Sareum Holdings plc (AIM: SAR), the structure-based drug discovery and services business admitted to AIM in October 2004, is pleased to announce that it has entered into a collaborative agreement with Millennium Pharmaceuticals, Inc. to generate chemical compound libraries to support drug discovery programmes at Millennium.

Under the terms of the agreement, which is on a fee-for-service basis, Sareum will utilise its skills in computational chemistry, automated medicinal chemistry and high-throughput purification to design and synthesise a library of compounds for Millennium to screen against their drug targets. Financial terms were not disclosed.

Commenting on the agreement, Sareum's Chief Executive Officer, Dr Tim Mitchell, said: "This is the second collaboration that the Company has announced since admission to AIM just six weeks ago and we are delighted that Millennium has chosen Sareum to provide these drug discovery services. This is a very exciting project and we look forward to a successful delivery."

For further information:

Sareum Holdings 01223 497700
Tim Mitchell, Chief Executive Officer

Buchanan Communications 020 7466 5000
Mark Court, Mary-Jane Johnson

Notes for editors:

About Sareum Holdings plc

Sareum Holdings plc is a structure based drug discovery business headquartered in Cambridge, UK. The Company was formed in August 2003 to discover new drugs for the treatment of cancer and inflammation and to provide a range of drug discovery services to the pharmaceutical industry. Sareum's unique approach aims to halve the time it takes to discover new drug candidates. Structure-based drug discovery involves the determination of a disease causing protein's three-dimensional structure. Once the structure is known, novel chemical entities are designed to 'lock-in' to the protein with the aim of reversing or arresting a disease's progression.

Sareum's approach to structure based drug discovery is to produce multiple recombinant proteins primarily through a baculovirus expression system; determine their structure using x-ray crystallography; and then use the Company's computational chemistry expertise to create virtual, focused libraries of new chemical entities designed to interact with the target protein. Sareum then uses its high-throughput medicinal chemistry platform to rapidly synthesise these molecules and develop the most promising into potential drug candidates.

Sareum offers its accelerated drug discovery capabilities on a fee basis to the pharmaceutical and biotechnology industries and has recently signed a collaborative agreement with Inpharmatica Ltd. Sareum also intends to license out its internally generated drug candidates at the Phase I or Phase II clinical trials stage.

Sareum joined the Alternative Investment Market of the London Stock Exchange in October 2004 and trades under the symbol SAR.