Preliminary Statement

Proteome Sciences PLC
16 May 2001

                            Proteome Sciences plc

16 May 2001

         PRELIMINARY STATEMENT FOR THE 12 MONTHS TO 31 DECEMBER 2000

                                  HIGHLIGHTS

Proteome Sciences plc (Proteome Sciences), the AIM listed proteomics and
modification of gene expression company, announces its preliminary results for
the year ended 31 December 2000, statement and the following highlights:

Strategic Overview

  * Establishment of one of most advanced proteomics facilities in Europe,
    representing a significant landmark in Proteome Sciences' development from
    its virtual model.
  * £4.3 million fund raising completed in April 2000.
  * High profile CEO appointed at Intronn.
  * Founder members of the Human Proteome Organisation (HUPO) council.
  * Dr Anthony Walker appointed as non-executive director (see separate
    announcement issued on 14 May 2001).

Proteomics

  * CJD, stroke and organ transplant rejection markers ready for
    commercialisation.
  * Further CJD samples provided by CJD surveillance unit with assay under
    evaluation.
  * Four further diabetes and obesity patents filed.
  * Proteomics collaboration in neurodegenerative diseases with Institute of
    Psychiatry, King's College, London.
  * £450K Britech grant for new diagnostic markers and therapeutic targets
    in Alzheimer's.
  * Potential commercialisation of intellectual property of University of
    Michigan cancer programme through formation of a specialist cancer
    proteomics newco in the US.

Gene Expression

  * Replacement of an internal exon using double splicing - a major
    scientific milestone with fundamental implications for the way gene
    therapy will be applied in the future.
  * SMaRT Biosciences Inc in process of incorporation.
  * Initial $6million funding to be completed at SMaRT Biosciences in the
    near future ahead of IPO in the US when the biotech market picks up.
  * Major $3m SBIR grant from the NIH in the US in cystic fibrosis.
  * Material Transfer Agreements signed: cystic fibrosis, haemophilia, HPV,
    cervical cancer, Alzheimer's and collagen disease - Intronn retains
    exclusive commercialisation of results.
  * Intronn poised to become market leader in the analysis of impurity and
    measurement of synthetic oligonucleotides.

Financial

  * Cash balance at end of year £3.3million
  * Loss of £1.4million (1999 - £1.2million)
  * No further significant investment required for Intronn/SMaRT from
    Proteome Sciences.

Commenting on the Company's progress and prospects, Christopher Pearce, Chief
Executive of Proteome Sciences said:-


        'The period has been the most significant in the Company's history
        from both a strategic and operational perspective. Of particular note,
        the full significance of proteins has been revealed following the
        sequencing of the human genome and the establishment of our leading
        edge high sensitivity proteomics facility. This will greatly increase
        the Company's ability to undertake strategic research partnerships
        with major pharmaceutical and biotechnology companies and represents a
        significant landmark in Proteome Sciences' development.

        'Our two platform technologies in proteomics and the modification of
        gene expression are now perceived to be particularly relevant as keys
        to unlock value from functional genomics and have a broad range of
        applications. This, combined with the policy of retaining proprietary
        control of the data and results generated from our research
        programmes, positions us extremely well to exploit the substantial
        commercial value within Proteome Sciences through licensing deals and
        further strategic collaborations in the current year and beyond.'

                                         ENDS

Enquiries:-

Proteome Sciences plc                Tel: [phone]

Christopher Pearce, Chief Executive

Public Relations

Ikon Associates                      Tel: [phone]

                Adrian Shaw   Mobile: [phone]
                              E-mail: [e-mail]

Set out below is the full text of the Chairman's statement.



Dear Shareholder,

The year ended 31st December 2000 has been very active, productive and
successful for the Company in respect of its activities in proteomics and in
its gene expression division. This momentum has continued into 2001 and a
number of major new milestones have been achieved.

Considerable progress has been made both scientifically in proteomics towards
the commercialisation of novel proteins discovered from Proteome Sciences'
research programme and with SMaRTTM gene expression in the US for the broad
range of applications of SMaRT. Over the period the Company has successfully
concluded a £4.3m fund raising in 2000 and appointed a high profile CEO at
Intronn, Dr Gerard McGarrity, to finalise the corporate strategy and to
complete its funding ahead of preparing the business for a possible IPO in
2001. The recent announcement of the setting up of a high sensitivity
proteomics research facility at King's College, London (KCL) is a further
major development, establishing one of the most advanced proteomics facilities
in Europe and increasing the opportunity to add more shareholder value through
more comprehensive partnership agreements with pharmaceutical and
biotechnology companies. This creates a significant landmark in Proteome
Sciences' corporate development, taking it a long way from the virtual model
from which the Company has evolved.

