start of this Phase III trial triggered
a milestone payment to Oxford BioMedica under the terms of our agreement.


Viragen Streamlines its Research

Another partner, Viragen, which licensed our LentiVector technology for the
development of an avian transgenic biomanufacturing system, reported further
progress with the technology and published results in a leading medical journal
in January 2007. However, in June 2007, Viragen halted development as part of
its efforts to cut costs and has subsequently sought bankruptcy protection. With
the Roslin Institute, which was collaborating with Viragen on this programme, we
are exploring alternative ways to advance and commercialise the avian transgenic
technology.


INTELLECTUAL PROPERTY


Our intellectual property estate is fundamental to our business to ensure that
we control and protect our products in development and our technologies. In
2007, we bolstered our proprietary position in immunotherapy through the
acquisition of Oxxon Therapeutics. At the end of 2007, our estate comprised 46
US and 20 European issued patents compared to 39 and 12, respectively, in the
previous year. During 2007, we were granted five patents in the USA and five in
Europe. We have a further 76 patents issued in other jurisdictions, with four of
these being granted in 2007. In total, 198 patent applications are currently
pending. Another 24 patent families, covering key technologies, are licensed
from third parties.


In 2007 and early 2008, respectively, we announced two significant in-licensing
deals of intellectual property. Firstly, we extended our rights to use two
anti-angiogenic genes for the treatment of cancer. Secondly, we secured
exclusive rights in the field of RNA interference for the development of
therapeutics using our LentiVector technology. Furthermore, in March 2008,
Oxford BioMedica, our partner, Sigma-Aldrich, and Open Biosystems settled a
patent dispute over use of our LentiVector technology in research reagents.


Oxxon Acquisition Adds Immunotherapy IP

Our acquisition of Oxxon Therapeutics in March 2007 has added intellectual
property in immunotherapy to our estate. Its Hi-8(R) PrimeBoost technology is a
pioneering method for producing a potent and specific T-cell immune response
against diseased cells. This platform has potential applications in developing
prophylactic as well as therapeutic vaccines. Oxxon owned or had exclusively
licensed a number of patent families covering the PrimeBoost technology and
these patents and licences are now part of Oxford BioMedica's estate.


Extended Rights to Anti-angiogenic Genes

In July 2007, we signed a license agreement with Children's Hospital Boston to
extend our existing rights for the anti-angiogenic genes, endostatin and
angiostatin, for the treatment of cancer. This has enabled us to initiate a new
anti-cancer development programme, EndoAngio-GT. We previously licensed rights
to these genes solely for the treatment of ocular diseases, and the genes are
being successfully employed in RetinoStat. We expect the development of
EndoAngio-GT to benefit from synergies with RetinoStat.


New Rights in Therapeutic RNA Interference

In January 2008, (as described in Technology Licensing above) we licensed Nobel
prize-winning RNA interference (RNAi) technology from the Carnegie Institution
of Washington and the University of Massachusetts Medical School. This agreement
provides exclusive rights to use our LentiVector technology for therapeutic RNAi
applications. We plan to develop LentiVector-based RNAi therapies, both
independently and through collaborations.


FINANCIAL REVIEW


Financial overview

The TroVax collaboration with sanofi-aventis has transformed the Group's
finances. A total of £25.8 million cash was received in 2007 from
sanofi-aventis. Of this amount, £7.0 million was recognised as revenue in 2007
and £18.8 million is classified as deferred income. In addition, the acquisition
of Oxxon Therapeutics Limited (Oxxon) in March 2007 for £16.0 million, which was
satisfied by Oxford BioMedica shares, brought with it cash and cash equivalents
of £3.8 million. Overall, there was a net increase in cash, cash equivalents and
current asset investments in the year of £9.6 million.


