Provisional Award of Innovate UK Grant

Physiomics plc

The Magdalen Centre

The Oxford Science Park

Robert Robinson Avenue

Oxford

OX4 4GA

UK

Tel 01865 784980

Fax 08701 671931

Physiomics plc

("Physiomics") or ("the Company")

Provisional Award of Innovate UK Grant

Physiomics plc (AIM: PYC), the Oxford, UK based systems biology company, is pleased to announce that it has been notified of Innovate UK's intention to award the Company a grant for its proposed project "Decision Support Systems For Stratified Cancer Treatment", as part of Innovate UK's Biomedical Catalyst 2016 Feasibility Study Competition, co-funded by Scottish Enterprise and the Medical Research Council.

In line with the Company's strategic objective to explore the personalised medicine market set out in the full year results RNS published on the 27th October 2016, the objective of the project is to create a prototype decision support system to improve cancer care by helping medical professionals make treatment decisions based on patient specific data.

The project would be executed in close collaboration with the Oxford Academic Health Science Network and academic collaborators including Professor Mark Middleton, Professor of Experimental Cancer Medicine and Lead Cancer Clinician for the Oxford University Hospitals NHS Foundation Trust and deputy director of the Cancer Research UK Oxford Centre.

A Biomedical Catalyst Feasibility Study grant covers 70% of the costs of projects up to £200k in value. The award of the grant, including the precise level of funding, remains subject to the submission of detailed project plans as well as a financial review by Innovate UK and the definitive award is likely to be made in Q1 2017. Accordingly, whilst the directors are confident that the grant will be issued there can be no guarantee it will be, until the plans are approved. Further announcements will be made in due course.

Further information on the Competition can be found here: https://www.gov.uk/government/publications/funding-competition-biomedical-catalyst-2016/competition-brief-biomedical-catalyst-2016-feasibility-studies-award

Enquiries:

Physiomics plc

Dr Jim Millen, CEO

+44 (0)1865 784 980

WH Ireland Limited (nomad)

Katy Mitchell

+44 (0) 161 832 2174

Hybridan LLP (broker)

Claire Louise Noyce

+44 (0) 203 764 2341

About Physiomics plc

Physiomics (AIM:PYC) is a computational systems biology services company applying simulations of cell behaviour to drug development to reduce the high attrition rates of clinical trials. 80-90 per cent of all clinical drug candidates fail to reach the market and estimates show that an overall ten per cent improvement in success rates could reduce the cost of one drug's development by as much as $242 million, from the current estimate of around $800 million1.

Physiomics develops computational systems biology models to predict and understand cancer drug efficacy from pre-clinical research to clinical development. Physiomics has created detailed mathematical models incorporating the most important molecular events taking place during the human cell cycle and apoptosis processes. The company's SystemCell® technology enables the simulation of populations of "virtual cells". The company has also developed a "Virtual Tumour" model to simulate the effect of anti-cancer drugs on tumour growth. The models are used to optimise compound design and to design drug schedules and combination therapies.

Physiomics, based in Oxford, UK, was founded in 2001, and floated on AIM in 2004. For further information, please visit www.physiomics-plc.com

SystemCell® is a registered trademark of Physiomics plc

1Tufts Centre Impact Report 2002