The advisory council for HUPO (Human Proteome Organisation) was created in
February 2001 to increase the awareness of this discipline of science to
society and to develop a broader understanding of the importance of proteins
and proteomics, and the opportunities they offer in the diagnosis, prognosis
and therapy of disease. Proteome Sciences is particularly well represented on
this forum, with Christopher Pearce, the Company's chief executive, and three
of our principal collaborators being members of the HUPO council.

Review of Activities

Last year I talked about our expectation that proteomics would arrive on
centre stage in the field of drug discovery and development. The surprising
revelation in February 2001 that humans have 30,000 genes, rather than the
100,000 to 150,000 predicted and that each gene may make several, or even
several hundred, proteins, clearly establishes that proteins play a much more
significant role than hitherto believed and confirms that other technologies,
particularly proteomics, will be key in unlocking functional genomics. This
has stimulated considerable activity in the pharmaceutical industry and
engendered much media attention. The vast amount of sequence data produced
needs to be made intelligible, and maximum value will be added to this process
through function and ability to patent utility of function. The two areas
addressed by Proteome Sciences, proteomics and modification of gene
expression, fulfil these objectives. They are platform technologies with
multiple applications, offering solutions in critical areas of unmet need. The
science has now delivered and moves to commercialisation are in hand.

Proteome Sciences will continue to focus as a pure research company and its
partners, pharmaceutical and biotechnology companies, will bring the
specialist skills in development and taking products to market. The platform
technologies at Proteome Sciences are complementary to other companies and
their techniques. In proteomics, Proteome Sciences retains proprietary control
of the data and results generated from its own research rather than acting on
a fees for service basis for third parties. In gene expression, SMaRTTM which
is effected at the mRNA level, is complementary to existing antisense and
ribosyme technology. Most importantly, Intronn was granted two key patents in
the US during the year and this will provide SMaRTTM with a field dominating
position.

Proteomics

Proteomics has been recognised as a key scientific tool in understanding
disease and from which to develop diagnostic and therapeutic interventions. On
the commercial front, Proteome Sciences developed three potential products
from proteomics over the course of the last year. These are protein markers
with high sensitivity, specificity and predictive accuracy from human blood
samples to detect CJD, stroke and chronic rejection. These are being actively
marketed to pharmaceutical/biotechnology companies and Proteome Sciences
expects to conclude licensing agreements in 2001/2002. Details of the CJD
marker have been disclosed to the CJD Surveillance Unit under a confidential
disclosure agreement. Further samples have now been provided to Proteome
Sciences and the assay is under evaluation. Discussions are in progress with
the stroke and solid organ transplant markers and Proteome Sciences
anticipates further progress with the diabetes and obesity programmes at the
University of Buckingham and the University of Geneva. A license agreement is
expected to be concluded with the University of Michigan shortly and the
specialist consultant retained to outlicense the cancer research programme has
encountered considerable interest.

The fourth Siena Conference 'From Genome to Proteome' in September provided an
ideal platform for Proteome Sciences to present some of its recent results
including stroke, diabetes, obesity, chronic heart disease and transplant
rejection to the core and strategic research areas of major pharmaceutical,
diagnostics and genomics companies. This has been followed with further
specialist meetings in London, Birmingham and York in 2001. Strong scientific
progress has been made across the proteomic projects with a further 7 patent
applications in diabetes and obesity and applications also for transmissable
spongiform encephalopathy (TSE - CJD, BSE, Scrapie etc) and acute rejection.

The new proteomics research facility at King's College, London (KCL) is a
major strategic development in that it establishes Proteome Sciences' leading
edge research capability, which will enable it for the first time to conduct
external research programmes with corporate partners at its own facility. This
will strengthen Proteome Sciences' ability to enter into strategic agreements
with pharmaceutical and biotechnology companies and the ability to use in
house intellectual property from data and results already generated for
protein markers for diagnosis, prognosis and therapeutic intervention.