Revenue £7,219,000 (2006: £760,000)

The TroVax collaboration with sanofi-aventis accounts for the majority of
revenue in 2007. A total of £25.8 million cash was received in 2007, comprising
an initial payment of £19.7 million (€29 million) on commencement in March 2007
and the first development milestone payment of £6.1 million (€9 million) in
September 2007. Revenue from these payments is being recognised on a
straight-line basis over the period to certain clinical events, which are
anticipated in 2009 and 2010. £7.0 million was recognised as revenue in the 2007
income statement. The remaining £18.8 million is classified as deferred income.


Revenue from technology licensing in 2007 amounted to £0.2 million compared to
£0.8 million in the previous year. Licenses that provide access to our
technology for research use generate minimal revenue but potentially facilitate
collaborations for product development.


Cost of sales £449,000 (2006: £80,000 included in operating expenses)

We have licensed a number of third-party technologies to expand our activities
and to ensure that we have freedom to operate. Most licences include royalties
payable on sales, and some include royalties payable on licensing income,
including up-front and milestone income. In 2007, £0.4 million of royalties were
recognised in cost of sales in the Group's income statement. The amounts of
royalty payable on revenue in previous years were lower, and were included in
operating expenses.

Operating expenses £26,759,000 (2006: £22,222,000)

Operating expenses increased by 20% in 2007 to £26.8 million, reflecting
increased employee costs, the acquisition of Oxxon and higher legal and
professional expenses associated with our patent estate and the licensing of
TroVax.


Research & development costs £22,142,000 (2006: £19,523,000)

R&D costs increased by 13% in 2007 to £22.1 million. Our R&D expenditure
comprises in-house costs (staff, R&D consumables, intellectual property,
facilities and depreciation of R&D assets) and external costs (preclinical
studies, GMP manufacturing, regulatory affairs, and clinical trials). In 2007,
as in 2006, external preclinical and clinical costs were the largest
contributors to R&D spend. The year was also impacted by the addition of £0.3
million in R&D costs associated with Oxxon.


Administrative expenses £4,617,000 (2006: £2,699,000)

The increase in administrative expenses in 2007 was partly due to the
acquisition of Oxxon and increased legal and professional costs. In 2007, there
was a charge of £0.3 million for exceptional closure and reorganisation of
Oxxon, and £0.1 million for non-exceptional administrative expenses during the
close-down period. Legal and professional costs related to the collaboration
with sanofi-aventis and other negotiations were £0.4 million.


Finance income £2,087,000 (2006:£1,714,000)

The Group places its cash in bank deposits for periods of up to 12 months and
generates interest on those deposits. The maturity profile of deposits is
intended to match planned patterns of expenditure. The average balance on
deposit in 2007 was approximately the same as in 2006 at £37.7 million. However,
due to higher interest rates in 2007, net interest receivable was up by 22%. The
Group has no debt, but is recognising as a finance expense the discount on a
lease provision and a dilapidation provision.


Taxation

Our UK operating subsidiaries are entitled to claim R&D tax credit. The credit
is based on certain eligible expenses, to which a 50% mark-up and a tax rate of
16% are applied. Under the prevailing rules, the R&D tax credit cannot exceed
the total amount of UK payroll tax (Income Tax and National Insurance) paid in
the year. In 2007, our R&D tax credit increased 48% to £2.5 million, due to
higher employee benefit expenses during the year. The year-end debtor for R&D
tax credit of £2.6 million represents the estimated tax credit for the current
year, including £0.1 million that is attributable to Oxxon in the period prior
to our acquisition.


Loss for the financial year £15,289,000 (2006: £17,626,000)

The Group's loss for the year narrowed to £15.3 million from £17.6 million
despite higher operating expenses in 2007.


Intangible assets £14,910,000 (2006: £1,665,000)

The Oxxon acquisition has resulted in a significant increase in intangible
assets. The principal acquired intangibles were in-process research and
development on the melanoma vaccine Hi-8 MEL, and the PrimeBoost patent
portfolio. The fair value of these assets was £13.1 million. In addition,
purchased intellectual property rights of £0.2 million were capitalised.


