making tomorrow’s medicines
Cobra Biomanufacturing Plc
Annual Report and Accounts 2006
for the year ended 30 September www.cobrabio.com
62235 Cobra cover  25/1/07  17:04  Page c1 Contents
Page
Financial Highlights 1
Chairman’s Statement 2
Chief Executive’s Review 3
Financial Review 4-7
Board of Directors 8
Senior Management Team 9-10
Report of the Directors 11-15
Corporate Governance Statement 16-17
Report on Directors’ Remuneration 18-22
Report of the Auditors 23
Group Profit and Loss Account 24
Balance Sheets 25
Group Statement of Cash Flows 26
Reconciliation of Net Cash Flow to
Movement in Net (Debt)/Funds 26
Notes to the Financial Statements 27-42
Notice of Annual General Meeting 43-44
Shareholder Information 45-47
Directors and Advisors 48
Glossary of Terms 49
62235 Cobra cover  25/1/07  17:04  Page c2 Cobra Biomanufacturing Plc 1
Financial Highlights 2006
Turnover
FY 2006 up 31% to £10.1m (FY 2005: £7.7m)
1.0
0.0
2.0
(1.0)
(2.0)
4.0
3.0
2.0
1.0
0.0
Sep 2004 Sep 2005 Sep 2006
8.0
10.0
12.0
6.0
2.0
4.0
0.0
FY 2004
FY 2004
FY 2005
FY 2006
FY 2005 FY 2006
0.0
(1.0)
1.0
(2.0)
(3.0)
FY 2004
FY 2005 FY 2006
(3.0)
Cash at bank (including short term deposits)
30 Sept 2006 £3.2m (30 Sept 2005: £3.0m)
4.0
3.0
2.0
1.0
0.0
FY 2004 FY 2005 FY 2006
Capital investment
FY 2006 £1.5m (FY 2005: £0.8m)
Profit before tax
FY 2006 £0.2m profit (FY 2005: £0.4m loss)
Operating cash flow
FY 2006 £1.2m inflow (FY 2005: £0.6m inflow)
2.0
1.0
0.0
Sep 2004 Sep 2005 Sep 2006
Deferred income
30 Sept 2006 £1.2m (30 Sept 2005: £0.4m)
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 1 The financial results for the year ended 30 September 2006
demonstrate a continued strengthening of Cobra’s
competitive position. Turnover grew by 31% to a record
£10.1m (2005: £7.7m) and the Group made a profit before tax
of £0.2m (2005: £0.4m loss), generating £1.2m operating cash
(2005: £0.6m).  Cash at bank (including short term deposits) at
the year end stood at £3.2m (30 September 2005: £3.0m). The
contracted forward order book for the financial year 2007
currently stands at £6.0m (10 January 2006: £5.0m). 
North America continues to dominate with £8.7m or 85% of
turnover (2005: £6.1m) and this increase reflects both the
buoyancy of investment into the biotechnology sector in the
region, and the ability of our business development team to
successfully promote Cobra’s range of protein, virus and DNA
manufacturing services.  
Process development skills in protein particularly resulted in a
doubling of turnover relating to that product segment over
the previous year to £6.7m (2005: £3.2m), including the
completion of our first Phase III clinical programme. This
offset somewhat a lower demand for DNA, which fell by 27%
to £1.0m (2005: £1.4m).
Despite the phasing of demand for virus based manufacturing
services in 2006 to £1.9m (2005: £2.8m), the forward order
book for this product segment shows good growth potential,
with Cobra recognised as an expert in this scientifically
challenging field.  Accordingly, further investment in people
and facilities is planned at our Oxford Facility to enable all
three suites to be operating during 2007.  In order to broaden
our virus service offering we have also entered into an
agreement with an internationally recognised provider of ‘fill
and finish’ services to the biopharmaceutical industry. A
dedicated virus ‘fill and finish’ suite will be constructed and
made available to Cobra so that we can provide a seamless
service from pre-clinical through to final clinical trial dosage
form. This facility will be operational during 2007 with
customer contracts already under discussion. We will continue
to examine other ways of providing specialised services for
our customers and also stand ready to acquire additional
manufacturing capacity, subject always to confirmed demand
from our customers.
During the year we have continued to support internal
research and development initiatives to add value to our
service offering and we have filed a number of patents and
acquired certain patents to compliment existing intellectual
property.  This is a knowledge-based business and we seek to
be at the forefront of process development science to
enhance our competitive position.
In September 2006 David Bloxham retired as a Non-Executive
Director. On behalf of the Board, I would like to thank him for
his four year service; his commitment and enthusiasm for
what we are seeking to achieve has been invaluable during
these early years in the Group’s development. David Oxlade
joined as a Non-Executive Director in July 2006.  David has
worked in the biotechnology, diagnostic and therapeutic
healthcare industry for over 30 years, with CEO appointments
in the UK, Asia and North America. David’s experience will be
applied to the challenges that we face in the global market
place and I am delighted to welcome him to the Board.
Cobra’s return to profitability is a significant milestone.  We
are a Group with a broad service offering across all
biopharmaceuticals, a strong North American business
development capability and active research and development
programmes into new processes and techniques to support
our customers in developing effective products. Further
expansion will be predicated on customer demand, and given
the forward order book, continued growth in sales and
profitability should support our ambition to be a leading
provider of biomanufacturing services to the global market
place.
G Peter Fothergill
Executive Chairman
9 January 2007
Cobra Biomanufacturing Plc 2
Chairman’s Statement
Up 41% to £8.7m (2005: £6.1m)
North American Revenue
Doubled to £6.7m (2005: £3.2m)
Protein Revenue
“Cobra’s return to profitability is a significant milestone”
January 2007
62235 Cobra Report 2006  26/1/07  15:44  Page 2 Cobra Biomanufacturing Plc 3
Chief Executive’s Review
Financial year 2006 was a period of impressive progress for
Cobra.  Whilst increasing revenue to a record £10.1m (2005:
£7.7m) and moving back into profit, Cobra completed the
largest reorganisation we have ever undertaken. This
initiative has included the creation of separate research,
process science and manufacturing departments and a major
upgrade to our quality systems; thus positioning Cobra to
provide a higher level of excellence for our customers and
further our evolution towards becoming a major supplier to
the pharmaceutical industry. 
Much of this change has been fuelled by increasingly
stringent manufacturing quality standards which have been
spearheaded by the MHRA’s (the UK’s pharmaceutical
regulator) attitude to the implementation of the EU Clinical
Trials Directive which only recognises a single manufacturing
standard for all phases of clinical development and
commercial manufacture.  Our success in managing these
changes was shown this year by the completion of Cobra’s
first Phase III contract, a milestone in our history and a
remarkable achievement for the process science,
manufacturing and quality departments. The process
development and scale up programme was carried out in
record time and enabled our customer to initiate pivotal trials
in November 2006, nine months after scale up work began.
The process science department developed an efficient and
robust production process for this protein product from
scratch, enabling the customer to announce their plans for
product launch and commercial supply.
As well as consolidating our position as a protein
manufacturer, 2006 saw the potential for real growth in our
virus manufacturing business and in particular, the initiation
of a large contract with International Aids Vaccine Initiative
and GSK Biologicals (Belgium) (IAVI/GSK). This project involves
the manufacture of an HIV vaccine based on genetically
engineered chimpanzee adenovirus; a groundbreaking
technology. The selection of Cobra as lead manufacturer
recognises our track record in tackling the most challenging
projects in the industry. 
During 2006 we initiated further capital investment in our
Oxford Facility in order to enable multiple commercial scale
manufactures of virus product in three bioreactor suites.
Additionally, we constructed a further building adjacent to
the Oxford Facility to house a central storage area, additional
meeting rooms and offices for the quality department. This
investment now positions our Oxford Facility as an
international centre of excellence for large scale GMP
manufacture of virus products and for significant revenue
growth in 2007. In April 2006 we also expanded and
strengthened the US sales team with the appointment of a
sales executive in Washington DC; Cobra now has
representation close to all the major North American biotech
hubs.
Cobra continues to develop its technology base through
investment in research and development. We are
collaborating with the US Navy on a vaccine for malaria using
our proprietary oral vaccine technology ORT-VAC. The US
Navy is a major player in malaria vaccine research and is able
to bring with it significant development resources to validate
this technology. During the year Cobra was awarded a broad
patent on the ORT-VAC vaccine technology which along with
our granted patents in the USA and other major territories
gives us excellent coverage and an exciting opportunity to
gain value through out-licensing. In addition, the Group has
had a number of patents granted related to DNA
manufacture and we also acquired certain patents from
Valentis Inc., consolidating our leading position in ORT, the
antibiotic free manufacture of biopharmaceuticals in
genetically engineered micro-organisms.
We have entered the new year with the contracted forward
order book at a historic high of £6.0m and a real opportunity
to maximise the return on investment. Financial year 2006
was a record year in several respects and it is a credit to the
energy and commitment of our staff that made this year a
success against the background of rapid change within Cobra.  
Dr David Thatcher
Chief Executive
9 January 2007
Cobra signs manufacturing agreement with IAVI/GSK
for two HIV vaccine candidates
May 2006 Up 20% to £6.0m (Jan 2006: £5.0m)
Contracted Forward Order Book FY 2007
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 3 Cobra Biomanufacturing Plc 4
Financial Review
Turnover
Cobra generated £11.0m worth of invoiced sales in financial
year 2006 (2005: £7.9m), £10.1m of which has been
recognised as revenue in the period, a 31% increase on the
previous financial year (2005: £7.7m).  The remainder was
held in the closing deferred income balance of £1.2m, a
threefold increase on the closing balance last year (30
September 2005: £0.4m). The deferred income balance
provides an indication of the value of contracts in progress as
at 30 September 2006. Turnover by the customer’s product
type and destination is as follows:
Cobra made excellent progress in the financial year 2006: 
• Turnover increased by 31% to £10.1m (2005: £7.7m).
• The Group retained a profit before tax of £0.2m (2005:
£0.4m loss).
• Operating cash inflow doubled to £1.2m (2005: £0.6m).
• Deferred income at 30 September 2006 stood at £1.2m
(2005: £0.4m).  
• Cobra invested £1.5m (2005: £0.8m) in new equipment
and buildings during the year, £1.1m (2005: £0.4m) of
which was funded via either mortgage or leasing finance.  
• Cash at bank (including short term deposits) at the year
end increased to £3.2m (30 September 2005: £3.0m).
Turnover derived from protein manufacturing services
supported the Group’s overall increase in turnover this year,
with a 112% increase on the previous year to £6.7m (2005:
£3.2m). Virus manufacturing services fell by 29% this year to
provide £1.9m (2005: £2.8m). Turnover from DNA
manufacturing services also fell by 27% compared with last
year to contribute £1.0m (2005: £1.4). Cell line manufacturing
services provided £0.4m of turnover, which is a 12% increase
on last year (2005: £0.4m).  
Cobra has maintained its success in North America. £8.7m of
turnover was derived from our North American customer base
a 41% increase on the previous year (2005: £6.1m). There was
also an indication of recovery in Continental Europe, with a
235% increase to £0.7m (2005: £0.2m). Turnover from the Rest
of the World increased by 124% to £0.2m (2005: £0.1m) and
turnover generated by our UK customers fell by 54% to £0.6m
(2005: £1.3m).
2006 2006 2005 Inc/
% £000’s £000’s (dec)
Protein 67% 6,742 3,177 112%
Virus 19% 1,946 2,758 (29%)
DNA 10% 1,013 1,391 (27%)
Cell Line 4% 444 395 12%
10,145 7,721
2006 2006 2005 Inc/
% £000’s £000’s (dec)
North America 85% 8,656 6,138 41%
Europe 7% 703 210 235%
UK 6% 589 1,285 (54%)
RoW 2% 197 88 124%
10,145 7,721
By customers’ product type By customers’ location
Cell Line
4%
DNA
10%
Protein 67%
Virus
19%
Europe
7%
RoW
2%
UK
6%
North America 85%
62235 Cobra Report 2006  25/1/07  17:53  Page 4 By customers’ location By customers’ product type
Cobra Biomanufacturing Plc 5
Financial Review
8.0
10.0
6.0
4.0
2.0
0.0
Protein Virus DNA Cell Line
£m
8.0
10.0
6.0
4.0
2.0
0.0
North
America
UK Europe RoW
£m
FY 2005
FY 2006
Gross margins: The majority of costs included in the cost of
goods are fixed labour and facility costs and despite a 41%
increase in these costs in the year to provide the infrastructure
necessary to support the growing contracted forward order
book, gross margins were largely maintained at 53% (2005:
56%) as capacity filled in the second half of the year.
Sales and marketing: The 31% increase in turnover was
accompanied by an 8% increase in sales, marketing and
distribution expenditure to £1.1m (2005: £1.0m) 
Research and development: Cobra continues to recognise
that it has achieved its competitive advantage in the complex
market of biopharmaceutical manufacturing, through
investment in research and development. Research and
development expenditure increased by 51% to £0.4m (2005:
£0.3m).   
Administrative expenses: Increased by 5% to £3.6m (2005:
£3.4m). The factors attributed to the increase include the cost
of sourcing and recruiting scientists and quality assurance
personnel, along with an increase in site service costs as Cobra
expands into its Oxford Facility.  
Profit before tax: The Group retained a profit before tax of
£0.2m (2005: £0.4m loss) and a profit after tax of £0.3m (2005:
£0.3m loss). This is Cobra’s first full year profit since financial
year 2003, and provides earnings per share of 1.4 pence (2005
1.7 pence loss). 
Profitability and margins
Turnover (continued)
£000’s FY 2006 FY 2005
Turnover 10,145 7,721
Cost of goods (4,808) (3,398)
Gross profit 5,337 4,323
Gross margin 53% 56%
Sales and marketing (1,079) (1,002)
Research and development (401) (265)
Administration (3,589) (3,408)
Operating profit/(loss) 268 (352)
Interest (58) (43)
Profit/(loss) before tax 210 (395)
Taxation 55 54
Profit/(loss) after tax 265 (341)
Earnings/(loss) per share 1.4 (1.7)
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 5 Cobra Biomanufacturing Plc 6
Financial Review
Cash Flow
Operating cash flow: The Group doubled its operating cash
inflow in 2006 to generate £1.2m from operations in the year
(2005: £0.6m). This was primarily derived from an EBITDA of
£1.0m (2005: £0.4m) along with an improvement in working
capital of £0.2m (2005: £0.2m). 
