Interim results for the six months to 30 June 2014

Oxford Pharmascience Group plc

("Oxford Pharmascience" or "the Company")

Interim results for the six months to 30 June 2014

Oxford Pharmascience Group Plc is pleased to announce its unaudited interim results for the six months to 30 June 2014.

HIGHLIGHTS

• Positive results of pilot clinical study to determine the extent of upper gastrointestinal irritation of the Company's OXP001 400mg ibuprofen tablet compared with standard ibuprofen by endoscopic evaluation, with optimisation work required to achieve bioequivalence.

• As well as ibuprofen, we now expect the platform will deliver across the vast non-steroidal anti-inflammatory drugs (NSAIDs) category gastric safer naproxen, diclofenac and potentially aspirin.

• Refocusing of activities to fine tune the release properties of the NSAID technology and validate its application across the four most commonly used NSAIDs.

• Recent work on NSAIDs has created further opportunities to strengthen the Company's intellectual property across the NSAIDs platform.

• Cash and cash equivalents at 30 June 2014of £8.2m (2013: £6.6m, 31 December 2013: £9.9m.).

• Loss before tax for the period of £1.7m (2013 loss before tax: £0.6m), reflecting scale-up of the NSAIDs programme.

Marcelo Bravo, Chief Executive Officer, commented:

"We are pleased with the positive developments made during the first half of 2014 and subsequently, have seen the Company progress significantly with its gastric safe NSAIDs programme. The highlight of the period was the positive outcome of our first in-human pilot study with gastric safe taste masked ibuprofen and subsequent refocusing of activities to capitalise on the significant opportunities presented by this technology."

For further information:

Oxford Pharmascience Group Plc

Marcelo Bravo, Chief Executive +44 20 7554 5875

N+1 Singer

Aubrey Powell / Jen Boorer +44 20 7496 3000

OVERVIEW

We are pleased with the positive developments made during the first half of 2014 and subsequently, have seen the Company progress significantly with its gastric safe NSAIDs programme. The highlight of the period was the positive outcome of our first in-human pilot study with gastric safe taste masked ibuprofen and subsequent refocusing of activities to capitalise on the significant opportunities presented by this technology. Optimisation work required to achieve bioequivalence compared to reference is near completion.

In June this year, the Company announced the positive results of its pilot clinical study of reduced gastric irritation ibuprofen. Specifically, the Company's ibuprofen tablet exhibited a dramatic and statistically significant reduction in gastrointestinal irritation ("GI") compared to standard ibuprofen tablets, as measured by: (1) the overall Lanza score in the stomach and duodenum(a standard measurement scale for gastrointestinal erosions); and (2) significantly fewer erosions observed separately in the stomach and duodenum.

Following these encouraging results and significant interest from industry, the Company prioritised its activities to improve the drug release profile of the technology and to accelerate the application of the technology across the four most commonly used NSAIDs, namely ibuprofen, naproxen, diclofenac and aspirin.

The Company has recently announced that it has successfully synthesized gastric safe taste masked naproxen at lab scale and is progressing to manufacturing scale-up and readiness for clinical proof of concept trial. Naproxen, alongside ibuprofen and diclofenac (for which the Company also has a gastric safe taste masked drug in advanced development) are the three most commonly used NSAIDs worldwide for the treatment of pain and inflammation. Importantly, the company has also made huge strides in developing gastric safe aspirin which opens a further separate significant opportunity for the Company. Aspirin is widely used as an antiplatelet agent in cardiovascular disease prevention and its use is limited by these gastric risks. The Company's reformulated aspirin directly addresses this problem and has the potential to disrupt the market.

The Company has also made significant progress in optimizing the release profile of the technology and expects to announce in Q4 2014 the timing of a return to the clinic to provide further proof of the gastric safe benefits of the Company's version of ibuprofen. Alongside this, development work has been ongoing to prepare other NSAIDs for clinical trials. Noteworthy, the work of the past few months has created further opportunities to strengthen intellectual property across its NSAIDs platform.

As a result of these recent developments, the Company's strategy has naturally evolved, seeking the fastest route to significant value creation. The evolved strategy increases the potential licensing scope and value of applying our technology across multiple products in both the anti-inflammatory pain relief and cardiovascular disease prevention categories. The Board now believes that a range of clinical stage commercial assets in the NSAIDs space both for the OTC and prescription markets offers the best opportunity over the development and licensing of single products.

FINANCIAL RESULTS

Our revenue for the six months to 30 June 2014 was £336k (2013: £501k), the majority derived from our partnership with Ache Laboratorios ("Ache") in Brazil. The lower revenue in the first half compared to 2013 was due to logistical delays experienced by our partner in Brazil. Furthermore the launch of a new line extension by Ache has now been postponed to 2015. While the run-rate for the Ache business continues to show positive momentum, the combined effect of the above two factors means that the Company now expects revenue for the full year to be slightly down on last year.

Our loss before tax was £1.7m (2013: loss of £0.6m), this increase is a result of the scale up of our Safer NSAIDs development programme and primarily reflects expenditure for the clinical proof of concept trial conducted in the period. Cash and cash equivalents at the half year-end totalled £8.2m (2013: £6.6m). Cash management and tight cost control continue to be a priority for the business.

R&D costs are running lower than originally anticipated due to the timing of our development work on both NSAIDs and statins. The Company's Safestat (statins) programme remains a compelling opportunity but the near-term focus of the Company's resources is currently on NSAIDs.

