GBP9.5 million Fundraising

Evolutec Group PLC
23 March 2005



For immediate release                                              23 March 2005


                               EVOLUTEC GROUP PLC

                         ('Evolutec' or 'the Company')


                       £9.5 million Secondary Fundraising


Evolutec Group plc (AIM: EVC), a biopharmaceutical company engaged in developing
novel products for the treatment of allergic, inflammatory and autoimmune
diseases, is pleased to announce that it has agreed, subject to certain
conditions, to raise approximately £9.5 million, net of expenses, by way of a
Placing.



Highlights



•   Evolutec is raising approximately £9.5 million, net of expenses, through 
    the placing of 7,142,858 Placing shares at a Placing price of 140p a
    share. The Placing is being fully underwritten by Collins Stewart.

•   The Placing price represents a discount of approximately 21.6 per cent to 
    the closing mid-market price of 178.5p per Ordinary share as at 22 March
    2005, the latest practicable date prior to the announcement of the Placing.

•   The Placing shares are being offered only to a number of new institutions 
    and existing institutional investors to ensure certainty, to broaden the 
    institutional shareholder base and to minimise transaction costs.

•   The funds raised will be used to fund further clinical studies of the
    Company's lead compound, rEV131, in rhinitis, post-cataract surgery and dry 
    eye, and to progress the development of rEV598 and rEV576.

•   Evolutec's Directors have agreed to subscribe an aggregate of £145,000
    for 103,571 Placing shares at the Placing price.

•   The necessary authority required for the allotment of Placing shares
    pursuant to the Placing will be sought at an Extraordinary General Meeting
    convened for 11.00am on 20 April 2005.

Commenting on the Placing, Mark Carnegie Brown, Evolutec's Chief Executive,
said: 'I am delighted by the high level of institutional support for this
Placing, which underlined the progress we have made since joining AIM last year.
The additional funds will allow us to accelerate the development of the Company
with the dual objectives of bringing novel medicines to market and building
value for our shareholders.'

Evolutec is today hosting an R&D review for analysts and institutional
shareholders. The R&D review, which will focus on the Company's clinical
development programmes, will take place at Buchanan Communications, 107
Cheapside, London EC2V 6DN, from 3.30pm to 5.30pm. Speakers will include the
Company's management and also Professor Mark Abelson, lead clinician and Senior
Clinical Scientist at Schepens Eye Research Institute, Associate Clinical
Professor at Harvard Medical School and President, Opthalmic Research
Associates, Inc.



For further information:


Evolutec                                                          01865 784070
Mark Carnegie Brown, Chief Executive Officer
Nicholas Badman, Chief Financial Officer
www.evolutec.co.uk

Collins Stewart                                                   020 7523 8350
Chris Howard

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





Notes for Editors

About Evolutec

Evolutec, which is based in Oxford, UK, is a clinical stage biopharmaceutical
company with a focus on allergy, inflammation and auto-immune diseases.

The Company's lead product, rEV131, is a histamine-binding protein that has
progressed to phase II trials in allergic conjunctivitis, rhinitis and ocular
inflammation.  Positive pre-clinical data has also been generated in asthma.
rEV131 is understood to be the only product currently in clinical trials that
impacts the recently discovered H4 receptor, a receptor implicated in many forms
of inflammatory disease.  The Company intends to carryout proof of concept phase
II clinical trials with rEV131 in allergic rhinitis and post-cataract surgery in
2005.

The Company has a further two products in pre-clinical development, rEV598 which
is being evaluated in carcinoid syndrome and CINV (chemotherapy-induced nausea
and vomiting), and rEV576, a complement inhibitor.

Evolutec was founded in 1998 to exploit research carried out by the Natural
Environment Research Council.  Evolutec's drugs were first isolated from the
saliva of ticks.  The tick remains undetected by its hosts, including humans, by
injecting an array of molecules into the skin that suppresses normal defence
mechanisms.  These stealth molecules have evolved over millions of years to
enable the tick to take a blood meal from its host.  Evolutec employs the tick's
evolutionary stealth technology to offer the potential of treating human
diseases.