Capital expenditure: During the year Cobra nearly doubled its
capital investment to £1.5m (2005: £0.8m). This was for new
equipment at both the Keele and the Oxford facilities and a
new freehold unit adjacent to the existing Oxford Facility to
further enhance our manufacturing capabilities. 
Intangible assets: In the year Cobra acquired certain patents
from Valentis Inc. for $0.3m to consolidate our leading edge
in ORT technology.
Financing: In the year Cobra increased its mortgages and loans
by £0.6m (2005: £0.2m) to fund the purchase of an industrial
unit adjacent to the Oxford Facility. In addition, the Group
financed £0.5m of its plant and equipment expenditure during
the year through sale and leaseback financing offset by
repayments in the year of £0.4m (2005: £0.3m) to provide a
total net financing of £0.7m (2005: £0.1m).
Cash at bank (including short term deposits): The Group’s
improved trading position provided an operating cash flow of
£1.2m, this combined with the £0.7m net financing and a
£1.5m capital investment programme contributed towards an
increase in Cobra’s cash at bank (including short term
deposits) by £0.2m to £3.2m (30 September 2005: £3.0m). 
Taxation
At 30 September 2006, the Group had trading tax losses
carried forward of £14.2m ensuring that the Group should
not be obliged to pay UK corporation tax for the foreseeable
future on any trading profits.  
The Group is entitled to claim research and development tax
relief, available under Schedule 20 of the Finance Act 2000, in
respect of financial year 2006, which resulted in a credit of
£55k to the profit and loss account (2005: £54k). 
Treasury policies and financial risk
Surplus funds are intended to support the Group’s short term
working capital requirements. These funds are invested
through the use of short term deposits and the policy is to
maximise returns as well as provide the flexibility required to
fund ongoing operations. It is not the Group’s policy to enter
into financial derivatives for speculative or trading purposes.
Interest rate, liquidity and foreign currency risk
Interest rate risk: At 30 September 2006 the Group had a
sterling mortgage with the National Westminster Bank Plc of
£1.5m. The Group utilises the availability of an ‘off-set’
arrangement with the bank on the mortgage, which effectively
means the Group currently pays a fixed rate of 1.5% over the
National Westminster Bank Plc’s sterling base rate on the
outstanding mortgage balance. In addition the Group has a
$0.5m loan, again with the National Westminster Bank Plc,
where the Group pays interest at a rate of 1.45% over the
bank’s US dollar base rate on the outstanding balance.  
Liquidity risk: Surplus funds are invested on a short term basis
at money market rates and therefore such funds are available
at very short notice.
£000’s FY 2006 FY 2005
Operating cash flow 1,153 571
Interest (62) (43)
Tax 49 69
Capital investment (1,483) (786)
Intangible assets (157) -
Pre financing cash flow (500) (189)
Financing
Shares - 2
Mortgage 550 213
Lease finance acquired 502 193
Repayments of lease finance (373) (342)
Financing 679 66
Net cash flow 179 (123)
Opening cash at bank* 3,036 3,159
Closing cash at bank* 3,215 3,036
*including short term deposits
62235 Cobra Report 2006  26/1/07  15:42  Page 6 Foreign currency risk: The Group generated significant
overseas turnover during the year, primarily from North
America. The position regarding currency risk is regularly
reviewed and currency hedging activity is initiated where
appropriate. In the year the Group achieved an exchange rate
gain of £127k (2005: £48k loss), through the provision of
forward currency contracts against the Group’s contracted US
dollar order book, and the transfer of £0.3m of its existing
mortgage facility to a $0.5m US dollar loan in April 2006 at an
exchange rate of $1.74 to provide a currency hedge against its
US dollar trade debtors. Currency risk is also partially offset by
overseas expenditure.
Peter Coleman
Finance Director
9 January 2007
Cobra Biomanufacturing Plc 7
Financial Review
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 7 Cobra Biomanufacturing Plc 8
Board of Directors
Peter Fothergill BA FCIM (Age 61), Executive Chairman
Peter has 38 years experience in the international healthcare
industry, including Chairmanship of Fisons Plc’s multinational
research-based Pharmaceutical Division and Consumer Health
Division, where he led a series of strategic development
initiatives, including acquisitions in North America, Europe
and Asia, whilst achieving significant organic growth. He was
a main board director responsible for the majority of the
Group’s profits when Fisons Plc was a FTSE 100 company. 
Peter subsequently formed his own strategic management
company that has been involved in management buy-out and
buy-in arrangements, consultancies and the creation of new
businesses in the private healthcare sector. He has been
Chairman or Director of 16 companies and is currently
Chairman of I Holland Limited, the world’s leading supplier of
tablet moulding tools to the global pharmaceutical industry.
He is a fellow of the Chartered Institute of Marketing and sits
on the boards of various charitable and public bodies.
David Thatcher PhD (Age 59), Chief Executive
David trained as a protein chemist at the Universities of
Newcastle upon Tyne and Edinburgh.  He pursued an
academic career until 1981, when he moved to Biogen SA. in
Geneva where he worked on the isolation of recombinant
cytokines. In 1985, he became Director of Process
Development at Biogen Inc., Cambridge Mass., where he was
responsible for the development of large-scale processes for
the production of gamma interferon, GM-CSF and several
other products.  
In 1988, David left Biogen and joined Zeneca Pharmaceuticals
as head of their Protein Production Laboratory where he was
responsible for the production of a number of
biopharmaceutical products for clinical evaluation.  In 1994,
he joined Therexsys Limited (now Cobra) as the second
employee and has been responsible for managing the
evolution of the Group’s manufacturing technology and
assets and developing the contract manufacturing business.
Peter Coleman FCMA MBA (Age 40), Finance Director
Peter has twelve years experience in the
pharmaceutical/biotechnology industry and has been Cobra’s
Finance Director since its flotation on AIM in June 2002. Prior
to Cobra he was employed in a variety of senior financial and
corporate development roles.  Peter qualified as a Chartered
Management Accountant in 1996 and in 2001 was awarded
an MBA with distinction jointly from the Manchester Business
School and the University of Wales.  
Michael Gatenby FCA (Age 62),
Independent Non-executive Director
Michael graduated from Cambridge University with Honours
in Law. He is a Chartered Accountant and was a Director of
Hill Samuel and Co and Vice Chairman of Charterhouse Bank.
He is currently a Director of Johnson Service Group Plc, Porvair
Plc and Chairman of Alliance Pharma Plc and he is also a
Trustee/Director of the Stroke Association. 
David Oxlade BSc (Age 57),
Independent Non-executive Director
After graduating with an Honours Degree in Biochemistry,
David has worked in the biotechnology, diagnostic and
therapeutic health care industries for over 30 years. He has
held senior management positions in Asia and the USA as well
as in Europe. Previously CEO of Xenova Group Plc and
President of Syva Co in California, David is currently Chairman
of BioAnaLab Ltd and a member of EuropaBio’s Emerging
Enterprise Council. Appointed an Honorary Fellow of Brunel
University in 2003, David chaired the European Working
Group of the (DTI) Bioscience and Innovation Growth Team
(2003) and was appointed to the BioScience Leadership
Council in 2004.
Professor Nigel Slater FREng (Age 53),
Independent Non-executive Director
Nigel is Professor of Chemical Engineering at the University of
Cambridge with research interests in the process
development and formulation of biopharmaceuticals. He is a
member of the MHRA Biologicals and Vaccine Expert Advisory
Group and his research portfolio has included collaborations
with a number of leading pharmaceutical companies. He is
the author of a number of scientific papers and patents.
Additionally, he has relevant biomanufacturing development
and engineering experience with Wellcome Plc, Unilever
Nederland BV and Cobra Therapeutics Limited.
Peter Fothergill David Thatcher Peter Coleman Michael Gatenby David Oxlade Nigel Slater
62235 Cobra Report 2006  26/1/07  08:32  Page 8 Sheena Pumford
Cobra Biomanufacturing Plc 9
Senior Management Team
John Lovelady BSc (Hons) PhD (Age 54),
Director of GMP Manufacturing Operations 
John was appointed Cobra’s Director of GMP Manufacturing
Operations in July 2006. He has 25 years international
pharmaceutical/biotechnology experience.  
Trained as a fermentation scientist, he has a BSc from
University of Bradford and a PhD from the University of
Swansea. After completing a research scientist appointment
at Porton Down in 1983, he moved on to be Head of
Fermentation at Fermentech, Edinburgh. He then joined
Genzyme UK in 1986 as a senior scientist, rising to the position
of Vice President Operations by 2001. In 2002 John joined
Gencell SAS, Paris (subsidiary of Sanofi Aventis) a leading
gene therapy company as Vice President Technical R&D and
Manufacturing. John brings a wide range of technical
experience in the field of biopharmaceutical manufacturing
and is an experienced manager of GMP operations.
Tony Mulcahy BSc (Hons) PhD (Age 42),
General Manager - Oxford
After gaining an honours degree in Biochemistry and
Physiology at the University of Sheffield, Tony completed a
PhD at the University of Newcastle upon Tyne, while
conducting research over a period of seven years on
autoimmune diseases.  
He joined the research and development division of Cobra in
1994 and was involved in developing reliable, stable, high-
level gene expression systems and cell-based delivery systems
during seven years of research.  In 2001, Tony joined the
biopharmaceutical manufacturing division and was involved
in setting up the Business Development and Account
Management functions within the Group. During his time in
the Business Development Group he has held the positions of
Associate Director of Business Development and European
Director of Business Development before his recent
promotion to General Manager of the Oxford Facility. 
Tracey Pughe ACMA BA (Hons) (Age 32)
Head of Planning and Commercial Finance
Tracey gained an honours degree in Business Economics from
the University of Leicester in 1995. After graduating Tracey
worked for ICL Sorbus Ltd and then Spiral Packs (London) Ltd
where she obtained commercial experience as an Account
Manager. She later went on to complete the Chartered
Institute of Management Accountancy examinations whilst
working for Elkes Biscuits Ltd, an operating division of
Northern Foods Plc. 
Tracey joined Cobra in Sept 2002 as Financial Controller, and
became Head of Planning and Commercial Finance in October
2006.
Sheena Pumford CIPD (Age 45),
Human Resource Manager
After completing a management training course with a large
retail organisation, Sheena was seconded to a training role
with the responsibility for the training of over 100 staff and
management. During this time she decided to specialise in the
field of human resource management and spent the next 14
years in various training and personnel roles within two large
retailing organisations. 
In 1997 Sheena joined Cobra to set up a Personnel
Department providing advice to staff and management on a
wide range of personnel and training issues. She has spent the
last nine years in the role and during this time has completed
an NVQ Level 4 in Personnel Management. During this period,
Sheena has played a fundamental role in the recruitment and
selection of employees as part of the Group’s expansion plan.
Paul Stockbridge BSc PhD CBiol MIBiol FIQA (Age 53),
Corporate Director of Quality Assurance
Paul was appointed Cobra’s Corporate Director of Quality
Assurance in October 2005. He holds a degree in Biological
Sciences and a PhD in fermentation and is registered as a
Qualified Person (QP) under the Permanent Provisions of the
EU directives.
Paul has over 25 years experience in the pharmaceutical/
biotechnology industry.  He spent 23 years with Eli Lilly in the
UK, the first 10 years of which were in fermentation
development and production before transferring to the QA
department. During the following 13 years he gained
extensive experience in QA with responsibility for projects,
quality systems, engineering, clinical trials API manufacture
and recombinant biotechnology products.  He acted as a
Senior Quality Advisor for Eli Lilly and travelled frequently to
the US and globally in connection with these activities. In
2002 he moved to Aventis Pharma where he was Head of
Quality Operations at their Holmes Chapel site. 
Tony Mulcahy John Lovelady Paul Stockbridge Tracey Pughe
making tomorrow’s medicines
62235 Cobra Report 2006  26/1/07  15:44  Page 9 Roy Cowell
Cobra Biomanufacturing Plc 10
Senior Management Team
Roy Cowell BSc (Hons) CSci CChem MRSC (Age 41),
Deputy Director of Quality Assurance
Roy joined Cobra in 1996 and has played a key role in setting
up the Quality Control Department. He is a QP under Directive
2001/83/EC and has 20 years experience in the
pharmaceutical/biotechnology industry. He is also a member
of the Royal Society of Chemistry with Chartered Chemist
status. 
Roy began his career within the Safety of Medicines
Department of Zeneca Pharmaceuticals (now AstraZeneca
Plc), before moving into the Pharmaceutical Development
Group. In this role Roy gained broad experience in process
and formulation development for new chemical entities and
a broad range of formulations. Prior to joining Cobra, Roy
gained an Honours Degree in Chemistry, awarded by Victoria
University of Manchester and undertook a role as Analytical
Chemist for the development of biopharmaceutical products. 
Tony Hitchcock BSc (Age 45),
Deputy Director of Process Science
Tony has been employed at Cobra since 1994, working initially
on the development of plasmid DNA purification and the
manufacture of plasmid DNA, filing patents and publications
on DNA manufacturing processes. More recently he has
managed Cobra’s purification and manufacturing teams
involved in the process development of purification strategies
for manufacture of plasmid DNA, virus and recombinant
proteins for clinical trials. He was appointed Deputy Director
of Process Science in December 2005.
Prior to Cobra, Tony worked for Zeneca Pharmaceuticals,
developing purification procedures for recombinant proteins
and the manufacture of these products for pre-clinical and
early clinical studies, including immunotoxins and cyokines.
He also worked for four years at the BioProducts Laboratory
at Elstree (formerly Blood Products Laboratory), developing
strategies to purify proteins from waste fractions from plasma
fractionation.
Joan Lancaster MSc (Age 53),
Head of Site Services
After graduating from Plymouth Polytechnic in 1973, Joan
joined the Medical Research Laboratories at Hartshill, Stoke-
on-Trent as a Research Technician and then subsequently as
Senior Technician. 
After carrying out research work for the Metabolic Unit at the
North Staffs Royal Infirmary, Joan joined the Life Sciences
Department at Keele University where she managed the day
to day operations of the Monoclonal Antibody Laboratory.
Joan joined Cobra in 1994 as a Research Scientist and became
Facilities Manager in 1997 and Head of Site Services in 2005.
