The consideration for the Acquisition comprises a base consideration of £14.3m (the “Base Consideration”) and a deferred contingent consideration of between £1.6m and £2.1m (the “Deferred Contingent Consideration”).  The Deferred Contingent Consideration will be payable if the ImmuCyst^® licence is extended beyond 31 March 2012, with the actual amount payable being dependent on the level of sales of ImmuCyst^® during 2010 and 2011.  The Base Consideration comprises an initial payment of £10.2m at Completion, three further cash payments of £0.4m in March 2010 and £1.1m each in June and October 2010 (the “Deferred Payments”) and a £1.5m cash payment upon completion of the Deferred Transfer (the “Deferred Transfer Payment”).  The amount of the Deferred Payments may be adjusted up or down depending on the level of sales of the toxicology product before Completion. Payment for the inventory, which is expected to cost approximately £1.4m, will be in cash within one month of Completion. 

The Base Consideration is to be satisfied as to £7.5m by way of a vendor share placing (the "Placing") with the remainder in cash.  28,846,154 new ordinary shares of 1 pence each in the capital of Alliance ("Placing Shares") have been conditionally placed with certain existing and new UK investors by Numis Securities Limited (“Numis”) at a placing price of 26.0 pence per share (the “Placing Price”).

To fund the cash element of the Acquisition due at Completion and the Deferred Transfer Payment, Lloyds Banking Group is providing an additional £4m term loan and has increased the existing £5m working capital facility to £6m. The Company expects to fund the Deferred Payments and the Deferred Contingent Consideration, if applicable, through the working capital facility and internal cash generation.

The Acquisition and the Placing are conditional upon, inter alia, the placing agreement between the Company and Numis becoming unconditional and not being terminated and the admission of the Placing Shares to AIM ("Admission").  Application will be made for the 28,846,154 Placing Shares to be admitted to AIM and it is expected that dealings in the shares will commence on 22 February 2010. Upon Admission, the Placing Shares will rank pari passu in all respects with the existing Ordinary Shares in issue. Following Admission, the total number of Ordinary Shares in the Company with voting rights in issue will be 222,165,552.

For further information:

Alliance Pharma plc                 +44 (0) 1249 466966

John Dawson, Chief Executive

Richard Wright, Financial Director

www.alliancepharma.co.uk

Buchanan Communications     +44 (0) 207 466 5000

Mark Court/Stasa Filiplic/Jennie Spivey

Numis Securities Limited        +44 (0) 207 260 1000

Nominated Adviser: Michael Meade/Brent Nabbs

Corporate Broking: David Poutney