biofusion plc annual report 
and accounts 2007
TURNING WORLD CLASS 
RESEARCH INTO BUSINESS
In ﬁelds as varied as drug discovery, alternative energy 
and engineering, Biofusion owns the rights to an amazing 
depth and quality of research from two of the UK’s leading 
universities, enabling us to invest in some of the world’s 
most advanced and exciting science and turn world 
class research into business.
WHO WE ARE
SHEFFIELD OFFICE
The Shefﬁeld Bioincubator 
40 Leavygreave Road 
Shefﬁeld 
S3 7RD
www.biofusion.co.uk
CARDIFF OFFICE
8th Floor  
Eastgate House 
35–43 Newport Road 
Cardiff 
CF24 0AB
biofusion plc annual report and accounts 2007
_cover.indd   1 26/10/2007   13:58:13 biofusion plc annual report 
and accounts 2007
TURNING WORLD CLASS 
RESEARCH INTO BUSINESS
In ﬁelds as varied as drug discovery, alternative energy 
and engineering, Biofusion owns the rights to an amazing 
depth and quality of research from two of the UK’s leading 
universities, enabling us to invest in some of the world’s 
most advanced and exciting science and turn world 
class research into business.
WHO WE ARE
SHEFFIELD OFFICE
The Shefﬁeld Bioincubator 
40 Leavygreave Road 
Shefﬁeld 
S3 7RD
www.biofusion.co.uk
CARDIFF OFFICE
8th Floor  
Eastgate House 
35–43 Newport Road 
Cardiff 
CF24 0AB
biofusion plc annual report and accounts 2007
_cover.indd   1 26/10/2007   13:58:13 WHAT WE DO
We create, support and grow a range of companies in an exciting 
variety of sectors. From lifestyle to energy, we seek to make 
the very best of emerging IP from two of the UK’s leading research 
intensive universities.
MEDICINE ENERGY ENVIRONMENT
ELECTRICAL ENGINEERING LIFESTYLE
OUR PORTFOLIO COMPANIES
Abcellute’s patent protected cell stabilising platform 
technology enables the non-frozen preservation 
and transportation of live organ-derived cells, without 
the loss of viability or function, for up to seven days.
Adjuvants help stimulate the immune system‘s response to a 
vaccine, so the better the adjuvant, the lower the vaccination 
dose can be, making the vaccine cheaper and safer. 
Adjuvantix’s adjuvant is capable of a profound enhancement 
(1,000 fold) of the anti body response.
Art of Xen holds a number of patents for the cost efﬁcient 
delivery of the anaesthetic gas Xenon. Xenon is showing 
promise in research as a neuroprotectant that can protect 
against and reduce brain damage with an almost complete 
lack of side effects.
Celltran provides active wound care by delivering living 
cells for the treatment and active healing of burns and chronic 
wounds in skin. Celltran has a number of products in its portfolio 
including MySkin (in market) and Lypoderm (ready for 
Phase III trials).
Medaphor designs and develops medical training solutions 
on multi-media and computer based simulations systems. 
The company has two online multimedia gynaecological 
ultrasound training modules and a prototype haptic 
ultrasound simulator.
Muscagen is a computation based, rational drug discovery 
company that design molecules which interact with receptors 
on the surface of human cells in speciﬁc ways. Its approach 
is potentially cost-effective and efﬁcient, reduces animal 
testing and avoids likely side effects.
Axordia is a regenerative therapeutics company utilising its 
platform human embryonic stem cell technology to prevent 
transplant rejection through the use of its unique endovascular 
cell technology; and cure degenerative blindness through 
its novel retinal cell technology for the treatment of AMD.
Genophrenix has identiﬁed several proteins and their genes 
that interact with a key component implicated in schizophrenia. 
Its initial focus is to develop a diagnostic for schizophrenia 
and provide licensing opportunities that will be attractive to 
the global pharmaceutical industry.
Mantelum is developing research focused on the G-protein 
coupled receptor (GPCR) superfamily, which are involved in 
a wide range of disorders including allergies, cardiovascular 
disease, pain, depression, cancer, obesity, diabetes and 
a variety of central nervous system disorders.
Phase Focus owns the rights to patents for a process 
that can generate high definition images of an object 
without the need for the high quality lenses that account 
for a signiﬁcant element of the cost of high-performance 
microscopes. This breakthrough technology has the 
potential to produce better images at a lower cost than 
currently available microscopes.
Simcyp’s informatics platform enables pharmaceutical 
companies to simulate drug behaviour in humans, prior 
to running clinical trials, by using virtual population data, 
rather than data from one ‘average’ individual. Allowing 
patients at extreme risk from adverse reaction to be 
identiﬁed at an early stage.
Absynth Biologics is developing vaccines and antibodies 
to treat infections caused by the bacterium Staphylococcus 
aureus, including its more difﬁcult-to-treat drug-resistant 
form, MRSA. Its unique patented technology is initially being 
used to develop an MSRA vaccine and antibodies to treat 
signiﬁcant MRSA related infections as well as other applications.
Asterion’s ProFuse technology platform is being 
used to develop ‘third generation’ therapeutic protein 
drugs designed to have greater potency and selectivity, 
to be longer lasting and have a better side effect profile 
than current protein-based therapies.
Diurnal owns the patent rights to Chronocort™, a modiﬁed 
release formulation of hydrocortisone to treat adrenal 
insufﬁciency. The product is designed to release hormone 
at concentrations that mimic the natural level of hormone 
in the body, controlling disease symptoms and reducing 
unwanted side effects.
Aperio’s prototype medical probe can detect pre-cancerous 
cells in a woman’s cervix, without the need for the current 
painful and lengthy internal colcoscopy examination.
Lifestyle Choices launched its ﬁrst product, a triple hormone 
ovarian reserve test called Plan Ahead, in 2006. The test 
offers the most accurate hormone based ovarian reserve 
test available to the public, enabling women to make more 
informed decisions about when they try for a baby. 
The company is developing its second product aimed 
at the IVF market for launch in 2008.
Morvus is engaged in the discovery, development and 
commercialisation of novel drugs and technologies, primarily 
in the ﬁeld of oncology. It has a broad portfolio of technology  
with products based upon its core expertise in prodrug-enzyme 
interactions and knowledge of the mechanism of apoptosis.
I2L Research provides worldwide agrochemical manufacturers 
with specialist product testing, development services and 
environmental monitoring services. The company has ofﬁces 
in Cardiff and Newcastle.
Biofusion Licensing is a specialist company that identiﬁes, 
develops and licenses world class university IP to commercial 
companies and research organisations. Their website is a 
licensing portal for identifying licensing opportunities within 
the Biofusion technology pipeline.
Biohydrogen is developing a metabolically engineered microbial 
production method that is capable of producing hydrogen 
from sugar solution media and water through fermentation. 
Initial results indicate this unique method of production has 
the potential to be at the forefront of new low carbon fuel 
technology developments.
Medella is designing monoclonal antibodies that inhibit the 
action of Adrenomedullin (ADM), a molecule found in 80% 
of cancer cells. It is believed that ADM is a key molecule in 
enabling cancer cells to survive and Medella is developing 
drugs that modulate ADM signalling in cancer cells and 
stop the tumour growing.
Q Chip develops advanced life science and therapeutic 
products using its proprietary MicroPlant platform for the 
production of precision loaded polymer microspheres. 
The company has three core precision microsphere products  
– ReaX, BiologiX and IonX which have just been launched 
into the UK market.
Magnomatics specialises in the development of novel 
high-torque magnetic gearboxes, motors and generators 
for use within wind turbine power generation, transportation 
and domestic energy products. Its patented ‘pseudo’ direct 
drive motor/generator system has additional applications 
in the aerospace and hybrid vehicle market.
COMPANY SECRETARY
RICHARD BIRTLES
COMPANY NUMBER
5275732
REGISTERED OFFICE
Innovation Centre 
217 Portobello 
Shefﬁeld S1 4DP
INDEPENDENT AUDITOR
KPMG AUDIT PLC
1 The Embankment 
Neville Street 
Leeds LS1 4DW
SOLICITOR
ASHURST
Broadwalk House 
5 Appold Street 
London EC2A 2HA
BANKER
BARCLAYS
Cambridge Business Centre 
28 Chesterton Road 
Cambridge CB4 3UT
NOMINATED ADVISOR AND BROKER
NOMURA CODE
1 Carey Lane 
London EC2V 8AE
REGISTRAR
CAPITA REGISTRARS
34 Beckenham Road 
Beckenham 
Kent BR3 4TU
PUBLIC RELATIONS
BUCHANAN COMMUNICATIONS
45 Moorﬁelds  
London EC2Y 9AE
COMPANY INFORMATION AND ADVISORS
_cover.indd   2 26/10/2007   13:58:40 WHAT WE DO
We create, support and grow a range of companies in an exciting 
variety of sectors. From lifestyle to energy, we seek to make 
the very best of emerging IP from two of the UK’s leading research 
intensive universities.
MEDICINE ENERGY ENVIRONMENT
ELECTRICAL ENGINEERING LIFESTYLE
OUR PORTFOLIO COMPANIES
Abcellute’s patent protected cell stabilising platform 
technology enables the non-frozen preservation 
and transportation of live organ-derived cells, without 
the loss of viability or function, for up to seven days.
Adjuvants help stimulate the immune system‘s response to a 
vaccine, so the better the adjuvant, the lower the vaccination 
dose can be, making the vaccine cheaper and safer. 
Adjuvantix’s adjuvant is capable of a profound enhancement 
(1,000 fold) of the anti body response.
Art of Xen holds a number of patents for the cost efﬁcient 
delivery of the anaesthetic gas Xenon. Xenon is showing 
promise in research as a neuroprotectant that can protect 
against and reduce brain damage with an almost complete 
lack of side effects.
Celltran provides active wound care by delivering living 
cells for the treatment and active healing of burns and chronic 
wounds in skin. Celltran has a number of products in its portfolio 
including MySkin (in market) and Lypoderm (ready for 
Phase III trials).
Medaphor designs and develops medical training solutions 
on multi-media and computer based simulations systems. 
The company has two online multimedia gynaecological 
ultrasound training modules and a prototype haptic 
ultrasound simulator.
Muscagen is a computation based, rational drug discovery 
company that design molecules which interact with receptors 
on the surface of human cells in speciﬁc ways. Its approach 
is potentially cost-effective and efﬁcient, reduces animal 
testing and avoids likely side effects.
Axordia is a regenerative therapeutics company utilising its 
platform human embryonic stem cell technology to prevent 
transplant rejection through the use of its unique endovascular 
cell technology; and cure degenerative blindness through 
its novel retinal cell technology for the treatment of AMD.
Genophrenix has identiﬁed several proteins and their genes 
that interact with a key component implicated in schizophrenia. 
Its initial focus is to develop a diagnostic for schizophrenia 
and provide licensing opportunities that will be attractive to 
the global pharmaceutical industry.
Mantelum is developing research focused on the G-protein 
coupled receptor (GPCR) superfamily, which are involved in 
a wide range of disorders including allergies, cardiovascular 
disease, pain, depression, cancer, obesity, diabetes and 
a variety of central nervous system disorders.
Phase Focus owns the rights to patents for a process 
that can generate high definition images of an object 
without the need for the high quality lenses that account 
for a signiﬁcant element of the cost of high-performance 
microscopes. This breakthrough technology has the 
potential to produce better images at a lower cost than 
currently available microscopes.
Simcyp’s informatics platform enables pharmaceutical 
companies to simulate drug behaviour in humans, prior 
to running clinical trials, by using virtual population data, 
rather than data from one ‘average’ individual. Allowing 
patients at extreme risk from adverse reaction to be 
identiﬁed at an early stage.
Absynth Biologics is developing vaccines and antibodies 
to treat infections caused by the bacterium Staphylococcus 
aureus, including its more difﬁcult-to-treat drug-resistant 
form, MRSA. Its unique patented technology is initially being 
used to develop an MSRA vaccine and antibodies to treat 
signiﬁcant MRSA related infections as well as other applications.
Asterion’s ProFuse technology platform is being 
used to develop ‘third generation’ therapeutic protein 
drugs designed to have greater potency and selectivity, 
to be longer lasting and have a better side effect profile 
than current protein-based therapies.
Diurnal owns the patent rights to Chronocort™, a modiﬁed 
release formulation of hydrocortisone to treat adrenal 
insufﬁciency. The product is designed to release hormone 
at concentrations that mimic the natural level of hormone 
in the body, controlling disease symptoms and reducing 
unwanted side effects.
Aperio’s prototype medical probe can detect pre-cancerous 
cells in a woman’s cervix, without the need for the current 
painful and lengthy internal colcoscopy examination.
Lifestyle Choices launched its ﬁrst product, a triple hormone 
ovarian reserve test called Plan Ahead, in 2006. The test 
offers the most accurate hormone based ovarian reserve 
test available to the public, enabling women to make more 
informed decisions about when they try for a baby. 
The company is developing its second product aimed 
at the IVF market for launch in 2008.
Morvus is engaged in the discovery, development and 
commercialisation of novel drugs and technologies, primarily 
in the ﬁeld of oncology. It has a broad portfolio of technology  
with products based upon its core expertise in prodrug-enzyme 
interactions and knowledge of the mechanism of apoptosis.
I2L Research provides worldwide agrochemical manufacturers 
with specialist product testing, development services and 
environmental monitoring services. The company has ofﬁces 
in Cardiff and Newcastle.
Biofusion Licensing is a specialist company that identiﬁes, 
develops and licenses world class university IP to commercial 
companies and research organisations. Their website is a 
licensing portal for identifying licensing opportunities within 
the Biofusion technology pipeline.
Biohydrogen is developing a metabolically engineered microbial 
production method that is capable of producing hydrogen 
from sugar solution media and water through fermentation. 
Initial results indicate this unique method of production has 
the potential to be at the forefront of new low carbon fuel 
technology developments.
Medella is designing monoclonal antibodies that inhibit the 
action of Adrenomedullin (ADM), a molecule found in 80% 
of cancer cells. It is believed that ADM is a key molecule in 
enabling cancer cells to survive and Medella is developing 
drugs that modulate ADM signalling in cancer cells and 
stop the tumour growing.
Q Chip develops advanced life science and therapeutic 
products using its proprietary MicroPlant platform for the 
production of precision loaded polymer microspheres. 
The company has three core precision microsphere products  
– ReaX, BiologiX and IonX which have just been launched 
into the UK market.
Magnomatics specialises in the development of novel 
high-torque magnetic gearboxes, motors and generators 
for use within wind turbine power generation, transportation 
and domestic energy products. Its patented ‘pseudo’ direct 
drive motor/generator system has additional applications 
in the aerospace and hybrid vehicle market.