Heike Lentfer Dipl.-Ing. Biotechnology (Age 39),
Deputy Director of Manufacturing
Heike gained her degree in Biotechnology at the Technical
University of Berlin in 1995. After graduating she joined a
start-up company, Alpha Bioprocess Technology, where she
specialised in cell culture technology. In 1999, Heike joined
Metris Therapeutics Ltd in the UK, where she took over
responsibility for the company's cell culture projects. She
became a Project Manager looking after a team of
fermentation, purification and QC scientists to bring a
recombinant product into clinical trials. 
In 2003, Heike joined Cobra and is now responsible for the
manufacturing activities in the Oxford facility.
Tony Hitchcock Joan Lancaster Heike Lentfer
62235 Cobra Report 2006  25/1/07  17:53  Page 10 Cobra Biomanufacturing Plc 11
Report of the Directors
The Directors of Cobra Biomanufacturing Plc present their
report to the shareholders, together with the audited
financial statements for the year ended 30 September 2006.
Principal Activities 
Cobra Biomanufacturing Plc is a holding company, with
wholly owned subsidiaries of Cobra Biologics Limited, Cobra
Biomanufacturing EBT Limited and Cobra Biomanufacturing
LLC.  The principal activity of the Group is the provision of
manufacturing services for protein, virus and DNA based
pharmaceuticals. 
Results and Dividend
The Group profit for the period after providing for taxation
tax was £0.3m (2005: £0.3m loss) and an equivalent amount
has been added to reserves. The Directors do not propose the
payment of an ordinary dividend (2005: nil).
The accumulated deficit carried forward for the Group
amounted to £33.2m (2005: £33.5m) 
Enhanced Business Review
Operations: Cobra Biomanufacturing Plc is an international
provider of manufacturing services for the global bio-
manufacturing industry. The Group operates two UK based
manufacturing facilities, one located  in Keele, Staffordshire
and the other in Cowley, Oxfordshire, both of which trade
through the Company’s wholly owned trading subsidiary
Cobra Biologics Limited. The Company’s other subsidiaries are
Cobra Biomanufacturing EBT Limited whose principal activity
is to act as trustee to the Group’s Long Term Incentive Plan
(LTIP) and Cobra Biomanufacturing LLC which is currently
dormant. The financial position and performance of the
Group is set out on pages 4 to 7.
Markets: Cobra’s primary market for its services is in
North America, a region that currently attracts 78% or
$16bn of the $20bn* global research and development
expenditure on biopharmaceuticals. The global outsourced
biopharmaceutical market is currently worth $2.6bn**, the
vast majority of which, approximately 70%, is for phase III and
commercial supply. Although Cobra has completed its first
phase III contract, the Group does not have the scale to
compete effectively in this area and is therefore focused
primarily on the remaining 30% estimated to be worth in the
region of $0.8bn which comprises activities such as process
development, pre clinical, phase I and II clinical trials supply. 
The vast majority of the biopharmaceutical market is for
protein based manufacturing services, but there is also an
available growing specialised niche market for both DNA and
virus based manufacturing services. Cobra can uniquely
provide manufacturing services for all of these segments in
addition to cell based therapies. However the growth in
turnover over the last two financial years, has been built upon
providing protein based manufacturing services for the North
American market. 
Sales and marketing: The success we have achieved in North
America, with 85% of the turnover in 2006 (2005: 79%) has
been achieved through the recruitment of a highly effective
US based sales force of 3 sales executives, covering the major
biotechnology hubs of the West Coast and East Coast,
focusing on mid size biotechnology product companies with a
requirement for process development expertise and
specialised manufacturing services. 
Research and development: To maintain the Group’s scientific
competitive edge Cobra invested £0.4m (2005: £0.3m) in
research and development in the year and purchased patents
for $0.3m (2005: nil). The Group has a distinct research
department which employs 5 members of staff (2005: 3),
through which the Group develops its own intellectual
property, not only in the filing of its own process patents,  but
also, for example in the development of its own oral vaccine
platform technology ORT VAC, which we are developing in
conjunction with DSTL (UK Defence Science and Technology
Laboratory) who are using it to carry out clinical trials for an
anthrax vaccine and also the US Navy, who are promoting a
malaria vaccine.
Contract values: These are variable and range from £0.1m to
£3.0m, dependent upon the size and complexity of the
programme. It usually follows that the further down the
regulatory process our customer is, the higher the value of the
potential contract. The Group has been more successful over
the last 2 years in winning bigger contracts that are longer
term in nature, which has provided greater revenue stability.  
*Ernst and Young’s ‘Beyond Borders’ Global Biotechnology Report 2006
**High Tech Business Decisions 2005
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62235 Cobra Report 2006  25/1/07  17:53  Page 11 Cobra Biomanufacturing Plc 12
Report of the Directors
Commercial risks  
The key commercial risks facing the Group are as follows: 
Recruitment, retention and training of employees: Cobra
operates in a knowledge based industry and recognises the
importance of the recruitment and retention of its highly
skilled workforce (for further information see key
performance indicator section). 
Regulatory compliance: Cobra is under intense pressure from
the UK pharmaceutical regulator, the Medical and Healthcare
Products Regulatory Agency (MHRA), through the EU Clinical
Trials Directive to ensure that both our manufacturing
facilities provide services that are consistent and achieve the
appropriate quality standards, termed as current Good
Manufacturing Practice (cGMP).  Non regulatory compliance
with the MHRA may result in production delays or the even
closure of our facilities until corrective action is in place. This
risk is managed by employing and maintaining an
experienced quality assurance/control team of 27 employees
at both facilities (2005: 21) two of which are Qualified
Person’s (QP’s).   
Customer funding: The global biopharmaceutical industry
raised $19.7bn* worth of funding in 2005, $15.7bn* or 80%
of which was in North America. The majority of Cobra’s
customers are mid sized loss making biopharmaceutical
companies, who are reliant upon funding from the capital
markets for their product development. Cobra has a market
intelligence capability which constantly monitors global
pipeline funding and which companies are receiving that
funding. The Group always carries out financial due diligence
on all its customers prior to contract signature. 
Customer product failure: The biopharmaceutical product
failure rate is similar to the failure rate of conventional
pharmaceuticals, in that 90% of phase I drugs fail to reach the
commercial market. Cobra attempts to mitigate this risk, by
ensuring it has a wide customer base, working with 35
customers in 2006 (2005: 48), operating in all the
biopharmaceutical market segments and being thorough in
its customer due diligence. 
Capital investment requirements: Both the Keele and Oxford
facilities are maintained to both full cGMP and MHRA
compliance, and it is essential we maintain our facilities to
these standards. Capital investment is key to on going
activities. The Group spent £1.5m this year on capital
expenditure (2005: £0.8m).
Exchange rates fluctuations: Turnover from North America is
primarily in US dollars and any significant movement in the
USD/£ exchange rate may hinder our competitive position.
This risk is alleviated somewhat by currency hedging activities
such as forward contracts and the utilisation of a $0.5m US
dollar loan, which resulted in a £127k exchange rate gain in
2006 (2005: £48k loss). Our specialist skills are also relatively
price insensitive and the currency risk is partially offset by
overseas expenditure.
Key performance indicators (KPI’s)
Cobra operates in a complex and specialist field, but with a
business model of a conventional contract manufacturing
business, whose primary objective each financial year is to fill
capacity slots and thereby cover the fixed overhead cost of
the two facilities. The vast majority of these overheads are
fixed labour costs. The business has high operational gearing
driven by the generation and completion of contractual
revenue in the year and therefore the KPI’s of the Group have
been identified as follows:
The contracted forward order book: This is at an historical
high of £6.0m for the financial year 2007, 20% higher than
the same time last year (Jan 2006: £5.0m).  
Turnover and deferred income: Cobra invoiced sales of
£11.0m in the year (2005: £7.9m), £10.1m of which was
recognised as revenue (2005: £7.7m), the remainder was held
in the balance sheet as deferred income. The deferred income
balance at 30 September 2006 reached an historical high of
£1.2m, three time higher than the closing figure in the
previous financial year (30 September 2005: £0.4m), this
provides an indication of the value of work that has been
invoiced and paid, but not yet completed.  
Gross margins and profit before tax: These are another key
financial indicator the outcome of which is dependent upon
three key variables, firstly the price of the contract, secondly
slot occupancy which allows the Group to recover its fixed
overhead costs and thirdly the efficiency and speed at which
Cobra completes its programmes i.e. productivity. Gross
margins for 2006 stood at 53% (2005: 56%). The profit before
tax for 2006 was £0.2m (2005: £0.4m loss).
Enhanced Business Review (continued)
*Ernst and Young’s ‘Beyond Borders’ Global Biotechnology Report 2006
**High Tech Business Decisions 2005
62235 Cobra Report 2006  25/1/07  17:53  Page 12 Cobra Biomanufacturing Plc 13
Report of the Directors
Operating cash flow: Cobra usually charges a non refundable
capacity reservation fee. This is payable by upon contract
signature and assists the Group with its working capital
requirements given that the majority of our costs are fixed
employee salaries. Trade debtors stood at the end of the
financial year at £1.4m (30 September 2005: £1.4m) despite
the 31% increase in turnover and debtor days for the Group
represented 48 days of invoiced sales (2005: 60 days).
Operating cash inflow for the year was £1.2m (2005: £0.6m).
Cash at bank: The Board pays particular attention to the cash
at bank to ensure the financial commitments of the Group are
met. Cobra closed the financial year with cash at bank
including short term deposits of £3.2m (30 September 2005:
£3.0m).
Employee recruitment and retention: The Group increased its
average headcount in the year by 25% to 118 employees
(2005: 94), 66% of which are regarded as productive
employees (2005: 65%). Voluntary staff turnover (excluding
temporary staff and retirements) increased in the year to 15%
(2005: 11%), but remains relatively stable compared with our
industry peers. 
Directors
The Directors in office during the year are listed below. All of
which served throughout the year, unless stated otherwise:
Executive
Peter Fothergill Chairman
David Thatcher Chief Executive
Peter Coleman Finance Director
Non Executive
David Bloxham (retired 30/09/2006)
Michael Gatenby
David Oxlade (appointed 01/07/2006)
Nigel Slater
David Oxlade was appointed as a Non-Executive Director on
1 July 2006 and will retire in accordance with the Company’s
articles of association and being eligible will offer himself for
re-appointment at the Annual General Meeting. Peter
Fothergill and Michael Gatenby retire by rotation and, being
eligible, offer themselves for re-election at the forthcoming
Annual General Meeting. 
All Directors are subject to re-election at intervals of no more
than 3 years.
Details of Directors’ interests in the share capital of the
Company, as shown in the register maintained in accordance
with Section 325 of the Companies Act 1985, together with
details of share options granted and awards made to
Directors are included in the Report on Directors’
Remuneration on pages 18 to 22.
Policy in Respect of Supplier Payments 
The Company and its principal subsidiary undertaking agree
terms and conditions for transactions with suppliers and pay
suppliers within the agreed time, provided that suppliers
comply with those terms and conditions. At 30 September
2006 the trade creditors for the Company represented 46 days
(2005: 59 days) of the amounts invoiced by suppliers.
Environmental Policy
The Group recognises the importance of good environmental
practice and, whilst its activities have a relatively low
environmental impact, the Group has strict environmental
policies on the discharge of waste and endeavours to comply
at all times with national government and local authority
regulations.
Charitable and Political Contributions
During the year the Group made no political or charitable
contributions (2005: nil).
Employee Involvement
The Group recognises and seeks to encourage the
involvement of its employees, with the aim being to recruit,
motivate and retain employees. The Group operates an
annual bonus scheme and a share option scheme, which
grants options to individuals within the Enterprise
Management Incentive Scheme. 
Each employee receives a staff handbook, which outlines the
Group’s employment policies and includes a commitment to
equal opportunities. The handbook is designed to attract and
motivate employees regardless of sex, race, religion or
disability. The staff handbook has also been updated to
reflect the new Employment Equality (Age) Regulations
which came into force on 1 October 2006. 
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Report of the Directors
The Group is committed to ensuring a safe and healthy
working environment for all employees consistent with the
requirements of health and safety legislation and wherever
practicable gives full consideration to applications for
employment from disabled persons.  
Employee Share Schemes
Employee involvement in the financial performance of the
Group is encouraged through participation in the Company’s
share option schemes.  Further information on share options
is shown in note 19 on page 37.
Major Interests in Shares
At 3 January 2007, the following shareholders held interests
in excess of 3% of the ordinary share capital:
No of
Percentage ordinary
Shareholder holding shares
Invesco UK 14.8% 2,900,200
Collins Stewart (CI) Limited 9.3% 1,815,750
Cavendish Asset Management 8.1% 1,590,000
New Star Select Opportunities Fund 5.1% 1,000,000
Barclays Stockbrokers 4.6% 892,457
Fidelity Investments 3.6% 701,900
No other person has notified an interest in the ordinary share
capital of the Company.
Annual General Meeting
The Annual General Meeting of the Company will be held on
12 April 2007 at 11.00am at the offices of Buchanan
Communications Limited, 45 Moorfields, London, EC2Y 9AE.
The notice of the Annual General Meeting, together with
notes on the resolutions, is on pages 43 and 44. In addition to
the ordinary business there are two items of special business
for consideration at the forthcoming Annual General
Meeting. These are: 
1. An ordinary resolution to renew the Directors’ authority
for the purpose of Section 80 of the Companies Act 1985
(“the Act”) to exercise all powers of the Company to allot,
or agree to allot, authorised but unissued (and unreserved
share capital of the Company). The authority will relate to
7,408,830 ordinary shares of 10p each, representing
37.8% of the current issued ordinary share capital of the
Company, and will expire at the conclusion of the next
Annual General Meeting of the Company or if sooner, 10
July 2008. The Directors have no present intention of
exercising the authority, which will be conferred by this
resolution. 
2. A special resolution to renew until the end of the next
Annual General Meeting or, if sooner, 10 July 2008 the
Directors’ power to allot equity securities (within the
meaning of Section 94 of the Act) for cash other than pro
rata to existing shareholders. This power will relate to
allotments in respect of rights issues (where difficulties
arise in offering shares to certain overseas shareholders
and in relation to fractional entitlements) and to
allotments (other than in respect of rights issues) of equity
securities having an aggregate nominal value not
exceeding £97,955 (being 5% of the issued equity share
capital of the Company). The Directors consider that it is
in the best interests of the shareholders that the Board
should have this limited power in order to retain
flexibility.