                 Evolutec Group plc ('the Company' or 'Evolutec')

                         Proposed £9.5 million Placing


Background to and reasons for the Placing

Evolutec is a research and development based biopharmaceutical business which
expects to incur further losses until revenues from royalty income, milestone
receipts and product sales exceed expenditure on the product portfolio (as well
as overheads and administrative costs). As a result, the Directors believe it is
necessary and in the best interests of the Company to raise extra funds in order
to fund further clinical studies of its lead compound, rEV131, in rhinitis,
post-cataract surgery and dry eye (as discussed in further detail in paragraph 3
below) and to provide additional finance so that Evolutec can progress the
development programmes with rEV598 (a serocalin) and rEV576 (a complement
inhibitor) during 2005. The Company will then be in a position to select
clinical indications for these development candidates in the next 12 to 18
months to create a portfolio of opportunities in different therapeutic
indications. This is in accordance with the Company's stated ambitions.

The Directors believe that the Company would benefit from access to additional
capital to fund further clinical studies of its lead compound rEV131. The Board
has therefore concluded terms for the raising of additional funds in order to
strengthen the Company's balance sheet and to provide it with additional working
capital.

In order to ensure certainty, to broaden the institutional shareholder base and
to minimise transaction costs, the Placing shares are only being offered to a
number of new and existing institutional shareholders.

The Placing Price represents a discount of approximately 21.6 per cent. to the
closing mid-market price of 178.5p per Ordinary Share as at 22 March 2005, the
latest practicable date prior to the announcement of the Placing.


rEV131 development

Evolutec's clinical development programmes for rEV131 in rhinitis and
post-cataract surgery are on track to deliver results by the end of 2005, as
discussed at the time of the Company's admission to AIM in August 2004. In
addition, dry eye has been selected as a third indication for rEV131.

In rhinitis, a nasal safety programme has been completed and a nasal delivery
device has been selected. An IND was submitted to the FDA on 14 February 2005,
outlining a dose ranging efficacy and safety rhinitis trial. Following positive
preliminary discussions with the FDA, it has been decided to increase the number
of patients from 80 to 112 to allow an extra cohort of patients to be tested at
the optimal dose. This will increase the power of the study.

A positive result in a model of ocular inflammation was obtained in the latter
part of 2004, which confirms the potential of rEV131 in post-cataract surgery.
Despite the small scale of the study the higher dose of rEV131 showed a
statistically significant improvement over the standard steroid treatment
prednisolone.

The dry eye market is estimated to be worth in excess of $1 billion in the US
alone.  It represents an exciting potential commercial opportunity for Evolutec
which intends to retain marketing rights using a specialist sales force
targeting ophthalmologists.

Cambrex has been selected to manufacture rEV131 for planned Phase III clinical
trials and subsequent marketing. REV131 has been manufactured to date according
to Good Laboratory Practice ('GLP') standards for the Phase II clinical trials.
The current GLP process produces good yields of rEV131. The agreement with
Cambrex covers process development work, during which Cambrex will develop a
robust, scaleable, current Good Manufacturing Practice ('cGMP') process for
purified rEV131, with the goal of optimising the process yield. The agreement
then provides for Cambrex to scale-up the cGMP process. The investment in cGMP
manufacturing with Cambrex gives Evolutec control of the production of rEV131.
This is important as it means that Evolutec can produce rEV131 for own sales in
chosen specialist indications and markets.


Financial

The results for the 18 month period to 31 December 2004 were announced on 3
March 2005. The Annual Report and Accounts for the year ended 31 December 2004
was issued on the same day. These documents contain a full review of the
Company's business, as well as the details of Evolutec's progress since
admission to AIM in August 2004. Copies of the Annual Report are available on
the website of the Company.

Evolutec raised £5.1 million (net of expenses) via a placing on AIM in August
2004. The operating loss for the 18 month period to 31 December 2004 was £2.5
million (12 months to 30 June 2003: operating loss of £1.1m). Evolutec had cash
and short-term investments of £3.9 million as at 31 December 2004. This cash is
sufficient to pay for the initial rhinitis and post-cataract surgery trials and
part of the cGMP manufacturing costs but will not cover subsequent trials and
the additional dry eye work.


Placing

The Company announced today that it is raising £9.5 million, net of expenses,
through the placing of 7,142,858 Placing Shares. The Placing Price represents a
discount of approximately 21.6 per cent. to the closing mi-market price of
178.5p per Ordinary Share as at 22 March 2005, the latest practicable date prior
to the announcement of the Placing. The Placing Shares will rank in full for all
dividends and otherwise pari passu in all respects with the existing Ordinary
Shares.

