Preliminary Results

Sareum Holdings PLC
19 September 2005


For immediate release                                          19 September 2005


                              SAREUM HOLDINGS PLC
                          ("Sareum" or the "Company")


                RESULTS FOR THE TWELVE MONTHS ENDED 30 JUNE 2005


Sareum Holdings plc (AIM: SAR), the specialist structure-based drug discovery
and services business, is pleased to announce its results for the twelve month
period ended 30 June 2005.


•        Financial highlights:

         -        Successful flotation on AIM, raising £1.75M net

         -        Revenues of £332,335 (2004: £21,050)

         -        Cash position over £100,000 better than budget


•        Business highlights:

         -        First in-house drug discovery collaboration announced

         -        Four revenue generating collaborations announced

         -        World-wide business development established


•        Post year end highlights:

         -        Additional in-house drug discovery collaboration signed

         -        Continued success in generating new business

         -        "Crystal Bank" protein structure resource launched


Dr Paul Harper, Chairman of Sareum Holdings plc, said: "Sareum has enjoyed a
productive and successful first year. The Company and its management has made
great progress and has matched the strategy and budget set out to date.  The
Board envisages strong growth in both research activities and the generation of
revenues for the year ahead.

The Board and the entire Sareum team remains dedicated to generating shareholder
value.  The Sareum directors continue to work to develop the Company's
structure-based drug discovery and services business and remain confident about
its future prospects."


For further information please contact:


Sareum Holdings plc                                                 01223 497700
Tim Mitchell, Chief Executive Officer

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



                Results for the twelve months ended 31 June 2005


Chairman's Statement

Sareum Holdings plc has enjoyed a successful first full financial year of
trading. The Company's primary purpose is the discovery of novel drugs for the
treatment of cancer and in addition provides a range of specialist drug
discovery services to the pharmaceutical industry to generate the revenues
required to support our research programmes.  The Company listed on the AIM
Market of the London Stock Exchange in October 2004 and raised £1.75 million
(net of expenses).  Sareum has, this year, relocated its business to
purpose-fitted state-of the-art laboratories in Cambridge and has built a team
of highly skilled scientists.

Sareum has created a unique approach to drug discovery that is capable of
reducing by up to half the time it takes to discover drug candidates for
pre-clinical and clinical trials. The Company now has the combination of
resources and skills in structural biology, computational chemistry and
high-throughput chemical synthesis required to deliver on our business plan.

The Company has made good progress in its in-house drug discovery programme, the
number of available therapeutic targets being enhanced through collaboration. In
addition, we have signed a number of revenue generating deals with European and
US drug discovery companies.

Our in-house drug discovery capability has flourished during the year.  In
December 2004 Sareum entered into its first such agreement with EiRx
Therapeutics plc, a drug discovery company developing targeted therapies for
cancer. This collaboration has made substantial progress to date.  In this
shared-risk agreement, Sareum is using its structure-based drug discovery
expertise to rapidly discover and develop novel cancer therapies effective
against gene targets identified by EiRx. Sareum aims to licence out successful
candidate drugs to larger pharmaceutical companies once initial proof-of-concept
has been demonstrated. Discovering and developing drug molecules that interact
with novel therapeutic targets remains the Company's highest priority.

Sareum made good progress in obtaining revenue-generating service
collaborations, with the announcement of four agreements. Our first contracts
were signed soon after flotation.  The first of these, with Inpharmatica Ltd., a
privately-held UK drug discovery company, was to express and determine the
structures of a series of novel, genomics-derived nuclear hormone receptor
targets making full use of our leading capabilities in high-throughput protein
expression.

A contract was signed with Millennium Pharmaceuticals Inc, the parent company
from which the Sareum team emanated. This was important since it provided
positive validation of Sareum's capabilities by the company in which much of our
technology platform was originally developed.

We also announced a fee-for-service agreement with Cancer Research Technology
Ltd in December 2004 which was extended in April 2005 for a further six months.

A fee-for-service agreement was also announced in December 2004 with a quoted UK
pharmaceutical company to provide protein structure determination services that
will support the client's research against diseases of the central nervous
system.  This collaboration represented a significant new deal for Sareum and in
June 2005 Sareum received the success milestone payment.