In the opinion of the Directors the passing of these
resolutions is in the best interests of the shareholders.
Employee Involvement (continued)
62235 Cobra Report 2006  25/1/07  17:53  Page 14 Cobra Biomanufacturing Plc 15
Report of the Directors
Statement of Directors’ Responsibilities in
Respect of the Financial Statements  
United Kingdom Company Law requires the Directors to
prepare financial statements for each financial year which
give a true and fair view of the state of affairs of the
Company and the Group as at the end of the financial year
and of the profit or loss of the Group for that period.  In
preparing those financial statements, the Directors are
required to:
1. select suitable accounting policies and then apply them
consistently;
2. make judgements and estimates that are reasonable and
prudent;
3. state whether applicable accounting standards have been
followed; and 
4. prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the Group
will continue in business.
The Directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time
the financial position of the Company and the Group and to
enable them to ensure that the financial statements comply
with the Companies Act 1985.  They are also responsible for
establishing and maintaining the system of internal control,
safeguarding the assets of the Company and the Group and
hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
Going Concern
The Directors have reviewed the budget, cash flow and other
relevant information and have a reasonable expectation that
the Group has adequate resources to continue in operational
existence for the foreseeable future. For this reason, the
Directors continue to adopt the going concern basis for the
preparation of the accounts.
Auditors
In the case of each of the persons who are Directors of the
Company at the date when this report is approved:
1. as far as each of the Directors is aware, there is no
relevant audit information (as defined in the Companies
Act 1985) of which the Company’s auditors are unaware;
and
2. each of the Directors has taken all the steps that they
ought to have taken as a Director to make themselves
aware of any audit information (as defined) and to
establish that the Company’s auditors are aware of that
information.
This statement is given and should be interpreted in
accordance with the provisions of s234ZA of the Companies
Act 1985.
Deloitte & Touche LLP were appointed as auditors during the
year and have expressed their willingness to continue in office
as auditors and a resolution to re-appoint them will be
proposed at the forthcoming Annual General Meeting.
By the order of the Board
Matthew Baker
Company Secretary
9 January 2007
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Corporate Governance Statement
The Combined Code
The Directors are committed to high standards of corporate
governance. The Board is accountable to its shareholders for
good corporate governance and adopts the necessary
structures and procedures. Although Cobra Biomanufacturing
Plc is listed on the Alternative Investment Market and
therefore does not need to comply with the Combined Code,
the Board has reviewed the corporate governance of the
Group and has implemented the changes it has felt
appropriate, given the Group’s size. The Board will continue
to review the corporate governance of the Company during
the next financial year. This statement describes the approach
of the Company and the application of the principles
identified in the current code, which are being applied.
Application of the Principles
of the Combined Code
The Board
The Board of Directors comprises three Executive Directors,
including the Chairman, and three Independent Non-
Executive Directors. The Executive Directors have a clear
division of duties and meet to direct and control strategy and
the operating performance of the Group. This includes the
approval and monitoring of budgets, reviewing trade
performance and determining risk management policies. The
Group also has a schedule of matters reserved for the decision
of the Board. There is an agreed procedure for Directors in
the furtherance of their duties to take independent
professional advice if necessary, at the Company’s expense.  
The Board met seven times during the financial year with
each member attending as follows: 
No of meetings held No of meetings
whilst a member attended
Board member
Peter Fothergill 7 7
David Thatcher 7 7
Peter Coleman 7 7
David Bloxham* 7 7
Michael Gatenby 7 6
David Oxlade** 2 2
Nigel Slater 7 7
Board Committees
The following committees deal with specific aspects of the
Group’s affairs:
Audit Committee: comprises the Non-Executive Directors with
Michael Gatenby as Chairman. The Committee meets at least
three times a year and the meetings are arranged to tie in
with the publication of the Company’s financial statements.
The Committee will also meet on an ad-hoc basis where
necessary. The external auditors attend the meetings at the
invitation of the Committee and report as appropriate.  The
Committee operates within specific terms of reference, which
include reviewing the Group’s accounting policies, financial
reporting, internal control and risk management processes. It
reviews the need to appoint an internal audit function, and
also considers the appointment and the audit and non-audit
fees of the external auditors together with their
independence and objectivity. 
Remuneration Committee: comprises the Non-Executive
Directors with Nigel Slater as Chairman.  The Committee
recommends to the Board the policy on executive
remuneration and it determines on behalf of the Board, the
terms and conditions of service for each Executive Director.
The Report on Directors’ Remuneration is set out on pages 19
to 22.
Nomination Committee: comprises the Chairman, Peter
Fothergill and the Non-Executive Directors. Peter Fothergill is
the Chairman of the Committee. The Committee operates
within specific terms of reference, which includes a regular
review of the Board structure, size and composition and
identifying and nominating candidates to fill board vacancies,
as and when they arise.     
Details of all the committee’s terms of reference are available
on the Company’s website www.cobrabio.com.
*retired 30 September 2006
**appointed 1 July 2006
62235 Cobra Report 2006  25/1/07  17:53  Page 16 Cobra Biomanufacturing Plc 17
Corporate Governance Statement
Risk Management and Internal Control
The Board is responsible for establishing and maintaining the
Group’s system of internal control, which is designed to meet
the particular needs of the Group and the risks to which it is
exposed. Such a system is designed to manage these risks, to
provide reasonable but not absolute assurance against
material misstatement or loss and to maintain proper
accounting records to ensure the integrity of financial
information used within the business and for external
publication.
The Group’s established internal control procedures include
the following:
1. A schedule of matters reserved for the Board. The Board
of Directors has overall responsibility for the effective
running of the Group and it has a formal schedule of
matters, which are specifically reserved for decisions by
the Board. 
2. The Board meet to manage the affairs of the Group. The
Group’s financial and operating performance is closely
monitored at each Board meeting with formal Board
reports from the Chief Executive and the Finance Director
covering their areas of the business.
3. The Group’s Board meet twice a year for a strategic
review. The purpose of which is to formulate a long term
strategy for the Group and develop a strategic framework
for the achievement of the Group’s financial targets.   
4. The Group’s Senior Management Team (the SMT) meets
weekly to review and discuss the current issues facing the
Group and financial performance. The SMT is comprised
of the operational senior management, including the
Chief Executive and the Finance Director who each
provide an update. Each member of the SMT operates
within a clearly defined Group structure and each
member is given the appropriate operational authority.
5. The Group prepares an annual budget, developed
through a comprehensive operational budgeting process
prior to the commencement of the financial year. A
revised forecast is prepared at the half year. The budget
and the revised forecast are reviewed and approved by
the Board and the SMT.   
6. The Board and the SMT then monitor the actual monthly
financial performance of the Group against the budget
and the half year revised forecast, with any significant
variances highlighted and explained. 
The Board also recognises the need for an effective risk
management process. Last year, the Group reviewed and
prioritised the major strategic risks facing the Group, with the
current controls for each risk identified and a recommended
strategy put in place for improvement. This year the Group
has developed and embedded a risk review process into the
established internal control procedures of the Group.
Relations with Shareholders
The Board recognises the importance of continual
communications with shareholders and will maintain a
programme of regular dialogue with its investors, including
presentations following the Company’s announcements of its
preliminary full year figures and of the half year results.
There is also an opportunity at the Company’s Annual General
Meeting for individual shareholders to raise general business
matters with the full Board and the notice of the Company’s
Annual General Meeting is circulated to all shareholders at
least 20 working days before such meeting. The Chairmen of
the Audit, Remuneration and Nomination Committees will be
available at the Annual General Meeting to answer questions. 
The Annual Report will be published on the Company’s
website www.cobrabio.com, which also includes previous
financial reports, press releases, presentations and other
announcements made during the year.
The table below shows the number of committee meetings during the financial year and member’s attendance. 
Audit Committee Remuneration Committee Nomination Committee
No of No of No of
meetings No of meetings No of meetings No of
held whilst meetings held whilst meetings held whilst meetings
a member attended a member attended a member attended
Committee member
David Bloxham* 332211
Peter Fothergill n/a n/a n/a n/a 1 1
Michael Gatenby 332211
David Oxlade** 1 1 ----
Nigel Slater 332211
* retired 30 September 2006
** appointed 1 July 2006
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Report on Directors’ Remuneration
This report describes the role and composition of the
Remuneration Committee (the Committee), the Group’s
remuneration policy and the arrangements currently in place
in respect of both Executive and Non-Executive Directors.
Reward Philosophy
To ensure corporate success and enhance shareholder value,
the Group needs people of high calibre able to meet the
challenges it faces. The Group’s overall remuneration policy
aims are to:
1. Attract, develop, motivate and keep talented people at
director and senior executive level;
2. Pay competitive total compensation packages to Directors
and Senior Executives, with a significant component
linked to the attainment of performance targets. When
pay levels are set, account is taken of the work a Director
does, what is paid by other companies for that work and
how well the Group’s businesses are performing; and
3. Encourage its Directors to hold shares in the Company,
which the Committee believes is an effective way of
bringing together their interests with those of external
shareholders.
The Company promotes greater ownership of its shares, by
offering Directors the opportunity to participate in the
Company’s share options scheme. 
Non-Executive Directors’ Remuneration
Non-Executive Directors are appointed for an initial period of
twelve months and then on a rolling contract subject to three
months’ notice either by themselves or the Company at a
salary determined by the Executive Directors. All Directors are
subject to re-election at an Annual General Meeting at least
every three years. The Board set the remuneration of the Non-
Executive Directors with reference to third party consultants.
The Non-Executive Directors receive a basic salary and do not
participate in the bonus arrangements, healthcare
arrangements, company share option schemes or the pension
scheme. The Company repays the reasonable expenses they
incur in carrying out their duties as directors. Non-Executive
Directors’ remuneration for the year ended 30 September
2006 is set out in the following table:
Total Total
2006 2005
£ £
Non-Executive Director
David Bloxham* 22,500 22,500
Michael Gatenby 22,500 22,500
David Oxlade** 5,625 -
Nigel Slater 22,500 22,500
Total 73,125 67,500
*   retired 30 September 2006
** appointed 1 July 2006
Executive Directors’ Remuneration
The Committee determines and agrees with the Board on the
Group’s framework of executive remuneration. It decides the
specific remuneration benefits, employment conditions,
pension rights, compensation payments and severance terms
for the Executive Directors and the remuneration framework
for the other Senior Executives. 
The Committee investigates and takes into account the
remuneration paid to the directors of other companies of a
similar size and comparable industry sector in the UK, to
ensure that the levels of remuneration paid by the Group are
appropriate.
The primary source of this information was provided through
subscription and access to the annual New Bridge Street
Consultants’ “Biotechnology Industry Remuneration Survey”.
The Committee met twice in the year to 30 September 2006
and the Board accepted the Committee’s recommendations
without amendment.
The current members of the Committee are Michael Gatenby,
David Oxlade and Nigel Slater as Chairman, with David
Bloxham retiring on 30 September 2006. The members of the
Committee have no personal financial interest in the
Company other than as shareholders and the fees paid to
them as Non-Executive Directors. They are not involved in the
day-to-day running of the Group’s businesses. 
Although not members of the Committee, the Chairman,
Chief Executive and Finance Director may be invited to attend
meetings and the Committee consults them on proposals
relating to the remuneration of Executive Directors and
Senior Executives. They do not attend when the Committee
discusses matters relating to their own remuneration.
62235 Cobra Report 2006  25/1/07  17:53  Page 18 Cobra Biomanufacturing Plc 19
Report on Directors’ Remuneration
Reward Policy
The Committee’s policy for Executive Directors’ remuneration
is to:
1. Pay a basic salary, which competes with other companies
of similar size and complexity in the biotechnology sector. 
2. Give executives the opportunity to increase their earnings
by meeting and outperforming short term objectives
through the executive bonus scheme and longer term
objectives through the LTIP scheme. 
3. Evolve compensation schemes that encourage executives
to hold shares in the Company such as the LTIP scheme.
4. Overall, reward executives fairly and responsibly for their
contribution to the Group’s short and long term
performance; and 
5. Aligns, where appropriate the interests of the executives
with those of the members.
Elements of Remuneration
In deciding the Executive Directors’ total remuneration
package and individual elements of it, the Committee refers
to the reward policy and assesses where the Company should
be positioned relative to other companies. It has obtained
independent advice on appropriate comparisons and treats
them cautiously. The main elements of Executive Directors’
remuneration are as follows:
Basic salary: The Committee reviews basic salaries each year
taking account of the various factors, elements and policies
set out earlier, including Group performance. Any changes are
made with effect from 1 January. The basic salaries of the
Executive Directors are set out in the table overleaf.
Performance related bonus: The annual bonus further
motivates the Executive Directors and other senior executives
to achieve the Group’s financial objectives for the financial
year. The Committee reviews regularly the basis of the bonus
and the targets to be achieved.
The Directors’ bonus for the financial year 2006 was
determined by both quantitative and qualitative
considerations and directly linked to the financial year. The
quantitative objectives were based on Group turnover, PBIT
shareholder value and cash management. The qualitative
objectives were based on personal and team achievements.
The Chief Executive was entitled to receive up to a maximum
of 50%, the Finance Director 40% and the Chairman 30% of
their basic salaries under this scheme. In addition, the
Committee may award an additional discretionary bonus
where merited. Taking these factors into account the
Committee recommended the payment of bonuses as shown
in the table overleaf. 
Long term incentive arrangements: The Company operates
the Cobra Biomanufacturing Plc 2005 Long Term Incentive
Plan (LTIP) for the Executive Directors, in addition to the
Company’s unapproved share option scheme, which is open
to all employees of the Company. Both schemes are able to
grant options within the Enterprise Management Scheme.
The LTIP is designed to link a substantial part of the long term
reward of the Executive Directors to the investment of their
own funds in the Company’s shares, to align Executive
Director’s remuneration to improvements in the Company’s
performance and help retain them over the long term. The
LTIP allows for two types of award:
Matching award: this takes the form of an option to acquire
a number of shares in the Company at nil cost up to a
maximum of three times the number of shares acquired by
the participant through the scheme’s trust or a SSIP/SSAS
pension scheme up to a maximum of £40,000 in any financial
year. The ability to exercise the option will be subject to the
prior satisfaction of a performance target. 
Option award: this award does not require the participant to
invest their own funds to be granted nil cost share options.
However the value of shares options granted will be limited
to one times salary in each financial year.
