LIPOXEN SIGNS $75MIL PACT TO DEVELOP BLOOD CLOTTING FACTORS.

Lipoxen PLC (AIM: LPX), London, U.K., has entered into an exclusive worldwide development and license agreement with a subsidiary of Baxter International Inc. to develop improved, longer-acting forms of blood-clotting factors.

The signing of this agreement by Baxter triggers a $1 million payment to Lipoxen, and the agreement includes further clinical and regulatory milestone payments to Lipoxen potentially worth up to a total of $75 million, plus royalties on future product sales.

This announcement follows a 12-month research evaluation announced 15 August, 2005, that focused on linking Lipoxen's PolyXen(r) drug delivery technology with Baxter's proprietary proteins.

Lipoxen's PolyXen(r) protein drug delivery technology links therapeutic proteins, or peptides, to the naturally occurring polymer polysialic acid to prolong protein stability and biological half-life, and to improve solubility and immunological characteristics while maintaining biological activity and minimizing toxicity. Conjugating PolyXen(r) to therapeutic blood-clotting factors aims to improve pharmacokinetic profile and extend active life in order to reduce the frequency of injections required to treat blood-clotting disorders such as haemophilia A.

M. Scott Maguire, CEO of Lipoxen, said: "We are very excited to sign this significant agreement with Baxter, our second major development agreement in the past year. Over the course of the 12-month evaluation period, our PolyXen(r) technology has indicated its potential for improving the delivery and effectiveness of Baxter's proprietary proteins and thereby represents an important validation of this protein drug delivery technology."

"Our agreement with Lipoxen furthers Baxter's legacy of scientific innovation and leveraging partnerships in the area of blood-free recombinant protein processing," said Hartmut J. Ehrlich, MD., vice president, global research and development, for Baxter's BioScience business. "Extending the duration of a blood-clotting treatment in the body is important for both patients and physicians when evaluating haemophilia therapy."

Lipoxen PLC (LSE:LPX) is a biopharmaceutical company specializing in the development of high value differentiated biologicals, vaccines and oncology drugs. Potential products, which address markets in excess of US$1 billion, currently under development include improved formulations of important biologicals including EPO, G-CSF, insulin and Interferon-alpha based on Lipoxen's proprietary PolyXen(r) technology. This technology is designed to improve the stability, biological half-life and immunologic characteristics of therapeutic proteins naturally. Lipoxen has two further naturally-derived proprietary delivery technologies ImuXen(r) and a related liposomal technology for the formulation of cytotoxic oncology drugs, which are being developed to enhance the efficacy and safety of various vaccines such as Hepatitis B and pneumococcal vaccines, as well as a number of anti-cancer agents like paclitaxel. The company's proprietary delivery technologies are attracting significant interest and Lipoxen is already co-developing products with The Serum Institute of India, one of the world's leading vaccine companies. In addition, its technologies are being currently evaluated by leading biotechnology companies such as Baxter, Amgen, Genzyme and Genentech.