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Xenova Group plc (XEN)

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Thursday 13 January, 2005

Xenova Group plc

Re Agreement

Xenova Licenses DISC-HSV and DISC-GM-CSF Vector Technologies to Oxxon


Slough, UK, 13 January 2005 - Xenova Group plc (NASDAQ: XNVA; London
Stock Exchange: XEN) today announced it has signed an exclusive
licensing agreement with Oxxon Therapeutics Ltd (Oxxon) potentially
worth up to £44 million ($83 million*) in up-front and milestone
payments, in addition to royalties on product sales.

The agreement provides Oxxon with the right to use the DISC-HSV
Vector (Disabled Infectious Single Cycle - Herpes Simplex Virus) in a
number of specified indications in the areas of oncology and
infectious diseases.  Oxxon also has the option to further, as yet
unspecified, indications subject to payment of additional fees.  The
agreement includes global development, manufacturing and marketing
rights to DISC-GM-CSF, an oncology product developed using the
DISC-HSV Vector platform which has successfully completed a Phase I
dose-escalating safety study.  Xenova retains the rights to the
DISC-PRO vaccine programme for the prophylaxis of herpes virus
diseases.

Oxxon will pay Xenova an upfront fee spread over 24 months and
milestone payments on the first four products to complete
commercialisation, potentially worth up to £44 million ($83
million).  Royalties will be paid on future sales of all products
derived from the DISC-HSV Vector platform.

David Oxlade, Chief Executive Officer of Xenova said: "This new
license is in line with Xenova's strategy of focusing on its
prioritised products and maximising the value of other assets in the
pipeline through out-licensing.  Xenova's DISC-HSV Vector platform
provides an excellent strategic fit with Oxxon's proprietary
Heterologous PrimeBoost system and enables this promising technology
to be actively progressed with appropriate resources and expertise."

Notes to Editors

DISC-HSV Vector Platform
The DISC-HSV (Disabled Infectious Single Cycle - Herpes Simplex
Virus) Vector platform was designed for the safe delivery of
heterologous genes to the immune system in order to stimulate a
comprehensive range of immunological responses, including helper and
cytotoxic T cell responses.  The virus is genetically inactivated
through the deletion of a single gene from the genome that is
essential for the reproduction of the virus.

The DISC-HSV vector has a number of features, which may offer
significant advantages over alternative vector systems.  These
include the ability to target cell types for which other vectors have
proved unsatisfactory and the capacity to carry and deliver large
amounts of foreign DNA.

In addition, they combine the immunological advantages of
conventional live virus vaccines with the safety normally associated
with chemically inactivated or subunit vaccines.  DISC-HSV Vectors
also have potential for generation of effective immune responses
after direct administration to mucosal surfaces, which may be an
important element of protection against pathogens that enter the body
at those sites.

These characteristics, coupled with the inability of the DISC-HSV
Vector to replicate within the body and its excellent safety profile,
demonstrated in extensive pre-clinical and clinical trials of
DISC-HSV as a vaccine, indicate that the DISC-HSV Vector has
considerable potential for the development of a number of new product
opportunities.

DISC-GM-CSF
DISC-GM-CSF (Granulocyte Macrophage Colony Stimulating Factor) is an
immunotherapy product that uses the DISC-HSV Vector to deliver the
GM-CSF gene to tumour cells.  GM-CSF is a cytokine and a potent
stimulator of immune responses.    DISC-GM-CSF has broad potential
for use across a wide range of solid tumour types.

In pre-clinical studies, DISC-GM-CSF was shown to be effective in
models of breast, renal and colorectal cancer.  The product was
capable of inducing regression when injected directly into these
tumours in vivo, and this regression was mediated by the induction of
an anti-tumour immune response.

DISC-GM-CSF successfully completed a Phase I dose-escalating safety
study at three centres in the UK, in patients with metastatic
melanoma.  DISC-GM-CSF was found to be well tolerated, with no
serious adverse events reported.  Following injection it was not
possible to retrieve DISC-GM-CSF from either the injection site or
from the patients' serum, showing that the DISC Vector was localised
and had not spread beyond the required therapeutic area.
              ________________________________________

Xenova Group plc is a UK-based biopharmaceutical company focused on
the development of novel drugs to treat cancer and addiction with a
secondary focus in immunotherapy.  The Company has a broad pipeline
of products in clinical development, including three cancer
programmes:  its lead product TransMID(TM), for the treatment of
high-grade glioma, is in Phase III trials, and its novel DNA
targeting agents and XR303 are both in Phase I for cancer
indications.  Xenova is also developing two therapeutic vaccines for
cocaine and nicotine addiction, which are in Phase II and Phase I
trials respectively.  Quoted on the London Stock Exchange (XEN) and
on NASDAQ (XNVA), Xenova employs approximately 75 people throughout
its sites in the UK and North America. (Reuters XEN.L; Bloomberg XEN
LN)
For further information about Xenova and its products please visit
the Xenova website at www.xenova.co.uk.

Oxxon Therapeutics is a mid-stage biotechnology company developing a
portfolio of immunotherapeutics for infectious disease and cancer
based on its proprietary Heterologous PrimeBoost approach. Founded in
1999 as a spin out from the University of Oxford, Oxxon has already
advanced its products for the treatment of melanoma and hepatitis B
to Phase II clinical trials, and has a number of pre-clinical
products in development on its own or through collaborations.  For
further information about Oxxon please visit www.oxti.com.


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 development and commercialization of
products. Various risks may cause Xenova's actual results to differ
materially from those expressed or implied by the forward looking
statements, including: our dependence upon strategic alliance
partners to develop and commercialize products and services.  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.

* US Dollar amounts have been translated at a rate of £1.00:$1.88
purely for information


Contacts:

Xenova Group plc
+44 (0)1753 706600
David A Oxlade, Chief Executive Officer
Daniel Abrams, Finance Director
Veronica Cefis Sellar, Head of Corporate Communications

UK - Financial Dynamics
+44 (0)20 7831 3113
David Yates
Ben Atwell

US - Trout Group/BMC Communications
+1 212 477 9007
Media: Brad Miles
Investors: Lee Stern

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