In May 2005 Sareum announced a major improvement in its research capability.  We
were the first UK company to install a new generation of X-ray equipment for
visualising protein structures in 3-D.  This instrument significantly improves
Sareum's ability to determine protein structure which is a key part of its
unique drug discovery platform. Acquisition of this state-of-the-art technology
demonstrates Sareum's continuing commitment to be on the leading-edge of drug
discovery.

Progress to date has matched the strategy and budget for the year.  All the
indicators for the next fiscal period point to strong positive growth in both
research activities and the generation of revenues to support the research.

Financials

During this period revenues amounted to £332,335, with approx. 75% of this
figure being earned in the second half of the year, reflecting the continuing
increase in business development activity throughout the year. Losses for the
period were £1,243,758, representing a loss per share of 0.42p. Careful control
of spending resulted in a cash position of £441,435 that was approx. £100,000
better than budget.

On 4 March 2005 the Board of Sareum confirmed that it was in discussions with a
party regarding an offer being made for the Company. On 25 April, Sareum
announced that these discussions had been terminated.

Outlook

Sareum has enjoyed a productive and successful year.  This good progress and
solid performance reflects the dedication of the Board and the entire Sareum
team to shareholder value.  The Directors continue to work to develop the
Company's structure-based drug discovery programmes and services business and
remain confident about future prospects.


19 September 2005
Dr Paul Harper
Chairman Sareum Holdings plc


Chief Executive's Review

Strategy and Business Model

Sareum's strategy is to support in-house research into novel cancer therapies by
generating revenues through the provision of specialist drug discovery services
to the pharmaceutical industry.

Our business model comprises two main components:

-    Investment in proprietary research into novel cancer therapeutics to
     generate drug candidates for partnering with pharmaceutical companies at 
     the early clinical or pre-clinical trials stage.

     We are collaborating with leading cancer research companies, enabling us to
     share the risks involved in drug discovery and to access the specialist 
     biology capabilities available from our chosen partners.

     We entered our first in-house drug discovery collaboration with EiRx
     Therapeutics plc in December 2004 and subsequently announced a major
     collaboration with the Institute of Cancer Research and Cancer Research
     Technology.

     During the next period we will continue to apply our unique and innovative
     structure-based approaches in these programmes to rapidly optimise the lead
     compounds currently under investigation. We expect to file drug patent
     applications during the coming year.

-    Generation of revenues through the provision of specialist drug discovery 
     services to pharmaceutical company customers.

     During this period we signed collaborations with Inpharmatica Ltd., 
     Millennium Pharmaceuticals Inc., Cancer Research Technology Ltd. and a 
     quoted UK pharmaceutical company. Subsequently, we entered into a 
     collaboration with Almirall Prodesfarma S.A.

     We recently announced "Crystal Bank", a collection of therapeutically 
     relevant proteins that we are using to accelerate the discovery of 
     potential drug candidates. Crystal Bank demonstrates our ability to 
     successfully solve the structures of important target proteins in drug 
     discovery. It is also providing a significant source of new revenues.

     We have been successful in signing revenue generating collaborations with
     companies in Europe and the USA. Our unique technology platforms and 
     experienced scientific staff, combined with our integrated chemistry and 
     biology capabilities have enabled us to meet and often exceed our 
     customers' expectations. As well as leading to repeat business, this track 
     record provides solid evidence of our capabilities. This in turn has 
     enhanced our ability to sign new collaborations and extend our customer 
     base.

     We will continue to build on this promising business development record. In
     addition to our ongoing activities in Europe and the USA we are now active 
     in Japan, a major market for outsourced pharmaceutical research.

Objectives for the coming year

We look forward to successfully building on the solid foundation created in our
first trading year.

Our primary objective is to advance our in-house drug discovery pipeline to
deliver drug candidates positioned to attract lucrative partnering deals with
pharmaceutical companies.  We will continue to advance these programmes, filing
drug patent applications during the coming year, and developing drug candidates
for pre-clinical studies in 2007/8.

Given the time-frame to achieve pre-clinical status from our current programmes,
we intend to obtain an interest in a cancer research program that is
significantly nearer to the clinic, either by in-licence, collaboration or
acquisition.

To generate the revenues to support our current drug discovery pipeline, we will
continue to advance our worldwide business development pipeline. We aim to
expand our current customer base, secure repeat business from our existing
clients and secure larger collaborations with major pharmaceutical companies. We
look forward to announcing successful results from these developing
relationships.