The laboratory facility will focus on high output proteomics, utilising high
sensitivity protein separation techniques in a powerful combination with the
latest mass spectrometry instrumentation. This brings together leading
expertise in the two main disciplines with Dr. Michael Dunn (presently at the
Heart and Lung Research Centre, Harefield Hospital, Imperial College, London
and Chairman of the British Electrophoresis Society) heading the specialist
protein separation team and Malcolm Ward (formerly of GlaxoSmithKline,
Stevenage) leading the mass spectrometry and sequencing team.

At the same time, Proteome Sciences has entered into a collaboration with the
Institute of Psychiatry at KCL to address a range of neurodegenerative
conditions including Alzheimer's, Parkinson's and motor neurone disease. With
the Institute of Psychiatry's expertise in the pathogenic mechanisms for
neurodegenerative diseases, this will create a powerful approach and should
accelerate the discovery process for new therapeutic treatments and
diagnostics.

In April, Proteome Sciences and Mindset BioPharmaceuticals Ltd, an Israeli
drug discovery and development company were awarded a £450,000 Britech grant
for a new research programme in Alzheimer's (PRO-TAMAD) to discover new
targets for therapy and new improved diagnostic markers. It has been estimated
that there are about 500,000 Alzheimer's sufferers in Britain and, according
to the American Alzheimer's Association, approximately 4 million people in the
US have this disease. Most of them are over the age of 65 and half of all
Americans over 85 are thought to have Alzheimer's. By 2005, it has been
predicted that this will rise to over 14 million people in the US alone. For a
disease that can span from 2 to 20 years, the cost in the US is currently
estimated at $180bn annually. The PRO-TAMAD programme will further enhance
Proteome Sciences' strong position in neurodegenerative disease.

The appointment of an internal business development manager in April 2000 has
been complemented by external consultants in oncology and licensing. This, in
combination with the human genome sequence information, should lead to a
number of collaborative research and license agreements with biotechnology and
pharmaceutical companies in 2001.

Gene Expression

Over the course of the last year, considerable advances have been made at
Intronn LLC, both in science and corporate development. SMaRT BioSciences Inc
is currently in the process of incorporation and the intention is that this
will shortly have all the personnel, results, data and intellectual property
associated with SMaRTTM assigned into it. The other activities of Intronn
relating to synthetic oligonucleotides and quality control markers will remain
in Intronn.

Dr Gerard McGarrity (formerly senior Vice President and Director of
Development at Genetic Therapy Inc, a Novartis company and most recently Chief
Scientific Officer at Cambridge Genetics Ltd) was appointed CEO at Intronn in
September. Since then he has undertaken a major scientific review of Intronn
to finalise the business plan and corporate strategy for SMaRT BioSciences Inc
and to complete its funding ahead of preparing the business for a possible IPO
in 2001. An interim funding was completed in July, which raised $500,000, the
initial part of the $6m total anticipated, and this is expected to be
completed in the near future. With this in place, SmaRT BioSciences will be
ideally positioned to move quickly to secure a substantial equity round and
IPO when the biotech funding window in the US is open.

In April 2000, Intronn entered into its first Materials Transfer Agreement
(MTA) with Dr John Engelhard at the University of Iowa to test the potential
of SMaRTTM technology to repair the gene defects which cause cystic fibrosis
in the most clinically relevant models of the disease, and for therapeutic
intervention. A Phase 2 SBIR grant application in cystic fibrosis was made to
the NIH in the USA, following the successful Phase 1 SBIR application in 1999.
The Phase 2 application was praised by the reviewers as 'one of the most
innovative, thoughtful and exciting ones they had ever read'. Intronn has
again been successful with a major Phase 2 grant award and will receive a
considerable proportion of the $3.2m grant for which it applied. This is a
clear endorsement of the outstanding and innovative scientific approach
established by SMaRT and is a good illustration of one specific model that it
can address across a wide range of different diseases. At the present time,
SMaRTTM is being applied to gene repair, exon tagging, exon swapping, gene
knockdown, target validation, agricultural biotechnology and gene therapy.

