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Xenova Group PLC (XEN)

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Wednesday 11 December, 2002

Xenova Group PLC

Operational Review

Xenova Group PLC
11 December 2002


                               Operational Review
           Cost Reductions Estimated at £2m p.a. and Two New Projects
                          into Preclinical Development

Slough, UK, December 11, 2002  -  Xenova Group plc (NASDAQ NM: XNVA; London
Stock Exchange: XEN) today announces that an operational review is expected to
produce annual cost savings of approximately £2m and that two new early stage
projects have entered preclinical research.


Operational Review

As a result of the good progress made by both the clinical and preclinical
biologics products acquired at the time of the Cantab merger, Xenova is now able
to apply the 'virtual' development approach, which it has used successfully with
its pharmaceutics programmes, to a major part of the biologics portfolio.  This
will allow the Company to reduce the level of in-house resources involved in the
early development and manufacturing of biologics, and will result in savings
which are expected to lower Xenova's annualised costs by approximately £2
million.


In-house capabilities that are essential to the further development of the
portfolio, or which cannot efficiently be sourced externally, including the
pilot and early clinical phase manufacturing plant, are to be retained.


Two new projects enter preclinical research

Xenova is pleased to announce today that two further programmes, HIF-1 alpha for
cancer and a vaccine against Meningitis B, have entered preclinical research.


Hypoxia inducible factor (HIF)-1 alpha is a complex molecular structure which
plays a role in gene expression, promoting cell survival.  Xenova is currently
developing small molecule inhibitors of HIF-1 alpha, which may have anti-cancer
and anti-angiogenic activity.


Xenova is also developing a vaccine for the prevention of meningitis caused by
meningococcal group B infections, the construct of which is intended to give
protection against all Group B strains.


An R&D update will be given at the time of Xenova's announcement of its
preliminary results for the year to 31 December 2002.  The date for this
announcement is to be confirmed shortly.


Commenting on today's news, David Oxlade, Chief Executive of Xenova, said:


'Xenova remains focused on generating maximum value from its product pipeline
and breadth of science, whilst at the same time maintaining tight control over
its cost base.


'We have been particularly pleased with the progress made in the past year by a
number of our high potential drug candidates, including our most advanced drug,
tariquidar, and I am delighted to be able to announce the initiation of these
two new research programmes.'


Contacts:

UK:                                                     US:

Xenova Group plc                                        Trout Group/BMC Communications
Tel: +44 (0)1753 706600                                 Tel: 001 212 477 9007
David A Oxlade, Chief Executive Officer                 Press: Brad Miles (Ext 17) Lauren Tortorete (Ext 20)
Daniel Abrams, Group Finance Director                   Investors: Jonathan Fassberg (Ext 16) Lee Stern (Ext 22)
Hilary Reid Evans, Corporate Communications

Financial Dynamics
Tel: +44 (0)207 831 3113
David Yates/Ben Atwell


Notes to Editors


Xenova Group plc's product pipeline focuses principally on the therapeutic areas
of cancer and immune system disorders.  Xenova has a broad pipeline of
programmes in clinical development.  The Group has a well-established track
record in the identification, development and partnering of innovative products
and technologies and has partnerships with significant pharmaceutical companies
including Lilly, Pfizer, Celltech, Genentech, QLT and Millennium
Pharmaceuticals.


For further information about Xenova and its products please visit the Xenova
website at www.xenova.co.uk


For Xenova: Disclaimer to take advantage of the 'Safe Harbor' provisions of the
US Private Securities Litigation Reform Act of 1995. This press release contains
'forward-looking statements,' including statements about the discovery,
development and commercialisation of products. Various risks may cause Xenova's
actual results to differ materially from those expressed or implied by the
forward looking statements, including: adverse results in our drug discovery and
clinical development programs; failure to obtain patent protection for our
discoveries; commercial limitations imposed by patents owned or controlled by
third parties; our dependence upon strategic alliance partners to develop and
commercialise products and services; difficulties or delays in obtaining
regulatory approvals to market products and services resulting from our
development efforts; the requirement for substantial funding to conduct research
and development and to expand commercialisation activities; and product
initiatives by competitors.  For a further list and description of the risks and
uncertainties we face, see the reports we have filed with the Securities and
Exchange Commission.  We disclaim any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise.


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