Statement re: Partial Investing of Share Options

Major Technical Innovation in Drug And Tumour Modelling Results in Partial   
                           Vesting of Share Options                            


Oxford, UK 25th October 2005 Physiomics (AIM: PYC), a European systems biology
simulation company, has developed a sophisticated addition to its core cell
growth model showing why different cancer cells respond in different ways to an
innovative new class of anti-cancer drugs. The simulation work also shows how
some time-consuming laboratory work to grow cancer cells could now be modelled
quickly in a computer rather than taking significantly longer in a laboratory.
The utility of Physiomics' computer simulation approach was discussed1.2 at the
International Conference on Systems Biology meeting in Boston, USA, 19th-21st
October 2005.

The technical innovation shows, using Physiomics' SystemCell® software, complex
virtual cells 'growing' in the computer to mimic the experimental behaviour of
many cancer cells and their responses to drugs. This important development
paves the way for realistic and predictive models of tumours' drug responses.
It also meets the criteria laid down by Physiomics' Remuneration Committee on
key technical criteria such that 25% of the unapproved options granted on 26
June 2005 are now available for exercise.

A better predictive system for testing cancer therapeutics is expected to be
enormously valuable to pharmaceutical companies and could confer significant
patient benefit through better treatment. Currently, only 5% of all cancer
drugs that are tested in clinical trials are approved for patient use, half the
industry norm 3. The new work on cell growth examines why small genetic
differences between cancer cells mean that some die when treated whereas others
survive and grow. This is not obvious from standard cell biology work, and it
opens up the possibility of optimising treatment using appropriate drug
combinations depending on patient profiles.

The data used to develop this model is from the scientific literature and
focuses specifically on an aurora kinase inhibitor drug candidate, VX-680,
developed by Vertex Pharmaceuticals Inc. and licensed to Merck & Co. Inc4.
Published data on an aurora kinase inhibitor being developed by AstraZeneca has
also been used. Aurora kinase inhibitors are a new type of therapeutic that has
shown excellent cancer killing ability in preclinical studies. Some 16 aurora
kinase inhibitors are under development by companies such as Astex Therapeutics
Ltd, Chroma Therapeutics, Cyclacel Ltd, Millennium Pharmaceuticals Inc, Rigel
Pharmaceuticals Inc and Serenex, in addition to Merck & Co and Vertex.

Physiomics believes that computer simulations could help to optimise the
transition from preclinical to clinical development and help in the
optimisation of dose scheduling, one of the major problems in clinical trials.
Studies5 have shown that improving the drug development success rate by 10%
overall could save $242m per drug. Physiomics and Bayer Technology Services
collaborate on Clinical Response Prediction in the area of cancer.

'For the pharmaceutical industry the virtual approach could represent huge
savings in time and money by predicting the effective drug dose and schedule
for different cell types. This currently is done step by step in the
laboratory, or in inflexible clinical trials.' said Dr John Savin, CEO of
Physiomics. 'Our technology is also very relevant for working out how best to
use the new generation of targeted therapeutics and for reducing their clinical
development risks.'

                                    --ENDS-                                    

1) Cell Cycle Simulations for Examining the Effects of Drugs inhibiting Aurora
Kinase According to Cancer Cell Phenotype, Chassagnole et al, Poster at ICSB
2005

2) Cell Cycle Lab: Using SystemCell® Technology for Multiple-Cell Simulations,
Finney et al, Poster at ICSB 2005

3) Can the pharmaceutical industry reduce attrition rates? Kola, I. and Landis,
J. Nature Reviews Drug Discovery, 3 (2004) 711-715

4) VX-680, a small molecule inhibitor of Aurora Kinases induces endoreplication
and apoptosis preferentially in p53 and p21 deficient cells, Gizatullin, F,, et
al, Poster LB-238 AACR Meeting 2004.