At the Keystone Symposium in Utah USA in January 2001, Intronn for the first
time confirmed a new event, double splicing of pre mRNA. SMaRTTM was able to
replace an internal exon using double splicing. This has been the goal that
gene therapy has tried without success to achieve using ribosomes over the
last fifteen years. This completed a further major milestone for the SMaRTTM
technology platform and has profound implications for modification of gene
expression and vector delivery in gene therapy. By achieving double splicing
using PTM inserts in a space of less than 600 nucleotides, the need for using
a vector delivery system may be eliminated as the process may be carried out
using chemistry in a conventional pharmaceutical setting. This will change the
way that gene therapy will be applied in the future.

A CRADA (co-operative research and development agreement) was signed with the
National Cancer Institute (NCI) within the National Institute of Health in the
USA in April 2001. The agreement will involve Intronn and Dr Carl Baker at the
NCI combining their expertise to develop RNA based treatments for human
papillomavirus infection (HPV) and cervical cancer using SMaRTTM.

A number of other MTA's have been signed following the Iowa agreement in April
2000 where Intronn has provided pre-transplicing molecules (PTMs). No
additional external costs will be incurred under the MTAs and Intronn owns the
PTMs and has exclusive commercialisation of any results. These cover cystic
fibrosis (Duke University), factor VIII (haemophilia) (University of North
Carolina), HPV and cervical cancer (NCI), Alzheimer's (King's College, London)
and collagen disease (Salzburg General Hospital, Austria). The applications
use different cell types and address diseases ranging from cancer,
neurodegenerative, dermatological, genetic to haemophilia.

Heads of Agreement were signed in July for a collaborative programme in
agricultural biotechnology using SMaRT and other collaborative research and
partnering opportunities are being actively addressed.

Driven by the advances in genetics, in particular the mapping of the human
genome, the US market for synthetic oligonucleotides, which was estimated to
exceed $200m in 2000, is thereafter expected to grow at a very rapid rate:
nucleic acid based therapeutics - there are 15 antisense products from nine US
companies in clinical trials - and diagnostic (DNA chip) products are
projected to reach $11bn in 2005.

Purification and analysis of purity of synthetic oligonucleotides requires
extensive methods and technologies. In order to achieve spliceosome mediated
mRNA transplicing Intronn needed to utilise ultra pure synthetic
oligonucleotides and therefore it had to develop new proprietary methods from
its research to achieve this objective. Patent applications filed in this
context cover a method for simple front end analysis and purification of
synthetic oligonucleotides. Intronn is presenting its oligonucleotide
technology to the FDA and National Institute of Standards and Technology
(NIST) in the USA, and if accepted as the benchmark, Intronn is poised to
become a market leader in the level of impurity and measurement of synthetic
oligonucleotides. Commercialisation is proposed to be undertaken through
licenses with oligonucleotide and DNA chip manufacturers.

External Investments

Over the course of the last year, Proteome Sciences has identified a new and
complementary approach, in addition to outlicensing, which will maximise
shareholder value and returns by converting elements of its intellectual
property into equity stakes in specialist newcos with leading technology that
plan future IPOs and listing.

Certain of the group's interests relating to patent filings in a colorectal
research project in Europe have been assigned to Europroteome SA in exchange
for equity. BioMerieux has taken a stake in Europroteome SA and a funding was
completed in 2000 valuing the company at approximately DM25m. Having
established a new laboratory facility in Berlin and completed a second funding
round, Europroteome is anticipated to effect an IPO in 2001.

Because of its close relationship with University Cantonal Hospital, Geneva,
Proteome Sciences was invited to be a seed investor in Geneva ProteomicsTM
(GeneProtTM) - a company formed to sequence human proteomes using 51 mass
spectrometers - in the first round of funding in April 2000. Since that time
further funding rounds and investment by partners including Compaq and Bruker
have been completed, capitalising the company in excess of $200m. In October
GeneProtTM entered into an agreement with Novartis to sequence three disease
proteomics for $43m, with further milestones which could trigger a further
$41m of payments. This was the first major deal in proteomics since the
announcement of the draft sequence of the human genome in June 2000 and sets a
basis of valuation for future transactions in disease related proteomics. It
is thought that GeneProtTM may seek an IPO in the future, possibly in 2001.

Given the substantial level of interest in the main proteomic cancer programme
undertaken at the University of Michigan, other than through conventional
research partnerships/out-licensing, Proteome Sciences is also exploring the
possibility of converting its intellectual property into a specialist
proteomics company in the US, with the major focus in cancer therapeutics and
early diagnosis.