Trade and other receivables £4,672,000 (2006: £2,202,000)

Trade and other receivables (debtors) were £2.5 million higher in 2007 than in
the previous year. There was an increase of £0.4 million in other receivables
principally due to higher bank interest fixed-term deposits. Prepaid clinical
trial expenses of £1.0 million (2006: nil) are materials for clinical trials not
yet shipped to site, and advance payments to clinical sites.


Trade and other payables £9,557,000 (2006: £4,671,000)

The increase in trade and other payables (creditors) in 2007 was principally
associated with our expanded clinical development activities.


Deferred income £18,913,000 (2006: £92,000)

The Group's deferred revenue at the end 2007 was boosted to £18.9 million.
Deferred revenue reflects payments received under our licensing agreements that
exceed the amount of recognised revenue. Receipts in 2007 from the TroVax
collaboration with sanofi-aventis are being recognised as revenue over a two to
three-year period. The amount expected to be recognised as revenue in 2008 is
£11.4 million.


Share issues

At the end of 2007, the Group had 534,655,843 shares in issue. During the year,
shares issued for cash raised £0.3 million before expenses from the exercise of
share options and other subscriptions. A total of 31,771,246 shares with a value
of £16.0 million were issued in the acquisition of Oxxon.


Cash and deposits £38,147,000 (2006: £28,543,000). Operational cash generated
£5,883,000 (2006: cash burn £15,876,000)

The total of cash, cash equivalents and current asset investments at the end of
2007 was £38.1 million, compared to £28.5 million in the previous years. The
format of the cash flow statement under IFRS does not make it easy to assess the
overall level of operational cash flows that have traditionally been a key
performance indicator for development-stage biotechnology companies. However, a
useful measure can be calculated by taking the aggregate of cash from operating
activities, proceeds of sale of property, plant and equipment and purchases of
property, plant and equipment and intangible assets. On this measure, there was
a positive operational cash flow of £5.9 million in 2007, in contrast to a
(negative) cash burn in 2006 of £15.9 million. The key difference in 2007 was
the receipt of £25.8 million from sanofi-aventis. In addition, cash and cash
equivalents of £3.8 million were acquired with Oxxon.


Financial outlook

In 2007, we conducted a strategic review of our development pipeline to enable
us to focus investment on opportunities that could generate the greatest value.
The present level of operational expenses is expected to be maintained through
2008 based on our current and planned development activities. We reached the
second development milestone in our agreement with sanofi-aventis in February
2008, which triggered a payment of €10 million. We will continue to monitor the
investment requirements for each of our programmes and will expand our internal
operations as required to meet our objectives. Our financial goal is to be
profitable within 12 months of registration of our first product, which could be
in 2009 following a successful outcome from the Phase III TRIST study of TroVax
in renal cancer.


OUTLOOK


With a focused strategy and a strong financial position, we are well placed to
deliver on our objectives for 2008. We are delighted to have recently triggered
a further development milestone payment in our collaboration with
sanofi-aventis, following the third successful review of the Phase III TRIST
study by the DSMB. We expect shortly to complete recruitment for this trial.
Over the next few years, sanofi-aventis is planning a significant investment in
the TroVax programme. Our key goals for TroVax in 2008 include continued
management of the TRIST study in renal cancer, and support for sanofi-aventis as
it broadens the Phase III programme into colorectal cancer and prepares for the
commercialisation of the product.


ProSavin, our novel treatment for Parkinson's disease is potentially the next
blockbuster opportunity in our pipeline. The Phase I/II trial is underway and we
aim to report preliminary safety and efficacy data from the study during this
year. Also in 2008, we aim take RetinoStat towards clinical development in wet
AMD.


As part of our strategy, we will continue to pursue collaboration opportunities
for certain programmes. In 2008, we intend to move forward with our
collaboration discussions for MetXia and its associated GDEPT technology for
localised cancer therapy. Also, having secured a proprietary position in the
field of therapeutic RNA interference, we plan to explore partnering
opportunities that could provide additional near-term revenue.