COMPANY SECRETARY
RICHARD BIRTLES
COMPANY NUMBER
5275732
REGISTERED OFFICE
Innovation Centre 
217 Portobello 
Shefﬁeld S1 4DP
INDEPENDENT AUDITOR
KPMG AUDIT PLC
1 The Embankment 
Neville Street 
Leeds LS1 4DW
SOLICITOR
ASHURST
Broadwalk House 
5 Appold Street 
London EC2A 2HA
BANKER
BARCLAYS
Cambridge Business Centre 
28 Chesterton Road 
Cambridge CB4 3UT
NOMINATED ADVISOR AND BROKER
NOMURA CODE
1 Carey Lane 
London EC2V 8AE
REGISTRAR
CAPITA REGISTRARS
34 Beckenham Road 
Beckenham 
Kent BR3 4TU
PUBLIC RELATIONS
BUCHANAN COMMUNICATIONS
45 Moorﬁelds  
London EC2Y 9AE
COMPANY INFORMATION AND ADVISORS
_cover.indd   2 26/10/2007   13:58:40 01
HIGHLIGHTS:
Trebled the research pipeline, for which we own exclusive rights, to £114m 
(31 July 2006: £37m) by signing an exclusive ten year pipeline agreement with 
Cardiff University (Cardiff). Cardiff is one of the UK’s leading research intensive 
universities, ranked seventh in the most recent RAE (Research Assessment 
Exercise) based rankings
 Expanded the business to include world class research in energy, environment, 
engineering and IT
 Raised £7.8m to invest in Cardiff Intellectual Property (IP), increasing total cash 
funds to £10.6m (31 July 2006: £5.9m)
 Increased the number of companies in our portfolio to 24 (31 July 2006: 12)
 Created four new companies (31 July 2006: 2): Biohydrogen, Absynth Biologics, 
Medella Therapeutics, Biofusion Licensing
Exited our 9% shareholding in Plasso Technologies
 Invested or committed to invest up to £3.3m in 14 portfolio companies to support 
their continued development
POST REVIEW END HIGHLIGHTS:
 In September 2007 announced that we had signed a co-investment 
Memorandum of Understanding (MoU) with Finance Wales which provides priority 
access to Finance Wales’ substantial investment funds
 In October 2007 announced that we had sold our 50% stakes in each of Cardiff 
Protides and Cardiff Biologicals to Morvus Technology Ltd (Morvus) in return for 
a 20% shareholding in Morvus
 In October 2007 announced that we signed an exclusive licence agreement 
with an undisclosed leading US reproductive testing laboratory to sell the 
Plan Ahead test in the USA and Canada
HIGHLIGHTS   01 
CHAIRMAN’S STATEMENT   02 
CHIEF EXECUTIVE’S REVIEW   04 
BOARD OF DIRECTORS   10
CORPORATE GOVERNANCE   12 
REPORT ON DIRECTORS’ REMUNERATION   14 
DIRECTORS’ REPORT   18 
STATEMENT OF DIRECTORS’ RESPONSIBILITIES   20 
INDEPENDENT AUDITORS’ REPORT   21 
CONSOLIDATED PROFIT AND LOSS ACCOUNT   22
 CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES   22
CONSOLIDATED BALANCE SHEET   23 
COMPANY BALANCE SHEET   24 
CONSOLIDATED CASH FLOW STATEMENT   25 
NOTES TO THE FINANCIAL STATEMENTS   26 
NOTICE OF ANNUAL GENERAL MEETING   38
FORM OF PROXY   39
COMPANY INFORMATION AND ADVISORS IBC
biofusion plc annual report and accounts 2007 01
_0_BIF_ar07_FRONT.indd   1 26/10/2007   13:54:31 02 biofusion plc annual report and accounts 2007
CHAIRMAN’S STATEMENT 
‘ ‘
We own the rights to an 
amazing depth and quality 
of research and we aim to 
turn that into real value for 
our shareholders.
Professor Phillip Wright and his team at Biohydrogen have metabolically engineered 
a strain of E. coli to include a copy of a cyanobacterial derived bi-directional 
hydrogenase enzyme that leads to the generation of additional hydrogen.
This novel and patented platform technology has demonstrated exceptional 
hydrogen production rates.  Although at an early stage, the results suggest 
that the hydrogen is being produced not just from the dark fermentation of the 
glucose to hydrogen but that the process is also causing a catalytic reaction 
that is splitting the water to produce extra hydrogen. 
The technology platform required to develop this bio-hydrogen production 
method is similar to the technology used by many biotech companies that 
produce enzymes for drug synthesis (antibiotics, anti cancer, etc.), consumer 
goods (detergents, brewed beverages, food products, plastics, etc.), and 
enhanced animal feed and alternative energy sources such as bio-ethanol. 
As a result the commercialisation of this enzyme-based product should be 
able to follow a clear and well-deﬁned path with well understood procedures.
There is signiﬁcant interest in all forms of renewable ‘clean’ energy technologies 
to combat global warming, in response to the depletion of and increasing price 
of fossil fuels and to address energy security problems. Biohydrogen believes 
its unique method of production has the potential to be at the forefront of 
new low carbon fuel technology developments and aims to develop a unique 
microbiological method of producing hydrogen for the industrial hydrogen 
market and any future hydrogen energy related market.
CASE STUDY: BIOHYDROGEN
DOUG LIVERSIDGE CBE
_0_BIF_ar07_FRONT.indd   2 26/10/2007   13:55:24 03 biofusion plc annual report and accounts 2007
I am delighted to announce Biofusion’s results 
for the year ended 31 July 2007, which has been 
a year of signiﬁcant progress and expansion.
KEY EVENTS
  Trebled the research pipeline, for which we own 
exclusive rights, to £114m (31 July 2006: £37m) 
by signing an exclusive ten year pipeline 
agreement with Cardiff University (Cardiff). 
Cardiff is one of the UK’s leading research 
intensive universities, ranked seventh in the 
most recent RAE (Research Assessment 
Exercise) based rankings;
  Expanded the business to include world class 
research in energy, environment, engineering 
and IT;
  Raised £7.8m to invest in Cardiff IP , 
increasing total cash funds to £10.6m 
(31 July 2006: £5.9m);
  Increased the number of companies 
in our portfolio to 24 (31 July 2006: 12);
  Created four new companies (31 July 2006: two): 
Biohydrogen, Absynth Biologics, Medella 
Therapeutics, Biofusion Licensing;
  Exited our 9% shareholding in Plasso 
T echnologies;
  Strengthened Asterion’s management team 
with a blue chip Chairman, Chief Executive 
Ofﬁcer and Non-executive Director; and
  Invested or committed to invest up to £3.3m 
in 14 portfolio companies to support their 
continued development.
In this our last year under UK GAAP , before 
we transfer to International Financial Reporting 
Standards (IFRS), we report turnover of £0.4m 
(2006: £0.3m), and losses of £2.9m (2006: loss 
of £1.9m), which were broadly in line with budgets. 
Under UK GAAP no allowance is made for the 
increase in the value of our portfolio company 
investments, which are currently held at cost less 
impairment in value. Going forward, increases 
in the fair value of our portfolio companies will be 
shown in the proﬁt and loss account, consistent 
with the approach taken by our competitors.
Post year end we announced:
  In September 2007 that we had signed a 
co-investment Memorandum of Understanding 
(MoU) with Finance Wales which provides priority 
access to Finance Wales’ substantial 
investment funds;
  In October 2007 that we had sold our 50% 
stakes in each of Cardiff Protides and Cardiff 
Biologicals to Morvus T echnology Ltd (Morvus) 
in return for a 20% shareholding in Morvus; and
  In October 2007, we signed an exclusive 
licence agreement with an undisclosed leading 
US reproductive testing laboratory to sell the 
Plan Ahead test in the USA and Canada.
CARDIFF UNIVERSITY
Our partnership with Cardiff is a signiﬁcant 
milestone that has enabled us to build on 
our successful partnership with the University 
of Shefﬁeld and secure access to a second 
high quality Intellectual Property (IP) pipeline, 
as well as enabling us to expand our portfolio 
into non-life science sectors such as engineering, 
energy, environment and computing.
Cardiff is the seventh ranked research 
intensive university in the UK and recently 
announced its second Nobel Prize winner, 
Professor Sir Martin Evans who won the 
Nobel Prize for Medicine in October 2007.
In conjunction with the Cardiff agreement and 
the £7.8m placing, Biofusion created a dedicated 
investment fund of £8.2m, in a new wholly owned 
subsidiary Fusion Cardiff Limited, exclusively for 
investing in Cardiff portfolio companies.
We now have exclusive IP pipeline agreements 
with two of the UK’s top ten research intensive 
universities and are confident that our model 
will continue to be attractive to high quality 
research intensive universities both in the 
UK and overseas.
INVESTMENTS DURING THE PERIOD
During the year we invested, or approved 
facilities for investments, of £3.3m, which has 
been used to fund the creation of four new 
companies and the continued development 
of 12 portfolio companies.
We continue to believe that our portfolio has 
a balanced mix of short, medium and long term 
investments and that we remain committed 
to, and focused on, our core strategy, which 
is to achieve high value exits from our portfolio 
of companies, at the appropriate time, to realise 
their value to our shareholders.
FINANCE WALES MOU
Post year end on 21 September 2007 we 
signed a MoU with Finance Wales, the provider 
of commercial funding to Wales-based businesses, 
detailing a co-investment strategy for investing 
in opportunities arising from Biofusion’s exclusive 
IP pipeline agreement with Cardiff University. 
Finance Wales already manages funds of more 
than £100m and has invested £75m in Wales.
EXITS
During the year as part of the sale of Plasso 
Technology (UK) Limited (Plasso) to Becton 
Dickinson and Company, Biofusion disposed 
of its 9% shareholding in Plasso. Financial terms 
of the deal were not disclosed.
Post year end, on 10 October 2007, we announced 
that we had sold our equity shareholdings 
in Cardiff Protides and Cardiff Biologicals 
to Morvus a privately owned pharmaceutical 
company specialising in the discovery and 
development of novel oncology therapies.
Morvus has raised over £3.4m in equity 
finance to date and its most recent funding, 
largely concluded in July 2007, valued Morvus at 
approximately £12m, based on a price of 30p per 
share. As a result of the sale Biofusion now owns 
13,698,630 shares in Morvus, giving it a 20% 
shareholding in the enlarged Morvus group.
Morvus’ expertise in oncology based pharmaceutical 
development convinced us that the new combined 
company could be a world leader in the provision 
of specialist oncology drugs and provided the 
best opportunity for bringing Cardiff Protides’ and 
Cardiff Biologicals’ lead compounds to market.
DIRECTORATE CHANGE
In January 2007 Mr Mike Davies, who is 
Director of Physical and Financial Resources 
for Cardiff University, became a Non-executive 
Director of the Board. We welcome him onto 
the Board of Biofusion.
ADOPTION OF INTERNATIONAL FINANCIAL 
REPORTING STANDARDS (IFRS)
From 1 August 2007 Biofusion will adopt 
International Financial Reporting Standards 
(IFRS). This will have a significant impact 
on the reporting of the company’s financial 
performance, as changes in the carrying value 
of our portfolio company investments will be 
recognised in the proﬁt and loss account.
At present Biofusion carries all these investments 
at cost. The Directors believe this does not reﬂect 
the true value of the portfolio.
The adoption of IFRS will bring the company’s 
reporting in line with its major competitors.
OUTLOOK
In ﬁelds as varied as drug discovery, alternative 
energy and engineering, we now own the rights 
to a truly signiﬁcant depth and quality of research 
from two of the UK’s leading universities. This has 
enabled us to create a growing portfolio of 
companies based on some of the world’s most 
advanced and exciting science. Our focus 
continues to be to expand this portfolio, maximise 
the value of these companies and then exit these 
companies, at the appropriate time, either through 
trade sale or IPO.
We look forward with considerable optimism 
to the next ﬁnancial year. 
DOUG LIVERSIDGE CBE
CHAIRMAN
15 October 2007
_0_BIF_ar07_FRONT.indd   3 26/10/2007   13:55:24 04 biofusion plc annual report and accounts 2007
CHIEF EXECUTIVE’S REVIEW
‘ ‘ This has been an excellent 
year for Biofusion in which 
we have continued to expand 
both our university base and 
our portfolio of companies.
PORTFOLIO COMPANY INVESTMENTS
 Year to  Post 
 31 July 2007  year end
   Committed not  Outstanding 
  Invested  yet invested Invested commitments 
  £ £ £ £
Abcellute  56,000 200,000 200,000 —
Absynth Biologics 140,000 185,000 — 185,000
Aperio Diagnostics 79,000 — — —
Asterion  — 265,000 — 265,000
Axordia  378,000 115,000 75,000 40,000
Biohydrogen  54,000 146,000 25,000 121,000
Cardiff Biologicals — — 200,000 —
Cardiff Protides — — 200,000 —
Celltran  161,000 150,000 75,000 75,000
Diurnal 126,000 99,000 — 99,000
Genophrenix  198,000 — — —
Lifestyle Choices 68,000 — — —
Medaphor 10,000 — — —
Medella Therapeutics 64,000 256,000 — 256,000
Phase Focus 314,000 86,000 — 86,000
Q-Chip  47,000 78,000 — 78,000
Total 1,695,000 1,580,000 775,000 1,205,000
DAVID BAYNES
_0_BIF_ar07_FRONT.indd   4 26/10/2007   13:55:30 05 biofusion plc annual report and accounts 2007
This has been an excellent year for Biofusion 
in which we have continued to expand both our 
university base and our portfolio of companies.
THE CARDIFF PIPELINE
The Cardiff agreement gives Biofusion exclusive 
rights, over ten years, to all Cardiff’s rights to IP 
generated by Cardiff research and to commercialise 
this IP through the formation of portfolio companies. 
The Directors estimate that the research spend 
available to Cardiff over the life of the Cardiff 
agreement will be well in excess of £1 billion. 
Biofusion will initially hold 100% of the equity 
in each new Cardiff portfolio company and will 
then allocate an appropriate proportion to the 
academics involved in these companies.
TRANSFERRED PORTFOLIO COMPANIES
As part of the agreement Cardiff’s shareholding 
in seven existing companies (see table below) 
were transferred to Biofusion, in return for loan 
notes of £1.4m (£1.65m including the post year 
end transfer of Cardiff Biologicals).
  Potential fully 
   diluted Biofusion 
  shareholding 
Company name (%)
Abcellute  24.08
Art of Xen   31.58
Cardiff Protides  22.50
Insect Investigations  10.00
Medaphor   32.03
Muscagen   12.97
Q Chip  20.35
Cardiff Biologicals* 25.00
*  Cardiff Biologicals shareholding was transferred 
to Biofusion on 2 October 2007
OUR PORTFOLIO COMPANIES
We now have 24 companies in our portfolio:
Portfolio companies as at 31 July 2006 12
New companies started/acquired in the year 13
Companies exited during the year 1
Portfolio companies as at 31 July 2007 24
New companies added post year end 1
Companies exited post year end 2
Successes in our portfolio during the period include:
ASTERION
Biofusion shareholding 
34% 
Asterion is developing next-generation therapeutic 
proteins with superior pharmacological proﬁles 
that will improve the current treatment options 
for patients with chronic diseases. It owns a 
novel, patented therapeutic platform technology, 
ProFuse
TM
, which has tremendous utility and 
versatility and can be applied to a huge number 
of cytokine families and targets to generate 
novel, IP-protected, next-generation 
biopharmaceutical products. 
Asterion’s most advanced product is a long-acting 
growth hormone (GH) agonist product for the 
treatment of growth disorders, which is being 
developed in a strategic alliance with Ipsen. 
The company has internal programmes for other 
cytokine targets which include erythropoietin 
(AFT™-EPO), G-CSF (AFT™ – GCSF), interferons 
(AFT™ – Inteferon α and AFT™ – Inteferon ß) and 
leptin (AFT™ – Leptin).
Post year end Asterion’s technology, exempliﬁed 
with GH, was published in the world renowned 
scientiﬁc journal ‘Nature Medicine’. The current 
therapeutic procedure for GH replacement in 
adults and children requires once daily injections 
of GH which are inconvenient, expensive and can 
be painful. The Nature paper reports that tests 
with the Asterion version of GH showed that a 
single injection promoted growth for ten days, 
which is far superior when compared with 
conventional GH. The ability to apply this 
technology to create a wide variety of therapeutic 
proteins lead the Directors to believe that this 
technology can lead to a next generation of 
recombinant protein therapeutics. 
During the year we strengthened Asterion’s 
management team with the appointment of 
Dr Kevin Bryett as Chairman, Dr Raymond 
Barlow as CEO and Dr David Lawrence as 
a Non-executive Director.
