SAREUM HOLDINGS PLC : Research Update

(AIM: SAR)

27 February 2012

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

Research Update: Positive Results from Research Programmes

Sareum (AIM: SAR), the specialist cancer drug discovery business, is pleased to announce positive results from several of its cancer and auto-immune disease research programmes:

Chk1: Following the announcement of the pre-clinical development candidate in August 2011, research continues to demonstrate the effectiveness of the programme lead compounds in further cancer models. In November 2011, scientists from Sareum and the Institute of Cancer Research presented two posters at the AACR-NCI-EORTC international cancer conference. These posters described the development and effectiveness of programme lead compounds, including new data showing significant tumour growth rate reductions in an in-vivo model of lung cancer when dosed in combination with gemcitabine, and significant regression of neuroblastoma tumours in an in-vivo model, when dosed as a single agent. Licensing discussions continue with several interested parties.

Aurora+FLT3: Work continues to select a pre-clinical development candidate from two of the programme lead compounds. One of these compounds, and its effectiveness in a model of Acute Myeloid Leukaemia, was described in the research update of February 2011. Head-to-head efficacy studies show the second compound to be similarly effective, whilst being better tolerated and having superior ADME (absorption, distribution, metabolism and excretion) properties. We are close to making the final selection, and are discussing opportunities with a number of interested parties regarding the co-development of the programme to prepare for clinical studies. Work also continues to optimise a second series of molecules with demonstrated oral bioavailability.

Aurora+ALK: We are optimising a series of compounds derived from our SKIL^® platform, which potently inhibit the Aurora and ALK kinases. Such inhibitors are designed to act against cancers where ALK is believed to be the oncogenic driving force behind tumour development, particularly against identifiable subsets of lymphomas, neuroblastomas and non-small cell lung cancer. Compounds with potent anti-proliferative properties against cell-lines bearing ALK activating mutations have been developed, however further optimisation is required to improve pharmacokinetic properties to deliver orally bioavailable examples, and this work is ongoing. In parallel, a subset of ALK-selective inhibitors (i.e. lacking activity against the Aurora kinases) has been discovered and efforts are ongoing to deliver orally bioavailable examples from this series.

TYK2: An initial in-vivo study into the effectiveness of a programme lead compound in a model of multiple sclerosis was encouraging, giving a statistically significant reduction in disease severity, across a range of criteria, in a dose-dependent manner when dosed orally on a twice daily schedule. Similarly, in a model of arthritis, twice-daily oral dosing of the same lead compound had significant beneficial effects on disease severity. These important proof-of-concept experiments have encouraged us to continue optimisation of programme compounds. In the meantime, we are discussing licensing and co-development opportunities with a number of interested parties.

VEGFR-3 (FLT4): We have prioritised our research spend on other programmes whilst we continue to seek a partner with the necessary biology expertise to assist us in the progression of this programme. We also await with interest the results of early clinical trials on products with similar modes of action, such as IMC-3C5 (ImClone) and VGX-100 (Circadian Technologies).

Microtubule Binding Agents: This is a new programme arising from the continued screening of our SKIL library compounds. Lead compounds act in a similar manner to the billion-dollar selling taxane drugs, by altering the dynamics of tubulin polymerisation, and therefore affecting the ability of a cell to divide. However, in contrast to taxanes, which are natural product derivatives, our lead compounds are entirely synthetic and have the potential to be dosed via the oral route. Indeed a programme lead compound was found to be more than 60% orally bioavailable with potent anti-proliferative effects against a range of colon, lung, breast, prostate and leukaemia cell lines. We intend to expand our understanding of Structure Activity Relationships (SAR) within this series, whilst seeking to improve potency and pharmacokinetic properties, before initiating marketing activities.

Sareum's CEO, Dr Tim Mitchell, commented: "The new research data gives us real confidence in our ability to partner our more advanced programmes with pharmaceutical companies.  We are in on-going discussions with a number of interested parties and we anticipate that a deal will be agreed before the end of the calendar year.  We are also continually screening for new candidates to secure a programme pipeline and look forward to providing shareholders with further updates on our progress."

Sareum Holdings plc
Tim Mitchell	01223 497 700
Merchant Securities Limited (Nomad)
Simon Clements	020 7628 2200
Hybridan LLP (Broker)
Claire Noyce / Deepak Reddy	020 7947 4350
The Communications Portfolio (Media enquiries)
Ariane Comstive / Caolan Mahon [e-mail]	020 7536 2028 / 2029

Notes for editors:

About Sareum Holdings plc

Sareum is a drug discovery company, headquartered in Cambridge UK, that is focused on producing targeted small molecule therapeutics to address unmet medical needs, primarily in cancer. Sareum aims to successfully deliver drug candidates for licensing to pharmaceutical and biotechnology companies at the pre-clinical or early clinical trials stage.

Sareum's Chk1 kinase cancer research programme is a joint research collaboration with The Institute of Cancer Research and Cancer Research Technology Limited. The development candidate resulting from the collaboration increases the effectiveness of current cancer therapeutics in in-vivo cancer models.

SKIL® (Sareum Kinase Inhibitor Library) is Sareum's drug discovery technology platform that has so far produced the Company's Aurora+FLT3, Aurora+ALK VEGFR-3, FLT3 & TYK2 kinase cancer and auto-immune disease research programmes. SKIL can also generate drug research programmes against other kinase targets.

Sareum Holdings plc joined the AIM market of the London Stock Exchange in October 2004, trading under the symbol SAR. For further information, please visit www.sareum.co.uk

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