In summary, we are looking forward to an exciting period for Oxford BioMedica,
which could see both TroVax and ProSavin reach key inflexion points in their
development. Both products address large markets and potentially provide
patients with new safe and effective treatment options. Hence, in our view, both
products present substantial value propositions.



Consolidated income statement
for the year ended 31 December 2007



                                                        Notes    2007      2006
                                                                £'000     £'000
Revenue                                                   2     7,219       760

Cost of sales                                                    (449)        -
Research and development costs                                (22,142)  (19,523)
Administrative expenses                                        (4,617)   (2,699)

Administrative expenses comprise:
Administrative expenses before exceptionals                    (4,282)   (2,699)
Exceptional administrative expenses                       3      (335)        -
Total administrative expenses                                  (4,617)   (2,699)

Other operating income: grants receivable                         161       360
Operating loss                                                (19,828)  (21,102)

Finance costs                                                     (30)      (29)
Finance income                                                  2,117     1,743
Loss before tax                                               (17,741)  (19,388)
Taxation                                                  4     2,452     1,762
Loss for the financial year                                   (15,289)  (17,626)
Basic loss and diluted loss per ordinary share            5     (2.9p)    (3.5p)



The notes on pages 16 to 22 form part of this financial information.



Consolidated balance sheet
as at 31 December 2007



                                                         Notes   2007      2006
                                                                £'000     £'000
Assets
Non-current assets
Intangible assets                                          6   14,910     1,665
Property, plant and equipment                              7      810       819
                                                               15,720     2,484
Current assets
Trade and other receivables                                8    4,672     2,202
Current tax assets                                              2,623     2,309
Financial assets: Available for sale investments           9   27,185    20,500
Cash and cash equivalents                                  9   10,962     8,043
                                                               45,442    33,054
Current liabilities
Trade and other payables                                  10    9,557     4,671
Deferred income                                           11   11,530        92
Current tax liabilities                                            14         -
Provisions                                                12       60        58
                                                               21,161     4,821
Net current assets/(liabilities)                               24,281    28,233
Non-current liabilities
Other non-current liabilities                                      96         -
Deferred income                                           11    7,383         -
Provisions                                                12      590       627
                                                                8,069       627
Net assets                                                     31,932    30,090

Shareholders' equity
Ordinary shares                                                 5,347     5,014
Share premium                                                 109,101   106,732
Merger reserve                                                 14,310       711
Other reserves                                                   (625)     (627)
Losses                                                        (96,201)  (81,740)
Total equity                                                   31,932    30,090


The notes on pages 16 to 22 form part of this financial information.



Consolidated cash flow statement
for the year ended 31 December 2007



                                                               2007      2006
                                                        Notes £'000     £'000
Cash flows from operating activities
Cash generated by/(used in) operations                   13   2,307   (17,726)
Interest received                                             1,567     1,440
Tax credit received                                           2,480       650
Overseas tax paid                                               (57)      (25)
Net cash from operating activities                            6,297   (15,661)

Cash flows from investing activities
Proceeds from sale of property, plant and equipment               7         1
Purchases of property, plant and equipment                     (259)     (192)
Purchases of intangible assets                                 (162)      (24)
Net (purchase)/maturity of available for sale                (6,685)    3,000
investments
Cash and cash equivalents acquired with subsidiary       14   3,759         -
Acquisition costs                                              (382)        -
Net cash (used in)/generated by investing activities         (3,722)    2,785

Cash flows from financing activities
Net proceeds from issue of ordinary share capital               345       629

Effects of exchange rate changes                                 (1)      (27)

Net increase/(decrease) in cash and cash equivalents          2,919   (12,274)
Cash and cash equivalents at 1 January                        8,043    20,317
Cash and cash equivalents at 31 December                  9  10,962     8,043


The notes on pages 16 to 22 form part of this financial information.