During the year we committed to invest 
a further £265,000 in Asterion.
SIMCYP
Biofusion shareholding 
25%
 Simcyp’s informatics platform and consultancy 
services enable pharmaceutical companies 
to simulate drug behaviour in humans prior 
to running clinical trials. The software uses virtual 
population data, rather than data from just one 
‘average’ individual. This allows patients at 
extreme risk from adverse reaction to be 
identiﬁed at an early stage. In addition, potential 
drug-drug interactions can also be predicted, 
thus enabling Pharmaceutical companies to 
tailor their testing programmes on humans in 
an informed way. Simcyp continues to expand 
its operations with turnover up 34% year on year 
at £1.99m (2006: £1.48m) and proﬁts up 39% 
to £0.53m (2006: £0.38m).
DIURNAL
Biofusion shareholding 
60%
During the year Diurnal, which owns the 
patent rights to Chronocort™, a modiﬁed 
release formulation of hydrocortisone to 
treat adrenal insufﬁciency, announced that 
Phoqus Pharmaceuticals Ltd, the speciality 
pharmaceutical company with whom it is 
developing Chronocort™, had raised £6.5m, 
gross of expenses, to progress Chronocort™ into 
Phase III clinical trials. The product is designed 
to release hormone at concentrations that mimic 
the natural level of hormone in the body. This is 
considered very important in controlling disease 
symptoms and reducing unwanted side effects. 
Chronocort™, which has European Orphan 
Medicinal Product designation, is expected to 
be ready for market within two years generating 
signiﬁcant royalty revenues for Diurmal in a 
market worth in excess of £100m.
During the year we invested £126,000 and 
committed to a further investment of £99,000 to 
expand its product pipeline and fund development 
work on three additional patented products.
Cardiff University, established in 1883, has an international reputation for the quality of its teaching and research. 
In August 2004 Cardiff merged with the renowned University of Wales College of Medicine, one of the UK’s leading 
medical schools, and now has more than 5,000 staff and 22,000 students.
A member of the exclusive Russell Group of research-led universities, Cardiff is:
  ranked 7th in the latest RAE (2001) based on average weighted RAE grade;
  ranked joint 8th in the latest RAE (2001) for the number of schools rated “5” and “5*” (being the highest ratings) 
in areas which the Directors consider to be the most likely to generate IP with commercialisation potential; and
  ranked 5th in the Times Higher Education Supplement 2006 review of university income generated from IP .
In the year to 31 July 2006 Cardiff had a research income of £77m representing a 51% increase over the last 
two years and has invested over £100m in its infrastructure over the last ﬁve years. In July 2007 Cardiff announced 
that it was on course for a record breaking research income year and had already secured research contract awards 
in excess of £100m.
_0_BIF_ar07_FRONT.indd   5 26/10/2007   13:55:30 06 biofusion plc annual report and accounts 2007
OUR PORTFOLIO COMPANIES CONTINUED
PHASE FOCUS
Biofusion shareholding 
56%
Phase Focus is developing an alternative approach 
to microscopy and imaging that does not require 
sophisticated lenses and has applications in 
optical, x-ray and electron microscopy, amongst 
others. Phase Focus, owns the rights to patents 
for a process that can generate high deﬁnition 
images of an object without the need for the high 
quality lenses that account for a signiﬁcant element 
of the cost of high-performance microscopes. 
The Directors believe that Phase Focus’ 
breakthrough technology has the potential 
to create a new generation of ‘lensless’ 
microscopes, which will produce better images 
at a lower cost in a market which is forecast 
to grow to $1.6 billion by 2009.
During the year we invested £314,000 in Phase 
Focus and committed to invest a further £86,000.
ABSYNTH BIOLOGICS
Biofusion shareholding 
60%
During the year we created Absynth Biologics, 
which is developing vaccines and antibodies 
to treat infections caused by the bacterium 
Staphylococcus aureus (S. aureus), including 
its more difﬁcult-to-treat drug-resistant form, 
methicillin-resistant S. aureus (MRSA). Hospital 
acquired infections are an increasing public 
health concern and are responsible for a rise 
in the number of hospital deaths. Absynth’s 
unique patented technology has been developed 
at the University of Shefﬁeld and initially is being 
used to develop an MSRA vaccine and antibodies 
to treat signiﬁcant MRSA related infections as 
well as other applications.
During the year we invested £140,000 in 
Absynth Biologics and committed to invest 
a further £185,000.
AXORDIA
Biofusion shareholding 
45% 
Axordia, one of the UK’s leading stem cell 
companies, announced it had received 
signiﬁcant support for its research programme, 
in collaboration with Shefﬁeld and Lombard 
Medical Technologies, through a £0.9m grant 
from the DTI and MRC, for the development, 
through to clinical trials, of a regenerative stent – 
a new generation treatment for cardiovascular 
disease. Axordia also announced its participation 
in the European Commission “ESTOOLS” 
programme. ESTOOLS is a world leading €12m 
stem cell research initiative that will advance the 
fundamental understanding and biomedical 
applications of human embryonic stem cells. 
Axordia is a major partner in the London Project 
to Cure Blindness, to which Axordia will be 
supplying all the RPE cell lines. This project has 
funding of £4m and plans to complete human 
trials to cure Age Related Macular Degeneration 
(AMD) within four years.
During the year we invested £378,000 in Axordia 
taking our shareholding to 45%.
Q-CHIP
Biofusion shareholding 
10%
Q-Chip develops advanced life science and 
therapeutic products using its proprietary 
MicroPlant platform for the production 
of precision loaded polymer microspheres. 
In July 2007 Q-Chip secured £2m of equity 
investment from groups including CPF, 
E-Synergy, Finance Wales, Jon Moulton 
and Biofusion. This investment should enable 
Q-Chip to develop and exploit three core 
precision microsphere products: 
  ReaX – for advanced bead based molecular 
reagents and cell assays. 
  BiologiX – benign and efﬁcient encapsulation 
system for the delivery and sustained release 
of biopharmaceutical drugs. 
  IonX – microsphere system for delivery 
and controlled release of small 
molecule therapies. 
During the year we invested £47,000 in Q-Chip 
and committed to invest a further £78,000.
MAGNOMATICS
Biofusion shareholding 
54%
In April 2007 we announced that we had taken 
over the University of Shefﬁeld’s 55% shareholding 
in one of their non-life science spin out companies, 
Magnomatics Ltd (Magnomatics). Magnomatics 
specialises in the development of novel high-torque 
magnetic gearboxes, motors and generators 
for use within wind turbine power generation, 
transportation and domestic energy products.
High-torque mechanical gearboxes, such as 
those used in the expanding domestic and 
industrial wind power generation market, can 
suffer expensive permanent damage if a gusting 
wind applies too great a load to their mechanical 
drive systems. Magnomatics patented ‘pseudo’ 
direct drive motor/generator systems removes 
the risk of expensive damage from high winds 
with the added beneﬁt of being lighter, lubrication 
free and more efﬁcient than a conventional high 
torque gearbox. The technology has additional 
applications in the aerospace and hybrid 
vehicle markets.
Magnomatics trades proﬁtably.
BIOHYDROGEN
Biofusion shareholding 
60%
In April 2007 we announced the creation of 
Biohydrogen Limited (Biohydrogen), which is 
developing a metabolically engineered microbial 
production method for producing hydrogen from 
fermentable sugars and water. Initial results 
indicate that this unique method of production 
has the potential to be at the forefront of new 
low carbon fuel technology developments.
There is signiﬁcant interest in all forms 
of renewable ‘clean’ energy technologies 
to combat global warming, in response to 
the depletion of and increasing price of fossil 
fuels and to address energy security problems. 
CHIEF EXECUTIVE’S REVIEW 
CONTINUED
_0_BIF_ar07_FRONT.indd   6 26/10/2007   13:55:30 07 biofusion plc annual report and accounts 2007
Biohydrogen aims to develop a unique 
microbiological method of producing hydrogen 
for the industrial hydrogen market and any future 
hydrogen energy related market. 
The company’s ofﬁces and laboratories 
are based in Shefﬁeld’s Bioincubator.
During the year we invested £54,000 in Biohydrogen 
and committed to invest a further £146,000.
ABCELLUTE
Biofusion shareholding 
34%
Abcellute’s patent protected cell stabilising 
platform technology enables the non-frozen 
preservation and transport of live organ-derived 
cells without the loss of viability or function. 
The Abcellute product is currently being sold 
to pharmaceutical companies in the UK, Europe 
and Japan for pre-clinical drug testing and the 
company is actively expanding these sales to 
Asia and the USA. In the long-term, the company 
plans to develop the preservation technology to 
provide products for cell-based therapeutics. 
During the year we invested £56,000 in Abcellute 
and then subsequent to the year end, Abcellute 
raised £400,000 from Biofusion (£200,000) and 
Finance Wales (£200,000), increasing Biofusion’s 
shareholding to 34%.
PLASSO TECHNOLOGY
Biofusion shareholding 
9%
During the year as part of the sale of Plasso 
Technology (UK) Limited (Plasso) to Becton, 
Dickinson and Company, Biofusion disposed 
of its 9% shareholding in Plasso. Financial 
terms of the deal were not disclosed.
LIFESTYLE CHOICES
Biofusion shareholding 
60%
Lifestyle Choices sells the Plan Ahead test which 
is a patented triple hormone ovarian reserve test 
that helps a woman to make a more informed 
decision about whether to try for a baby sooner 
rather than later.
In October 2007 Lifestyle Choices announced 
it had signed a licence agreement with an 
undisclosed leading US reproductive diagnostics 
company (the Partner), for the exclusive rights to 
sell the Lifestyle Choices’ Plan Ahead test, which 
helps measure a woman’s egg reserves, in North 
America and Canada. Under the terms of the 
agreement, the Partner will be given exclusive 
rights to market, sell and distribute Plan Ahead in 
North America and Canada through its extensive 
network of speciality physicians. Lifestyle Choices 
will receive an agreed fee, on a sliding scale, per 
test that is sold with a commitment by the Partner 
Asterion is developing a range of third-generation therapeutic proteins that will 
improve the current treatment options for patients with chronic diseases. Using 
its novel, patented ProFuse
TM
 therapeutic platform Asterion is generating and 
developing long-acting biopharmaceutical products that can be administered at a 
lower dose, less frequently and with fewer side effects than existing marketed drugs.
Asterion is adopting a lower risk development strategy by developing third-generation 
Asterion Fusion T echnology (AFT™) therapeutic proteins that address unmet clinical 
and commercial needs in large markets where the targets are validated, the clinical 
development path is known and the commercial opportunity is clear. 
These proprietary, best-in-class, third-generation, therapeutic products are being 
developed and commercialised through a combination of internal programmes 
and external collaborations.
Asterion’s most advanced product is a long-acting Growth Hormone agonist 
product for the treatment of growth disorders, which is being developed in a 
strategic alliance with Ipsen. Asterion also has internal programmes for other 
cytokine targets, which include erythropoietin (AFT
TM 
– EPO), G-CSF (AFT
TM
 
– GCSF), interferons (AFT
TM
 – Inteferon α; AFT
TM
 – Inteferon β) and leptin 
(AFT
TM
 – Leptin), products which will be used to treat diseases such as anaemia, 
neutropenia, multiple sclerosis, growth disorders and autoimmune disorders.
CASE STUDY: ASTERION
_0_BIF_ar07_FRONT.indd   7 26/10/2007   13:55:44 08 biofusion plc annual report and accounts 2007
to selling an agreed minimum number of tests 
per year. The Partner expects to commence sales 
of the Plan Ahead test at the end of 2007. 
Subsequent to the year end we announced the 
addition of one more company to our portfolio, 
an investment in two companies and the sale 
of two companies to Morvus:
CARDIFF BIOLOGICALS
Biofusion shareholding 
50%
In September, as part of the Cardiff agreement, 
we took over Cardiff’s 25% share holding 
in Cardiff Biologicals. Cardiff Biological’s 
technology is based on Professor Wen Jiang’s 
research specialising in anti-angiogenesis 
products for the treatment of cancer. Their lead 
compound is KVE702, a novel, hybrid molecule 
combining anti-angiogenic activity and endothelial 
cell regulatory activity. KVE702 has completed 
its research phase and is now ready to enter 
full development. This protein comprises two 
functional sequences each with a different mode 
of action and so has the potential for dual action 
giving rise to a greater anti-angiogenic activity. 
Subsequent to taking over the University’s 25% 
shareholding, Biofusion invested £200,000, 
increasing our shareholding to 50%.
CARDIFF PROTIDES
Biofusion shareholding 
50%
Cardiff Protide’s technology is based 
on Professor Christopher McGuigan’s research 
which enables the discovery of new and 
improved nucleoside based drugs. This 
approach has been successfully utilised with a 
number of major pharmaceutical companies in 
the anti-viral ﬁeld and has more recently been 
applied in the anti-cancer ﬁeld. Cardiff Protide’s 
CHIEF EXECUTIVE’S REVIEW 
CONTINUED
Based on the work of Professor John Rodenburg, Phase Focus is developing 
microscope and imaging devices that do without the need for traditional 
focussing devices such as lenses or zone plates. This reduces instrument 
cost and banishes the distortions and aberrations that are inherent in even 
the most sophisticated of today’s microscopes. Moreover, it provides images 
showing not only how much illumination is absorbed by the specimen, but also 
how much the specimen changes the “phase” of the illumination. 
Potentially applicable to a wide variety of imaging applications and, most particularly, 
to microscopy, the application to electron microscopy is expected to create a 
revolution in visualisation at the nano-scale. Indeed, if the same gain in resolution 
already achieved for x-rays is achieved at electron wavelengths, it will be possible 
to resolve every atom in an extended object with unprecedented resolution.
Phase Focus’s truly disruptive technology solves a fundamental challenge 
in imaging science and promises users, in industries as diverse as bioscience 
and semiconductor manufacturing, the possibility of observing and analysing 
their materials, processes and products in new ways and with unprecedented 
clarity and ease.
CASE STUDY: PHASE FOCUS
_0_BIF_ar07_FRONT.indd   8 26/10/2007   13:56:06 09 biofusion plc annual report and accounts 2007
vision is to become a leading developer of 
cutting edge nucleoside based pharmaceuticals 
targeted at areas of unmet medical need, initially 
for the treatment of cancer. 
Subsequent to the year end Biofusion invested 
£200,000, increasing our shareholding to 50%.
SALE OF CARDIFF PROTIDES AND 
CARDIFF BIOLOGICALS TO MORVUS
On 10 October 2007 Morvus, a privately owned 
pharmaceutical company specialising in the 
discovery and development of novel oncology 
therapies, acquired Biofusion’s shareholdings 
in Cardiff Protides and Cardiff Biologicals. 
Morvus’ facilities at their new laboratories in Wales, 
combined with their expertise in pharmaceutical 
development, convinced the board of Biofusion 
that the new combined company could be a 
world leader in the provision of specialist oncology 
drugs and provided the best opportunity for 
bringing Cardiff Protides and Cardiff Biologicals 
exciting lead compounds to market. 
Morvus has raised over £3.4m in equity ﬁnance 
to date and its most recent funding, largely 
concluded in July 2007, valued Morvus at 
approximately £12m, based on a price of 30p per 
share. As a result of the sale Biofusion now owns 
13,698,630 shares in Morvus, giving it a 20% 
shareholding in the enlarged company.
However, the valuation of the transaction is 
based on Morvus’ last funding round and given 
that these shares were privately held, the Directors 
of Biofusion will take a conservative view to 
recognising this value in Biofusion’s accounts. 
Our intention will be to re-evaluate this value at 
Morvus’ next third party funding round.