5) Tufts Center Impact Report 2002


For further information please contact:

Physiomics plc

Dr John Savin (CEO) Tel: + 44 1865 784 980

Mr David Evans (Chairman)

 

Northbank Communications Tel: + 44 207 886 8150

Emma Palmer (financial enquiries)

Fiona Brown/Rowan Minnion (media)

Notes to Editors



About aurora kinases

Aurora kinases are key enzymes involved in the later stages of cell division,
particularly the formation and control of the machinery that enables cells to
divide. When applied to cancer cells, inhibitors of these enzymes prevent the
cells from dividing properly. This can lead in some tumour types to cell growth
being halted quickly. In other types of cancer cells, growth continues for more
cycles before the cells start to die. Understanding the differences between
these aspects has been problematic.

A key part of Physiomics' work in this area has been reproducing two biomarkers
of drug action. These are the extent of aurora kinase modification of a protein
used to package DNA (histone H3), and a measure of the number of gene copies
that a cell has (polyploidy). In addition, the model starts to explain why some
cell types respond well to the drug and others do not. In the next stage of the
development, different drug doses and schedules plus combinations with existing
therapeutics could be explored.

About treatment of virtual tumours
Using the Physiomics advanced cell cycle model and SystemCell software,
populations of virtual cells have been 'grown' in a computer and a virtual drug
that targets aurora kinase administered. The virtual cell population
quantitatively reproduced the observed experimental behaviour published in the
literature (4).

One type of responsive cell stopped growing after drug administration due to
the action of the drug on the individual cells in the population model. Another
cell type with a common cancer-causing alteration (reduction of p53 levels)
kept on growing with two, four and eight times the normal amount of DNA. Cells
with higher levels of DNA then started to experience cell death.

In both cases, the virtual experiment reproduced results acquired over five
days of actual experimental time in under an hour of computational time. This
indicates that the model should have potential in predicting the effect of
human drug doses, as well as the activity of new drugs and drug combinations.


About Physiomics plc

Physiomics plc (AIM:PYC) is a computational systems biology services company
applying simulations of cell behaviour to drug development to reduce the high
attrition rates of clinical trials. As 80-90 per cent of all clinical drug
candidates fail to reach the market, estimates show that an overall ten per
cent improvement in success rates could reduce the cost of one drug's
development by as much as $242 million, from the current estimate of around
$800 million.

Physiomics is currently focused on optimising the design of cancer clinical
trials as a service to major pharmaceutical companies. In addition, it has
secured an option to in-license two innovative molecules in the cancer area
from Cronos Therapeutics. Physiomics has a major collaboration with Bayer
Technology Services GmbH to develop globally clinical response prediction
services using both companies' proprietary technologies and mathematical cell
models, including the SystemCell® technology developed by Physiomics. In June
2005, Physiomics became a distributor of Bayer's PK-Sim® product for
understanding the way pharmaceuticals are distributed round the body.
Physiomics, based in Oxford, UK, was founded in 2001, and floated on AIM in
2004.

For further information, please visit www.physiomics-plc.com

SystemCell is a registered trademark of Physiomics plc


About Bayer Technology Servcies

Bayer Technology Services GmbH is the center for technological competence of
the Bayer Group worldwide. The Bayer company employs more than 2,100 experts
worldwide at its headquarters in Leverkusen and other German locations, as well
as in regional offices in Baytown (Texas, USA), Antwerp (Belgium), Mexico City
(Mexico) and Shanghai (Peoples Republic of China). Bayer Technology Services
posted sales of EUR 520 million in 2004, including utilities procurement for
all Bayer sites in Germany (first six month only). In addition to
fully-integrated solutions along the life cycle of pharmaceutical and chemical
plants - from development through engineering and construction to process
optimization, Bayer Technology Services offers a broad range of products and
services for all stages of diagnostics and drug research and development.
Examples include nano-phosphors, the pharmacokinetic simulation software PK-Sim
® as well as sophisticated data mining and modeling techniques. Additional
information about Bayer Technology Services is available at 
www.bayertechnology.com



                                Physiomics plc                                 

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