OUTLOOK

We are excited by the new phase we are entering as the Company gets closer to initiating commercialisation of its lead NSAID assets. We are now prioritising our work to demonstrate that reduced gastric irritation is a class effect for NSAIDS formulated using our technology and also to establish comparable absorption vs. the standard (generic) reference. In the next six months the Company is initiating work to establish the value and scope of these assets while in parallel progressing development activities with focus on the NSAIDs programme. We continue to benefit from a strong pipeline of platform technologies backed up with strong IP protection.

Our immediate priority is to run further proof of concept trials with ibuprofen and to get other NSAIDs ready for the clinic. Our medium-term aim is to initiate commercialisation of these assets upon the completion of various clinical and non-clinical milestones.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

The loss for the year arises from the Group's continuing operations.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Approved by the Board and authorised for issue on 29 September 2014.

Marcelo Bravo Chris Hill

Chief Executive Officer Chief Financial Officer

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

NOTES TO THE CONDENSED FINANCIAL STATEMENTS

1) BASIS OF PREPARATION

The interim financial statements of Oxford Pharmascience Group Plc are unaudited condensed consolidated financial statements for the six months to 30 June 2014. These include unaudited comparatives for the six months to 30 June 2013 together with audited comparatives for the year to 31 December 2013.

The Company was incorporated on 7 October 2009 as Oxford Nutrascience Group Plc and changed its name to Oxford Pharmascience Group Plc on 19 May 2011. The Company was specifically created to implement a re-organisation in relation to Oxford Pharmascience Limited (formerly Oxford Nutrascience Limited) which would permit admission of the Group to the AIM market. Under the re-organisation, Oxford Pharmascience Limited became a wholly owned subsidiary of Oxford Pharmascience Group Plc on 27 January 2010.

Shareholders in the company at the time of the re-organisation received shares in Oxford Pharmascience Group Plc in the same proportionate interest as they had in Oxford Pharmascience Limited. The business, operations, assets and liabilities of the Oxford Pharmascience Group under the new holding company immediately after the re-organisation were no different from those immediately before the re-organisation and the Directors have therefore treated this combination as a simple re-organisation using the pooling of interests method of accounting.

The condensed consolidated financial statements do not constitute statutory accounts. The statutory accounts for the year to 31 December 2013 have been reported on by the auditors to Oxford Pharmascience Group Plc and have been filed with the Registrar of Companies. The report of the auditors was unqualified and did not contain a statement under section 498 of the Companies Act 2006.

2) SIGNIFICANT ACCOUNTING POLICIES

The condensed consolidated financial statements have been prepared under the historical cost convention in accordance with International Financial Reporting Standards as adopted by the European Union.

The accounting policies adopted are consistent with those followed in the preparation of the annual financial statements of Oxford Pharmascience Group Plc for the year ended 31 December 2013.

3) SEGMENTAL REPORTING

Primary reporting format - business segments 

At 30 June 2014, the Group operated in one business segment, that of the development and commercialisation of medicines via reformulation using advanced pharmaceutic technologies to add value to generic and soon to be generic drugs. All revenues have been generated from continuing operations and are from external customers.

Secondary reporting format - geographical segments

The Group operates in four main geographic areas, although all are managed in the UK. The Group's revenue per geographical segment is as follows:

All the Group's assets are held in the UK and all of its capital expenditure arises in the UK.

4) TAXATION

The Group has accumulated losses available to carry forward against future trading profits. No deferred tax asset has been recognised in respect of tax losses since it is uncertain at the balance sheet date as to whether future profits will be available against which the unused tax losses can beutilised.

5) LOSS PER SHARE (BASIC AND DILUTED)

Basic loss per share is calculated by dividing the loss attributable to equity holders of the parent by the weighted average number of ordinary shares in issue during the period. Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares in issue during the period to assume conversion of all dilutive potential ordinary shares.

The Company has issued employee options over 80,875,000 ordinary shares which are potentially dilutive. There is however, no dilutive effect of these issued options as there is a loss for each of the periods concerned.

6) SHARE CAPITAL

As permitted by the provisions of the Companies Act 2006, the Company does not have an upper limit to its authorised share capital.

The acquisition of Oxford Pharmascience Limited in 2010 has been accounted for as a re-organisation using the pooling of interests method of accounting as set out in note 1 to these financial statements and under which the shares issued by the Company are recorded at nominal value together with an amount established as Merger reserve in order to replicate the total issued capital of Oxford Pharmascience Limited as at the acquisition date.

7) RELATED PARTY TRANSACTIONS

There are no sales to related parties. Purchases from related parties are made at normal market prices. Outstanding balances at the period end are unsecured, interest free and settlement occurs in cash.

During the six month period to 30 June 2014 consultancy fees of £nil (six months to 30 June 2013: £2k, year ended 31 December 2013: £3k) have been charged in respect of ORA Capital Partners Limited which used to be a substantial shareholder in Oxford Pharmascience Group Plc.

During the six month period to 30 June 2014 consultancy fees of £nil (six months to 30 June 2013: £nil, year ended 31 December 2013: £10k) have been charged in respect of Quoram Plc, a company of which Christopher Hill is also a director.

During the six month period ended 30 June 2014, the Company entered into numerous transactions with its subsidiary company which net off on consolidation - these have not been shown.

In addition, during the period the Company paid remuneration to the Directors' in accordance with their service contracts and letters of appointment.

8) INTERIM FINANCIAL REPORT

A copy of this interim report will be available on the Company's website at www.oxfordpharmascience.com