FINANCIAL REVIEW
RESULTS
The group’s reported loss for the year increased 
by 53% to £2.9m (2006: £1.9m), but was broadly in 
line with budget. The losses reﬂect the incremental 
costs of the Cardiff operations for the last six 
months of the ﬁnancial year and an increase in 
the number of portfolio companies classiﬁed as 
subsidiaries, for which overheads and losses are 
consolidated into the group’s results.
Turnover has increased by 26% to £351,000 
(2006: £279,000) and represents the amounts 
charged to associated companies for management 
services provided and the turnover of consolidated 
portfolio companies. The gross proﬁt margin of 
91% is consistent with 2006.
Administrative expenses for the year, before 
exceptional items, were £3.0m (2006: £1.4m). 
This increase was due to the following:
  incremental costs associated with operations 
established alongside Cardiff University, 
within the Fusion Cardiff subsidiary £170,000;
  increased expenditure incurred 
in newly acquired/created portfolio 
subsidiaries £208,000;
  increased expenditure in existing portfolio 
subsidiaries £584,000 (2006: £285,000) 
as they continue through their research 
and development phases; and
  impairment of ﬁxed asset 
investments £652,000.
As a result of the Cardiff University pipeline 
agreement, an intangible asset of £15.9m was 
recognised in accordance with FRS 10 “Goodwill 
and intangible assets”. The asset is being amortised 
on a straight line basis through the proﬁt and 
loss account over the length of the agreement. 
The charge of £0.9m has been represented 
within exceptional items by virtue of its size in 
comparison to normal administrative expenses.
The Company’s adoption of FRS 20 “Share-based 
payments” has resulted in a prior year restatement 
and exceptional charge of £1.3m. This principally 
relates to the warrants granted to NPI Ventures 
on 23 March 2006. This charge has no impact 
on net assets and will not be recurring. Also 
included in the prior year was a £0.2m net credit 
following the impairment of goodwill relating to the 
acquisition of Bioacta Limited and the release of 
related loan notes and accrued interest.
Interest income increased 53% to £535,000 
(2006: £349,000) as a result of the increase in 
the group’s cash holdings and interest relating 
to loans made to the group’s portfolio companies. 
Interest payable of £195,000 (2006: £102,000) 
relates to interest accrued on the loan notes 
used to purchase the group’s shareholding 
in portfolio companies acquired as part of the 
Shefﬁeld and Cardiff agreements. These amounts 
are only payable in the event of an exit, and are 
not considered to be a current liability.
During the year investments on the balance 
sheet increased to £4.5m (2006: £3.4m). 
The increase in the year was made up of both 
equity investments and convertible loan investments, 
plus accrued interest, in a number of our portfolio 
companies. The principal increase was the £1.4m 
acquisition of the interests in seven companies 
associated with the Cardiff agreement.
Amounts falling due greater than one year rose 
to £3.3m (2006: £2.0m). The increase is the net 
impact of loan notes of £1.4m issued as part of 
the Cardiff agreement from the acquisition of the 
seven companies plus accrued interest arising in 
the year and a £0.4m repayment of a loan note to 
the University of Shefﬁeld following the disposal 
of the holding in Plasso Technology Limited.
Net cash outﬂow before ﬁnancing was consistent 
with the prior year at £2.3m. Fund raising net of 
share issue costs raised £7.0m leaving a closing 
cash balance of £10.6m (2006: £5.9m) which is 
sufﬁcient to support the current portfolio of 
companies, planned creation of new portfolio 
companies and central overheads beyond the 
next twelve months.
FUNDRAISING
The key fundraising event of the year was 
a placing of 5.3m shares at a share price 
of £1.45 which raised £7.8m. The costs of 
this fund raising were £0.8m, all of which 
were taken to the share premium account, 
leaving net funds raised of £7.0m.
As part of the consideration for the Cardiff 
agreement 11.0m shares were issued at a price 
of £1.45 giving a total value of £15.9m. Following 
the completion of this agreement Cardiff University 
owns 30% of the issued share capital of the 
company. The University of Shefﬁeld now owns 
25%, management own 11% and institutional 
investors, the remaining 34%.
POST YEAR END
Trading has continued in line with expectations 
since the year end.
DAVID BAYNES
CHIEF EXECUTIVE
15 October 2007
• 10 year exclusive IP agreement
• Top 10 UK research intensive university
• 10 year exclusive IP agreement
• T op 10 UK research intensive university
_0_BIF_ar07_FRONT.indd   9 26/10/2007   13:56:08 10 biofusion plc annual report and accounts 2007
BOARD OF DIRECTORS
1 2
3 4
5 6 7
9 8
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1. DOUG LIVERSIDGE CBE
CHAIRMAN 
Appointed to the Board of Biofusion plc on 
1 December 2004, having been a director of Biofusion 
Trading since 28 November 2003. He was employed for 
21 years at British Steel, before moving to G W Thornton 
Limited as Managing Director and subsequently 
Chief Executive. He guided the company through its 
ﬂotation on the full list of the London Stock Exchange 
in March 1987. In 1991 Mr. Liversidge was awarded 
South Yorkshire Businessman of the Year. 
Mr. Liversidge acts as a Senior Industrial Advisor to the 
University of Shefﬁeld and was awarded the CBE in the 
2000 New Year’s Honours List for services to industry.
2. DAVID BAYNES
CHIEF EXECUTIVE
Appointed to the Board of Biofusion plc on 
2 November 2004, having been a director of 
Biofusion Trading since 2 January 2003. David has 
previously worked at Celsis International plc (Celsis) 
from its incorporation to its ﬂotation on the full list of 
the London Stock Exchange in July 1993; Toad plc 
(now TG21 plc), which he co-founded and was 
responsible for taking the company from start-up 
to a full listing on the London Stock Exchange; 
Whereonearth Limited; and Codemasters Limited.
3. DR PETER GRANT
OPERATIONS DIRECTOR
Appointed to the Board of Biofusion plc on 
1 December 2004, having been a director of Biofusion 
Trading since 2 January 2003. Peter has a PhD 
in BioChemistry from Cardiff University and has 
previously worked at Genzyme UK Limited; Celltech 
Limited; Enzymatix Limited and Celsis plc, which 
he co-founded and took to a full listing on the 
London Stock Exchange. 
4. STUART GALL
COMMERCIAL DIRECTOR
Appointed to the Board of Biofusion plc on 27 April 2005. 
Mr. Gall has experience in both small company start-ups 
and public companies and specialises in marketing, 
communications and new business development. 
He has previously worked at British Airways plc, 
The Promotions Partnership Limited, Anvil Limited 
and Toad plc (now TG21 plc).
5. DR EDWIN MOSES
NON-EXECUTIVE DIRECTOR 
Appointed to the Board of Biofusion plc on 
1 December 2004. Dr. Moses has extensive experience 
as a non-executive director for companies including 
Evotec OAI AG, BioImage A/S, Inpharmatica Ltd, Ionix 
Limited, Amedis Limited, Avantium Technologies BV, 
Paradigm Therapeutics and Clinphone Limited.
6. PROF TONY ATKINSON
NON-EXECUTIVE DIRECTOR
Appointed to the Board of Biofusion plc on 
1 December 2004, Prof. Atkinson has extensive 
experience as both a director and non-executive director 
for companies including Generic Biologicals, Kymed, 
Enact Pharma and Chimereran.
7. DAVID CATTON
NON-EXECUTIVE DIRECTOR
Mr. Catton was appointed to the Board of Biofusion plc 
on 1 December 2004, having been a director of 
Biofusion Trading since 14 August 2003. David is 
Managing Director of SUEL, the University of Shefﬁeld’s 
tech transfer operation. Prior to this David worked for 
Ford Motor Company, British Leyland, Rank Xerox 
Limited and Cambridge Consultants Limited. 
8. MIKE DAVIES
NON-EXECUTIVE DIRECTOR
Appointed to the Board of Biofusion on 29 January 2007, 
Mike is Cardiff University’s Director of Physical 
and Financial Resources. Mike has gained extensive 
experience of Cardiff’s technology transfer activities 
through his role as Chairman of UC3, and as a Director/
Company Secretary of the General Partner Board of the 
Cardiff Partnership Fund.
9. SIMON OAKLAND
NON-EXECUTIVE DIRECTOR
Appointed to the Board of Biofusion on 20 April 2006. 
Simon is a Principal of Nikko Principal Investments 
Limited (NPIL), the European principal ﬁnance arm 
of Nikko Cordial Corporation, and a Director of NPI 
Ventures. Simon previously worked for the Corporate 
Finance Department of Cazenove & Co. and prior 
to that was a management consultant at Accenture.
_0_BIF_ar07_FRONT.indd   11 26/10/2007   13:56:51 biofusion plc annual report and accounts 2007 12
The company is committed to high standards of corporate governance. The revised Combined Code on Corporate Governance (Combined Code) was 
published in 2003. While the group is not required to report on compliance with the Combined Code since its shares are traded on AIM, we make every 
effort to comply. The statement below describes how principles of corporate governance are applied to the group.
THE WORKINGS OF THE BOARD AND ITS COMMITTEES
THE BOARD
The board currently comprises six Non-executive Directors and three executive Directors and is responsible for the management of the group. As disclosed 
on page 16 Dr Edwin Moses, Prof Tony Atkinson and David Catton have some share options in the company, however the board considers them to be 
independent because the number of share options are not considered to be material. Simon Oakland, as a representative of NPI Ventures, is not considered 
to be independent. The other Non-executive Directors are considered by the board to be independent. The board meets at least six times a year, setting 
and monitoring group strategy, reviewing trading performance, reviewing and agreeing on investments in spin-out companies and formulating policy on 
key issues. Day to day operational decisions are delegated to the executive Directors. Key issues reserved for the board include the consideration of 
potential investments, share issues and fundraising, the setting of group strategy, City public relations and the review and evaluation of signiﬁcant risks 
facing the business. Brieﬁng papers are distributed by the Company Secretary to all Directors in advance of board meetings. All Directors have access 
to the advice and services of the Company Secretary who is responsible for ensuring that board procedures are followed and that applicable rules and 
regulations are complied with. The appointment and removal of the Company Secretary is a matter for the board as a whole. In addition, procedures 
are in place to enable Directors to obtain independent professional advice in the furtherance of their duties if necessary, at the company’s expense.
Biographies of the Directors including details of their experience and roles within the group are set out on pages 10 and 11.
ATTENDANCE AT MEETINGS
The full board met six times in the ﬁnancial year ending 31 July 2007 and with the exception of Doug Liversidge, Dr Edwin Moses, Mike Davies 
and Stuart Gall, who missed one meeting each, all of the Directors in ofﬁce at that time were in attendance at these meetings. 
THE AUDIT COMMITTEE
The Audit Committee comprises the Non-executive Chairman, Doug Liversidge and two of the Non-executive Directors, Dr Edwin Moses and 
Prof Tony Atkinson. The Audit Committee’s remit is set out in its terms of reference and is scheduled to meet with the auditors at least twice a year. 
The Committee assists the board in ensuring the group’s published ﬁnancial statements give a true and fair view and that, where the auditors provide 
non-audit services, their objectivity and independence is safeguarded. 
THE REMUNERATION COMMITTEE
The Remuneration Committee comprises the Non-executive Director, Doug Liversidge and two of the Non-executive Directors, Dr Edwin Moses 
and Prof Tony Atkinson. The Committee is responsible for making recommendations to the board on the remuneration of all the Directors.
THE NOMINATION COMMITTEE
The Nomination Committee comprises the Non-executive Directors and is chaired by the Chairman, Doug Liversidge. It meets as necessary and is 
responsible for making recommendations to the board on the appointments of executive and Non-executive Directors. When required, it is the usual 
practice for the Nomination Committee to employ specialist external search and selection consultants to assist in the appointment process for new 
executive and Non-executive Directors.
TERMS OF REFERENCE
The terms of reference for the Audit, Remuneration and Nomination Committees are available on request from the Company Secretary. 
CORPORATE GOVERNANCE
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PERFORMANCE EVALUATION
Performance of each of the executive Directors is evaluated on an ongoing basis by the Chairman and the Non-executive Directors, with a formal review 
held at least annually. The Non-executive Directors are responsible for the performance evaluation of the Chairman, taking into account the views of the 
other executive Directors. The Non-executive Directors will meet with the Chairman on an ad hoc basis but at least once a year to appraise the Chairman’s 
performance. The performance of the Non-executive Directors and the sub-committees on which they serve are reviewed by the executive board on an 
ongoing basis.
RELATIONS WITH SHAREHOLDERS
Key members of the executive board regularly visit institutional investors and the full board will make itself available to questions at all shareholder 
meetings it holds. The Chairman and Chief Executive plan to report back to the board views of investors obtained at analyst and brokers’ brieﬁngs. 
The board will use the Annual General Meeting to communicate with private and institutional investors and welcomes their participation. The Chairman 
aims to ensure that the Chairman of the Audit, Remuneration and Nomination Committees is available at Annual General Meetings to answer questions. 
INTERNAL CONTROLS
The Directors acknowledge that they are responsible for the group’s system of internal control and for reviewing its effectiveness. Internal control systems 
are designed to meet the particular needs of the group and the risks to which it is exposed. In accordance with the guidance of the Turnbull Committee 
on internal control, the procedures are regularly reviewed in an ongoing process to identify, evaluate and manage the signiﬁcant risks faced by the group. 
The procedures are designed to manage rather than eliminate risk of failure to achieve business objectives and can only provide reasonable and not 
absolute assurance against material misstatement or loss.
The key procedures which the Directors have established with a view to providing effective internal control are as follows:
 MANAGEMENT STRUCTURE
  The board has overall responsibility for the group and there is a formal schedule of matters speciﬁcally reserved for decision by the board. 
Each executive Director has been given responsibility for speciﬁc aspects of the group’s affairs. The executive Directors meet weekly to discuss 
day to day operational matters. 
 CONTROL ENVIRONMENT
  The group’s control environment is the responsibility of the group’s Directors and the internal controls were implemented in February 2005. 
The effectiveness of the group’s internal controls are reviewed annually to ensure they remain appropriate.
 MAIN CONTROL PROCEDURES
   The Directors have established control procedures in response to key risks. Standardised ﬁnancial control procedures operate throughout the group 
to ensure the integrity of the group’s ﬁnancial statements. The board has established procedures for authorisation of capital and revenue expenditure.
 MONITORING SYSTEM USED BY THE BOARD
 The board reviews the group’s performance against budgets on a monthly basis. The group’s cash ﬂow is monitored bi-monthly by the board.
 INTERNAL AUDIT
  The group does not have an independent internal audit function, as the board does not consider the current scale of operations warrants such 
a function. However, as the group continues to grow, the board will keep this under review, with a view to creating an internal audit function when 
it is warranted.
GOING CONCERN
After making enquiries, the Directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the 
foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the ﬁnancial statements.
DOUG LIVERSIDGE CBE
CHAIRMAN
15 October 2007
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This remuneration report sets out the company’s policy on the remuneration of executive and Non-executive Directors, together with detail of Directors’ 
remuneration packages and service contracts.
REMUNERATION COMMITTEE
For the ﬁnancial year ended 31 July 2007, remuneration policy for executive and Non-executive Directors and the determination of individual executive 
Directors’ remuneration packages, have been delegated to the board’s Remuneration Committee comprising three Non-executive Directors, one of 
which is the Non-executive Chairman.
In setting the remuneration policy, the Remuneration Committee considers a number of factors including:
(a) the basic salaries and beneﬁts available to executive Directors of comparable companies;
(b) the need to attract and retain Directors of an appropriate calibre; 
(c) the need to ensure executive Directors’ commitment to the continued success of the company by means of incentive schemes; and
(d) the need for the remuneration awarded to reﬂect performance.