We expect that the external investments that Proteome Sciences has established
will play an important role in the commercialisation of the research
programme, and will also demonstrate the substantial value of the data and
results generated from its early involvement in proteomics associated with
human diseases.

Results

In the twelve month period ended 31st December 2000, Proteome Sciences
incurred a pre-tax loss of £1,405,447 (1999: £1,229,758).

At the year end cash balances stood at £3.304m. With Intronn now raising its
own funding in the US, it is not envisaged that Proteome Sciences will need to
make any further significant investment into Intronn/SMaRT in the future.

Current Outlook

The sequence information from the human genome has dramatically elevated the
importance and value of proteins in bio-medical research and this will have a
substantial impact in accelerating the development of diagnostic and
therapeutic intervention.

Proteome Sciences has established a unique position with its platform
technologies in proteomics and in modification of gene expression. These will
be key value drivers to unlock functional genomics. The Company is
exceptionally placed to capitalise from these technologies across Proteome
Sciences substantial portfolio of research. The establishment of the high
sensitivity proteomics facility at KCL creates a significant landmark in the
Company's corporate development and will greatly increase its ability to
undertake research partnerships with major pharmaceutical and biotechnology
companies. The Board looks to the future with confidence and to exploiting the
considerable commercial opportunities that this will provide.

I would like to express my sincere thanks and appreciation to Professor Keith
Mansford, who retired following the last Annual General Meeting, for the
outstanding contribution he made to Proteome Sciences, in particular as
Chairman of the Scientific Advisory Board and he has been succeeded in that
position by Professor William Dawson. The Board is, however, pleased to
announce that Dr. Anthony Walker, has been appointed as a non-executive
Director. He is Chief Executive of Onyvax Limited, a cancer vaccine company,
prior to which he had a distinguished career as a management consultant at
Arthur D. Little and The Wilkerson Group to many of the major European
pharmaceutical and biotechnology companies.

As a final comment, I would like to pass on my sincere thanks and appreciation
to all the employees, scientists, collaborators and consultants for their hard
work and contribution to the progress at Proteome Sciences over the period.

Steve Harris

Chairman                                        16th May 2001


                                                  Year ended    Year ended
                                                  31st December 31st December
                                                  2000          1999
                                                  £             £

Administrative expenses                           (1,149,995)   (761,396)
Realised exchange gains                           303,158       71,072
Research and development expenses                 (695,018)     (560,190)
Other operating expenses                          (35)          (5,614)
                                                  __________    __________

Operating loss                                    (1,541,890)   (1,256,128)

Interest receivable                               158,135       32,817
Interest payable and similar charges              (21,692)      (6,447)
                                                  __________    __________

Loss on ordinary activities before taxation       (1,405,447)   (1,229,758)
Tax on loss on ordinary activities                -             -
                                                  __________    __________
Loss for the financial year                       (1,405,447)   (1,229,758)
                                                  __________    __________
Loss per share

Basic and diluted                                 (1.59p)       (1.57p)
                                                  _________     _________


1.     There has been no change to any of the accounting policies set out in
the 1999 statutory accounts.

2.     Following the loss of £1,405,447 incurred in the period, the Directors
do not recommend the payment of a dividend.

3.     a.     The calculation of the loss per share for the year ended 31st
December 2000 is based on the loss for the year of £1,405,447 and on
88,552,458 Ordinary Shares, being the weighted average number of shares in
issue and ranking for dividend during the year.

     a. The calculation of the loss per share for the year ended 31st December
        1999 is based on the loss for the year of £1,229,758 and on 78,505,304
        Ordinary Shares, being the weighted average number of shares in issue
        and ranking for dividend during the year.

4.     The preceding financial information does not constitute statutory
accounts as defined in Section 240 of the Companies Act 1985. The financial
information for the year to 31st December 1999 is based on the statutory
accounts for that year. These accounts, upon which the auditors issued an
unqualified opinion, and which did not contain any statement under Section 237
(2) or (3) of the Companies Act 1985, have been delivered to the Registrar of
Companies.

The auditors have not yet reported on the full statutory accounts for the year
ended 31st December 2000 which will be posted to shareholders later this
month. After that time they will also be available at the Company's registered
office: Coveham House, Downside Bridge Road, Cobham, Surrey KT11 3EP.