The first awards under the LTIP were made in August 2006
and were matching awards (details of which are included in
the Directors’ Options and Performance Related Share Awards
table on page 21). The performance targets in achieving the
options were over a three year period and were split 50% on
achievement of a cumulative EPS target of 12 pence and 50%
on total shareholder return in comparison to other companies
within the FTSE Small Cap Pharmaceutical and Biotechnology
Sector.
Other benefits: The Chief Executive, David Thatcher and the
Finance Director, Peter Coleman receive a motor car, private
healthcare and death and disability in service cover. The
Chairman, Peter Fothergill receives a provision for private
healthcare and death and disability in service cover.
Pension arrangements: The Chief Executive, David Thatcher
and the Finance Director, Peter Coleman, are members of the
Group’s defined contribution personal pension scheme, which
is open to all employees. The Group makes a contribution of
10% of salary for David Thatcher and 7% for Peter Coleman
and both are required to make a minimum contribution of
3% of their basic salary. The scheme also provides a lump sum
death in service benefit. The Chairman, Peter Fothergill,
receives from the Group a contribution of 15% of his basic
salary to his defined contribution personal pension plan.
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62235 Cobra Report 2006  25/1/07  17:53  Page 19 Cobra Biomanufacturing Plc 20
Report on Directors’ Remuneration
Service Contracts
The Executive Directors have a notice period of one year.
There are no special provisions for compensation in the event
of loss of office. The Remuneration Committee considers the
circumstances of individual cases of early termination and
determines compensation payments accordingly.
Directors’ Interests
At 30 September 2006, the Directors had the following
beneficial interests in the Company’s shares and options to
subscribe for shares under the Company’s share option
scheme:
Elements of Remuneration
The basic salary, bonus, pension and benefits awarded to the Executive Directors during the year were as follows:
Basic Remuneration Pension Remuneration Pension
salary Bonus Benefits 2006 2006 2005 2005
££ £ £ £ ££
Executive Directors
David Thatcher 168,508 16,851 14,527 199,886 16,851 192,436 16,360
Peter Fothergill 105,317 7,372 4,186 116,875 15,798 114,441 15,338
Peter Coleman 95,925 7,674 6,966 110,565 6,715 107,299 6,441
Total 369,750 31,897 25,679 427,326 39,364 414,176 38,139
Ordinary shares
of 10p each Share options
2006 2005 2006 2005 
No No No No
Executive Directors
David Thatcher 66,500 60,500 646,302 615,794
Peter Fothergill 66,000 60,000 510,489 479,981
Peter Coleman 20,000 15,500 189,960 167,079
Non-Executive Directors
David Bloxham* 17,200 17,200 - -
Michael Gatenby 30,000 30,000 - -
David Oxlade** - - - -
Nigel Slater 9,000 9,000 - -
* retired 30 September 2006
**    appointed 1 July 2006
From the end of the financial year until 9 January 2007 there have been no changes in the above interests.
62235 Cobra Report 2006  25/1/07  17:53  Page 20 Cobra Biomanufacturing Plc 21
Report on Directors’ Remuneration
Directors’ Share Options and Performance Related Share Awards
The Executive Directors have been awarded share options over the Company’s shares as follows: 
At At Date from
1 October Granted 30 September Exercise which Expiry Performance
2005 In year 2006 price exercisable date conditions
No No No pence
David Thatcher
Unapproved scheme 230,000 - 230,000 100.0 14.06.05 12.06.12 n/a
Unapproved scheme(i) 269,430 - 269,430 96.5 08.07.06 06.07.13 n/a
Unapproved scheme 116,364 - 116,364 27.5 13.07.07 11.07.14 n/a
LTIP matching award - 30,508 30,508 Nil 01.10.09 23.08.16 1&2
615,794 30,508 646,302
Peter Fothergill
Unapproved scheme 200,000 - 200,000 100.0 14.06.05 12.06.12 n/a
Unapproved scheme 207,254 - 207,254 96.5 08.07.06 06.07.13 n/a
Unapproved scheme 72,727 - 72,727 27.5 13.07.07 11.07.14 n/a
LTIP matching award - 30,508 30,508 Nil 01.10.09 23.08.16 1&2
479,981 30,508 510,489
Peter Coleman
Unapproved scheme 60,000 - 60,000 100.0 14.06.05 12.06.12 n/a
Unapproved scheme(ii) 74,352 - 74,352 96.5 08.07.06 06.07.13 n/a
Unapproved scheme(ii) 32,727 - 32,727 27.5 13.07.07 11.07.14 n/a
LTIP matching award - 22,881 22,881 Nil 01.10.09 23.08.16 1&2
167,079 22,881 189,960
Performance Criteria:
1. EPS Target: for each complete 1 penny by which the aggregate of the earnings per share in respect of the financial years 2006, 2007 & 2008 is achieved, the participant
is entitled to exercise 4.17% of the options granted, up to a maximum 12 pence or 50% of the options granted. 
2. TSR: If the Company is ranked equal to the 50th percentile of the FTSE Small Cap Pharmaceutical and Biotechnology Sector at the end of the financial year 2008, the
participant is entitled to exercise 25% of the options granted, for each complete 1% by which the Company is ranked above the 50th percentile, the participant is
entitled to exercise a further 1%, up to a maximum of the 75th percentile or 50% of the options granted
Notes:
(i) 103,627 of the options were granted under the Enterprise Management Incentive Scheme (EMI Scheme).
(ii) All of the options were granted under the EMI scheme.  
All of the share options granted to the Directors under the unapproved share option scheme were granted at the closing mid
market price on the last dealing day before grant. The market price of the Company’s shares at 30 September 2006 was 51.5 pence
(30 September 2005 46.0 pence) and the range during the year was 43.5 pence to 56.0 pence.
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62235 Cobra Report 2006  25/1/07  17:53  Page 21 Cobra Biomanufacturing Plc 22
Report on Directors’ Remuneration
The graph shows the Company’s Total Shareholder Return
compared to the FTSE Small Cap Pharmaceutical and
Biotechnology Sector for the period from 13 June 2002 to 31
October 2006. Total Shareholder Return is defined as share
price growth plus reinvested dividends. Given its size and
market sector, the Company believes that they are the most
appropriate basis for comparison as a relevant equity index of
which it is a member.
Nigel Slater
Chairman - Remuneration Committee
9 January 2007
2002 2003 2004 2005 2006
20
40
60
80
100
120
140
160
— Cobra Biomanufacturing Plc
— FTSE Small Cap Pharma and Biotech Sector
Performance Graph
62235 Cobra Report 2006  26/1/07  15:43  Page 22 Cobra Biomanufacturing Plc 23
Independent Auditors’ Report to the Members
of Cobra Biomanufacturing Plc
We have audited the Group and Parent Company financial statements of Cobra Biomanufacturing Plc for the year ended 30
September 2006 which comprise the consolidated profit and loss account, the consolidated statement of total recognised gains
and losses, the balance sheets, the consolidated cash flow statement and the related notes 1 to 25.  These financial statements
have been prepared under the accounting policies set out therein.
This report is made solely to the Company’s members, as a body, in accordance with s235 of the Companies Act 1985.  Our audit
work has been undertaken so that we might state to the company’s members those matters we are required to state to them in
an auditors’ report and for no other purpose.  To the fullest extent permitted by law, we do not accept or assume responsibility
to anyone other than the Company and the Company’s Members as a body, for our audit work, for this report, or for the opinions
we have formed.
Respective responsibilities of Directors and Auditors
The Directors' responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and
United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) are set out in the statement of
Directors' responsibilities.
Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and
International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in
accordance with the Companies Act 1985.  We also report to you whether in our opinion the information given in the Directors’
Report is consistent with the financial statements.
In addition we report to you if, in our opinion, the Company has not kept proper accounting records, if we have not received all
the information and explanations we require for our audit, or if information specified by law regarding Directors' remuneration
and other transactions is not disclosed.
We read the other information contained in the Annual Report, and consider whether it is consistent with the audited financial
statements.  We consider the implications for our report if we become aware of any apparent misstatements or material
inconsistencies with the financial statements.  Our responsibilities do not extend to any further information outside the Annual
Report.
Basis of audit opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices
Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial
statements. It also includes an assessment of the significant estimates and judgments made by the Directors in the preparation of
the financial statements, and of whether the accounting policies are appropriate to the Group’s and Company’s circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order
to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material
misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion:
1. the financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted Accounting
Practice, of the state of the Group’s and the Parent Company's affairs as at 30 September 2006 and of the Group’s profit for
the year then ended; 
2. and the financial statements have been properly prepared in accordance with the Companies Act 1985; and
3. the information given in the Directors’ Report is consistent with the financial statements.
Deloitte & Touche LLP
Chartered Accountants and Registered Auditors
9 January 2007
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62235 Cobra Report 2006  27/1/07  13:51  Page 23 Cobra Biomanufacturing Plc 24
Group Profit and Loss Account 
for the Year Ended 30 September 2006
Notes 2006 2006 2005 2005
££ ££
Turnover 2 10,144,875 7,720,576
Cost of sales (4,807,955) (3,397,853)
Gross profit 5,336,920 4,322,723
Sales, marketing and distribution costs (1,078,678) (1,000,804)
Administrative expenses
Research and development (401,302) (265,192)
Other administrative expenses (3,588,750) (3,408,230)
(3,990,052) (3,673,422)
Operating profit/(loss) on ordinary 
activities before interest and taxation 3 268,190 (351,503)
Bank interest receivable 65,222 79,219
Interest payable (123,355) (122,155)
5 (58,133) (42,936)
Profit/(loss) before tax 210,057 (394,439)
Taxation 6 55,000 53,568 
Retained profit/(loss) for the year 265,057 (340,871)
Earnings/(loss) per share
Basic 8 1.4p (1.7p)
Diluted 8 1.3p (1.7p)
All the results are derived from continuing operations.
Group Statement of Total Recognised Gains and Losses
There are no recognised gains or losses other than the profit for the year ended 30 September 2006 of £265,057 and the loss of
£340,871 in the year ended 30 September 2005.
62235 Cobra Report 2006  25/1/07  17:53  Page 24 Group Company
Notes 2006 2005 2006 2005
£ £ £ £
Fixed assets
Tangible assets 9 8,355,267 7,495,274 - -
Intangible assets 10 159,281 - - -
Investments 11 - - 600,001 600,000
8,514,548 7,495,274 600,001 600,000
Current assets
Stocks and work in progress 12 595,230 231,652 - -
Debtors 13 2,272,807 2,013,909 2,031,983 1,679,393
Cash at bank and in hand 3,214,955 3,035,884 3,058,567 2,668,205
6,082,992 5,281,445 5,090,550 4,347,598
Creditors: amounts falling due within one year 14 (3,742,522) (2,781,400) (593,240) (412,185)
Net current assets 2,340,470 2,500,045 4,497,310 3,935,413
Total assets less current liabilities 10,855,018 9,995,319 5,097,311 4,535,413
Creditors: amounts falling due after more
than one year 15 (2,776,258) (2,183,033) (1,772,551) (1,280,000)
Net assets 8,078,760 7,812,286 3,324,760 3,255,413
Capital and reserves
Called up share capital 19&20 1,959,117 1,950,727 1,959,117 1,950,727
Share premium 20 9,633,766 9,633,766 9,633,766 9,633,766
Merger reserve 20 29,728,872 29,728,872 - -
Other reserves 20 (6,973) - (6,973) -
Profit and loss account 20 (33,236,022) (33,501,079) (8,261,150) (8,329,080)
Equity shareholders’ funds 8,078,760 7,812,286 3,324,760 3,255,413
The financial statements on pages 24 to 42 were approved by the Board of Directors on 9 January 2007 and were signed on its
behalf by:
David Thatcher Peter Coleman
Chief Executive Finance Director
Cobra Biomanufacturing Plc 25
Balance Sheets
at 30 September 2006
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62235 Cobra Report 2006  25/1/07  17:53  Page 25 Cobra Biomanufacturing Plc 26
Group Statement of Cash Flows 
for the Year Ended 30 September 2006
2006 2005
As restated 
per note 25
Notes £ £
Net cash inflow from operating activities 21 1,153,297 571,662
Returns on investment and servicing of finance
Interest received 65,222 79,219
Interest on bank loans (32,877) (45,331)
Interest element of finance lease rental payments (94,217) (76,824)
(61,872) (42,936)
Taxation
R&D tax credit 49,290 69,189
Capital expenditure
Payments to acquire tangible fixed assets (1,483,567) (786,461)
Payments to acquire intangible fixed assets (157,175) -
(1,640,742) (786,461)
Net cash outflow before the management of
liquid resources and financing (500,027) (188,546)
Management of liquid resources
Decrease in short term deposits 25 - 1,165,000
Financing
Issue of ordinary shares 8,390 2,000
Purchase of treasury shares (8,390) -
Repayment of long term loans (1,100,000) (1,067,639)
New long term loans 1,650,000 1,280,000
Repayment of capital element of finance leases (372,876) (341,231)
Finance acquired via sale and leaseback 501,974 192,727
679,098 65,857
Increase in cash 179,071 1,042,311
Reconciliation of Net Cash Flow to
Movement in Net (Debt)/Funds 2006 2005
As restated 
per note 25
Notes £ £
Increase in cash 179,071 1,042,311
Cash inflow from loans (550,000) (212,361)
Repayment of capital element of finance leases 372,876 341,231
Lease finance acquired (636,726) (376,884)
Cash inflow from short term deposits 25 - (1,165,000)
Movement in net (debt)/funds resulting from cash flows (634,779) (370,703)
Exchange rate differences 19,929 -
Movement in net (debt)/funds (614,850) (370,703)
Net funds at the start of the year 546,409 917,112
Net (debt)/funds at the end of the year 21 (68,441) 546,409
62235 Cobra Report 2006  26/1/07  15:44  Page 26 Cobra Biomanufacturing Plc 27
Notes to the Financial Statements 
for the Year Ended 30 September 2006
1 ACCOUNTING POLICIES
Basis of preparation: The accounts are prepared under the historical cost convention and in accordance with applicable United
Kingdom law and accounting standards.
Basis of consolidation and presentation of financial statements: The Group accounts comprise the accounts of Cobra
Biomanufacturing Plc and its subsidiary undertaking’s Cobra Biologics Limited, Cobra Biomanufacturing EBT Limited and Cobra
Biomanufacturing LLC up to 30 September 2006. No profit and loss account is presented for Cobra Biomanufacturing Plc as
permitted by Section 230 of the Companies Act 1985.