REMUNERATION OF THE NON-EXECUTIVE DIRECTORS
All the Non-executive Directors, except for Simon Oakland, who represents NPI Ventures and Mike Davies, who represents Cardiff University, received 
a fee for their services. The fee is agreed by the board following recommendation by the Chairman with a view to rates paid in comparable organisations 
and appointments. The Non-executive Directors did not receive any pension or other beneﬁts from the company, nor did they participate in any bonus 
or incentive schemes other than share options. The Non-executive Directors, each have a three year service contract with the company with three 
months’ notice either side. After this time their appointment is reviewed annually. 
REMUNERATION POLICY FOR EXECUTIVE DIRECTORS
The company’s remuneration policy for executive Directors is to:
(a)  have regard to the Directors’ experience and the nature and complexity of their work in order to pay a competitive salary that attracts and retains 
management of the highest quality;
(b) link individual remuneration packages to the group’s long-term performance through the award of discretionary bonus schemes; and
(c) provide employment-related beneﬁts including life assurance, insurance relating to Directors’ duties and medical insurance. 
SALARIES AND BENEFITS
The Remuneration Committee meets at least once a year to consider and set the annual salaries for executive Directors, having regard to personal 
performance and information regarding the remuneration practices of companies of similar size and of industry competitors. Executive Directors’ 
salaries were last reviewed in January 2007.
REPORT ON THE DIRECTORS’ REMUNERATION
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DIRECTORS’ SERVICE CONTRACTS
The service contracts of the executive Directors provide for six months’ notice of termination. Other than the notice periods afforded to the executive 
and Non-executive Directors, 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.
Details of individual Directors’ service contracts are as follows:
  Unexpired  
  term at  
 Effective 31 July  
 contract date  2007 Notice period
D Liversidge (Chairman) 1 December 2004 4 months 3 months
D Baynes 26 January 2005 n/a 6 months
P Grant 26 January 2005 n/a 6 months
S Gall 1 April 2005 n/a 6 months
E Moses 1 December 2004 4 months 3 months
T Atkinson 1 December 2004 4 months 3 months
D Catton 1 December 2004 4 months 3 months
S Oakland 19 April 2006 21 months 3 months
The Directors are required to retire by rotation once every three years.
All the Directors with the exception of Simon Oakland and Mike Davies are required to retire by rotation and being eligible, will seek re-election at the 
forthcoming Annual General Meeting.
Mike Davies, having been appointed by the Directors since the last general meeting, is subject to re-election by shareholders and being eligible, 
will seek re-election.
NON-EXECUTIVE DIRECTORSHIPS
With the permission of the Chairman, the executive Directors may accept appointments as Non-executive Directors. Where an executive Director 
accepts an appointment to the board of a company in which the group is a shareholder, the group retains the Directors’ fees. Fees earned for 
directorships of companies in which the group does not have a shareholding would be retained by the Directors.
DIRECTORS’ DETAILED EMOLUMENTS
Details of individual Directors’ emoluments for the year are as follows:
 Salary  Pension   Total  Total 
 and fees  Bonuses  contributions Beneﬁts  2007  2006 
 £ £  £ £  £  £
EXECUTIVE
D Baynes 147,000  10,000 14,700 2,234 173,934 137,652
P Grant 126,000  10,000 12,600 1,860 150,460 123,902
S Gall 126,000  10,000 12,600 1,860 150,460 123,902
NON-EXECUTIVE
D Liversidge (Chairman)  33,500 —  — — 33,500 24,000
E Moses 24,250 —  — — 24,250 24,000
T Atkinson 24,250 —  — — 24,250 24,000
D Catton 12,125 —  — — 12,125 12,000
S Oakland  — —  — —  —  —
M Davies
1
  — —  — —  —  —
  493,125  30,000 39,900  5,954 568,979 469,456
1
 Joined board on 29 January 2007, as part of the Cardiff agreement and is an unpaid Non-executive Director.
The pension contributions are paid into private pension plans nominated by the related Directors or can be included with the basic salary. At the year 
end an amount of £36,400 was accrued but unpaid. 
No Director waived emoluments in the year (2006: nil). 
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DIRECTORS’ INTERESTS IN SHARE OPTIONS
Details of options held by Directors over the company’s Ordinary shares of 1p are set out below:
      
  As at  As at    Earliest 
    31 July  31 July  Exercise exercise  Expiry  
The scheme  2006 2007 price date date
E Moses  33,333 33,333 150p 28.01.08 28.01.15
T Atkinson  33,333 33,333 150p 28.01.08 28.01.15
D Catton  33,333 33,333 150p 28.01.08 28.01.15
The market price of the company’s shares at the end of the ﬁnancial year was 149.0p (2006: 160.0p) and the range of market prices during the year 
was 160.0p to 149.0p (2006: 175.5p to 110.0p).
Each option will vest monthly as to one thirty-sixth of the Ordinary shares under option on the expiry of each month following the date of the grant until 
the third anniversary of the date of the grant when the option shall become fully vested. Any vested portion of the options will normally be exercisable 
between the expiry of the third month after the date of the grant and the tenth anniversary of the date of the grant. No performance conditions are required 
to be met. Options will become immediately exercisable in full on the death of the option-holder for a period of twelve months from the date of death. 
If an option-holder ceases to be a Non-executive Director of the company for any reason other than death, his option (to the extent unexercised and 
unvested) will lapse. On a change of control or a voluntary winding-up of the company, options may be exercised in full for a ﬁxed period. Options will 
lapse on the expiry of ten years from their date of grant.
Until options are exercised, the option-holders have no voting or other rights in respect of the Ordinary shares under their options. Ordinary shares 
issued pursuant to the Share Option Agreements shall rank pari passu in all respects with the Ordinary shares already in issue except that they will 
not rank for any dividend or other distribution announced prior to the date of the exercise. Options are not transferable nor are they pensionable.
DIRECTORS’ INTERESTS IN SHARES
The Directors at 31 July 2007 and their interests in the share capital of the company, other than in respect of options to acquire Ordinary shares, 
were as follows:
      31 July 
The company – ordinary 1p shares      2007
D Baynes       1,333,332
P Grant       1,333,332
S Gall       1,333,332
D Liversidge (Chairman)      —
E Moses      —
T Atkinson      —
D Catton       —
S Oakland      —
M Davies      —
On 27 January 2005 David Baynes, Peter Grant and Stuart Gall granted an option to Doug Liversidge entitling him to acquire 97,756 Ordinary shares 
from each of them at an aggregate exercise price of £44,000. The options can be exercised at any time prior to 27 January 2015. Doug Liversidge has 
undertaken to Biofusion to indemnify it from any PAYE and employers’ national insurance contributions payable by the group as a result of the exercise 
of any or all of these options.
Apart from the interests disclosed above, no Directors held interests, at any time in the year, in the share capital or loan stock of the company or other 
group companies.
REPORT ON THE DIRECTORS’ REMUNERATION CONTINUED
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TOTAL SHAREHOLDER RETURN
The following line graph shows, for the ﬁnancial year ended 31 July 2007, the total cumulative shareholder return on a holding of the company’s 
Ordinary shares compared with a hypothetical holding of shares made up of companies in the FTSE AIM All Share index, which the Directors believe 
reﬂects the most appropriate benchmark for the company’s performance.
The company has never paid a dividend and so the total shareholder return has been calculated as the weekly movement in the share price by reference 
to a base point of 31 July 2007.
Signed on behalf of the board
DOUG LIVERSIDGE CBE
CHAIRMAN
15 October 2007
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_1_BIF_ar07_BACK.indd   17 26/10/2007   14:00:32 biofusion plc annual report and accounts 2007 18
The Directors present their report and the group ﬁnancial statements for the year ended 31July 2007. 
RESULTS AND DIVIDEND
Group loss for the year after taxation and minority interests amounted to £2,890,000 (2006: loss £1,947,000). The Directors do not recommend 
the payment of a dividend (2006: £nil).
PRINCIPAL ACTIVITY
The group’s principal activity is the commercialisation of intellectual property (IP) that is developed at universities and similar establishments. 
ENHANCED BUSINESS REVIEW
The Companies Act 1985 (Operating and Financial Review) Regulations 2005 require that the Directors present an enhanced Directors’ report. 
These enhancements are provide within the Chairman’s statement and Chief Executive’s review.
DIRECTORS
The names of the Directors who held ofﬁce during the ﬁnancial year are as follows:
EXECUTIVE
D Baynes    appointed 2 November 2004
P Grant    appointed 1 December 2004
S Gall    appointed 27 April 2005
NON-EXECUTIVE
D Liversidge (Chairman)    appointed 1 December 2004
E Moses    appointed 1 December 2004
T Atkinson    appointed 1 December 2004
D Catton    appointed 1 December 2004
S Oakland     appointed 20 April 2006
M Davies    appointed 29 January 2007 
Details of the interests of Directors in the share capital of the company, together with details of share options granted to them, are set out in the Report 
on the Directors’ remuneration.
ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)
The London Stock Exchange conﬁrmed changes to the AIM rules which will require AIM companies to use IFRS for ﬁnancial years commencing on 
or after 1 January 2007. As a result, this is the last set of ﬁnancial statements the group will present under UK Generally Accepted Accounting Practice 
(UK GAAP).
From 1 August 2007 the group will present its ﬁnancial statements for the ﬁrst time under IFRS. The group’s transition date to IFRS would therefore be 
1 August 2006 with the ﬁrst ﬁnancial statements complying with IFRS being the year ended 31 July 2008 (with full comparative ﬁgures for the year ended 
31 July 2007).
The adoption of IFRS is anticipated to have a material impact on the group’s ﬁnancial position and reported results, with key changes in accounting 
policy expected in dealing with ﬁxed asset investments.
All ﬁxed asset investments will be deﬁned as ﬁnancial assets under International Accounting Standard (IAS) 32 and will be classiﬁed as ﬁnancial assets 
held at fair value under IAS 39, “Financial instruments: recognition and measurement”.
The current accounting policy adopted under UK GAAP , accounts for investments at historic cost less any provision for impairment in value. The carrying 
value of all investments will be at fair value under IFRS with changes in fair value between accounting periods being charged or credited to the proﬁt 
and loss account. 
The change in the basis of the valuation of ﬁxed asset investments is likely to result in signiﬁcant changes to carrying values.
It is anticipated that the introduction of IFRS will not have a material impact on other accounting policies.
DIRECTORS’ REPORT
_1_BIF_ar07_BACK.indd   18 26/10/2007   14:00:32 19 biofusion plc annual report and accounts 2007
FINANCIAL RISK MANAGEMENT
The group’s principal ﬁnancial instruments comprise cash and loan notes. The main purpose of these ﬁnancial instruments is to raise ﬁnance for the 
group’s operations. The group has various other ﬁnancial instruments such as trade debtors and trade creditors that arise directly from its operations.
MAJOR INTEREST IN SHARES
As at 15 October 2007, according to the company’s register, the following shareholders each held 3% or more of the company’s issued share capital:
     Ordinary 
Name     1p shares % Holding
Cardiff University      10,997,541 30.00
The University of Shefﬁeld      9,333,324 25.46
HSBC Global Custody Nominee (UK)     2,758,620  7.52
Barclayshare Nominees Limited     2,672,614  7.29
Vidacos Nominees Limited      2,300,748  6.28
P Grant     1,333,332  3.64
D Baynes     1,333,332  3.64
S Gall     1,333,332  3.64
CREDITOR PAYMENT POLICY
The group’s policy is to:
(a) establish the payment terms with suppliers when agreeing the terms of supply;
(b) ensure that suppliers are aware of the terms of payment; and 
(c) adhere to the agreed terms.
The group’s average creditor payment period at 31 July 2007 was 41 days (2006: 37 days). The company has no trade creditors.
CHARITABLE DONATIONS
During the year the group made no charitable donations.
DISCLOSURE OF INFORMATION TO AUDITORS
The Directors who held ofﬁce at the date of approval of this Directors’ report conﬁrm that, so far as they are each aware, there is no relevant audit 
information of which the company’s auditors are unaware, and each Director has taken all the steps that they ought to have taken as Director to make 
themselves aware of any relevant audit information and to establish that the company’s auditors are aware of that information.
AUDITORS
In accordance with Section 384 of the Companies Act 1985, a resolution for the reappointment of KPMG Audit Plc is to be proposed at the forthcoming 
Annual General Meeting.
By order of the board
DAVID BAYNES
CHIEF EXECUTIVE OFFICER
15 October 2007
_1_BIF_ar07_BACK.indd   19 26/10/2007   14:00:32 biofusion plc annual report and accounts 2007 20
The Directors are responsible for preparing the Directors’ report and the ﬁnancial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare ﬁnancial statements for each ﬁnancial year. Under that law, the Directors have elected to prepare 
the ﬁnancial statements in accordance with UK Accounting Standards and applicable law (UK Generally Accepted Accounting Practice).
The group and parent company ﬁnancial statements are required by law to give a true and fair view of the state of affairs of the group and the 
parent company and of the proﬁt or loss for that period. 
In preparing those ﬁnancial statements, the Directors are required to:
 select suitable accounting policies and apply them consistently;
 make judgements and estimates that are reasonable and prudent;
  state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the 
ﬁnancial statements; and
  prepare the ﬁnancial statements on the going concern basis unless it is inappropriate to presume that the group and the parent company will 
continue in business.
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the ﬁnancial position of the 
parent company and enable them to ensure that the ﬁnancial statements comply with the Companies Act 1985. They have general responsibility for 
taking such steps as are reasonably open to them to safeguard the assets of the group and to prevent and detect fraud and other irregularities. 
The Directors are responsible for the maintenance and integrity of the corporate and ﬁnancial information included on the company’s website. 
Legislation in the United Kingdom governing the preparation and dissemination of ﬁnancial statements may differ from legislation in other jurisdictions.
STATEMENT OF THE DIRECTORS’ RESPONSIBILITIES
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We have audited the group and parent company ﬁnancial statements (the “ﬁnancial statements”) of Biofusion plc for the year ended 31 July 2007 which 
comprise the consolidated proﬁt and loss account, the consolidated and company balance sheets, the consolidated cash ﬂow statement, the consolidated 
statement of recognised gains and losses and the related notes. 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 Section 235 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. 
T o 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 UK Accounting Standards 
(UK Generally Accepted Accounting Practice) are set out in the Statement of Directors’ responsibilities on page 20.
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. We also 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 other information.
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 judgements 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:
  the ﬁnancial statements give a true and fair view, in accordance with UK Generally Accepted Accounting Practice, of the state of the group’s 
and the parent company’s affairs as at 31 July 2007 and of the group’s loss for the year then ended;
 the ﬁnancial statements have been properly prepared in accordance with the Companies Act 1985; and
 the information given in the Directors’ report is consistent with the ﬁnancial statements.
KPMG AUDIT PLC
CHARTERED ACCOUNTANTS 
REGISTERED AUDITOR
LEEDS
15 October 2007
INDEPENDENT AUDITORS’ REPORT
REPORT OF THE INDEPENDENT AUDITORS, KPMG AUDIT PLC, TO THE MEMBERS OF BIOFUSION PLC
_1_BIF_ar07_BACK.indd   21 26/10/2007   14:00:32 biofusion plc annual report and accounts 2007 22
  Continuing 
  operations Acquisitions Total Restated 
  2007 2007 2007 2006 
 Note £000 £000 £000 £000
TURNOVER 2 301 50 351 279
Cost of sales  (17) (15) (32) (23)
GROSS PROFIT  284 35 319 256
ADMINISTRATIVE EXPENSES
– normal 3 (2,806) (208) (3,014) (1,402)
– exceptional 4 (903) — (903) (1,158)
   (3,709) (208) (3,917) (2,560)
OPERATING LOSS  (3,425) (173) (3,598) (2,304)
Surplus on disposal of ﬁxed asset investments    58 —
Interest receivable and similar income 7   535 349
Interest payable and similar charges 8   (195) (102)
LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION 3   (3,200) (2,057)
Tax on loss on ordinary activities  9   — —
Minority interests 20   310 110
LOSS FOR THE FINANCIAL YEAR    (2,890) (1,947)
BASIC AND DILUTED LOSS PER SHARE 10   (9.68p) (10.08p)
There is no difference between the loss on ordinary activities before taxation and the loss for the years stated above and their historical cost equivalents. 