Statement of changes in shareholders' equity
for the year ended 31 December 2007



                           Share    Share   Merger Translation  Losses   Total
                         capital  premium  reserve     reserve
                           £'000    £'000    £'000       £'000   £'000   £'000
At 1 January 2007          5,014  106,732      711        (627)(81,740) 30,090
Exchange adjustments           -        -        -           2       -       2
Loss for the year              -        -        -           - (15,289)(15,289)
Total recognised               -        -        -           2 (15,289)(15,287)
expense for the year
Shares issued in             318    2,083   13,599           -       -  16,000
acquisition
Share options                 13      199        -           -       -     212

Proceeds from shares
issued
Value of employee              -        -        -           -     828     828
services                                                                   
Issue of shares                2       97        -           -       -      99
excl. options
Costs of share                 -      (10)       -           -       -     (10)
issues
At 31 December 2007        5,347  109,101   14,310        (625)(96,201) 31,932


The notes on pages 16 to 22 form part of this financial information.



Notes to the financial information
for the year ended 31 December 2007


1 Basis of preparation


This financial information for the years ended 31 December 2007 and 31 December
2006 does not constitute the statutory financial statements for the respective
years and is an extract from the financial statements. Financial statements for
the year ended 31 December 2006 have been delivered to the Registrar of
Companies and included the auditors' report. Financial statements for the year
ended 31 December 2007 have not yet been delivered to the Registrar. The
auditors' reports on the financial statements for the years ended 31 December
2007 and 31 December 2006 were unqualified and did not contain statements under
either section 237(2) or section 237(3) of the Companies Act 1985. The financial
information in this report does not constitute statutory accounts within the
meaning of Section 240 of the Companies Act 1985.


The financial statements have been prepared in accordance with International
Financial Reporting Standards (IFRS) and International Financial Reporting
Interpretations Committee (IFRIC) interpretations endorsed by the European Union
and with those parts of the Companies Act 1985 applicable to companies reporting
under IFRS. The financial statements are prepared in accordance with the
historical cost convention as modified by revaluation of available for sale
investments. Whilst the financial information included in this preliminary
announcement has been prepared in accordance with IFRSs adopted for use in the
European Union, this announcement does not itself contain sufficient information
to comply with IFRSs.


Copies of this announcement and the interim report for 2007 are available from
the Company Secretary. The audited statutory financial statements for the year
ended 31 December 2007 are expected to be distributed to shareholders by 31
March 2008 and will be available at the registered office of the Company,
Medawar Centre, Oxford Science Park, Oxford, OX4 4GA. Details can also be found
on the Company's website at www.oxfordbiomedica.co.uk.


This announcement was approved by the Board of Oxford BioMedica plc on 7 March
2008.


Use of estimates and assumptions

The preparation of financial statements in conformity with IFRS requires the use
of certain critical accounting estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Estimates and judgements are continually made and are based on
historic experience and other factors, including expectations of future events
that are believed to be reasonable in the circumstances.


Critical accounting estimates and assumptions

Where the Group makes estimates and assumptions concerning the future, the
resulting accounting estimates will seldom exactly match actual results. Due to
the amounts involved, the estimates and assumptions regarding revenue
recognition and the amounts accrued for clinical trial costs have a greater risk
of causing a material adjustment to the carrying amounts of assets and
liabilities.


Revenue from payments in 2007 by sanofi-aventis under the TroVax collaboration
is being recognised on a straight-line basis over the estimated period to
specific milestone events in 2009 and 2010, based on management's estimates of
the timing of these events. Should the timing of these events differ from
management's estimates, there could be a material effect on the income statement
and on the amount of deferred revenue in the balance sheet. For clinical trial
costs the Group uses a percentage-of-completion method to accrue for such costs.
This method requires the Group to estimate the services performed by contractors
to date as a proportion of total services to be performed.