Turnover and revenue recognition: Turnover, which excludes value added tax, represents amounts receivable in respect of the sale
of goods and services during the year. Turnover on contracts is invoiced in accordance with the terms of the agreement with the
customer. Non refundable capacity reservation fees, which are usually invoiced and paid upon contractual signature, are
recognised as turnover as the contract progresses. The remainder of the contractual turnover is recognised upon the stage of
completion when the outcome of the contract can be foreseen with reasonable certainty and after allowing for costs of
completion. 
Intangible assets: Are stated at cost less provisions for amortisation and impairments. Patents and know-how are amortised over
their estimated useful economic lives from the time they are available for use. The estimated useful lives for determining the
amortisation charge are reviewed annually.
Tangible assets and depreciation: Depreciation is provided on all tangible fixed assets, other than freehold land, at rates
calculated to write off the cost less residual value of each asset evenly over its expected useful life as follows:
Freehold buildings between 15 and 50 years
Plant and laboratory equipment between 6.67 and 10 years
Short leasehold building improvements 6.67 years
Office equipment 4 years
Motor vehicles 3 years
The cost of tangible fixed assets includes directly attributable finance costs, calculated on a day to day basis, on expenditure
incurred during construction and modification. The carrying values of tangible fixed assets are reviewed for impairment when
events or changes in circumstances indicate the carrying value may not be recoverable. Assets under construction include the costs
directly attributable to bringing the asset into working condition for its intended use.
Government grants: In respect of capital expenditure are credited to a deferred income account and are released to profit over
the expected useful lives of the relevant assets by equal instalments. Grants of a revenue nature are credited to income so as to
match them with the expenditure to which they relate.  
Stocks: Are valued in the balance sheet at the lower of cost incurred in bringing each product to its present location and
condition, and net realisable value. Cost is calculated on a first in first out basis. 
Raw materials: purchase cost on a first in first out basis.
Work in progress: cost of direct materials and labour plus attributable overheads based on a normal level of activity.
Net realisable value is based on estimated selling price less any further costs expected to be incurred on completion and disposal.
Research and development expenditure: Is written off in the period in which it is incurred, and includes inter alia all internal and
external costs incurred in patenting, external studies and consultancy.
Leasing and hire purchase commitments: Assets held under finance leases and hire purchase contracts, which are those where
substantially all the risks and rewards of ownership of the asset have passed to the Group, are capitalised in the balance sheet
and are depreciated over their useful lives. The interest element of the rental obligations is charged to the profit and loss account
over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding. 
Rentals paid under operating leases are charged to income on a straight-line basis over the lease term.
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 27 Notes to the Financial Statements 
for the Year Ended 30 September 2006
Deferred tax: Is recognised in respect of all timing differences that have originated but not reversed at the Balance Sheet date
where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to
receive more tax.  Deferred tax assets are recognised only to the extent that the Directors consider that it is more likely than not
that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing
differences reverse, based on tax rates and laws enacted or substantively enacted at the Balance Sheet date.
Foreign currencies: Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date.
All differences are taken to the profit and loss account.
Pension costs: The Group operates a defined contribution scheme, covering all eligible employees. Contributions are charged to
the profit and loss account on an accruals basis.
Derivatives and other financial instruments: The Group uses derivative financial instruments to reduce exposure to foreign
exchange risk and interest rate movements. The Group does not hold or issue derivative financial instruments for speculative
purposes.  The criteria for forward foreign currency contracts are:
–  The instrument must be related to a firm foreign currency commitment;
–  It must involve the same currency as the hedged item; and
–  It must reduce the risk of foreign currency exchange rate movements on the Group’s operation.
Share based payments: Are accounted for in accordance with UITF 17, “Employee Share Schemes”, whereby the difference
between the market price and the exercise price of the options are charged to the profit and loss account over the period the
shares are vested, with a corresponding credit to reserves. 
Cobra Biomanufacturing Plc 28
1 ACCOUNTING POLICIES (continued)
62235 Cobra Report 2006  25/1/07  17:53  Page 28 Cobra Biomanufacturing Plc 29
Notes to the Financial Statements 
for the Year Ended 30 September 2006
2 TURNOVER
The Group operates in one area of activity that of contract manufacturing services. All turnover originates from the UK. 
The geographical analysis of turnover by destination is as follows:
2006 2005
£ £
United Kingdom 588,631 1,284,832
North America 8,656,631 6,138,082
Europe 703,058 209,976
Rest of the World 196,555 87,686
10,144,875 7,720,576
The analysis of turnover by customer’s biopharmaceutical product type is as follows:
2006 2005
£ £
Protein 6,741,915 3,177,350
Virus 1,946,061 2,757,695
DNA 1,012,810 1,390,690
Cell line 444,089 394,841
10,144,875 7,720,576
3 OPERATING PROFIT/(LOSS) 
2006 2005
This is stated after charging/(crediting): £ £
Auditors’ remuneration - audit fees 15,250 15,000
- other audit services 15,250 15,000
- other services 36,102 18,741
Research and development 401,302 265,192
Amortisation of patents 1,430 -
Depreciation of owned assets 508,255 517,839
Depreciation of assets held under finance leases 228,467 193,302
Operating leases - plant and machinery 36,873 24,057
- land and buildings 240,486 214,169
Foreign currency exchange (gain)/loss (127,101) 48,037
Government grants (72,125) (54,389)
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62235 Cobra Report 2006  26/1/07  07:53  Page 29 Cobra Biomanufacturing Plc 30
Notes to the Financial Statements 
for the Year Ended 30 September 2006
2006 2005
£ £
Wages and salaries 3,910,938 3,172,547
Social security costs 361,499 310,160
Other pension costs 173,838 152,338
4,446,275 3,635,045
The average monthly number of employees during the year was made up as follows:
2006 2005
No. No.
Manufacturing 78 61
Sales, marketing and distribution 11 8
Research and development 5 3
Administration 24 22
118 94
Directors’ remuneration
2006 2005
£ £
Aggregate emoluments 500,451 481,676
Company contributions to defined contributions pension schemes 39,364 38,139
539,815 519,815
Remuneration to highest paid director
2006 2005
£ £
Aggregate emoluments 199,886 192,436
Company contributions to defined contributions pension schemes 16,851 16,360
216,737 208,796
There are 3 directors (2005: 3) to whom retirement benefits are accruing under defined benefit contributions pension schemes.
5 INTEREST RECEIVABLE AND PAYABLE
2006 2005
£ £
Interest receivable
Bank interest receivable 65,222 79,219
Interest payable
Interest payable bank loans 32,877 47,034
Interest payable on finance leases 94,217 76,824
127,094 123,858
Less: interest capitalised (3,739) (1,703)
123,355 122,155
4 STAFF COSTS
62235 Cobra Report 2006  25/1/07  17:53  Page 30 Cobra Biomanufacturing Plc 31
Notes to the Financial Statements 
for the Year Ended 30 September 2006
6 TAXATION
The Group is entitled to Research and Development tax relief under Schedule 20 of the Finance Act 2000, in respect of the years
ended 30 September 2006 and 2005.
2006 2005
£ £
Taxation on profit/(loss) on ordinary activities
Current tax
Tax credit in relation to R&D claim (55,000) (49,290)
Adjustments in respect of previous periods - (4,278)
(55,000) (53,568)
Factors affecting the tax charge for the year
The tax assessed for the year is lower than the standard rate of corporation tax in the UK.  The differences are explained below:
2006 2005
£ £
Profit/(loss) on ordinary activities before tax 210,057 (394,439)
Profit/(loss) on ordinary activities multiplied by the standard rate of
Corporation Tax in the UK of 30% (2005 30%) 63,017 (118,332) 
Effect of
Disallowed expenses and non taxable income 5,722 39,407
Depreciation less than capital allowances (133,825) (21,643)
Other timing differences (11,009) 3,184
Adjustment in respect of previous periods - (4,278)
Tax losses (utilised)/carried forward (4,457) 4,275
Difference in R&D rate and standard rate of tax 25,552 43,819
Current tax charge for the year (55,000) (53,568)
Factors affecting future tax charges
The trading losses carried forward available for set off against future profits arising from the same trade amount to approximately
£14.2m (2005: £14.2m)
Deferred taxation
The deferred tax recognised and not recognised is as follows:
Group
Not Not 
Recognised Recognised Recognised Recognised
2006 2006 2005 2005
££ ££
Accelerated capital allowances - (533,927) - (84,243)
Other timing differences - 7,088 - (8,169)
Tax losses - (4,270,259) - (4,274,275)
- (4,797,098) - (4,366,687)
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 31 Notes to the Financial Statements 
for the Year Ended 30 September 2006
Company
Not Not 
Recognised Recognised Recognised Recognised
2006 2006 2005 2005
££ ££
Other timing differences - (119) - (224)
Tax losses -- - (4,016)
- (119) - (4,240)
The deferred tax asset has not been provided for as it is uncertain whether sufficient profit will arise in the foreseeable future to
enable the asset to reverse.
7 PROFIT/(LOSS) ATTRIBUTABLE TO MEMBERS OF THE PARENT COMPANY
The profit dealt with in the accounts of the parent company for the year ended 30 September 2006 was £67,930 (2005 £6,136
loss).
8 EARNINGS/(LOSS) PER ORDINARY SHARE
The calculation of basic earnings per ordinary share is based on profit of £265,057 (2005: £340,871 loss) and on 19,512,560 ordinary
shares (2005: 19,504,264) being the weighted average number of shares in issue during the year.
The earnings for the year for calculating the diluted earnings per share for the year ended 30 September 2006 are identical to
those used for the basic earnings per share. The weighted average number of ordinary shares for calculating the diluted earnings
per share for the year ended 30 September 2006 includes 389,304 share options and warrants that would potentially be issued
and would have the effect of reducing the earnings per ordinary share and would therefore be dilutive under the terms of
Financial Reporting Standard (FRS) No 22.  
The loss for the year and the weighted average number of ordinary shares for calculating the diluted loss per share for the year
ended 30 September 2005 are identical to that used for the basic loss per share. This is because the outstanding share options and
warrants would have the effect of reducing the loss per ordinary share and would therefore not be dilutive under the terms of
Financial Reporting Standard (FRS) No 22. 
Cobra Biomanufacturing Plc 32
6 TAXATION (continued)
62235 Cobra Report 2006  25/1/07  17:53  Page 32 Cobra Biomanufacturing Plc 33
Notes to the Financial Statements 
for the Year Ended 30 September 2006
9 TANGIBLE FIXED ASSETS
Short
Plant and leasehold Freehold Assets
laboratory Motor Office building land & under
equipment vehicles equipment improvements buildings construction Total
£ £ £ £ £££
Cost
At 1 October 2005 6,033,826 8,036 687,569 1,845,427 3,348,076 256,309 12,179,243
Additions 575,125 - 156,390 - - 865,200 1,596,715
Transfers 154,429 - - - 880,893 (1,035,322) -
Decapitalised (997,519) - (294,517) (1,845,427) - - (3,137,463)
At 30 September 2006 5,765,861 8,036 549,442 - 4,228,969 86,187 10,638,495
Depreciation
At 1 October 2005 2,094,224 3,566 527,926 1,845,427 212,826 - 4,683,969
Charge for the year 502,157 2,678 83,080 - 148,807 - 736,722
Decapitalised (997,519) - (294,517) (1,845,427) - - (3,137,463)
At 30 September 2006 1,598,862 6,244 316,489 - 361,633 - 2,283,228
Net book value
At 30 September 2006 4,166,999 1,792 232,953 - 3,867,336 86,187 8,355,267
At 30 September 2005 3,939,602 4,470 159,643 - 3,135,250 256,309 7,495,274
The net book value of tangible fixed assets includes £1,760,899 (2005: £1,340,186) in respect of assets held under finance leases.
The assets under finance leases consist of plant, laboratory and office equipment and motor vehicles. 
The cost of tangible assets includes £73,754 (2005: £70,015) of capitalised interest relating to the property mortgage loan taken
out to purchase freehold land and buildings.  
The short leasehold building improvements, plant and laboratory equipment and office equipment decapitalised in the year were
fully depreciated assets purchased prior to the 30 September 2000.
10 INTANGIBLE FIXED ASSETS
Patents
£
Cost
At 1 October 2005 -
Additions 160,711
At 30 September 2006 160,711
Amortisation
At 1 October 2005 -
Charge for the year 1,430
At 30 September 2006 1,430
Net book value 
At 30 September 2006 159,281
At 30 September 2005 -
Patent costs are amortised evenly over their useful economic lives.
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 33 Cobra Biomanufacturing Plc 34
Notes to the Financial Statements 
for the Year Ended 30 September 2006
11 INVESTMENTS
Group
The Group had no investments at 30 September 2006 and 30 September 2005.
Company
Shares in
subsidiary
undertakings
£
Cost
At 1 October 2005 600,000
Additions 1
At 30 September 2006 600,001
Provisions
At 1 October 2005 -
Charge for the year -
At 30 September 2006 -
Net book value
At 30 September 2006 600,001
At 30 September 2005 600,000
On 2 May 2006, the Company acquired the entire issued share capital of Cobra Biomanufacturing EBT Limited at par for a cash
consideration of £1.
