Interim Results - Progress in Scientific Projects

PROTEOME SCIENCES PLC
20 October 1999


INTERIM  STATEMENT
                              
Introduction

The Company announces its interim financial results for the
six months ended 30th June 1999, together with an update of
progress within its research and development portfolio and
the details of a Placing of 3,885,874 new ordinary shares at
a price of 10p per share to Finsbury Life Sciences Trust plc
and Finsbury Technology Trust plc, representing 5 per cent
of the ordinary share capital of Proteome Sciences and the
proposed grant to them of an option to subscribe for a
further 4,080,164 ordinary shares, which will be exercisable
at the then prevailing market price and be subject to
shareholder approval by way of Special Resolution at an
Extraordinary General Meeting.

Development Update

Intellectual Property

In the six months to 30th June 1999, Proteome Sciences has
made further progress across its scientific projects.  As a
result of the developments in the various group research
programmes, five new patents have been filed to date this
year:-

- a group of three patents relating to the diabetes and
  obesity research underway at the Universities of Geneva and
  Buckingham;

- a patent in connection with the Company's proprietary
  techniques in the field of enhanced Immuno-PCR which has
  significantly increased the level of sensitivity available
  over existing ELISA methods;  and

- a further patent in connection with the detection and
  possible treatment of lung cancer.

Intronn

The SMaRT gene therapy programme at Intronn, Proteome
Sciences' US gene therapy subsidiary, has been awarded a
Phase 1 SBIR grant from the National Institute of Health
(NIH) in the USA of $235,000.  This was over twice the level
that Intronn had requested and reflects the strong interest
in SMaRT and its applications for cystic fibrosis, cancer
and inherited genetic disorders.  This grant contribution
should significantly reduce Proteome Sciences' funding
contribution to Intronn in the second half of 1999.

Intronn received notification in August 1999 of issuance of
its first main US patent which covers the SMaRT gene therapy
platform.  Following the significant attention generated by
an article in the March edition of Nature Biotechnology,
which announced a major advance and novel approach to gene
therapy, a specialist consultant has been recruited to
negotiate licensing and research agreements with the wide
range of interested parties who have been in contact,
primarily in SMaRT, the genomic applications of Exon tagging
and the agbio applications for genetic modification in
plants and crops.

Intronn signed a Materials Transfer Agreement with Oxford
BioMedica (UK) Limited in September 1999 under which Intronn
will provide Oxford BioMedica with transplicing constructs
for them to apply using a group of different viral delivery
vectors.

The Board is currently evaluating the options available to
maximise the value of its interests in Intronn.  Such
options may include a separate structure for the company
with independent funding and a possible future listing.

Diabetes and Obesity Programme

Following the meeting 'New Molecular Targets for Obesity and
Type 2 Diabetes' at the University of Buckingham in July
1999, considerable interest has been expressed in respect of
the Company's proteomic research programme undertaken
through the Collaboration Agreement with the Universities of
Geneva and Buckingham.  The Company has entered into
Confidential Disclosure Agreements with selected parties
with the view of entering into a funded research programme.

Having filed two patents for diabetes earlier in the year, a
third patent application for obesity was filed in July,
covering methods and compositions relating to body weight
and eating disorders.

Other Research Programmes

Research under the funded Agreement with Rhone-Poulenc Rorer
has progressed well, as have the results for lung cancer
which falls under the Materials Transfer Agreement with
diaDexus.  In the latter case, the Company is intending to
produce more sensitive monoclonal antibodies to the proteins
of interest in lung cancer.

The Company's Protein Separation and Analysis Service at
Harefield Hospital has carried out a limited amount of work
for outside parties. The REMAP programme, also at Harefield,
has continued satisfactorily and the Company is now actively
seeking commercial partners for the related chronic
rejection marker.

Financial Update

The financial results for the six months to 30th June 1999,
show a loss before taxation for the six months of £502,560,
compared with £886,204 in the corresponding period in 1998.
This reflects a favourable movement in realised exchange
gains of £158,876 (1998:  losses £37,306) and the writing
back of certain provisions made in earlier years which the
Board now no longer considers to be necessary.

Cash at 30th June 1999 was £547,061.  The Company has
implemented the contingency plan, referred to in the 1998
Annual Report and Accounts;  this has involved reductions in
overhead costs and the level of research expenditure.

The Company's existing research programmes at the University
of Michigan will be continued until the end of November and
at the Cantonal Hospital of Geneva until the end of
December, with the diabetes programme at the Universities of
Geneva and Buckingham continuing into 2000.

