Investment in Photopharmica

IP Group PLC
18 May 2007



FOR IMMEDIATE RELEASE                                                18 May 2007

                  IP GROUP TO INCREASE STAKE IN PHOTOPHARMICA

IP Group plc (LSE: IPO) ('IP Group'), the intellectual property
commercialisation company, is pleased to announce that it is increasing its
stake in Photopharmica Holdings Limited ('Photopharmica' or 'the Company'), a
University of Leeds spin-out company. IP Group will pay a total consideration of
£5.5 million to be satisfied as to £1 million in cash and £4.5 million by the
issue of 3,237,410 new Ordinary Shares of 2 pence ('Ordinary Shares') (fully
paid ranking pari passu with the existing Ordinary Shares) in IP Group
calculated at an issue price of 139 pence per share (being IP Group's average
mid-market Closing Price on the five dealing days prior to the date of this
announcement).

IP Group is acquiring debt instruments of approximately £5.0m in aggregate as
well as shares which will increase its equity stake to 56.6%, having previously
been beneficially interested in 4.3% of the Company.

Photopharmica was established in 2001 to develop novel photosensitisers as
products for medical use. The Company has opened up new applications of topical
photodynamic therapy and produced photosensitisers that have improved properties
compared with those previously available. Photopharmica's first clinical trial
was conducted in 2004 and further Phase II trials are being conducted and
planned.

Photopharmica's Chief Executive Officer, John Lyon, has a track record in
growing commercial life science businesses and, in particular, strong experience
in managing the drug development process. Mr Lyon held the position of Global
Vice President within a publicly quoted NYSE company and was the Managing
Director of their world renowned clinic in Leeds, UK, through which many
approved medicines have been developed.

Application will be made for the new Ordinary Shares, which are subject to a
lock-in for six months following issue, to be admitted to the Official List and
to be traded on London Stock Exchange plc's market for listed securities
('Admission'). IP Group will also provide an additional £1.0 million to
Photopharmica at completion through additional debt.

It is expected that Admission will become effective and that dealings will
commence in the 3,237,410 Ordinary Shares on 23 May 2007. Following Admission,
the issued share capital of IP Group will be 250,291,965 Ordinary Shares.

For further information, please contact:

IP Group plc 020 7489 5200
Alan Aubrey, Chief Executive Officer
Liz Vaughan-Adams (Communications) 020 7489 5206/07979853802

Buchanan
Tim Anderson, Mary-Jane Johnson, Mark Court 020 7466 5000

Notes for Editors

About IP Group

IP Group Plc is an intellectual property (IP) commercialisation company that
specialises in commercialising university technology. Founded in 2001, IP Group
listed on AiM in October 2003 and moved to the Official List in June 2006. It
has made two acquisitions to date - Techtran, a company set up to commercialise
university intellectual property under a long term contract with the University
of Leeds, in 2005 and Top Technology Ventures, an investment adviser to early
stage technology venture capital funds, in 2004.

The group has formed long-term partnerships with ten universities - the
University of Oxford, King's College London, CNAP/University of York, the
University of Leeds, the University of Bristol, the University of Surrey, the
University of Southampton, Queen Mary (University of London), the University of
Bath and the University of Glasgow.

As at 31 December 2006, 53 spin-out companies had been created among the group's
university partners. Of those, eight have listed on the AiM market of the London
Stock Exchange, one on PLUS Markets and there have been two trade sales.

For more information, please visit our website at www.ipgroupplc.com. For more
information on Photopharmica, please visit its website at www.photopharmica.com.

The University of Leeds

The University of Leeds has a long history of successful entrepreneurial
activity based on leading edge research, generating more than 70 spin-out
companies to date. In the last 18 months three University of Leeds companies
have floated on AIM.

The White Rose Technology Seedcorn Fund

An early stage investment in Photopharmica was made in 2002 by White Rose
Technology Seedcorn Fund, which is owned by the Universities of York, Leeds and
Sheffield and managed by Aberdeen Asset Managers.

The White Rose Technology Seedcorn Fund is an early stage seedcorn fund, which
invests in exciting new technology emerging from the universities of York, Leeds
and Sheffield.  The £9 million Fund provides venture capital funding of up to
£250,000 (and above for exceptional opportunities) to enable the transition from
promising research work to commercial reality.

ENDS



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