At 30 September 2006 the company had the following subsidiary undertakings:
Subsidiary undertaking Nature of business Country of incorporation
Cobra Biologics Limited Manufacture of protein, virus and DNA England and Wales
based pharmeceuticals
Cobra Biomanufacturing EBT Limited Employee benefit trust England and Wales
Cobra Biomanufacturing LLC Dormant USA
12  STOCKS AND WORK IN PROGRESS
Group Company
2006 2005 2006 2005
£ £ £ £
Raw materials & consumables 221,428 231,652 - -
Work in progress 373,802 - - -
595,230 231,652 - -
62235 Cobra Report 2006  25/1/07  17:53  Page 34 Cobra Biomanufacturing Plc 35
Notes to the Financial Statements 
for the Year Ended 30 September 2006
13 DEBTORS
Group Company
2006 2005 2006 2005
£ £ £ £
Trade debtors 1,445,137 1,432,069 2,006 -
Amounts owed by group undertakings - - 1,965,979 1,659,038
Corporation tax 55,000 49,290 - -
Other debtors 263,237 111,589 30,551 14,030
Prepayments 509,433 420,961 33,447 6,325
2,272,807 2,013,909 2,031,983 1,679,393
14 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group Company
2006 2005 2006 2005
£ £ £ £
Loans and overdrafts 37,520 - 37,520 -
Obligations under finance leases 469,618 306,442 - -
Trade creditors 1,393,974 1,336,649 373,050 135,297
Other taxation and social security costs 121,119 89,480 38,164 34,606
Deferred income 1,194,812 356,010 - -
Other creditors - 103,899 - 74,411
Accruals 525,479 588,920 144,506 167,871
3,742,522 2,781,400 593,240 412,185
15 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Group Company
2006 2005 2006 2005
£ £ £ £
Loans and overdrafts 1,772,551 1,280,000 1,772,551 1,280,000
Obligations under finance leases 1,003,707 903,033 - -
2,776,258 2,183,033 1,772,551 1,280,000
16 LOANS
Group Company
2006 2005 2006 2005
£ £ £ £
Amounts falling due:
In one year or less or on demand (note 14) 37,520 - 37,520 -
In more than one year but less than two years 103,980 41,070 103,980 41,070
In more than two years but less than five years 417,709 295,704 417,709 295,704
In more than five years 1,250,862 943,226 1,250,862 943,226
1,810,071 1,280,000 1,810,071 1,280,000
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 35 Notes to the Financial Statements 
for the Year Ended 30 September 2006
The long term loans are mortgage facilities of £1,542,891 and a $500,000 USD loan. Both are secured against freehold land and
buildings. They are repayable in monthly instalments, over a 13 year period commencing May 2007. For the mortgage facilities,
the Group utilises the availability of an ‘off-set’ arrangement with the bank, which effectively means the Group currently pays a
fixed rate of 1.5% over the National Westminster Bank Plc’s base rate on the outstanding mortgage balance.  For the USD loan
the Group pays interest at a rate of 1.45% over the bank’s US dollar base rate on the outstanding balance.   
17 OBLIGATIONS UNDER FINANCE LEASES
Group Company
2006 2005 2006 2005
£ £ £ £
Payable within one year (note 14) 469,618 306,442 - -
Payable between one and two years 503,672 312,490 - -
Payable between two and five years 500,035 590,543 - -
1,473,325 1,209,475 - -
18 OTHER FINANCIAL COMMITMENTS
At 30 September 2006 the Group had annual commitments under non-cancellable operating leases as follows:
Land & buildings Other
2006 2005 2006 2005
£ £ £ £
Expiring within one year 56,200 47,000 6,720 3,148
Expiring between one and two years - - 17,454 9,206
Expiring between two and five years - - 8,098 17,964
Expiring in greater than five years 154,450 154,450 - -
210,650 201,450 32,272 30,318
The Company has no amounts due under non-cancellable operating leases.
19 CALLED UP SHARE CAPITAL
Group and Company No. £
Authorised
At 1 October 2005 and at 30 September 2006 27,000,000 2,700,000
Group and Company
No. £
Allotted, called up and fully paid
At 1 October 2005 19,507,273 1,950,727
Allotted in the year 83,897 8,390
At 30 September 2006 19,591,170 1,959,117
On 7 June 2002 the Company entered into a placing agreement with Collins Stewart Limited, as disclosed in the admission
document for the Company’s admission to the Alternative Investment Market, to issue to Collins Stewart Limited a warrant to
subscribe for 390,000 ordinary shares at the placing price of 100.0 pence. The warrant is exercisable at any time up to 13 June 2007.
Cobra Biomanufacturing Plc 36
16 LOANS (continued)
62235 Cobra Report 2006  25/1/07  17:53  Page 36 Cobra Biomanufacturing Plc 37
Notes to the Financial Statements 
for the Year Ended 30 September 2006
19 CALLED UP SHARE CAPITAL (continued)
On 24 August 2006 the company issued a further 83,897 ordinary 10p shares at par for cash consideration. The issue of ordinary
shares was in accordance with the agreed terms of the LTIP scheme.
At 30 September 2006 the following options had been granted to employees and Directors and remained outstanding: 
At At 30 Date from
1 October Granted Exercised Cancelled September Exercise which Expiry
2005 in year in year or expired 2006 price exercisable date
No No No No No pence
Unapproved scheme
Issue 13 Jun 2002 682,890 - - (45,214) 637,676 100.0 14.06.05 12.06.12
Issue 7 Jul 2003 607,797 - - - 607,797 96.5 08.07.06 06.07.13
Issue 7 Jan 2004 95,621 - - (24,423) 71,198 147.5 08.01.07 06.01.14
Issue 12 Jul 2004 311,651 - - (28,155) 283,496 27.5 13.07.07 11.07.14
Issue 21 Feb 2005 140,874 - - (127,500) 13,374 50.0 22.02.08 20.02.15
Issue 4 Aug 2005 20,000 - - - 20,000 51.5 05.08.08 03.08.15
Issue 10 Aug 2005 5,957 - - (2,170) 3,787 53.0 11.08.08 09.08.15
Issue 13 Feb 2006 - 10,458 - (4,527) 5,931 56.0 14.02.09 12.02.16
Issue 7 Aug 2006 - 27,198 - - 27,198 47.5 08.07.09 06.08.16
Total 1,864,790 37,656 - (231,989) 1,670,457
LTIP scheme
Issue 24 Aug 2006 - 83,897 - - 83,897 Nil 01.10.09 23.08.16
Total 1,864,790 121,553 - (231,989) 1,754,354
All of the share options granted under the unapproved share option scheme have been granted at either the closing mid market
price on the last dealing day before grant or the average closing mid market price on the last three dealing days before grant.
20 RECONCILIATION OF SHAREHOLDERS’ FUNDS AND MOVEMENT ON RESERVES
Group
Share Share Merger Other Profit &
capital premium reserve reserves loss account Total
££££££
At 1 October 2005 1,950,727 9,633,766 29,728,872 - (33,501,079) 7,812,286
Share issue 8,390 ---- 8,390
Shares purchased - - - (8,390) - (8,390)
Share based payments - - - 1,417 - 1,417
Profit for the year ---- 265,057 265,057
At 30 September 2006 1,959,117 9,633,766 29,728,872 (6,973) (33,236,022) 8,078,760
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 37 Notes to the Financial Statements 
for the Year Ended 30 September 2006
20 RECONCILIATION OF SHAREHOLDERS’ FUNDS AND MOVEMENT ON RESERVES (continued)
Other reserves
Own shares
purchased Share based
by EBT payments Total
£££
At 1 October 2005 ---
Shares purchased (8,390) - (8,390)
Share based payments - 1,417 1,417
At 30 September 2006 (8,390) 1,417 (6,973)
Company
Share Share Other Profit & 
capital premium reserves loss account Total
£££££
At 1 October 2005 1,950,727 9,633,766 - (8,329,080) 3,255,413
Share issue 8,390 - - - 8,390
Shares purchased - - (8,390) - (8,390)
Share based payments - - 1,417 - 1,417
Profit for the year - - - 67,930 67,930
At 30 September 2006 1,959,117 9,633,766 (6,973) (8,261,150) 3,324,760
Other reserves
Own shares
purchased Share based
by EBT payments Total
££ £
At 1 October 2005 ---
Shares purchased (8,390) - (8,390)
Share based payments - 1,417 1,417
At 30 September 2006 (8,390) 1,417 (6,973)
Own shares include 83,897 (2005: nil) ordinary shares in the Company that have been purchased by Cobra Biomanufacturing
EBT Limited. The shares are held to satisfy potential awards or options under the Company's share scheme. The value of shares
in Cobra Biomanufacturing EBT Limited has been recognised as an investment in treasury shares. The market value of these
shares at 30 September 2006 was £43,207 (2005: £nil).
Cobra Biomanufacturing Plc 38
62235 Cobra Report 2006  27/1/07  08:27  Page 38 Cobra Biomanufacturing Plc 39
Notes to the Financial Statements 
for the Year Ended 30 September 2006
21 NOTES TO THE STATEMENT OF CASH FLOWS
(a) Reconciliation of operating profit/(loss) to net cash flow from operating activities
2006 2005
£ £
Operating profit/(loss) 268,190 (351,503)
Depreciation of tangible fixed assets 736,722 711,141
Amortisation of intangible fixed assets 1,430 -
Share based payments 1,417 -
Unrealised foreign exchange rate gain (67,305) -
(Increase)/decrease in stock (363,578) 43,852
Increase in debtors (220,976) (417,548)
Increase in deferred income 838,802 128,996
(Decrease)/increase in other creditors (41,405) 456,724
Net cash inflow from operating activities 1,153,297 571,662
(b) Analysis of net funds/(debt)
Other non
cash 
2005 Cash flow movements 2006
As restated
per note 25
£££ £
Cash at bank and in hand 2,760,884 179,071 - 2,939,955
Short term deposits* 275,000 - - 275,000
3,035,884 179,071 - 3,214,955
Bank loan (1,280,000) (550,000) 19,929 (1,810,071)
Finance leases (1,209,475) (129,098) (134,752) (1,473,325)
(2,489,475) (679,098) (114,823) (3,283,396)
Net funds/(debt) 546,409 (500,027) (114,823) (68,441)
The non cash movement of £19,929 is an unrealised gain on the Group’s $500,000 US Dollar loan.
The Group financed the purchase of its tangible assets where possible through two types of finance leases; sale and leaseback
transactions, which are shown as a separate component of cash flow in the cash flow statement; and direct financing
arrangements, which are shown as a non cash movement in the analysis of net funds. 
* Short term deposits are included within the cash at bank and in hand on the balance sheet.
making tomorrow’s medicines
62235 Cobra Report 2006  26/1/07  15:44  Page 39 Notes to the Financial Statements 
for the Year Ended 30 September 2006
22 FINANCIAL INSTRUMENTS
An explanation of the Group’s objectives, policies and strategies for the role of derivatives and other financial instruments can
be found on page 7. It is not the Group’s policy to enter into financial derivatives for speculative or trading purposes. The
financial instruments employed by the Group other than short-term debtors and creditors are used to fund its operations and
comprise cash, short-term deposits, long term loans and finance leases. 
The Group’s policy during the year ended 30 September 2006 was to place the majority of its cash on short-term deposit with its
bankers, to finance the purchase of freehold land and buildings through mortgage finance and to finance the purchase of fixed
assets through sale and leaseback, where possible, for cash flow purposes.
The Group’s exposure to interest rate risk is limited to finance leases which are typically fixed rate, and its mortgage facility and
cash deposits which are typically floating rate. As permitted by Financial Reporting Standard (FRS) No.13 the disclosures below
with the exception of currency exposure, exclude short-term debtors and creditors.
Interest rate risk profile of financial assets
The interest rate profile of financial assets of the Group as at 30 September 2006 is as follows:
Financial assets on which  Floating rate Total
no interest is earned  financial assets
£££
2006
Sterling 62,628 3,000,092 3,062,720
US Dollar - 32,402 32,402
Euro 119,833 - 119,833
182,461 3,032,494 3,214,955
2005
Sterling 374,662 2,658,913 3,033,575
US Dollar 561 1,748 2,309
375,223 2,660,661 3,035,884
Floating rate financial assets comprise cash deposits on money market deposit at call and interest is received either at the Bank
of Scotland’s base rate or at the National Westminster Bank Plc’s money market rate.
Interest rate risk profile of financial liabilities
The interest rate profile of the financial liabilities of the Group as at 30 September 2006 is as follows:
Fixed rate Floating rate Total
financial financial
liabilities liabilities
£££
2006
Dollar - 267,180 267,180
Sterling 1,473,325 1,542,891 3,016,216
1,473,325 1,810,071 3,283,396
2005
Sterling 1,209,475 1,280,000 2,489,475
The weighted average interest rate on fixed rate financial liabilities at 30 September 2006 was 7.5% (2005: 7.0%).
Cobra Biomanufacturing Plc 40
62235 Cobra Report 2006  27/1/07  08:25  Page 40 Cobra Biomanufacturing Plc 41
Notes to the Financial Statements 
for the Year Ended 30 September 2006
Interest rate risk profile of financial liabilities (continued)
The weighted average period to maturity of fixed rate financial liabilities at 30 September 2006 was 37 months (2005: 53 months).
The fixed rate financial liabilities were confined to obligations under finance leases. Floating rate financial instruments comprise
a £1,542,891 mortgage facility with National Westminster Bank Plc with an interest rate of 1.50% over the bank’s UK base rate
and a $500,000 loan with National Westminster Bank Plc with an interest rate of 1.45% over the bank’s US base rate.
Maturity of financial liabilities
The maturity profile of the Group’s financial liabilities as at 30 September 2006 was as follows: 
2006 2005
£ £
Payable within one year 507,138 306,442
Payable between one and two years 607,652 353,560
Payable between two and five years 917,744 886,247
Payable in more than five years 1,250,862 943,226
3,283,396 2,489,475
Currency exposures
The table below shows the Group’s currency exposures that give rise to net currency gains and losses recognised in the profit and
loss account.  Such exposures comprise monetary assets and liabilities of the Group that are not denominated in the operating
currency of the operating unit involved.
Functional currency of Net currency monetary (liabilities)/assets
Group operations US Dollar Euro Other Total
££££
2006
Sterling (888,305) (83,870) 1,598 (970,577)
2005
Sterling 799,524 52,122 - 851,646
The amount shown in the table above take into account the effect of forward foreign currency contracts entered into to manage
the currency exposure of the contracted forward order book.
Borrowing facility
At the year end the Group did not have a borrowing facility. 
Fair Values of financial assets and financial liabilities 
The fair value, based upon the market value or discounted cashflows of the financial instruments detailed above was not
materially different from their book values.
23 CAPITAL COMMITMENTS
Amounts contracted for but not provided in the financial statements amounted to £114,470 (2005: £nil)
22 FINANCIAL INSTRUMENTS (continued)
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 41 Notes to the Financial Statements 
for the Year Ended 30 September 2006
Cobra Biomanufacturing Plc 42
24 PENSION COMMITMENTS  
The Group operates a defined contribution pension scheme established with Scottish Widows Plc.  The assets of the scheme are
held separately from those of the Group and are independently administered.  The contributions payable by the Group under the
scheme amounted to £158,774 (2005: £137,000).  Contributions totalling £22,022 (2005: £19,179) were payable at the year end.