Notes to the financial information
for the year ended 31 December 2007 (continued)


2 Segmental analysis


The Group's primary segment reporting is by geographical location of assets,
with business sector as the secondary format. Revenue and loss on ordinary
activities before taxation are derived entirely from the Group's one business
segment, biotechnology research and development. All costs of acquisition of
property, plant and equipment and intangible assets as well as depreciation
expense borne by the Group relate to this one segment In addition, all other
non-cash expenses incurred by the Group relate to this one segment. The two
geographic locations comprise the Group's UK and US operations. The majority of
the Group's activities take place in the United Kingdom, with the United States
subsidiary providing intellectual property management and business development
support to the United Kingdom operation. Purchases and sales between
subsidiaries are eliminated on consolidation.


The Group's revenue derives from assets located in the United Kingdom. By
destination, revenue derives from the European Union and the United States of
America.
                                                                  2007      2006
Revenue by destination                                           £'000     £'000
Europe                                                           7,021        56
United States of America                                           198       704
Total revenue                                                    7,219       760



3 Exceptional administrative expenses


Exceptional administrative expenses of £335,000 (2006: nil) were restructuring
costs associated with the integration of Oxxon Therapeutics Limited ('Oxxon')
and closure of the former Oxxon offices and laboratories following the
acquisition of Oxxon in March 2007. Severance and related costs for former Oxxon
employees were £247,000. Fixed asset write-offs (mostly leasehold improvements)
were £73,000. Other expenses were £15,000. The cash outflow associated with the
exceptional expenses was £262,000 (2006: nil).



4 Taxation


The Group is entitled to claim tax credits in the United Kingdom for certain
research and development expenditure. The amount included in the financial
statements for the year ended 31 December 2007 represents the credit receivable
by the Group for the year and adjustments to prior periods. These amounts have
not yet been agreed with the relevant tax authorities.

                                                                   2007    2006
Continuing operations                                             £'000   £'000
Current tax
United Kingdom corporation tax research and development credit   (2,526) (1,709)
Overseas taxation                                                    60      38
                                                                 (2,466) (1,671)
Adjustments in respect of prior periods
United Kingdom corporation tax research and development credit        -     (75)
Overseas taxation                                                    14     (16)
Taxation credit                                                  (2,452) (1,762)



Notes to the financial information
for the year ended 31 December 2007 (continued)


5 Basic loss and diluted loss per ordinary share


The basic loss per share has been calculated by dividing the loss for the year
by the weighted average number of shares of 528,024,022 in issue during the year
ended 31 December 2007 (2006: 499,865,620).


The Company had no dilutive potential ordinary shares in either year which would
serve to increase the loss per ordinary share. There is therefore no difference
between the loss per ordinary share and the diluted loss per ordinary share.



6 Intangible assets
                                               In process Intellectual        Total
                                                      R&D     property
                                                                rights
                                                    £'000        £'000        £'000
Cost
At 1 January 2007                                       -        1,927        1,927
Additions - through business combination           10,400        2,686       13,086
(note 14)
Additions                                               -          167          167
At 31 December 2007                                10,400        4,780       15,180
Accumulated amortisation and impairment
At 1 January 2007                                       -          262          262
Impairment in the year                                  -            8            8
At 31 December 2007                                     -          270          262
                                                   

Net book amount at 31 December 2007                10,400        4,510       14,910
                                                        

Net book amount at 31 December 2006                     -        1,665        1,665


In-process research and development acquired in 2007 comprises the fair value of
the Hi8-MEL therapeutic vaccine for the treatment of melanoma. Intellectual
property rights acquired through acquisition comprise the Oxxon Therapeutics
patent portfolio covering therapeutic vaccines and prime-boost methods.