The notes on pages 26 to 37 form part of these ﬁnancial statements.
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 31 JULY 2007
     Restated 
    2007 2006 
   Note £000 £000
Loss for the ﬁnancial year    (2,890) (1,947)
TOTAL RECOGNISED LOSSES FOR THE YEAR    (2,890) (1,947)
Prior year adjustment   4 (1,339) —
TOTAL LOSSES RECOGNISED SINCE LAST ANNUAL REPORT    (4,229) (1,947)
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JULY 2007
_1_BIF_ar07_BACK.indd   22 26/10/2007   14:00:32 23 biofusion plc annual report and accounts 2007
  2007 2007 2006 2006 
 Note £000 £000 £000 £000
FIXED ASSETS
Intangible assets 11  15,204  68
T angible assets 12  41  25
Investments 13  4,510  3,370
   19,755  3,463
CURRENT ASSETS
Stock 14 6  7 
Debtors  15 789  569 
Cash at bank and in hand  10,600  5,883 
  11,395  6,459
CREDITORS: amounts falling due within one year  16 (403)  (197) 
NET CURRENT ASSETS   10,992  6,262
TOTAL ASSETS LESS CURRENT LIABILITIES   30,747  9,725
CREDITORS: amounts falling due after more than one year 17  (3,293)  (2,038)
NET ASSETS   27,454  7,687
CAPITAL AND RESERVES
Called up share capital 18  367  203
Capital reserve 19  2  2
Share premium 19  31,671  8,906
Capital redemption reserve 19  1  1
Proﬁt and loss account 19  (4,244)  (1,370)
SHAREHOLDERS’ FUNDS   27,797  7,742
Minority interest 20  (343)  (55)
   27,454  7,687
These ﬁnancial statements were approved by the board of Directors on 15 October 2007 and were signed on its behalf by the Chairman:
DOUG LIVERSIDGE CBE
CHAIRMAN
CONSOLIDATED BALANCE SHEET
AT 31 JULY 2007
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  2007 2007 2006 2006 
 Note £000 £000 £000 £000
FIXED ASSETS
Tangible assets 12  23  —
Investments 13  2  1
   25  1
CURRENT ASSETS
Debtors  15 31,885  8,917 
  31,885  8,917 
CREDITORS: amounts falling due within one year  16 (63)  — 
NET CURRENT ASSETS  31,822  8,917 
NET ASSETS   31,847  8,918
CAPITAL AND RESERVES
Called up share capital 18  367  203
Share premium 19  31,671  8,906
Capital redemption reserve 19  1  1
Proﬁt and loss account 19  (192)  (192)
SHAREHOLDERS’ FUNDS   31,847  8,918
These ﬁnancial statements were approved by the board of Directors on 15 October 2007 and were signed on its behalf by the Chairman:
DOUG LIVERSIDGE CBE
CHAIRMAN
COMPANY BALANCE SHEET
AT 31 JULY 2007
_1_BIF_ar07_BACK.indd   24 26/10/2007   14:00:33 25 biofusion plc annual report and accounts 2007
    2007 2006 
   Note £000 £000
NET CASH OUTFLOW FROM OPERATING ACTIVITIES    23 (2,279) (943)
RETURNS ON INVESTMENT AND SERVICING OF FINANCE
Interest received    535 349
TAXATION    — —
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENTS
Payments for tangible ﬁxed assets    (28) (13)
Payments for ﬁxed assets investments    (833) (1,561)
Payments for intangible ﬁxed assets    (118) —
Proceeds from sales of ﬁxed assets investments    377 —
NET CASH OUTFLOW FROM CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT    (602) (1,574)
NET CASH OUTFLOW BEFORE FINANCING AND ACQUISITIONS    (2,346) (2,168)
ACQUISITIONS     
Payments to acquire investments in subsidiary undertakings    (6) (128)
Net cash acquired with subsidiaries    29 26
    23 (102)
NET CASH OUTFLOW BEFORE FINANCING    (2,323) (2,270)
FINANCING
Issue of ordinary share capital    7,757 2,000
Share issue costs    (717) (72)
    7,040 1,928
Increase/(decrease) in cash in the period    23 4,717 (342)
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 JULY 2007
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1 ACCOUNTING POLICIES
The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the ﬁnancial 
statements, except as noted below.
In these ﬁnancial statements the following new standard has been adopted for the ﬁrst time:
 FRS 20 “Share-based payments”
The accounting policies under this new standard are set out below together with an indication of the effect of its adoption. 
The company operates an equity-settled, share-based compensation plan for its Directors and has also issued warrants for the purchase of shares in 
respect of the side fund established by NPI Ventures. The fair value of the share-based compensation has been recognised as an expense. The total 
amount to be expensed over the vesting period is determined by reference to the fair value of the share options or warrants granted. Fair value has 
been determined by reference to the Black-Scholes option pricing model.
The adoption of FRS 20 has resulted in a prior year adjustment which reduced the proﬁt for the prior year by £1,339,000 and increased proﬁt and loss 
reserves by the corresponding amount. There was no impact on the group’s net assets.
BASIS OF PREPARATION
The ﬁnancial statements have been prepared in accordance with applicable accounting standards, under the historical cost accounting rules and with 
the requirements of the Companies Act 1985, except as explained below.
The ﬁnancial statements are prepared on the going concern basis. Cash balances at 31 July 2007 amount to £10,600,000 (2006: £5,900,000). 
The balances are considered sufﬁcient to meet expenditure for at least the next 12 months from the date of these ﬁnancial statements. In addition 
the Company’s forecast expenditure includes amounts of a discretionary basis in relation to potential investments.
BASIS OF CONSOLIDATION
The consolidated ﬁnancial statements include the ﬁnancial statements of the company and its subsidiary undertakings made up to 31 July 2007. 
The acquisition method of accounting has been adopted. Under this method, the results of subsidiary undertakings acquired or disposed of in the year 
are included in the consolidated proﬁt and loss account from the date of acquisition or up to the date of disposal.
Those investments that are associated undertakings are carried at cost in accordance with the group’s normal policy and are not equity accounted 
as required by the Companies Act 1985. The Directors consider that as these investments are held as part of the group’s portfolio, with a view to the 
ultimate realisation of capital gains, equity accounting would not give a true and fair view of the group’s interest in these investments. The accounting 
treatment adopted is in line with the FRS 9 “ Associates and joint ventures”, with respect to investment funds. The Directors have decided not to quantify 
the effect of the different treatments due to the signiﬁcant increase in the number of investments in the year.
Merger accounting has been adopted to consolidate the subsidiary Biofusion Trading Limited under the provisions of FRS 6 “ Acquisitions and Mergers”. 
TURNOVER
Turnover, comprising fees for various advisory and fund management services, is recognised in the proﬁt and loss account when the related services 
are performed and when considered recoverable. All turnover is generated within the United Kingdom and is stated exclusive of value added tax. 
GOODWILL
Goodwill arising on the acquisition of subsidiary undertakings, representing the excess fair value of the consideration given over the fair value of the 
identiﬁable assets and liabilities acquired, is capitalised and written off on a straight line basis over its useful economic life, which is ten years. Provision 
is made for impairment.
Intellectual property, patents and licences purchased by the company are amortised to nil by equal annual instalments over their useful economic lives, 
generally their respective unexpired periods, which are ten years.
The intellectual property pipeline with Cardiff University has been recognised in accordance with FRS 10 “Goodwill and intangible assets” as an intangible 
asset. The asset is amortised on a straight line basis over the ten year agreement, with provision made for any impairment when required.
INVESTMENTS
Investments are stated at historic cost less any provision for impairment in value and are held for long-term investment purposes. Investments are 
classiﬁed as equity investments and loans which are convertible to equity in the future.
Provisions are based upon an assessment of events or changes in circumstances that indicate that an impairment has occurred. This includes 
the performance and/or prospects (including ﬁnancial prospects) of the investee company being signiﬁcantly below the expectations on which 
the investment was based, a signiﬁcant adverse change in the markets in which the investee company operates or a deterioration in general market 
conditions and the value implied by third party external funding in the year.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2007
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1 ACCOUNTING POLICIES CONTINUED
STOCKS
Stocks are stated at the lower of cost and net realisable value.
FIXED ASSETS AND DEPRECIATION
Depreciation is provided to write off the cost, less the estimated residual value of tangible ﬁxed assets by equal instalments over their estimated useful 
economic lives as follows:
Computer equipment – 25% per annum
Ofﬁce equipment – 33% per annum
PAYMENTS ON ACCOUNT
Payments on account represent transfer of funds in advance to the University of Shefﬁeld held on the balance sheet of Biofusion Trading Ltd. 
The payments on account are held at cost, less any amounts transferred to equity investments on account of the acquisition of interests in spin 
out companies from the University of Shefﬁeld Life Science department.
RESEARCH AND DEVELOPMENT EXPENDITURE
Expenditure on research and development is written off to the proﬁt and loss account in the year in which it is incurred.
PENSION COMMITMENTS
The group makes deﬁned contributions to employees’ approved personal pension plans. Contributions are charged to the proﬁt and loss account 
in the period in which payments are payable to the pension funds.
DEFERRED TAXATION
Provision is made in full for deferred tax liabilities that arise from timing differences where transactions or events, that result in an obligation to pay more 
tax in the future, have occurred by the balance sheet date. Deferred tax assets are recognised to the extent that it is considered more likely than not that 
they will be recoverable. Deferred tax is measured at the average tax rates that are expected to apply in periods in which the timing differences are 
expected to reverse based on the tax rates and laws that have been enacted or substantially enacted by the balance sheet date. Deferred tax assets 
and liabilities are not discounted.
FINANCIAL INSTRUMENTS
Currently, the group does not enter into derivative ﬁnancial instruments. Financial assets and ﬁnancial liabilities are recognised and cease to be recognised 
on the basis of when the related titles pass to or from the group. Financial assets are stated at the lower of cost to the group, less provision for amortisation 
and impairment.
2 TURNOVER
Turnover and loss on ordinary activities before taxation are derived entirely from the principal activities within the United Kingdom. 
3 LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION
     2007 2006 
     £000 £000
Loss on ordinary activities before taxation is stated after charging/(crediting)
Depreciation and other amounts written off tangible ﬁxed assets     12 4
Loss on sale of ﬁxed assets     — 1
Amortisation of intangible ﬁxed assets     903 55
Proﬁt on deemed disposal of subsidiary     (8) (5)
Impairment of ﬁxed asset investments     652 —
Auditors’ remuneration:
 – audit of ﬁnancial statements – group      18  15
 – audit of ﬁnancial statements – subsidiaries      8  4
 – review of interim ﬁnancial statements      9  5
 – services relating to corporate ﬁnance transactions     55  —
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4 EXCEPTIONAL ITEMS
     2007 2006 
     £000 £000
Share-based payments     16 1,339
Goodwill amortisation     887 —
Goodwill impairment/loan note waiver     — (181)
     903 1,158
Following the adoption of FRS 20 “Share-based payments”, a prior year adjustment of £1,339,000 was charged to the proﬁt and loss account 
and increased proﬁt and loss reserves by the corresponding amount. There was no impact on the group’s net assets. The charge relates primarily 
to the warrants granted to NPI Ventures on 23 March 2006.
The goodwill amortisation charge of £887,000 represents the amortisation of the Cardiff intellectual property pipeline for the period from 9 January 2007. 
The goodwill impairment and loan note waiver in 2006 arose following an impairment review of Bioacta Ltd. 
5 REMUNERATION OF DIRECTORS
     2007 2006 
     £000 £000
Directors’ emoluments     529 434
     529  434
Company contributions to money purchase pension schemes     40 35
     569  469
The aggregate of emoluments of the highest paid Director was £159,234 (2006: £125,152) and company pension contributions of £14,700 (2006: £12,500) 
were accrued for payment to be made to a money purchase scheme on his behalf.
      Number of Directors
     2007 2006
Retirement beneﬁts are accruing to the following number of Directors under:    
Money purchase schemes     3 3
6 STAFF NUMBERS AND COSTS
The average number of persons employed by the group (including Directors) during the year, analysed by category, was as follows:
      Number of employees
     2007 2006
Directors     9 8
Staff     4 2
     13  10
The aggregate payroll costs of these persons were as follows:
     2007 2006 
     £000 £000
Wages and salaries     614 488
Social security costs     68 51
Other pension costs     40 35
     722 574
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FOR THE YEAR ENDED 31 JULY 2007
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7 INTEREST RECEIVABLE AND SIMILAR INCOME
     2007 2006 
     £000 £000
Bank interest receivable     467 261
Interest on loans to associated undertakings     68 88
     535 349
8 INTEREST PAYABLE AND SIMILAR CHARGES
     2007 2006 
     £000 £000
Interest on loans from related parties     195 102
9 TAX ON LOSS ON ORDINARY ACTIVITIES
ANALYSIS OF CHARGE IN YEAR
     2007 2006 
     £000 £000
CURRENT TAX    
UK corporation tax on loss of the period     — —
Adjustments in respect of prior year     — —
Tax on loss on ordinary activities     — —
No deferred tax asset has been recognised in respect of trading losses carried forward due to the uncertainty of the availability of future taxable proﬁts 
from which the trading losses can be deducted. The total amount unprovided at 31 July 2007 is £1,092,000 (2006: £481,000). 
     2007 2006 
     £000 £000
Accelerated capital allowances     — 1
Tax losses carried forward     (1,114) (482)
     (1,114) (481)
FACTORS AFFECTING THE TAX CHARGE FOR THE CURRENT PERIOD
Current tax on income for the period is lower (2006: lower) than the standard rate of corporation tax in the United Kingdom (20%) (2006: 19%). 
The differences are explained below:
     2007 2006 
     £000 £000
CURRENT TAX RECONCILIATION
Loss on ordinary activities before tax     (3,200) (2,057)
Current tax at 20% (2006: 19%)     (640) (391)
EFFECTS OF:
Expenses not deductible for tax purposes     8 6
Capital allowances for period in excess of depreciation     — —
Unutilised tax losses     632 385
Total current tax charge (see above)     — —
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10 BASIC AND FULLY DILUTED LOSS PER ORDINARY SHARE
     2007 2006 
     No. No.
NUMBER OF SHARES
Basic weighted average number of shares in issue     29,852,493 19,318,799
Loss retained in the year     (2,890) (1,947)
The basic loss per share is based on the weighted average number of Ordinary shares in issue during the year. This included 20,316,429 shares 
in issue throughout the year, and 16,347,538 shares issued on 9 Janaury 2007 which were included for seven months of the year. 
The calculation of diluted loss per ordinary share is identical to that used for basic loss per share. This is because the exercise of options would have 
the effect of reducing the loss per ordinary share and is therefore not dilutive under the terms of FRS 14 “Earnings per share”.
11 INTANGIBLE FIXED ASSETS
    IP rights Goodwill Total 
Group    £000 £000 £000
COST
At 1 August 2006    — 599 599
Additions – purchased intellectual property    16,064 — 16,064
Additions – negative goodwill on acquisition    — (25) (25)
AT 31 JULY 2007    16,064 574 16,638
ACCUMULATED AMORTISATION
At 1 August 2006    — (531) (531)
Charge for the year    (898) (5) (903)
AT 31 JULY 2007    (898) (536) (1,434)
NET BOOK VALUE
AT 31 JULY 2007    15,166 38 15,204
At 31 July 2006    — 68 68
The IP rights in the year arise from the acquisition of the Cardiff University pipeline, £15,946,000 and intellectual property acquired from  
the University of Shefﬁeld in relation to certain subsidiary undertakings, £118,000.