25 CASH FLOW RESTATEMENT
The cash flow statement has been restated following a decision to reclassify the treatment of cash at bank held by the Group in
short term interest bearing accounts. This restatement has been made because in the opinion of the Directors this is a clearer
presentation of the cash movement in the financial year. 
The restatement has resulted in the following amendments to the financial statements:
Extracts of the ‘Group Statement of Cash Flows’
2006 2005
£ £
Management of liquid resources
Decrease in short term deposits as previously stated - 352,077
Restatement - 812,923
Decrease in short term deposits as restated - 1,165,000
Extracts of the ‘Reconciliation of Net Cash Flow to Movement in Net (Debt)/Funds’
2006 2005
£ £
Cash inflow from short term deposits as previously stated - (352,077)
Restatement - (812,923)
Cash inflow from short term deposits as restated - (1,165,000)
Extract of ‘Analysis of net (debt)/funds’ 
2005
£
Cash at bank and in hand as previously stated 375,223
Restatement 2,385,661
Cash at bank and in hand as restated 2,760,884
Short term deposits as previously stated 2,660,661
Restatement (2,385,661)
Short term deposits as restated 275,000
62235 Cobra Report 2006  25/1/07  17:53  Page 42 Cobra Biomanufacturing Plc 43
Notice of Annual General Meeting
Notice is given that the Annual General Meeting of Cobra Biomanufacturing Plc will be held at the offices of Buchanan
Communications Limited, 45 Moorfields, London, EC2Y 9AE on 12 April 2007 at 11.00am.
To transact the following business:
Ordinary Business
1. To receive the accounts for the year ended 30 September 2006 and the Report of the Directors and the auditors thereon;
2. To re-appoint as a Director, David Oxlade;
3. To re-elect as a Director,  Peter Fothergill;
4. To re-elect as a Director, Michael Gatenby; and
5. To re-appoint Deloitte & Touche LLP as auditors of the Group and to authorise the Directors to determine their remuneration.
Special Business
To consider and, if thought fit, (and subject in the case of resolution 7 to the passing of resolution 6) pass the following resolutions
which in the case of resolution 6 will be proposed as an ordinary resolution and in the case of resolution 7 will be proposed as a
special resolution:
6. That the Directors of the Company be and are hereby generally and unconditionally authorised in accordance with Section 80
of the Companies Act 1985 (“the Act”) (in substitution for all existing authorities under the said Section 80) to exercise all the
powers of the Company to allot relevant securities (within the meaning of the said Section 80) up to an aggregate nominal
amount of £740,883 (representing 37.8% of the current issued ordinary share capital of the Company) provided that this
authority shall expire at the conclusion of the next Annual General Meeting of the Company after the passing of this
resolution (or, if earlier, 10 July 2008) and provided further that the Company may before such expiry make any offers or
agreements which would or might require relevant securities to be allotted after such expiry.
7. That the Directors of the Company be and are hereby empowered pursuant to Section 95(1) of the Act to allot equity securities
(within the meaning of Section 94(2) of the Act) for cash as if Section 89(1) of the Act did not apply to any such allotment,
provided that this power shall be limited to:
a. the allotment of equity securities in connection with a rights issue in favour of the holders of ordinary shares
(notwithstanding that, by reason of such exclusions or other arrangements as the Directors may deem necessary or
desirable to deal with fractional entitlements or legal or practical problems under the laws of, or the requirements of any
recognised regulatory body or any stock exchange in, any territory, the equity securities to be issued are not offered to all
such holders in proportion to the number of ordinary shares held by each of them); and 
b. the allotment (otherwise than pursuant to paragraph (a) above) of equity securities up to an aggregate nominal value of
£97,955;
and shall expire at the conclusion of the next Annual General Meeting of the Company after the passing of this resolution (or if
earlier on 10 July 2008), save that the Company may before such expiry make any offers or agreements which would or might
require equity securities to be allotted after such expiry.
By order of the Board Registered in England No.4442927 
Registered office
Stephenson Building
The Science Park
Keele, Staffordshire ST5 5SP
Matthew Baker
Company Secretary
9 January 2007
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 43 Notice of Annual General Meeting
Notes:
1. Members entitled to attend and vote at the meeting may appoint one or more proxies to attend and, on a poll, vote on their
behalf. A proxy need not be a member of the Company.
2. An explanation of the special business is given in the Report of the Directors’ on pages 14 and 15.
3. In accordance with Regulation 41 of the Uncertificated Securities Regulations 2001 the Company specifies that only those
shareholders registered in the Company’s register of members on 5.00pm on 10 April 2007 will be entitled to attend or vote
at the meeting and that the number of votes which any such shareholder may cast, upon a poll, will be determined by
reference to the number of shares registered in such shareholder’s name at that time.
4. In order to be valid any form of proxy and power of attorney or other authority under which it is signed, or a notarially
certified or office company of such power of attorney, must reach the Company’s registrars Capita Registrars not less than 48
hours before the time of the meeting or of any adjournment of the meeting.
5. Any alterations to this proxy must be initialled.
6. The register of Directors’ interests in the Company’s shares and copies of the Directors’ service contracts will be available for
inspection at the Registered Office of the Company during normal business hours from the date of the notice until the date
of the meeting and at the place of the meeting from fifteen minutes before the meeting until it closes.
Cobra Biomanufacturing Plc 44
62235 Cobra Report 2006  25/1/07  17:53  Page 44 Cobra Biomanufacturing Plc 45
Shareholder Information
Five Year Financial Summary
Year to 30 September 2006 2005 2004 2003 2002
£000's £000's £000's £000's £000's
Turnover 10,145 7,721 3,516 6,020 2,540
Cost of sales (4,808) (3,398) (1,951) (2,618) (1,700)
Gross profit 5,337 4,323 1,565 3,402 840
GP % 53% 56% 45% 57% 33%
Operating expenses (5,069) (4,675) (3,949) (2,670) (1,647)
Operating profit/(loss) 268 (352) (2,384) 732 (807)
Discontinued operations - - - - (125)
Interest (58) (43) 113 85 (5)
Profit/(loss) before tax 210 (395) (2,271) 817 (937)
Taxation 55 54 (127) 225 1,026
Profit/(loss) after tax 265 (341) (2,398) 1,042 89
Operating cash flow 1,153 572 (2,014) 445 (3,032)
Capital expenditure (1,483) (786) (3,180) (2,357) (2,040)
Cash at bank* 3,215 3,036 3,159 7,262 2,613
Net (debt)/funds (68) 546 917 5,675 2,321
* inc short term deposits
Analysis of Ordinary Shareholders
% of 
No of ordinary
No of % of ordinary share 
Shareholding range shareholders total shares capital
1-1,000 130 26.8% 82,238 0.4%
1,001 - 5,000 154 31.8% 427,430 2.2%
5,001 - 50,000 148 30.5% 2,134,598 10.9%
50,001 - 500,000 45 9.3% 8,457,213 43.2%
500,001 and over 8 1.6% 8,489,691 43.3%
485 100.0% 19,591,170 100.0%
making tomorrow’s medicines
62235 Cobra Report 2006  25/1/07  17:53  Page 45 Shareholder Information
Cobra Biomanufacturing Plc 46
Financial Calendar
Interim results for the six months to 31 March in June.
Final results for the year to 30 September in January.
Quarterly trading updates April and October.
Annual General Meeting
The Annual General Meeting will be held on 12 April 2007 at 11.00 am at the offices of Buchanan Communications Limited 45
Moorfields, London, EC2Y 9AE. The notice of the meeting is set out on pages 43 and 44. 
Share Price Information
The Company’s share price is available from the website of Cobra Biomanufacturing Plc under www.cobrabio.com.
Company Web Site
The Company’s website provides information on products and manufacturing activities. It also includes the latest financial
information and press releases and any other information that is relevant to the Company.
Shareholder Enquiries
Any queries regarding individual shareholdings, transfers etc, should be directed to Capita Registrars.
Shareholders wishing to consolidate two or more individual certificates may do so by writing to Capita Registrars at the address
given overleaf, enclosing the certificates to be consolidated. 
Where shareholders are receiving duplicate sets of accounts or mailing, as a result of inconsistencies in the name or address details,
they should advise the registrars so that this can be corrected.
Capita Share Dealing Services 
A quick and easy share dealing service is available to either sell or buy more shares. An on-line and telephone dealing facility is
available providing shareholders with an easy to access and simple to use service. 
The table below provides you with details of the associated charges: 
There's no need to pre-register and there are no complicated forms to fill in. The on-line and telephone dealing service allows
you to trade "real time" at a known price which will be given to you at the time you give your instruction. To deal on-line or by
telephone all you need is your surname, shareholder reference number, full postcode and your date of birth. Your shareholder
reference number can be found on your latest statement or Certificate where it will appear as either a 'folio number' or 'investor
code'. Please have the appropriate documents to hand when you log on or call, as this information will be needed before you can
buy or sell shares. 
For further information on this service, or to buy and sell shares, please contact:
• www.capitadeal.com (on-line dealing) 
• 0870 458 4577 (telephone dealing)
Type of trade Online Telephone
Share certificates 1% of the value of the deal 1.50% of the value of the deal
(Minimum £17.50 max £50) (Minimum £22.50, max £100)
All transactions incur a Compliance charge of £2.50
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Shareholder Information
Investor Relations Services
The Company operates an Investor Relations Mailing List and Email Alert Service for investors and other interested parties. 
Copies of announcements made during the year as well as the Annual and Interim Reports are sent to current registered
shareholders. However, if you would like to receive this information regardless of your current shareholding, you can register for
either one of the above services by writing to Investor Relations, Cobra Biomanufacturing Plc, Stephenson Building, The Science
Park, Keele, Staffordshire, ST5 5SP.
Alternatively, you can register to receive updates electronically via the website under:
www.cobrabio.com/investors/investor_email_alert.htm.
Data Protection Policy
We will comply with the requirements of all Data Protection legislation in force in England and Wales from time to time.  In
particular, you may request a copy of any personal data held by us about you upon written request.  Please note that we reserve
the right to charge the current statutory fee for providing such information.  We do not use or distribute the information provided
by you to our Investor Relations Mailing List or Email Alert Service, for any purpose other than the provision to you of up to date
company information.  We do not sell databases or personal information to third parties.
You can request to be removed from the mailing lists at any time, by writing to the registered office or via email.
making tomorrow’s medicines
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Directors
Peter Fothergill        (Executive Chairman)
David Thatcher            (Chief Executive Officer)
Peter Coleman            (Finance Director)
Michael Gatenby   (Independent Non-executive Director)
David Oxlade (Independent Non-executive Director)
Nigel Slater     (Independent Non-executive Director)
Company Secretary
Matthew Baker                    
Eversheds LLP                                                                    
Eversheds House                                                                    
70 Great Bridgewater Street                                                
Manchester M1 5ES
Auditors
Deloitte and Touche LLP
201 Deansgate
Manchester M60 2AT
Bankers
National Westminster Bank Plc
34 High Street
Nantwich                                                                             
Cheshire CW5 5AZ
www.natwest.com/corporate
Bank of Scotland
600 Gorgie Road
Edinburgh EH11 3XP
Registrars
Capita Registrars                                                                 
The Registry                                                                         
34 Beckenham Road                                                                                           
Beckenham                                                                              
Kent BR3 4TU                                                                    
+44 (0) 870 162 3100
www.capitaregistrars.com
Registered Office
Stephenson Building
The Science Park
Keele
Staffordshire ST5 5SP
+44 (0) 1782 714181
Registered in England No: 4442927
Directors, Registered Office and Advisors
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Glossary of Terms
Biopharmaceuticals: medicines where the active principal
cannot be chemically synthesised and comprise either
recombinant DNA, protein or virus.
Cell line products/manufacturing services: live cells as
medicinal products.
Cobra: Cobra Biomanufacturing Plc and its wholly owned
subsidiaries Cobra Biologics Limited, Cobra Biomanufacturing
EBT Limited and Cobra Biomanufacturing LLC (The Group).
DNA: Deoxyribonucleic Acid, a molecule that encodes
genetic information.
Dosage form: the final physical form of the drug (including
tablets & capsules) which is administered to the patient. 
EU Clinical Trials Directive: EU Directives are legally binding
on all EU member states and therefore govern the standards
under which Cobra operates. EU Directives 2001/20/EC and
2003/94/EC require that all phases of clinical trials manufacture
adhere to cGMP. More information on these Directives can
be found at http://cordis.europa.eu/news/calls-en/html.
Fill and finish: the process by which a drug substance is
packaged  into individual doses that will then be
administered to clinical trials volunteers. 
cGMP: current Good Manufacturing Practice, a code of
practice that ensures medicinal products are produced
consistently and to the appropriate quality standards. In the
UK, manufacturers of medicinal products require
accreditation with the Medicines and Healthcare products
Regulatory Agency (MHRA). 
Microbial: consisting of, or utilising micro-organisms.
MHRA: the UK’s pharmaceutical regulator, the Medical and
Healthcare Products Regulatory Agency
ORT®: Operator Repressor Titration, a host vector system
that avoids the use of antibiotics and antibiotic resistant
genes during biological manufacture.
ORT-VAC: derived using ORT® technology, strains of
attenuated bacteria bearing high copy number plasmids for
use as live vaccines.
Plasmid DNA: vaccines/medicines where the active
ingredient is made of DNA produced in bacteria and which
encodes a therapeutic gene. Plasmid DNA being replicating
circular DNA encoding genes.
Protein products/manufacturing services: medicines (the
manufacture of medicines) where the active ingredient is
protein.
Qualified Person or QP: The quality assurance professional
for medicines defined by British Law, based upon European
Union directives. For clinical trial materials the QP ensures
that every batch released to the clinic complies with its
specification and has been made according to current cGMP.
Medicines produced outside the EU can be imported and, if
assessed as suitable by the QP, be used for an approved EU
clinical trial.
Virus products/manufacturing services: medicines (the
manufacture of medicines) where the active ingredient is a
recombinant virus engineered to deliver DNA encoding a
therapeutic gene.
making tomorrow’s medicines
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Registered Office
Stephenson Building
The Science Park
Keele
Staffordshire
ST5 5SP
UK
Tel: +44(0) 1782 714 181
Fax: +44(0) 1782 710 485
www.cobrabio.com
Oxford Facility
County Trading Estate
Waltington Road
Oxford
OX4 6LX
UK
Tel: +44(0) 1865 785 300
Fax: +44(0) 1865 775 498
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