Document:

<PAGE>

                                                                     Exhibit 4.2

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. IF YOU ARE IN
ANY DOUBT AS TO THE ACTION YOU SHOULD TAKE, AND IF YOU ARE IN THE UK, YOU ARE
RECOMMENDED TO SEEK YOUR OWN PERSONAL FINANCIAL ADVICE IMMEDIATELY FROM YOUR
STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR OTHER INDEPENDENT FINANCIAL
ADVISER DULY AUTHORISED UNDER THE FINANCIAL SERVICES AND MARKETS ACT 2000. IF
YOU ARE OUTSIDE THE UK YOU SHOULD IMMEDIATELY CONSULT ANOTHER APPROPRIATELY
AUTHORISED INDEPENDENT FINANCIAL ADVISER.

The distribution of this document in jurisdictions other than the UK may be
restricted by law and therefore persons into whose possession this document
comes should inform themselves about and observe any of those restrictions. Any
failure to comply with any of those restrictions may constitute a violation of
the securities laws of any such jurisdiction.

The contents of this document and the Form of Acceptance, which have been
prepared by and are the sole responsibility of British Biotech plc, have been
approved by J.P. Morgan plc of 125 London Wall, London EC2Y 5AJ (regulated in
the UK by the Financial Services Authority) solely for the purposes of section
21 of the Financial Services and Markets Act 2000. J.P. Morgan plc is acting for
British Biotech plc and no one else in connection with the Offer and will not be
responsible to any other person for providing the protections afforded to
clients by J.P. Morgan plc or for providing advice in relation to the Offer.

                          -----------------------------

                                      OFFER

                                       BY

                               BRITISH BIOTECH PLC

                                       FOR

                            RIBOTARGETS HOLDINGS PLC

--------------------------------------------------------------------------------

TO ACCEPT THE OFFER, THE ACCOMPANYING FORM OF ACCEPTANCE SHOULD BE COMPLETED AND
RETURNED AS SOON AS POSSIBLE, AND IN ANY EVENT NOT LATER THAN 3.00P.M. ON 20TH
APRIL, 2003. THE PROCEDURE FOR ACCEPTANCE OF THE OFFER IS SET OUT ON PAGE 5 OF
THIS DOCUMENT AND IN THE ACCOMPANYING FORM OF ACCEPTANCE.

                                       1
<PAGE>

                                    CONTENTS

Letter from the Chairman of British Biotech plc

Appendix I - Conditions and further terms of the Offer

Appendix II - Definitions

                                       2
<PAGE>

                 LETTER FROM THE CHAIRMAN OF BRITISH BIOTECH PLC

                               BRITISH BIOTECH PLC

     (Incorporated in England and Wales under the Companies Acts 1985 with
                             Registered No.2304992)

                                                              Registered office:
                                                                    Thames Court
                                                                 Watlington Road
                                                                          Oxford
                                                             Oxfordshire OX4 6LY

                                                                21st March, 2003

To Ribotargets Shareholders and, for information only, to holders of Ribotargets
options

Dear Shareholder

            OFFER BY BRITISH BIOTECH PLC FOR RIBOTARGETS HOLDINGS PLC

1.       INTRODUCTION

1.1      British Biotech has today announced the terms of an offer to be made by
         British Biotech for the whole of the issued and to be issued share
         capital of Ribotargets.

1.2      This document contains the Offer. A Form of Acceptance for completion
         by you, if you wish to accept the Offer, is enclosed with this
         document. You are, however, also referred to the compulsory transfer
         provisions described in section 8 below.

2.       THE OFFER

2.1      British Biotech hereby offers to acquire all the Ribotargets Shares, on
         the terms and subject to the conditions set out in Appendix I of this
         document and in the Form of Acceptance.

2.2      The Ribotargets Shares will be acquired fully paid and free from all
         liens, charges and Encumbrances and together with all rights attaching
         to them as at the date of Completion including, without limitation, the
         right to receive all dividends and other distributions declared, made
         or paid by Ribotargets on or after Completion.

2.3      The Offer is conditional upon satisfaction or, where permitted, waiver
         of each of the Conditions set out in Part A of Appendix I and is
         subject to the further terms set out in Part B of Appendix I.