19 September 2005
Dr Tim Mitchell
CEO Sareum Holdings plc



Consolidated profit and loss account
For the period ended 30 June 2005

                                                                  2005                    2004
                                                                  £            £           £           £
Turnover                                                                 332,335                  21,050

Cost of sales                                                            798,599                  34,747
Gross loss                                                             (466,264)                (13,697)

Administrative expenses                                                  912,350                 104,240
Operating loss                                                       (1,378,614)               (117,937)

Interest receivable                                          28,846                       36
Interest payable                                           (13,786)                        -
                                                                          15,060                      36
Loss on ordinary activities before                                   (1,363,554)               (117,901)
taxation

Tax on loss on ordinary activities                                     (119,796)                       -
Loss on ordinary activities after                                    (1,243,758)               (117,901)
taxation

Basic and diluted earnings per share                                    (0.0042)                (0.7378)


The loss on ordinary activities before taxation arises from the Group's
operations all of which are continuing.

There are no recognised gains or losses other than as stated in the profit and
loss account.

During the period the Company acquired a subsidiary company, Sareum Limited. The
profit and loss account has been prepared using merger accounting principles and
is presented as if the Group had been in existence throughout both the current
and prior periods. Further information is given in the notes on accounting
policies.

As required by the Companies Act 1985 this profit and loss account also covers
the first statutory accounting period of Sareum Holdings plc from its date of
incorporation on 7 June 2004 to 30 June 2005. This includes the results for the
merged group solely from the date of the merger.



Consolidated balance sheet
As at 30 June 2005

                                                            2005                        2004
                                                           £                £           £             £
Fixed assets

Intangible assets                                                      23,498                    29,497
Tangible fixed assets                                                 964,455                   458,452
                                                                      987,953                   487,949
Current assets

Debtors                                              362,191                       92,617
Cash at bank                                         441,435                      141,628
                                                     803,626                      234,245
Creditors: amounts falling due                       378,762                      810,068
within one year
Net current assets                                                    424,864                 (575,823)
Total assets less current                                           1,412,817                  (87,874)
liabilities
Creditors: amounts falling due after                                   93,154                         -
more than one year
Net assets                                                          1,319,663                  (87,874)

Capital and reserves

Called up share capital                                                86,937                    30,000
Share premium account                                               2,594,358                        27
Merger reserve                                                             27                         0
Profit and loss account                                           (1,361,659)                 (117,901)
Equity shareholders' funds                                          1,319,663                  (87,874)



Company balance sheet
As at 30 June 2005
                                                                                    2005
                                                                                     £              £
Fixed assets
Investment in subsidiary                                                                       30,000
Current assets
Debtor - subsidiary                                                          2,549,971
Cash at bank                                                                         0
Net current assets                                                                          2,549,971
Net assets                                                                                  2,579,971

Capital and reserves
Called up share capital                                                                        86,937
Share premium account                                                                       2,594,358
Profit and loss account                                                                     (101,324)
Equity shareholders' funds                                                                  2,579,971



Consolidated cash flow statement
For the period ended 30 June 2005
                                                                               2005               2004
                                                                                  £                  £
Net cash (outflow)/inflow from operating activities                     (1,553,557)            (5,022)

Returns on investment and servicing of finance                               15,060                 36
Capital expenditure                                                       (880,983)            (8,416)
Cash flow before financing                                              (2,419,480)           (13,402)

Financing                                                                 2,719,287            155,030
Increase in cash                                                            299,807            141,628



NOTES TO THE FINANCIAL STATEMENTS

1    General

The financial information set out above does not constitute statutory accounts
within the meaning of s.240 of the Companies Act 1985.

2    Basis of accounting

The financial statements have been prepared under the historical cost convention
and in accordance with applicable UK accounting standards.

3    Earnings per share

The basic and diluted earnings per share is calculated on the loss after tax of
£1,243,758 and a weighted average number of shares of 295,115,883 The
calculation of diluted earnings per share takes account of share options which
have vested. The 2004 comparative figure is based on the loss per share of
29.51p reported by the Company's operating subsidiary, Sareum Limited in their
accounts for the period 12 August 2003 to 30 June 2004.  As this was based on 1p
shares an adjustment has been made, by dividing by 40, to provide a more
meaningful comparison based on notional 0.0025p shares.


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