Drug Discovery Collaboration

Sareum Holdings PLC
01 December 2004

For immediate release                                            1 December 2004


                 SAREUM HOLDINGS PLC and EIRX THERAPEUTICS PLC
                             ("Sareum" and "EiRx")


             Sareum and EiRx Announce Drug Discovery Collaboration

Sareum Holdings plc (AIM: SAR), the structure-based drug discovery and services
business, and EiRx Therapeutics plc (AIM: ERX), the healthcare company
specialising in the control of programmed life and death of cells (apoptosis),
are pleased to announce they have entered into a collaboration to discover and
develop novel cancer therapies.

The collaboration will harness the two companies' highly synergistic
capabilities in drug discovery biology and chemistry to accelerate the
development of new cancer drug candidates with the intention of licensing
compounds after initial clinical trials.

EiRx has discovered novel gene targets that control apoptosis and cancer cell
survival, using its proprietary target discovery and validation platform, 
ALIBI(TM). Under the collaboration, 5 of these targets will be brought together
with Sareum's expertise and high-throughput processes in protein expression,
structure determination and medicinal chemistry. The skill sets of the two
companies combine with the aim of rapidly and efficiently discovering novel
chemical entities for development into effective cancer therapies.

The collaboration represents a significant milestone for both Sareum and EiRx.
It enables both companies to complement their respective service-based
businesses with the opportunity to generate a pipeline of potential drug
candidates. Payments and royalties arising from any licensing deals through this
collaboration will be shared between Sareum and EiRx.

Commenting on the agreement, Sareum's Chief Executive Officer, Dr Tim Mitchell,
said: "I am delighted to have entered into this agreement which allows Sareum
and EiRx to pool our complementary skills in structure-based drug discovery and
apoptosis biology in a collaborative framework structured to rapidly discover
cancer drug candidates that we hope will add significant value to both companies
and ultimately to benefit cancer patients."

Commenting on the agreement, EiRx's Chief Executive Officer, Dr Ian Hayes, said:
"Many types of cancer still remain hard to treat effectively because they are
resistant to conventional drug therapies. The ability of the cancer cell to
evade death, by apoptosis, appears to be central to this resistance. At EiRx we
have applied our knowledge of apoptosis to find points of intervention for the
design of new, selective and more potent therapies for these cancers. The
structure-based approach to chemistry employed by Sareum perfectly complements
EiRx's apoptosis and cancer biology. I am looking forward to working with Sareum
and bringing these new cancer therapies to the clinic."

For further information:

Sareum Holdings                                 [phone]
Tim Mitchell, Chief Executive Officer

EiRx Therapeutics plc                           [phone]
John Pool, Chairman

Buchanan Communications                         [phone]
Mark Court, Mary-Jane Johnson

About Sareum Holdings plc

Sareum Holdings plc is a structure based drug discovery business headquartered
in Cambridge, UK. The Company was formed in August 2003 to discover new drugs
for the treatment of cancer and inflammation and to provide a range of drug
discovery services to the pharmaceutical industry. Sareum's unique approach aims
to halve the time it takes to discover new drug candidates.

Structure-based drug discovery involves the determination of a disease causing
protein's three-dimensional structure. Once the structure is known, novel
chemical entities are designed to 'lock-in' to the protein with the aim of
reversing or arresting a disease's progression.

Sareum's approach to structure based drug discovery is to produce multiple
recombinant proteins primarily through a baculovirus expression system;
determine their structure using x-ray crystallography; and then use the
Company's computational chemistry expertise to create virtual, focused libraries
of new chemical entities designed to interact with the target protein. Sareum
then uses its high-throughput medicinal chemistry platform to rapidly synthesise
these molecules and develop the most promising into potential drug candidates.

Sareum offers its accelerated drug discovery capabilities on a fee basis to the
pharmaceutical and biotechnology industries and has recently signed
collaborative agreements with Inpharmatica Ltd. and Millennium Pharmaceuticals,
Inc. Sareum also intends to license out its internally generated drug candidates
at the Phase I or Phase II clinical trials stage.

Sareum joined the AIM Market of the London Stock Exchange in October 2004 and
trades under the symbol SAR. For further information, please visit
www.sareum.co.uk.

About EiRx

EiRx Therapeutics plc is a healthcare company headquartered in Cork, Ireland.
The Company was formed in 1999 to discover new therapeutic treatments for
cancer, inflammation and degenerative diseases and to provide its specialist
capabilities to the pharmaceutical and biotechnology industry. EiRx specializes
in the biology of apoptosis (cell death).

EiRx's core technology is a series of novel, validated drug targets and
candidate molecules, which modulate apoptosis in cancer and inflammatory
disease. EiRx has a unique insight into the mechanisms underlying a cell's
decision to die. Deregulation of apoptosis occurs in many diseases, most notably
cancer, so mechanisms for understanding/controlling apoptosis may be applied to
the development of treatments. EiRx is also interested in the discovery of novel
targets and drug candidates for the treatment of neurodegeneration and retinal
degeneration through founder Prof. Cotter's academic research at University
College Cork.

EiRx, employing its proprietary Target Discovery & Validation platform, 
ALIBI(TM), has implicated novel genes in the control of apoptosis. Patent
applications have been filed covering all validated kinases, GPCRs and enzymes,
a number of which have been implicated in the PI3K/AKT and GSK/Wnt survival
pathways. EiRx is advancing these targets through drug discovery in-house and
with the help of its developmental partners. Additionally, EiRx have recently
announced a collaboration, valued at up to $4.7M per target, total $18.8M
depending on results, to license a number of targets to OSI Pharmaceuticals,
Inc.

EiRx joined the AIM Market of the London Stock Exchange in January 2004 and
trades under the symbol ERX. For more information visit www.eirx.com

About Apoptosis and Cancer

The epidemiology of cancer has been viewed historically as a disease caused by
uncontrolled proliferation of cancer cells which eventually consume the host.
Only over the past few years, and with the appreciation of the significance of
apoptosis, has this view been challenged. We now know that within every cell of
the body there is a struggle taking place between the decision to live and die.
Typically, and in healthy non-transformed cells, their continued survival is
dependent on continuous stimulation from their environment through
receptor-mediated contact with other cells or through growth factors. However,
when a cell becomes ineffective in its job, infected with virus or begins
growing in a wrong location within the body, the survival signals become
abrogated and the cell will trigger the genetic program of apoptosis, leading to
its self-destruction and disappearance. Through this mechanism, the homeostasis
and structured environment of the body is maintained.

In transformed cells like those found in a cancer, the situation is different.
The survival signals or apoptosis-triggering signals are damaged by a mutation
in the cells' DNA, such that the cell becomes independent of its environment and
refractory to signals within the cell that should tell it to commit suicide.
Since cells are continuously being formed, any delay in their death will result
in a large increase in their number, thus the formation of a tumour.

Drugs that are designed to take advantage of this knowledge offer the potential
to effectively treat cancer types without also damaging the body's normal
healthy cells. An example of one such drug in development is Tarceva, developed
by OSI Pharmaceuticals and Genentech. Tarceva inhibits a survival signal in
cancer cells mediated through the growth factor receptor, EGFR. In 2001, OSI
Pharmaceuticals announced an agreement, with Genentech and Roche to co-develop
and commercialise Tarceva.


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