Notes to the financial information
for the year ended 31 December 2007 (continued)


7 Property, plant and equipment
                                Short       Office   Computer  Laboratory      Total
                            leasehold   equipment,  equipment   equipment
                         improvements     fixtures
                                               and
                                          fittings
                                £'000        £'000      £'000       £'000      £'000
Cost
At 1 January 2007               2,608           87        281       2,670      5,646
Exchange adjustments               (4)           -          -           -         (4)
Additions - through                79           10          2           8         99
business combination
(note 14)
Additions - separately             20            7         75         174        276
Dilapidation asset -                8            -          -           -          8
effect of change in
discount rate
Disposals                         (79)          (9)       (63)        (26)      (177)
At 31 December 2007             2,632           95        295       2,826      5,848
Accumulated depreciation
At 1 January 2007               2,267           81        224       2,255      4,827
Exchange adjustments               (4)           -          -           -         (4)
Charge for the year                93            6         41         174        314
Disposals                         (12)          (3)       (63)        (21)       (99)
At 31 December 2007             2,344           84        202       2,408      5,038
Net book amount at                288           11         93         418        810
31 December 2007
Net book amount at 31             341            6         57         415        819
December 2006



8 Trade and other receivables
                                                      2007        2006
                                                     £'000       £'000
Non-current
Other receivables - rent deposit                       118         150
Current
Trade receivables                                       91         241
Other receivables                                    1,129         765
Other tax receivable                                   414         220
Prepaid clinical trial expenses                        969           -
Other prepayments                                    1,917         603
Accrued income                                          34         223
                                                     4,554       2,052
Total trade and other receivables                    4,672       2,202


Prepaid clinical trial expenses comprise stocks of materials for use in clinical
trials and advance payments to clinical trial sites.



Notes to the financial information
for the year ended 31 December 2007 (continued)


9 Cash and cash equivalents
                                                       2007        2006
                                                      £'000       £'000
Cash at bank and in hand                              5,402       2,343
Short term bank deposits                              5,560       5,700
Total cash and cash equivalents                      10,962       8,043


In addition to the cash and cash equivalents described above, the Group held
Sterling bank deposits of £27,185,000 (2006: £20,500,000) with an initial term
to maturity between three and twelve months classified as available for sale
investments. Group cash at bank and in hand includes £76,000 (2006: £182,000)
held in escrow for expenses of the TRIST Phase III clinical trial.



10 Trade and other payables - current
                                                      2007        2006
                                                     £'000       £'000
Trade payables                                       2,948       1,579
Other taxation and social security                     418         315
Accruals                                             6,191       2,777
Total trade and other payables                       9,557       4,671



11 Deferred income


In 2007 non-refundable payments totalling €38,000,000 (£25,793,000) were
received from sanofi-aventis under the TroVax licence agreement. These payments
are being recognised as revenue over a period of 24 to 36 months. To date
revenue recognised under the sanofi-aventis collaboration is £6,970,000.


At 31 December 2007 the Group had deferred income of £18,913,000 (2006:
£92,000). £11,530,000 (2006: £92,000) is expected to be recognised as revenue
within 12 months of the balance sheet date, and is classified as current; the
remaining £7,383,000 (2006: nil) is classified as non-current.



12 Provisions
Group                                               Dilapidations  Onerous         Total
                                                                     lease
                                                            £'000    £'000         £'000

At 1 January 2007                                             347      338           685
Exchange adjustments                                            -       (5)           (5)
Utilised in the year                                            -      (71)          (71)
Amortisation of discount                                       16       14            30
Change of discount rate - charged to income                     -        3             3
statement
Change of discount rate - adjustment to recognised              8        -             8
fixed asset
At 31 December 2007                                           371      279           650
At 31 December 2006                                           347      338           685

                                                             2007     2006
                                                            £'000    £'000
Current                                                        60       58
Non-current                                                   590      627
Total provisions                                              650      685


Notes to the financial information
for the year ended 31 December 2007 (continued)


12 Provisions (continued)


The dilapidations provision relates to anticipated costs of restoring the
leasehold property in Oxford, UK to its original condition at the end of the
present leases in 2011, discounted at 4.32% per annum (2006: 4.96%). The
provision will be utilised at the end of the leases if they are not renewed.


The onerous lease provision relates to the estimated rental shortfall in respect
of a redundant property in San Diego, USA which has been sub-let for the
remainder of the lease term until June 2012, discounted at 4.39% per annum
(2006: 4.88% per annum).The provision will be utilised over the term of the
lease.