3.       UNDERTAKINGS

         British Biotech has received undertakings to accept the Offer in
         respect of:

         7,028,679 B ORDINARY SHARES, REPRESENTING 100 PER CENT. OF THE B
         ORDINARY SHARES IN ISSUE AS AT THE DATE OF THIS DOCUMENT;

         7,717,732 A ORDINARY SHARES, REPRESENTING 99.9 PER CENT. OF THE A
         ORDINARY SHARES IN ISSUE AS AT THE DATE OF THIS DOCUMENT; AND

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<PAGE>

         526,533 ORDINARY SHARES, REPRESENTING 100 PER CENT. OF THE ORDINARY
         SHARES IN ISSUE AS AT THE DATE OF THIS DOCUMENT.

         British Biotech has also received undertakings to accept the Offer in
         respect of any further B Ordinary Shares which are issued at or prior
         to Completion.

4.       CONSIDERATION

4.1      The consideration for the sale of the B Ordinary Shares will be
         satisfied by the issue and allotment by British Biotech at Completion
         to the B Ordinary Shareholders of:

         2.7883114505 BRITISH BIOTECH ORDINARY SHARES FOR EVERY B ORDINARY SHARE

4.2      The consideration for the sale of the A Ordinary Shares will be
         satisfied by the issue and allotment by British Biotech at Completion
         to the A Ordinary Shareholders of:

         0.8545918288 BRITISH BIOTECH ORDINARY SHARES FOR EVERY A ORDINARY SHARE

4.3      The consideration for the sale of the Ordinary Shares will be satisfied
         by the issue and allotment by British Biotech to the Ordinary
         Shareholders of a total of:

         396,198 BRITISH BIOTECH ORDINARY SHARES

         to be allocated amongst holders of Ordinary Shares pro rata to their
         holdings of Ordinary Shares immediately prior to Completion.

4.4      British Biotech Ordinary Shares issued in respect of fractional
         entitlements will not be allotted to Ribotargets Shareholders on
         Completion but will be aggregated and sold into the market and the
         gross proceeds will be retained for the benefit of British Biotech.

5.       CONSIDERATION SHARES

5.1      The Consideration Shares will be allotted, credited as fully paid, and
         will rank pari passu in all respects with the British Biotech Ordinary
         Shares in issue at the date of their allotment.

5.2      British Biotech will use all reasonable endeavours to ensure that all
         the Consideration Shares are admitted to the Official List by the UK
         Listing Authority and to trading on the market for listed securities of
         the London Stock Exchange on or as soon as reasonably practicable after
         their allotment. A copy of the Circular and Listing Particulars, which
         have today been issued to the shareholders of British Biotech,
         accompanies this document.

6.       PAYMENT OF CONSIDERATION

6.1      Any share certificates in respect of Consideration Shares to be issued
         by British Biotech to Ribotargets Shareholders who validly accept the
         Offer, and whose acceptances are complete in all respects, will be
         delivered as soon as practicable following Completion (and, in any
         event, within 10 days of Completion) to Ribotargets's Solicitors.
         Ribotargets's Solicitors will be responsible for distributing such
         documents to the Ribotargets Shareholders in accordance with the
         completed instructions in the Form of Acceptance.

6.2      All documents and remittances sent by or to the Ribotargets
         Shareholders will be sent at their risk and no acknowledgement of
         receipt will be given by British Biotech. If the Offer is withdrawn or
         terminates in accordance with its terms, the Form of Acceptance, share
         certificate(s) and/or other document(s) of title will be sent by post
         within 7 days of the Offer being withdrawn or terminating to the
         address set out in the Form of Acceptance or, if none is

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<PAGE>

         set out, to Ribotargets's Solicitors (who will be responsible for
         distributing such documents to the relevant Ribotargets Shareholders).

7.       PROCEDURE FOR ACCEPTANCE

7.1      To accept the Offer, you must complete and sign the accompanying Form
         of Acceptance in accordance with the instructions contained in it which
         form part of the terms of the Offer.

7.2      The Form of Acceptance, duly completed in all respects, should be
         returned, together with the relevant share certificate(s) and/or other
         document(s) of title, to the Company Secretary of British Biotech (at
         Thames Court, Watlington Road, Oxford, Oxfordshire OX4 6LY) so as to
         arrive as soon as possible, but in any event not later than 3.00 p.m.
         on 20th April, 2003.