Goodwill relates to that generated on the acquisition of the group’s subsidiaries, Bioacta Ltd (fully written down), Diurnal Ltd and Lifestyle Choices Ltd. 
The negative goodwill on acquisition arose when Biofusion acquired a 55% shareholding in Magnomatics Ltd from the University of Shefﬁeld (see note 24).
Intangible ﬁxed assets are written down over their useful economic lives, subject to annual impairment reviews. The charge for the year includes 
£887,000 in relation to the Cardiff University pipeline, written down over ten years from the commencement of the agreement in January 2007.
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FOR THE YEAR ENDED 31 JULY 2007
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12 TANGIBLE ASSETS
 Group  Company
      Computer Computer  
      equipment equipment 
     £000 £000
COST
At 1 August 2006     34 —
Additions     28 7
Aquired with subsidiary undertaking     — 21
AT 31 JULY 2007     62 28
ACCUMULATED DEPRECIATION
At beginning of year     (9) —
Charge for year     (12) (5)
AT END OF YEAR     (21) (5)
NET BOOK VALUE
AT 31 JULY 2007     41 23
At 31 July 2006     25 —
13 INVESTMENTS
    Equity Loans Total 
Group    £000 £000 £000
COST
At 1 August 2006    2,242 1,128 3,370
Additions    1,761 388 2,149
Transfers     634  (634) —
Disposals    (357) — (357)
AT 31 JULY 2007    4,280 882 5,162
PROVISION FOR IMPAIRMENT
At 1 August 2006    — — —
Charge for year    652 — 652
AT 31 JULY 2007    652 — 652
NET BOOK VALUES
AT 31 JULY 2007    3,628 882 4,510
At 31 July 2006    2,242 1,128 3,370
Investments relate to shareholdings in portfolio companies below 50%. In accordance with the group’s accounting policies, these amounts are held 
at cost less any provision for impairment.
The value of participating interests comprises of investments in Associates £4,510,000 (2006: £3,012,000) and other investments £nil (2006: £357,000).
      Shares  
      in group  
      undertakings 
Company      £000
COST AND NET BOOK VALUE
At 1 August 2006      1
Additions      1
AT 31 JULY 2007      2
Shares in group undertakings represent the company’s investment in Biofusion Trading Ltd. 
During the year Fusion Cardiff Ltd was incorporated and the company owns 100% of the issued share capital. In addition, the company acquired 
a 10% holding in Bitecic Limited which is a collaboration between industry, universities and expert clinicians in the Yorkshire region.
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13 INVESTMENTS CONTINUED
The group’s interest in companies at the year end is as follows:
 Country of Principal  Class of  
 incorporation activity Holding shares held
SUBSIDIARY UNDERTAKINGS
Biofusion Trading Limited United Kingdom Holding company 100% Ordinary
Fusion Cardiff Limited United Kingdom Holding company 100% Ordinary
Biofusion Licensing (Shefﬁeld) Limited
1
 United Kingdom Licensing 100% Ordinary
Mantelum Limited
1
 United Kingdom IP development 100% Ordinary 
   company 
Absynth Biologics Limited
1
 United Kingdom MRSA vaccines 60% Ordinary
BioHydrogen Limited
1
 United Kingdom Hydrogen production 60% Ordinary
Medella Therapeutics Limited
1
 United Kingdom Cancer therapeutics 60% Ordinary
Lifestyle Choices Limited
1
 United Kingdom Ovarian reserve  60% Ordinary 
  measurement 
Diurnal Limited
1
 United Kingdom Hormone replacement 60% Ordinary
Genophrenix Limited
1
 United Kingdom Identiﬁcation of  60% Ordinary 
  Schizophrenia targets  
Phase Focus Limited
1
 United Kingdom Lensless microscopy 56% Ordinary
Magnomatics Limited
1
 United Kingdom Magnetic devices 54% Ordinary
Bioacta Limited
1
 United Kingdom Angiogenesis  52% Ordinary 
  compounds 
PARTICIPATING INTERESTS
Adjuvantix Limited
1
 United Kingdom Vaccine adjuvants 49% Ordinary
Axordia Limited
1
 United Kingdom Stem cell therapy 45% Ordinary
Asterion Limited
1
 United Kingdom Cytokine therapies 34% Ordinary
Art of Xen Limited
2
 United Kingdom Medical use of Xenon gas 32% Ordinary
Medaphor Limited
2
 United Kingdom Medical 32% Ordinary 
   training solutions 
Simcyp Limited
1
 United Kingdom Drug metabolism 25% Ordinary
Abcellute Limited
2
 United Kingdom Cell stabilising 24% Ordinary 
   technology 
Cardiff Protides Limited
2
 United Kingdom Nucleoside drugs 23% Ordinary
Celltran Limited
1
 United Kingdom Chronic wound therapy 15% Ordinary
Aperio Diagnostics Limited
1
 United Kingdom Cervical cancer detection 14% Ordinary
Muscagen Limited
2
 United Kingdom Drug discovery 13% Ordinary
Bitecic Limited United Kingdom Clinical research 10% Ordinary 
   and support 
I2L Research Limited
2
 United Kingdom Pesticide testing 10% Ordinary
Q Chip Limited
2
 United Kingdom Life science and  10% Ordinary 
  therapeutic products 
1
 Held indirectly by Biofusion Trading Ltd.
2
 Held indirectly by Fusion Cardiff Ltd.
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FOR THE YEAR ENDED 31 JULY 2007
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14 STOCK
 Group  Company
   2007 2006 2007 2006 
   £000 £000 £000 £000
Finished goods and goods for resale   6 7 — —
15 DEBTORS
 Group  Company
   2007 2006 2007 2006 
   £000 £000 £000 £000
Trade debtors   243 85 — —
Amounts due from associated undertakings   — 16 — —
Amounts due from group undertakings   — — 31,856 8,917
Other tax and social security   36 19 — —
Other debtors   8 1 — —
Payments on account   296 388 — —
Prepayments and accrued income   206 60 29 —
   789 569 31,885 8,917
16 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
 Group  Company
   2007 2006 2007 2006 
   £000 £000 £000 £000
Trade creditors   189 87 — —
Other creditors   — 21 — —
Other tax and social security   6 — — —
Accruals and deferred income   208 89 63 —
   403 197 63 —
17 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
 Group  Company
   2007 2006 2007 2006 
   £000 £000 £000 £000
Amounts owed to related parties    3,293 2,038 — —
The amount of £3,293,000 due at 31 July 2007 includes £1,754,000 (2006: £1,977,000) and £1,474,000 (2006: £nil) that relates to loan notes and 
accrued interest due to the University of Shefﬁeld and Cardiff University respectively arising from the purchase of the group’s interest in its portfolio of 
spin out companies. These amounts are repayable on the earlier of the sale by Biofusion of the underlying share capital in the company, or the company 
making dividend payments or ten years from the day of issue. These amounts are only payable to the extent that any gain or dividend is received by 
Biofusion, and can be cancelled by Biofusion by the return of the shares to which they relate to the University of Shefﬁeld or Cardiff University respectively.
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18 CALLED UP SHARE CAPITAL
   Number  2007 Number  2006 
   of shares £000 of shares £000
AUTHORISED
Equity: Ordinary shares of £0.01 each   40,000,000 400 40,000,000 400
    400  400
ALLOTTED, CALLED UP AND FULLY PAID
Equity: Ordinary shares of £0.01 each   36,663,967 367 20,316,429 203
    367  203
      Ordinary 
      shares 
      £000
Balance brought forward      203
Issue of shares      164
Balance carried forward      367
As part of the Cardiff University agreement dated 9 January 2007, Biofusion issued 10,997,541 new Ordinary shares of 1p each to Cardiff University 
at £1.45 per share. In addition to this, Biofusion placed 5,349,997 new Ordinary shares of 1p each with institutional investors at £1.45 per share which 
raised £7,757,000 before expenses. 
The costs of the combined share issue amounted to £775,000 and have been charged to the share premium account. These costs related to legal 
and brokerage fees incurred on the transaction (see note 19).
19 RESERVES
   Proﬁt Share Capital  
   and loss premium  redemption Capital 
    account account reserve reserve 
Group   £000 £000 £000 £000
Balance brought forward   1,370 8,906 1 2
Issued during the year   — 23,540 — —
Cost of share issue   — (775) — —
Share-based payments   (16) — — —
Loss for the ﬁnancial year   2,890 — — —
Balance carried forward   4,244 31,671 1 2
The capital reserve represents differences on consolidation under merger accounting.
      Proﬁt Share Capital 
    and loss premium redemption  
    account account reserve  
    2007 2007 2007 
Company    £000 £000 £000
Balance brought forward    (192) 8,906 1
Issued during the year    — 23,540 —
Cost of share issue    — (775) —
Balance carried forward    (192) 31,671 1
As permitted by Section 230 of the Companies Act 1985, the company’s proﬁt and loss account has not been included in these ﬁnancial statements. 
The company’s result for the ﬁnancial year was a £nil (2006: loss of £192,000).
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FOR THE YEAR ENDED 31 JULY 2007
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20 MINORITY INTERESTS
     2007 2006 
     £000 £000
Balance brought forward     (55) 2
Deemed disposal     (6) (13)
Introduced at acquisition     28 6
Gain on dilution     — 60
Share of loss in the year      (310) (110)
Balance carried forward     (343) (55)
Minority interests of £343,000 represent the minority share of Bioacta, Life Style Choices, Phase Focus, Genophrenix, Diurnal, Magnomatics, 
BioHydrogen, Medella Therapeutics, Absynth Biologics and Mantelum’s losses generated since the date of acquisition or incorporation of these 
companies, less any amount invested in these companies by the minority shareholders. The deemed disposal represents the reduction in Biofusion’s 
shareholding in Phase Focus.
21 RELATED PARTY TRANSACTIONS
During the year, Biofusion purchased administrative and other services from Shefﬁeld University Enterprises Ltd (SUEL), a wholly owned subsidiary 
of the University of Shefﬁeld, totalling £19,000 (2006: £7,000). In addition, Biofusion provided support services to SUEL during the year of £120,000 
(2006: £180,000). At 31 July 2007 the balance due from SUEL was £217,000 (2006: £71,000).
In addition, under the terms of the Agreement dated January 2005, Biofusion Trading Ltd paid the University of Shefﬁeld £120,000 (2006: £130,000) 
as payments on account for intellectual property. Biofusion Trading Ltd purchased intellectual property from the University during the year with a total 
value of £118,000. These payments were taken against payments on account. 
Under the terms of the Agreement dated January 2007 Fusion Cardiff Ltd paid Cardiff University £118,000 as payments to support the management 
of the intellectual property pipeline. At 31 July 2007 the balance due to Cardiff University was £3,000.
During the year, Biofusion has continued to accrue for interest due on loans in respect of the purchase of the original portfolio companies from both 
the University of Shefﬁeld and Cardiff University.
During the year, the company supplied management services to companies in which it held a participating interest totalling £11,000 (2006: £48,000). 
22 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS
      Restated 
     2007 2006 
Group     £000 £000
LOSS FOR THE FINANCIAL YEAR     (2,890) (1,947)
Share-based payments     16 1,340
Proceeds from share issue     23,704 2,000
Costs of share issue     (775) (73)
NET INCREASE IN SHAREHOLDERS’ FUNDS     20,055 1,320
Opening shareholders’ funds     7,742 6,422
CLOSING SHAREHOLDERS’ FUNDS     27,797 7,742
     2007 2006 
Company     £000 £000
LOSS FOR THE FINANCIAL YEAR     — (192)
Proceeds from share issue     23,704 2,000
Costs of share issue     (775) (72)
NET INCREASE IN SHAREHOLDERS’ FUNDS     22,929 1,736
Opening shareholders’ funds     8,918 7,182
CLOSING SHAREHOLDERS’ FUNDS     31,847 8,918
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23 NOTES TO THE CASH FLOW STATEMENT  
     2007 2006 
     £000 £000
(I) RECONCILIATION OF OPERATING LOSS TO OPERATING CASH FLOW
Operating loss     (3,598) (2,304)
Amortisation of goodwill     903 55
Share-based payment     16 1,339
Impairment losses     652 421
Deemed proﬁt on disposal     (8) (5)
Depreciation     12 4
Loss on sale of ﬁxed assets     — 1
Proﬁt on sale of ﬁxed asset investments     58 —
Decrease/(increase) in stock     1 (7)
(Increase)/decrease in debtors     (177) 40
Increase in creditors     (138) (487)
NET CASH OUTFLOW FROM OPERATING ACTIVITIES      (2,279) (943)
(II) RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
Increase/(decrease) in cash in the period      4,717 (342)
Non cash movement on loan notes      (1,612) 444
Decrease in debt     357 —
Increase in net funds     3,462 102
Opening net funds     3,845 3,743
CLOSING NET FUNDS     7,307 3,845
(III) NET FUNDS      
Cash      10,600 5,883
Loan notes     (3,293) (2,038)
Opening net funds     7,307 3,845
24 ACQUISITIONS
During the year, Biofusion established a number of new companies and acquired a 54.6% shareholding in Magnomatics Ltd from the University of Shefﬁeld.
The fair value and book value of assets acquired on 24 January 2007 were:
      Book and  
      fair value 
      24 January 
      2007 
      £000
CURRENT ASSETS
Debtors      43
Cash at bank and in hand      29
      72
Creditors amounts falling due within one year      (11)
NET ASSETS       61
Net consideration      8
Net assets acquired      33
NEGATIVE GOODWILL ARISING ON ACQUISITION      (25)
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FOR THE YEAR ENDED 31 JULY 2007
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25 SHARE-BASED PAYMENTS
During the year no new share options or share warrants were issued.
Details of the share options held by directors are set out within the Report on Directors’ Remuneration.
On 23 March 2006, as part of a £10m Side Fund agreement, Biofusion issued the following warrants to NPI Ventures:
 (i) 1,225,000 Ordinary shares with an exercise price of £1.50;
 (ii) 1,225,000 Ordinary shares with an exercise price of £1.60;
 (iii) 612,500 Ordinary shares with an exercise price of £1.80; and
 (iv) 612,500 Ordinary shares with an exercise price of £2.20.
All of the Warrants are exercisable at any time commencing on the ﬁrst anniversary of the associated Warrant Deed and on or before the tenth anniversary 
of the date of the Warrant Deed.
The fair value of the share based options and warrants are recognised as an expense through the proﬁt and loss account over the relevant vesting periods. 
The charge in the current year was £16,000 (2006: £1,339,000).
The fair values are determined by using the Black-Scholes option pricing model and the assumptions used at the fair value measurement date are shown 
in the table below:
     Directors NPI
Share price at grant     150.00p 152.25p
Dividend yield     0.0% 0.0%
Expected volatility     18.52% 18.85%
T erm to maturity     6.5 years 5.5 years
Risk free interest rate     4.46% 4.28%
Number of shares under option     99,999 3,675,000
The expected volatility was benchmarked against an index of similar companies in the biotech index as no historic data was available for the company 
at the grant date.
26 POST BALANCE SHEET EVENTS
On 15 August 2007, the company invested £75,000 in Celltran as part of a £1m syndicated loan, with a further £75,000 due once certain milestones 
are achieved.
On 17 September 2007, the company invested £200,000 in Abcellute as part of a £400,000 funding round with Finance Wales. As a result of the funding 
round Biofusion’s holding in Abcellute increased to 34%.