13 Cash flow from operating activities

Reconciliation of loss before tax to net cash from operations
                                                        2007        2006
                                                       £'000       £'000

Continuing operations

Loss before tax                                      (17,741)    (19,388)
Adjustment for:
Depreciation                                             314         537
Loss/(profit) on disposal of property, plant and          77          (1)
equipment
Impairment of intangible assets                            8           -
Finance income                                        (2,117)     (1,743)
Finance expense                                           30          29
Charge in relation to employee share schemes             828         451

Changes in working capital:
Increase in trade and other receivables               (1,880)       (107)
Increase in payables                                   4,036       2,596
Increase/(decrease) in deferred income                18,821         (13)
(Decrease) in provisions                                 (69)        (87)
Net cash generated by/(used in) operations             2,307     (17,726)




14 Acquisition of Oxxon Therapeutics Limited


On 9 March 2007 the Company purchased the entire issued share capital including
all voting rights of Oxxon Therapeutics Limited ('Oxxon'). In addition, a loan
of £1.7 million to Oxxon from the former owners of Oxxon was acquired. The
purchase has been accounted for as an acquisition. The assets acquired included
cash and cash equivalents of £3.8 million. On 2 April 2007 in an internal
reorganisation, the trade of Oxxon Therapeutics Limited together with all its
assets and liabilities was sold to the Group's principal operating subsidiary
Oxford BioMedica (UK) Limited, and Oxxon is now dormant.


The purchase consideration, including the acquisition of the loan was
£16,000,000 which was satisfied by the issue of 31,771,246 new 1p ordinary
shares at 50.36p per share (the average market price over the 30 days ended 8
March 2007).


From the date of acquisition to 2 April 2007 the net loss of Oxxon was £95,000.
From 2 April 2007 the Oxxon business was integrated with that of Oxford
BioMedica (UK) Limited, and the facilities formerly occupied by Oxxon were
closed down. Since 2 April 2007 the net loss attributable to the Oxxon business
was approximately £517,000 of which closure and severance costs of £335,000 were
classified as exceptional administrative expenses. Had the acquisition taken
place at the beginning of 2007 these amounts would not have been materially
different.


All intangible assets have been recognised at their respective fair values.
There was no residual excess of the consideration over the fair value of net
assets acquired, so no goodwill has been recognised in the financial statements.

Notes to the financial information
for the year ended 31 December 2007 (continued)


14 Acquisition of Oxxon Therapeutics Limited (continued)

Acquisition of Oxxon Therapeutics Limited       Carrying Fair value Fair value
                                              values pre adjustment
                                             acquisition                 
                                                   £'000      £'000      £'000
Intangible assets                                    243     12,843     13,086
Property, plant and equipment                         99          -         99
Receivables                                          100          -        100
Payables                                            (930)         -       (930)
R&D tax credit receivable                            268          -        268
Deferred tax liability on fair value of                -     (3,926)    (3,926)
intangibles
Deferred tax asset - tax losses                        -      3,926      3,926
Cash and cash equivalents                          3,759          -      3,759
Loans                                             (1,700)     1,700          -
Net assets acquired                                1,839     14,543     16,382
Goodwill                                                          -
Consideration                                                           16,382
Consideration satisfied by:
Shares issued to acquire Oxxon share capital                            13,875
Shares issued to acquire loan from former                                2,125
parent of Oxxon
Expenses of acquisition                                                    382
                                                                        16,382


The net inflow of cash and cash equivalents on the acquisition of Oxxon was:
                                                                         £'000
Cash and cash equivalents acquired                                       3,759
Cash costs of acquisition                                                 (382)
                                                                         3,377


The fair value of the intangibles acquired with Oxxon was:
                                                                         £'000
In-process R&D: Hi-8 MEL melanoma vaccine                               10,400
Intellectual property rights: prime-boost technology                     2,686
                                                                        13,086






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