Research Update

Phytopharm PLC
21 January 2004

                                                                21 January 2004


Phytopharm plc


Receives second milestone from its collaboration with Yamanouchi Pharmaceutical
Co Ltd in Alzheimer's disease

Phytopharm plc (PYM: London Stock Exchange) announces today that it has received
a milestone of $2M from Yamanouchi Pharmaceutical Co., Ltd., the leading
Japanese pharmaceutical company.  This milestone was paid following receipt by
Yamanouchi of the results of the phase I study of its orally active, synthetic,
neuroprotective and neuroregenerative product, PYM50028, which is under
development as a treatment for Alzheimer's disease.


This data was also considered by the UK Medicines and Healthcare Products
Regulatory Agency, which granted a clinical trial exemption (CTX) certificate on
December 9th 2003 enabling Phytopharm to commence a Phase II study in the UK
with the material.


On 1 May 2003, Phytopharm entered a licensing agreement with Yamanouchi for the
development and commercialisation of PYM50028 in Japan and other Asian
territories.  A total potential milestone stream of $33 million is payable
during the course of development of the product, and Phytopharm has now received
two milestones amounting to $5 million from this total. A further $15 milion is
potentially payable over the next 18 months.


Dr Richard Dixey, Chief Executive of Phytopharm, said: 'We continue to make
strong progress in the development of this potentially important medicine.'


                                     -ENDS-

Enquiries:

Phytopharm plc
Dr Richard Dixey, Chief Executive                 Tel:              01480 437697
                                                  Mobile:           [phone]

Financial Dynamics
David Yates / Ben Atwell                          Tel:             0207 831 3113



NOTES TO EDITORS



Phytopharm is a leading company in the development of Botanical pharmaceuticals.
These plant-based medicines, manufactured to pharmaceutical standards, can be
clinically evaluated in chronic and poorly understood diseases.  Where novel
modes of action are discovered, such research can form the basis for drug
discovery platforms, which enable the development of new medicines and the
isolation of single chemical entities of clinical importance.  Phytopharm has
four drug discovery platforms in full development, for metabolic disease,
neurodegeneration, inflammation and dermatology.



PYM50028 arose from research into the activity of an Asian medicinal plant.  In
pre-clinical studies, this synthetic chemical has been shown to be
neuroprotective, to reverse the decrease of neuronal growth factors and to
reverse neuronal degeneration observed in the ageing brain.  Importantly, this
product was observed to restore levels of proteins that are altered in the
ageing brain, returning them to levels seen in the young and causing beneficial
neurite outgrowth and branching.  PYM50028 thereby offers the potential of
disease modification in poorly treated but prevalent neurodegenerative
conditions such as Alzheimer's disease.  The neurodegeneration platform, from
which PYM50028 has been developed, is protected by nine global patent families
and contains a library of related chemical compounds that share this mode of
action.



Phytopharm is developing nine programmes based on its four drug discovery
platforms alongside a number of other projects in early evaluation.



More information concerning Phytopharm's activities can be found on its web site
                          at http://www.phytopharm.com







                      This information is provided by RNS
            The company news service from the London Stock Exchange