7.3      Even if your share certificate(s) and/or other document(s) of title
         is/are not readily available or is/are lost, you should nevertheless
         complete, sign and return the Form of Acceptance as indicated above.
         The share certificate(s) and/or other document(s) of title should be
         forwarded as soon as possible thereafter, or, if you have lost your
         share certificate(s), a form of lost share certificate indemnity (a
         SHARE INDEMNITY) should be requested from the Company Secretary of
         British Biotech (Thames Court, Watlington Road, Oxford, Oxfordshire OX4
         6LY) and completed and signed as indicated. Although no Consideration
         Shares will be issued or allotted to you until such document(s), or a
         duly completed Share Indemnity in lieu thereof, is/are received,
         British Biotech reserves the right to treat acceptances of the Offer as
         valid, even though not complete in all respects or not accompanied by
         the relative share certificate(s) and/or other document(s) of title.

8.       COMPULSORY TRANSFER PROVISIONS

8.1      The Ribotargets Articles provide that if the holder(s) of at least 65%
         by nominal value of the B Ordinary Shares and the A Ordinary Shares (an
         INVESTOR MAJORITY) intend to sell all of their holdings of shares in
         Ribotargets to a purchaser who has made a bona fide offer on arm's
         length terms for the entire issued share capital of Ribotargets, such
         Investor Majority may issue a Selling Notice to Ribotargets stating the
         place, date and time of completion of the proposed sale and setting out
         the terms and conditions of such offer to be extended to the other
         Ribotargets Shareholders. The date of completion must be at least 14
         days from the date of the Selling Notice.

8.2      As noted in section 3 of this letter, more than 65% by nominal value of
         the B Ordinary Shareholders and the A Ordinary Shareholders have
         entered into undertakings to accept the Offer. In accordance with the
         Articles, such shareholders (the SELLERS) have today issued a Selling
         Notice to Ribotargets. The date of completion (which will be at least
         14 days from the date of the Selling Notice) is the date upon which the
         Offer becomes unconditional, save only as to the Escrow Condition.

8.3      Upon receipt of the Selling Notice referred to above, the Ribotargets
         Articles oblige Ribotargets to send a Compulsory Sale Notice to each of
         the Ribotargets Shareholders (other than the Sellers), giving the
         details of the terms of offer as set out in the Selling Notice and
         requiring each of them to sell all of their Ribotargets shares to
         British Biotech on such terms. A Compulsory Sale Notice has been, or if
         the Offeror requires, will be sent to those Ribotargets Shareholders
         who are not Sellers with this Offer.

8.4      The Articles provide that if a Ribotargets Shareholder fails to comply
         with the Compulsory Sale Notice given to him (a DEFAULTING MEMBER),
         Ribotargets is constituted as the agent of any such Defaulting Member
         for the sale of its shares in Ribotargets in accordance with the
         Compulsory Sale Notice and the directors of Ribotargets are entitled to
         authorise any person

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<PAGE>

         to execute and deliver the necessary transfer(s) on behalf of a
         Defaulting Member and cause the purchaser (in this case British
         Biotech) to be registered as the holder of such shares.

8.5      Accordingly, if you do not accept the Offer by completing and returning
         the Form of Acceptance in accordance with the procedure set out in
         section 7 of this letter, the Articles authorise the directors of
         Ribotargets to transfer your shares in Ribotargets to British Biotech
         in consideration for the issue and allotment of the appropriate number
         of Consideration Shares, calculated in accordance with section 4 of
         this letter. However, if you do not accept the Offer by completing and
         returning the Form of Acceptance in accordance with section 7 of this
         letter, the Consideration Shares to be issued and allotted to you in
         respect of the transfer of your shares in Ribotargets will be issued to
         Ribotargets who will hold such Consideration Shares on trust for you in
         accordance with the Ribotargets Articles. The Consideration Shares to
         which you are entitled under the Offer will only be transferred from
         Ribotargets to you (or to your nominee) once you have delivered the
         relevant share certificates in respect of your shares in Ribotargets
         (or a Share Indemnity) to the Company Secretary of British Biotech.

