ValiRx Regulatory News (VAL)

ValiRx Plc

("ValiRx" or the "Company")

Re: GeneICE and Biomarkers Development Update

ValiRx Plc (AIM: VAL), a life science company with a focus on cancer diagnostics and therapeutics for personalised medicine, is pleased to provide an update on progress regarding its revolutionary GeneICE technology (or "Gene inactivation by chromatin engineering"), ValiRx's proprietary gene-silencing technology which has been developed for silencing or "freezing" rebellious genes, which cause conditions such as cancer and various neurological problems. GeneICE based lead compound VAL 101 has shown good progress in the preclinical phase and the development programme is going ahead as planned.

GeneICE and VAL101 Preclinical Validation

The Eurostar Programme, a two year grant of €1.2 million awarded to an international consortium ("the consortium") led by ValiRx to develop the GeneICE technology, has now been completed. The final reports on the scientific and developmental results from the programme are being compiled for submission and under the terms of the contract, this data will trigger the release of final payments to the consortium from the grant.

Significant progress has been made in all areas.

As previously reported, the manufacturing of the GeneICE compounds has been significantly optimised and simplified, which by extension makes the compound cheaper to produce, thereby adding future value. The production of the lead compounds from this part of the programme is about to be upgraded for GMP production.

In addition, a number of unique target sequences have been identified for future potential therapeutic development.

In connection with the lead therapeutic programme and using the GeneICE VAL101 formulation, work has been carried out at Imperial College, University of London, from whom the technology was originally licensed, that has been shown to effectively deliver the compounds as desiredand has efficacy in killing cancer cells in several systems. The agreement with Imperial College has been extended and Imperial College will continue with the further development of this cancer therapeutic work.

GeneICE Validation

The validation of the optimised version of VAL101 in cellular systems has been concluded and they show results that are in line with predictions, as far as the shutting down of particular rebellious genes are concerned, thereby halting and reversing tumour growth.

Various other demonstration and potentially therapeutic GeneICE constructs have also been produced and tested. The results obtained are in line with predictions. In parallel with this activity, a number of new and novel methods have been developed, that are being useful in the advancement of the compound and in its future trialling, as well as in research for further applications for GeneICE.These methods will permit clearer and more cost effective outcome monitoring and the completion of the late stage pre-clinical validation of Val101.

Dose ranging studies with the lead compound and its delivery systems are underway and a refined ADME toxicology programme has been developed that will be undertaken in conjunction with the later stage development.

Biomarkers

The establishment of our subsidiary, ValiRx Finland OY ("ValiFinn"), in Finland and the acquisition from Pharmatest Services Oy ("Pharmatest") of Oulu, Finland, of its biomarkers business unit together with several families of patents and patent applications and related intellectual property ("IP") has provided the Group with both an increased exposure to the Biomarker market, a key and increasingly exciting field within our industry, but also to a revenue stream, derived from the provision of contract services.

The Company has built on this specialist biomarker expertise to develop its own companion diagnostic biomarkers to complement ValiRx's therapeutics, its existing intellectual property and its companion diagnostic activities, as well as marketing that expertise for the development programmes of other companies. This activity has attracted interest from a number of organisations and the company is progressing various opportunities.

Dr Satu Vainikka, CEO, commented: It is very encouraging to see GeneICE, VAL101 and our biomarker development programme progressing so well.  GeneICE is a platform technology, and as such, it has the potential to produce a whole pipeline of compounds for the treatment of a wide range of neurological and inflammatory diseases. We are also very pleased, as announced, to be working with World-class institutions such as Imperial College, the Institut Paoli & Calmettes in Marseille, France and various academic institutions in Finland, which represent a centre of excellence for molecular oncology, to build expertise and knowledge in the Cancer space and to effectively leverage off this unique exposure to such a scientific base".

- ENDS -

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Notes for Editors

ValiRx Plc

ValiRx Plc is a biopharmaceutical company developing novel technologies and products in oncology therapeutics and diagnostics. The product focus is in the epigenomic analysis and treatment of cancer, but the technologies can be applied to other fields as well, such as neurology and inflammatory diseases.

The Company listed on AIM in October 2006 and is creating a portfolio of innovative products through investment in specific development projects. It actively manages projects within this portfolio as a trading company and is not an investment vehicle. The ValiRx business model spreads the risks of life science technology developments by minimising financial exposure and running a set of projects to defined commercial endpoints. This maximises returns to shareholders by adding value at the earlier stages where value increases per investment unit are the greatest.

The Company operates through the following divisional companies:

 ValiMedix is the sales and distribution division of ValiRx

 ValiPharma is the therapeutics division with two

Background to GeneICE & Eurostars

In June 2009, ValiRx, as the leading partner of an international consortium of three companies, was awarded a two year grant by Eurostar against substantial competition from across Europe, to develop its GeneICE technology ("GeneICE" or "Gene inactivation by chromatin engineering"), in which "rebellious genes", which cause problems such as cancer and potentially some neurological problems, are shut down or "put on ice".

The Eurostars programme is a EU grant scheme and EUrEKa Network initiative, created with the purpose of providing funding for market-oriented research and development activities by Small and Medium-sized Enterprises within the EU.

ValiRx successfully led the funding application with GenoSyst (Finland) and PentaBase (Denmark) under the 2nd call to the Eurostars joint Programme, for design optimisation, lead selection and pre-clinical testing of GeneICE. The application was rated second in the UK and Finland and first in Denmark, coming in 4th overall out of over 500 applicants within the EU wide scheme.

The technology is under license from Imperial College, University of London and it has been shown to be effective against several cancer cell lines, including prostate cancer, ovarian cancer, pancreatic cancer and lung cancer. ValiRx retains all commercial rights for GeneICE from the programme.

The GeneICE development plan has four principal goals:

1. Identification of specific genomic DNA sequences associated with proven cancer targets.

2. Design and optimisation of the anti-gene system to silence the aberrant genes

3. Evaluation of desired and potential off-target effects

4. Pre-clinical development of an optimised lead therapeutic against a selected target

Background on Biomarkers (Sources: BCC Research and researchandmarkets 2010/2011)

Biomarkers in Cancer Research 2010 stated that the use of Biomarkers in Oncology Therapeutics is one of the biggest application areas with main emphasis on predictive and personalized medicine.

The global cancer biomarkers market for 2007 was estimated to be $3.6 billion and is expected to grow at a CAGR (Compounded Annual Growth Rate) of 6.3% to reach $6.3 billion by 2016.

This growth is primarily attributed to the rise in the number of biomarker tests in a wide variety of Cancer types.

In the future, the growth of personalized medicines and the strong support from regulatory agencies such as the FDA will be the two major factors that will drive the demand for biomarkers, particularly in cancer research.

Personalized medicines are gaining popularity due to their ability to provide customized treatment to patients based on their genetic as well as medical profile. Since biomarkers help in predicting patient response to a compound, personalized medicine are increasingly using biomarkers to identify the patient population set that is more likely to respond to a particular drug therapy. Personalized medicines are also increasingly being used in targeted cancer therapies. Thus, going forward, as personalized medicines gain more importance and popularity, the demand for biomarkers is also expected to increase.