Norwood and AWI Sign Agreement for Next Phase of Development Program for Delivery of Chemical Mulesing Protein.

MELBOURNE, Australia -- Norwood Abbey Limited (OTC:NABYF) (ASX:NAL):

Key points:

--Norwood enters into next phase agreement with AWI for a needle-free delivery system

--AWI funding phase 2 development project

--Prototype complete and preliminary trial on live sheep successful

--Next stage of needle-free delivery system testing in sheep to commence in September 2005

Norwood Abbey Limited (OTC:NABYF) (ASX:NAL) today announced that it has entered into an agreement with Australian Wool Innovation Limited (AWI) for the next phase of development of its needle-free delivery system to deliver a chemical mulesing agent (protein) into sheep.

The agreement relates to the Phase II development and testing of the device which is designed to deliver substances by way of an application technology that can effectively substitute for surgical mulesing.

AWI is funding the Phase II development project.

The Phase II development project will develop a needle-free injector for drug delivery and has two main stages:

--The first stage will develop a needle-free injector for administering the mulesing protein

--The second stage will test this injector on live sheep (this is in addition to studies already successfully completed)

The first stage is complete. The second stage of the program will involve testing of the prototype device in sheep and is scheduled to commence in September 2005. Ethics approval for this second stage of testing has been granted.

As previously reported the Bioinstrumentation Laboratory at Massachusetts Institute of Technology in Boston (MIT) has produced the first hand-held working prototype of a needle-free drug delivery device. In recent trials at MIT, the prototype device has successfully delivered the protein into sheep skin in the laboratory. Additionally, in preliminary trials on sheep, the hand-held prototype device delivered the protein to an animal. Based on the trial parameters and examination of biopsied skin samples, the trial was deemed to be a success.

AWI Animal Health and Welfare Program Manager Dr. Scott Williams said that preliminary trials on sheep using the needle-free prototype gave the equivalent results as conventional needle delivery.

"This is really exciting news and we are now moving into proof-of-concept trials for this particular injection device with Norwood Abbey," he added.

Following the completion of the testing and assuming all milestones are achieved, a detailed brief and proposal will be prepared for the final product development and commercialisation phase of the needle-free mulesing injector system.

Subject to the success of further trials of both the protein and applicator, the final product could be commercially available as early as 2007.

Currently surgical mulesing is performed on approximately 15 million sheep a year and has been shown to prevent 90-100% of cases of breech flystrike. However AWI has initiatives underway to develop better flystrike prevention and control, including viable alternatives to surgical mulesing.

For further information on Norwood Abbey, visit www.norwoodabbey.com.