On 21 September 2007, Biofusion announced it had signed a Memorandum of Understanding with Finance Wales. The agreement detailed a co-investment 
strategy for investing in spin-out companies formed as part of the IP pipeline agreement with Cardiff University.
On 2 October 2007, Biofusion announced that Cardiff University had transferred its 25% holding in Cardiff Biologicals to Biofusion for a loan note to the value 
of £250,000. Subsequently Biofusion invested £200,000 in Cardiff Biologicals to increase its holding to 50%.
On 2 October 2007, Biofusion invested £200,000 in Cardiff Protides to increase its holding to 50%.
On 9 October 2007, Biofusion sold its holdings in Cardiff Biologicals and Cardiff Protides to Morvus T echnology Limited, a privately owned pharmaceutical 
company. In consideration for the transaction Biofusion now owns a 20% holding in Morvus.
_1_BIF_ar07_BACK.indd   37 26/10/2007   14:00:35 biofusion plc annual report and accounts 2007 38
Notice is hereby given that the Annual General Meeting of Biofusion plc will be held at the ofﬁces of Ashurst, Broadwalk House, 5 Appold Street, 
London EC2A 2HA on Friday 30 November 2007 at 10.30 a.m., for the following purposes:
1.  To receive the accounts (including the Directors’ remuneration report) for the ﬁnancial year ended 31 July 2007, together with the reports 
of the Directors and auditors thereon. (Resolution 1)
2. To re-appoint KPMG Audit Plc as auditors of the Company. (Resolution 2)
3. To authorise the Directors to set the remuneration of the auditors. (Resolution 3)
4. To re-elect Mr D Liversidge, who retires by rotation as a Director of the Company. (Resolution 4)
5. To re-elect Mr D Baynes, who retires by rotation as a Director of the Company. (Resolution 5)
6. To re-elect Dr P Grant, who retires by rotation as a Director of the Company.(Resolution 6)
7. To re-elect Mr S Gall, who retires by rotation as a Director of the Company. (Resolution 7)
8. To re-elect Dr E Moses, who retires by rotation as a Director of the Company. (Resolution 8)
9. To re-elect Prof T Atkinson, who retires by rotation as a Director of the Company. (Resolution 9)
10. To re-elect Mr D Catton, who retires by rotation as a Director of the Company. (Resolution 10)
11. To re-elect Mr M Davies as a Director of the company, having been appointed as a Director since the last Annual General Meeting. (Resolution 11)
By order of the board
RICHARD BIRTLES
COMPANY SECRETARY
15 October 2007
Registered Ofﬁce:
Innovation Centre 
217 Portobello 
Shefﬁeld S1 4DP
NOTES:
PROXIES
1.  A member entitled to attend and vote may appoint a proxy or proxies who need not be a member of the company to attend (and on a poll to vote) 
instead of him or her. Forms of proxy need to be deposited with the company’s registrar Capita Registrars at The Registry, 34 Beckenham Road, 
Beckenham, Kent BR3 4TU not later than 48 hours before the time of the meeting. Completion of a form of proxy will not preclude a member 
attending and voting in person at the meeting.
DOCUMENTS ON DISPLAY
2.  The register of Directors’ interests in the share capital and debentures of the company, together with copies of service agreements under which 
Directors of the company are employed, and copies of the terms and conditions of appointment of Non-executive Directors are available for inspection 
at the company’s registered ofﬁce during normal business hours from the date of this notice until the date of the Annual General Meeting and will be 
available for inspection at the place of the Annual General Meeting for at least 15 minutes prior to and during the meeting.
RIGHT TO ATTEND AND VOTE
3.  Pursuant to regulation 41 of the Uncertiﬁcated Securities Regulations 2001 (SI 2001 No 3755), the Company speciﬁes that in order to have the right 
to attend and vote at the meeting (and also for the purpose of calculating how many votes a person entitled to attend and vote may cast), a person 
must be entered on the register of holders of the Ordinary shares of the Company by no later than 10.30 a.m. on 28 November 2007, being 
48 hours before the time ﬁxed for the meeting. Changes to entries on the register after this time shall be disregarded in determining the rights 
of any person to attend or vote at the meeting.
NOTICE OF ANNUAL GENERAL MEETING
_1_BIF_ar07_BACK.indd   38 26/10/2007   14:00:35 FORM OF PROXY
Please read the notes below before completing this form.
Any amendments to this form should be initialled by the signatory.
I/We (name(s) in full)
..................................................................................................................................................................................................................................................... 
of (address(es))
..................................................................................................................................................................................................................................................... 
being (a) member(s) of the above-named company, hereby appoint the Chairman of the meeting, or failing him
..................................................................................................................................................................................................................................................... 
as my/our proxy to vote for me/us on my/our behalf as directed below at the 2007 Annual General Meeting of the company to be held at the ofﬁces 
of Ashurst, Broadwalk House, 5 Appold Street, London EC2A 2HA on Friday 30 November 2007 at 10.30 a.m., and at any adjournment thereof.
Please indicate in the boxes below how you wish your votes to be cast.
   Vote 
 For Against witheld
 RESOLUTION 1 To receive the accounts and reports of the Directors and auditors 
  for the year ended 31 July 2007.
 RESOLUTION 2 To re-appoint KPMG as auditors of the Company.
 RESOLUTION 3 To authorise the Directors to set the remuneration of the auditors.
 RESOLUTION 4  To re-elect Mr D Liversidge.
 RESOLUTION 5 To re-elect Mr D Baynes.
 RESOLUTION 6 To re-elect Dr P Grant.
 RESOLUTION 7 To re-elect Mr S Gall.
 RESOLUTION 8 To re-elect Dr E Moses.
 RESOLUTION 9 To re-elect Prof T Atkinson.
 RESOLUTION 10 To re-elect Mr D Catton.
 RESOLUTION 11 To re-elect Mr M Davies.
Signature......................................................................................................................................................Date........................................................................ 
NOTES TO THE FORM OF PROXY
1.  You may appoint one or more proxies of your own choice, if you are unable to attend the meeting but would like to vote. If such an appointment 
is made, delete the words “the Chairman of the meeting” and insert the name(s) of the person or persons appointed as proxy/proxies in the space 
provided. A proxy need not be a member of the company. If no name is entered, the return of this form duly signed will authorise the Chairman 
of the meeting to act as your proxy.
2.  In the case of a corporation, this form of proxy must be executed under its common seal or under the hand of a duly authorised ofﬁcer or attorney.
3.  In order that this form of proxy shall be valid, it must be deposited (together with any power of attorney or other authority under which it is signed 
or a notarially certiﬁed copy of such power or a copy certiﬁed in accordance with the Powers of Attorney Act 1971 or in some other manner approved 
by the Directors), at the company’s registrars Capita Registrars at The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU, not later than 
48 hours before the time appointed for the meeting. The completion and return of a form of proxy will not, however, preclude shareholders from 
attending and voting in person at the meeting or at any adjournment thereof, should they wish to do so.
4.  If two or more persons are jointly entitled to a share conferring the right to vote, any one of them may vote at the meeting either in person or by proxy, 
but if more than one joint holder is present at the meeting either in person or by proxy, the one whose name stands ﬁrst in the register of members 
in respect of the joint holding shall alone be entitled to vote in respect thereof. In any event, the names of all joint holders should be stated on the 
form of proxy.
5.  The “vote withheld” option is provided to enable you to instruct your proxy not to vote on any particular resolution, however, it should be noted that 
a “vote withheld” in this way is not a vote in law and will not be counted in the calculation of the proportion of votes “for” and “against” a resolution.

39 biofusion plc annual report and accounts 2007
_1_BIF_ar07_BACK.indd   39 26/10/2007   14:00:35 business reply style
Business Reply
Licence Number
MB 122
Capita Registrars (Proxies)
PO Box 25
Beckenham
Kent BR3 4BR
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_1_BIF_ar07_BACK.indd   40 26/10/2007   14:00:45 WHAT WE DO
We create, support and grow a range of companies in an exciting 
variety of sectors. From lifestyle to energy, we seek to make 
the very best of emerging IP from two of the UK’s leading research 
intensive universities.
MEDICINE ENERGY ENVIRONMENT
ELECTRICAL ENGINEERING LIFESTYLE
OUR PORTFOLIO COMPANIES
Abcellute’s patent protected cell stabilising platform 
technology enables the non-frozen preservation 
and transportation of live organ-derived cells, without 
the loss of viability or function, for up to seven days.
Adjuvants help stimulate the immune system‘s response to a 
vaccine, so the better the adjuvant, the lower the vaccination 
dose can be, making the vaccine cheaper and safer. 
Adjuvantix’s adjuvant is capable of a profound enhancement 
(1,000 fold) of the anti body response.
Art of Xen holds a number of patents for the cost efﬁcient 
delivery of the anaesthetic gas Xenon. Xenon is showing 
promise in research as a neuroprotectant that can protect 
against and reduce brain damage with an almost complete 
lack of side effects.
Celltran provides active wound care by delivering living 
cells for the treatment and active healing of burns and chronic 
wounds in skin. Celltran has a number of products in its portfolio 
including MySkin (in market) and Lypoderm (ready for 
Phase III trials).
Medaphor designs and develops medical training solutions 
on multi-media and computer based simulations systems. 
The company has two online multimedia gynaecological 
ultrasound training modules and a prototype haptic 
ultrasound simulator.
Muscagen is a computation based, rational drug discovery 
company that design molecules which interact with receptors 
on the surface of human cells in speciﬁc ways. Its approach 
is potentially cost-effective and efﬁcient, reduces animal 
testing and avoids likely side effects.
Axordia is a regenerative therapeutics company utilising its 
platform human embryonic stem cell technology to prevent 
transplant rejection through the use of its unique endovascular 
cell technology; and cure degenerative blindness through 
its novel retinal cell technology for the treatment of AMD.
Genophrenix has identiﬁed several proteins and their genes 
that interact with a key component implicated in schizophrenia. 
Its initial focus is to develop a diagnostic for schizophrenia 
and provide licensing opportunities that will be attractive to 
the global pharmaceutical industry.
Mantelum is developing research focused on the G-protein 
coupled receptor (GPCR) superfamily, which are involved in 
a wide range of disorders including allergies, cardiovascular 
disease, pain, depression, cancer, obesity, diabetes and 
a variety of central nervous system disorders.
Phase Focus owns the rights to patents for a process 
that can generate high definition images of an object 
without the need for the high quality lenses that account 
for a signiﬁcant element of the cost of high-performance 
microscopes. This breakthrough technology has the 
potential to produce better images at a lower cost than 
currently available microscopes.
Simcyp’s informatics platform enables pharmaceutical 
companies to simulate drug behaviour in humans, prior 
to running clinical trials, by using virtual population data, 
rather than data from one ‘average’ individual. Allowing 
patients at extreme risk from adverse reaction to be 
identiﬁed at an early stage.
Absynth Biologics is developing vaccines and antibodies 
to treat infections caused by the bacterium Staphylococcus 
aureus, including its more difﬁcult-to-treat drug-resistant 
form, MRSA. Its unique patented technology is initially being 
used to develop an MSRA vaccine and antibodies to treat 
signiﬁcant MRSA related infections as well as other applications.
Asterion’s ProFuse technology platform is being 
used to develop ‘third generation’ therapeutic protein 
drugs designed to have greater potency and selectivity, 
to be longer lasting and have a better side effect profile 
than current protein-based therapies.
Diurnal owns the patent rights to Chronocort™, a modiﬁed 
release formulation of hydrocortisone to treat adrenal 
insufﬁciency. The product is designed to release hormone 
at concentrations that mimic the natural level of hormone 
in the body, controlling disease symptoms and reducing 
unwanted side effects.
Aperio’s prototype medical probe can detect pre-cancerous 
cells in a woman’s cervix, without the need for the current 
painful and lengthy internal colcoscopy examination.
Lifestyle Choices launched its ﬁrst product, a triple hormone 
ovarian reserve test called Plan Ahead, in 2006. The test 
offers the most accurate hormone based ovarian reserve 
test available to the public, enabling women to make more 
informed decisions about when they try for a baby. 
The company is developing its second product aimed 
at the IVF market for launch in 2008.
Morvus is engaged in the discovery, development and 
commercialisation of novel drugs and technologies, primarily 
in the ﬁeld of oncology. It has a broad portfolio of technology  
with products based upon its core expertise in prodrug-enzyme 
interactions and knowledge of the mechanism of apoptosis.
I2L Research provides worldwide agrochemical manufacturers 
with specialist product testing, development services and 
environmental monitoring services. The company has ofﬁces 
in Cardiff and Newcastle.
Biofusion Licensing is a specialist company that identiﬁes, 
develops and licenses world class university IP to commercial 
companies and research organisations. Their website is a 
licensing portal for identifying licensing opportunities within 
the Biofusion technology pipeline.
Biohydrogen is developing a metabolically engineered microbial 
production method that is capable of producing hydrogen 
from sugar solution media and water through fermentation. 
Initial results indicate this unique method of production has 
the potential to be at the forefront of new low carbon fuel 
technology developments.
Medella is designing monoclonal antibodies that inhibit the 
action of Adrenomedullin (ADM), a molecule found in 80% 
of cancer cells. It is believed that ADM is a key molecule in 
enabling cancer cells to survive and Medella is developing 
drugs that modulate ADM signalling in cancer cells and 
stop the tumour growing.
Q Chip develops advanced life science and therapeutic 
products using its proprietary MicroPlant platform for the 
production of precision loaded polymer microspheres. 
The company has three core precision microsphere products  
– ReaX, BiologiX and IonX which have just been launched 
into the UK market.
Magnomatics specialises in the development of novel 
high-torque magnetic gearboxes, motors and generators 
for use within wind turbine power generation, transportation 
and domestic energy products. Its patented ‘pseudo’ direct 
drive motor/generator system has additional applications 
in the aerospace and hybrid vehicle market.
COMPANY SECRETARY
RICHARD BIRTLES
COMPANY NUMBER
5275732
REGISTERED OFFICE
Innovation Centre 
217 Portobello 
Shefﬁeld S1 4DP
INDEPENDENT AUDITOR
KPMG AUDIT PLC
1 The Embankment 
Neville Street 
Leeds LS1 4DW
SOLICITOR
ASHURST
Broadwalk House 
5 Appold Street 
London EC2A 2HA
BANKER
BARCLAYS
Cambridge Business Centre 
28 Chesterton Road 
Cambridge CB4 3UT
NOMINATED ADVISOR AND BROKER
NOMURA CODE
1 Carey Lane 
London EC2V 8AE
REGISTRAR
CAPITA REGISTRARS
34 Beckenham Road 
Beckenham 
Kent BR3 4TU
PUBLIC RELATIONS
BUCHANAN COMMUNICATIONS
45 Moorﬁelds  
London EC2Y 9AE
COMPANY INFORMATION AND ADVISORS
_cover.indd   2 26/10/2007   13:58:40 biofusion plc annual report 
and accounts 2007
TURNING WORLD CLASS 
RESEARCH INTO BUSINESS
In ﬁelds as varied as drug discovery, alternative energy 
and engineering, Biofusion owns the rights to an amazing 
depth and quality of research from two of the UK’s leading 
universities, enabling us to invest in some of the world’s 
most advanced and exciting science and turn world 
class research into business.
WHO WE ARE
SHEFFIELD OFFICE
The Shefﬁeld Bioincubator 
40 Leavygreave Road 
Shefﬁeld 
S3 7RD
www.biofusion.co.uk
CARDIFF OFFICE
8th Floor  
Eastgate House 
35–43 Newport Road 
Cardiff 
CF24 0AB
biofusion plc annual report and accounts 2007
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