Proteome Sciences intends to resume part or all of the
research programme at Geneva and Michigan, however, the
Board will re-assess the scope of such research programmes
in light of the status of licensing arrangements, research
partnerships and the level of funding available.

Placing and Financial Resources

Proteome Sciences is pleased to announce that Finsbury Life
Sciences Trust plc and Finsbury Technology Trust plc have
subscribed for a total of 3,885,874 new ordinary shares in
Proteome Sciences plc representing 5 per cent of the
ordinary share capital at 10p per share, being 1,942,937
shares respectively.  The new shares issued have provided
additional cash of £388,587. Finsbury Life Sciences Trust
plc and Finsbury Technology Trust plc have indicated that
they would like to have an option to subscribe for a further
4,080,168 ordinary shares (5.0 per cent of the ordinary
share capital after the issuance of 3,885,874 ordinary
shares as set out above).  The option to subscribe for
4,080,168 ordinary shares will be exercisable at the then
prevailing market price and will be subject to shareholder
approval by way of Special Resolution at an Extraordinary
General Meeting.  A circular setting out details of the
proposal will be sent to shareholders in due course and your
Board will unanimously recommend approval of the proposed
Option Agreement with Finsbury Life Sciences Trust plc and
Finsbury Technology Trust plc.

Application has been made to the London Stock Exchange
Limited for the 3,885,874 Ordinary Shares to be traded on
the Alternative Investment Market (AIM). It is expected that
dealings in the Ordinary Shares on AIM will commence on 25th
October, 1999.

The Directors believe that the Placing announced today will
provide financing for the foreseeable future but that the
Company may require further funding to reach the point at
which revenues can sustain ongoing development expenditure.

Corporate Strategy

Increasing levels of corporate merger activity have been
taking place in the biotechnology sector as 1999 has
progressed, both in the USA and Europe.  The Directors
consider that the industry recognises the pressures for
consolidation and creation of entities with greater areas of
specialist focus and 'one stop solutions'.

As a consequence, the Directors are considering a range of
options including possible merger, alliances and funding
opportunities which would enhance shareholder value.  To
date, preliminary discussions have been held with certain
parties and the Directors intend to continue discussions
which may be extended to a larger group which may or may not
lead to an offer for the entire issued share capital of the
Company.


Outlook

Proteome Sciences is, at the same time, vigorously and
actively pursuing licensing and partnership agreements to
exploit commercially the Company's results, technology and
patent portfolio.

The Placing announced with the Interim Results provides
funding for Proteome Sciences to progress its research.  The
Board's priority remains focused to commercialise the
discoveries and results both from its proteomics research
programme and from Intronn's gene therapy/RNA repair and
SMaRT technologies.


R.S. Harris
Chairman                          20th October 1999



Unaudited consolidated profit and loss account for the six
months ended 30th June 1999




                               Six months    Six months  Year  ended
                                    ended         ended         31st
                                30th June     30th June     December
                                     1999          1998         1998
                             £             £             £
                                                         
Administrative expenses          (426,206)     (478,457)     (1,061,510)
Research and development         (252,205)     (451,516)       (904,707)
expenses
Other operating expenses           (4,491)       (9,167)        (13,528)
                                    ______        ______        ________
Operating loss before                                    
realised exchange gains          (682,902)     (939,140)     (1,979,745)
(losses)
Realised exchange gains/          158,876       (37,306)        (22,246)
losses                              ______        ______        ________
                                                         
Operating loss                   (524,026)     (976,446)     (2,001,991)
Interest receivable                23,208        92,094         155,349
Interest payable and similar       (1,742)       (1,852)         (3,885)
charges                                                  
                                    ______        ______        ________
                                                         
Loss on ordinary activities      (502,560)     (886,204)     (1,850,527)
before taxation
Tax on loss on ordinary                 -              -           -
activities
                                    ______        ______        ________
                                                         
Accumulated deficit for the      (502,560)     (886,204)     (1,850,527)
period
                                                         
                                                         
Loss per share                      0.64p         1.14p         2.38p
                                                         

Notes to the Financial information


1.   There has been no change to any of the accounting
 policies set out in the 1998 statutory accounts.

2.   Following the loss of £502,560 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
     six months ended 30th June 1999 is based on the loss
     for the financial period of £502,560 and on
     77,717,483 Ordinary Shares, being the number of
     shares in issue and ranking for dividend during the
     period (six months ended  30th June 1998 - loss
     £886,204, number of Ordinary Shares in issue and
     ranking for dividend, 77,717,483).

 b) The calculation of the loss per share for the year
    ended 31st December 1998 is based on the loss for
    the year of £1,850,527 and on 77,717,483 Ordinary
    Shares, being the 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 1998 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.