It is expected that the New Ordinary Shares will be admitted to trading on AIM
on 21 April 2005. The Placing, which has been fully underwritten by Collins
Stewart, is conditional, inter alia, upon:


•   the approval of the Resolutions at the EGM;

•   the Placing Agreement becoming unconditional in all respects and not
    having been terminated in accordance with its terms; and

•   Admission of the Placing Shares.



Directors' shareholdings

The Directors have agreed to subscribe an aggregate of £145,000 for 103,571
Placing Shares at the Placing Price. In respect of the subscription of the
Placing Shares subscribed by the Director's, the Director's have agreed to be
bound by a 12 month lock-up agreement. The Directors' beneficial and non
beneficial interests in Shares (not including unexercised options over Shares)
on the date of this announcement and following the Placing are set out below:


Director                            Current Interests            Interests after Placing

                                 Number of    Percentage of        Number of     Percentage of
                                    Shares     Issued Share           Shares      Issued Share
                                                    Capital                            Capital

David Bloxham                      103,572             1.02          117,858              0.68
Mark Carnegie Brown                 40,000             0.39           50,714              0.29
Nicholas Badman                     35,000             0.34           56,429              0.33
John Burke                         101,343             0.99          129,914              0.75
Graeme Hart                        110,168             1.08          138,739              0.80



Extraordinary General Meeting and action to be taken

A notice convening the EGM to be held at 100 Longwater Avenue, Green Park,
Reading RG2 6GP at 11.00 a.m. on 20 April 2005 is set out in the circular to
shareholders. Resolutions will be proposed at the EGM to authorise the Directors
to allot shares. The Company will despatch the circular to shareholders today.


Recommendation

The Directors consider the terms of the Placing to be fair and reasonable
insofar as the Shareholders are concerned and in the best interests of the
Company; and accordingly recommend that Shareholders vote in favour of the
Resolutions at the EGM as they intend to do in respect of their own holding of
Shares, representing 390,083 Ordinary shares, being 3.82 per cent.  of the
current issued ordinary share capital.



Expected timetable of events


Extraordinary General Meeting                       11.00 a.m. on 20 April 2005


Admission of the New Ordinary Shares to AIM         8.00 a.m. on 21 April 2005


This announcement shall not constitute or form any part of any offer or
invitation to subscribe for, underwrite or otherwise acquire, or any
solicitation of any offer to purchase or subscribe for, securities including in
the United States.

This announcement does not constitute an offer of securities for sale in the
United States. Neither this announcement nor any copy of it may be taken or
distributed into the United States or distributed or published, directly or
indirectly, in the United States. Any failure to comply with this restriction
may constitute a violation of US securities laws. The securities referred to
herein have not been and will not be registered under the Securities Act, and
may not be offered or sold in the United States unless they are registered under
the Securities Act or pursuant to an available exemption therefrom. No public
offering of securities of the Company is being made in the United States.

This announcement does not constitute an offer to sell or issue or the
solicitation of an offer to buy, subscribe or otherwise acquire Placing Shares
or other shares in the Company in Canada, Australia, Japan, the Republic of
Ireland or in any jurisdiction in which such offer or solicitation is unlawful
and the information contained herein is not for release, publication or
distribution in whole or in part in or into Canada, Australia, Japan or the
Republic of Ireland or in any jurisdiction in which such publication or
distribution is unlawful.

The Placing Shares have not been recommended, approved or disapproved by any
United States federal or state securities commission or regulatory authority.
Furthermore, the foregoing authorities have not confirmed the accuracy or
determined the adequacy of this announcement. Any representation to the contrary
is a criminal offence in the United States.

The announcement contains a number of statements relating to the Company that
are considered 'forward looking statements' as defined in the Private Securities
Litigation Reform Act 1995 of the United States. Such statements are based on
current plans and, information and intentions and certain external factors which
may be beyond the control of the Company and, therefore, undue reliance should
not be placed on them. Forward looking statements speak only as of the date they
are made and the Company undertakes no obligation to update publicly any of them
in light of new information or future events. These statements are subject to
risks and uncertainties that could cause actual occurrences to differ materially
from the forward looking statements.

Collins Stewart Ltd., a division of Collins Stewart Tullet plc, which is
authorised and regulated in the United Kingdom by the Financial Services
Authority under the Financial Services and Markets Act 2000, is acting
exclusively for the Company in connection with the Placing and no one else and
will not be responsible to anyone other than the Company for providing the
protections afforded to clients of Collins Stewart nor for providing advice in
relation to the Placing or any other matter referred to herein.  Collins Stewart
can be contacted at 88 Wood Street, London EC2V 7QR.


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