9.       FURTHER INFORMATION

9.1      Your attention is drawn to the Form of Acceptance and to the following
         Appendices which form part of this document:

<TABLE>
<CAPTION>

<S>                                    <C>
         Appendix I                    Conditions and further terms of the Offer
         Appendix II                   Definitions

</TABLE>

10.      ACTION TO BE TAKEN

10.1     To accept the Offer, the Form of Acceptance must be completed and
         returned. Forms of Acceptance should be completed and returned as soon
         as possible and, in any event so as to be received by the Company
         Secretary of British Biotech at Thames Court, Watlington Road, Oxford,
         Oxfordshire OX4 6LY not later than 3.00 p.m. on 20th April, 2003.

Yours faithfully
Peter Fellner

Chairman
British Biotech plc

                                       6
<PAGE>

                                   APPENDIX I

                CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER

PART A: CONDITIONS OF THE OFFER

1.       The Offer is subject to the following conditions being fulfilled or,
         where appropriate, waived:

         (a) valid acceptances being received (and not, where permitted,
             withdrawn) in respect of not less than 100 per cent. in nominal
             value (or such lesser percentage as the Offeror may decide) of the
             Ribotargets Shares in issue at the date of this document and issued
             in accordance with the Contribution Deed;

         (b) resolutions to approve the Capital Reorganisation (as defined in
             the Circular and Listing Particulars) and the purchase of the
             Ribotargets Shares (as set out in Resolutions 1 and 2 of the notice
             of Extraordinary General Meeting contained in the Circular and
             Listing Particulars) being passed at an extraordinary general
             meeting of British Biotech and becoming unconditional;

         (c) a resolution approving the waiver of any obligation on the
             Ribotargets Shareholders and directors of British Biotech to make a
             general offer for British Biotech under Rule 9 of the Code (as set
             out in Resolution 3 of the notice of Extraordinary General Meeting
             contained in the Circular and Listing Particulars) being passed at
             an extraordinary general meeting of the independent shareholders
             (for the purposes of the Code) of British Biotech;

         (d) the admission to the Official List and to trading on the London
             Stock Exchange of the Consideration Shares becoming effective (in
             accordance with the Listing Rules of the UK Listing Authority and
             the rules of the London Stock Exchange);

         (e) no material breach of the Warranties coming to the notice of
             British Biotech;

         (f) no Executive being in breach of any obligation on his part, under
             clause 2.4 of the Undertaking, to deliver to British Biotech, not
             later than 5 Business Days after 31st March, 2003, the Ribotargets
             Balance Sheet satisfactory to British Biotech, together with such
             supporting information as British Biotech may reasonably require,
             demonstrating that the Ribotargets Net Working Capital was not less
             than Pound Sterling 8,200,000;

         (g) no Ribotargets Shareholder or director of Ribotargets who has
             entered into the Undertaking being in material breach of any
             obligation (other than the Completion Delivery Obligations) on its
             part under the Undertaking and, where that breach is capable of
             remedy, it is not remedied to British Biotech's reasonable
             satisfaction;

         (h) the issue of the Compulsory Sale Notice by Ribotargets to each
             Ribotargets Shareholder who is a Ribotargets Shareholder at the
             date of this document and has not entered into the Undertaking as
             soon as reasonably practicable and in any event not later than 2
             Business Days after the date of this document or such other date as
             British Biotech may specify;

         (i) the issue of the Compulsory Sale Notice by Ribotargets to each
             person who becomes a Ribotargets Shareholder between the date of
             this document and Completion as soon as reasonably practicable and
             in any event not later than 2 Business Days following

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             the date that such person becomes a Ribotargets Shareholder or
             such other date as British Biotech may specify; and

         (j) the subscription by the Relevant Investors for additional B
             Ordinary Shares in accordance with the terms of the Contribution
             Deed.

2.       British Biotech may waive all or any of Conditions (a) to (c) and (e)
         to (j) above (either in whole or in part) at any time by notice in
         writing to Ribotargets's Solicitors.

PART B: FURTHER TERMS OF THE OFFER

The following further terms apply to the Offer:

1.       If:

         (a) any material breach of the Warranties comes to the notice of
             British Biotech; or

         (b) any Executive breaches any obligation on his part, under clause 2.4
             of the Undertaking, to deliver to British Biotech, not later than 5
             Business Days after 31st March, 2003, the Ribotargets Balance Sheet
             satisfactory to British Biotech, together with such supporting
             information as British Biotech may reasonably require,
             demonstrating that the Ribotargets Net Working Capital was not less
             than Pound Sterling 8,200,000; or

         (c) any Ribotargets Shareholder or director of Ribotargets who has
             entered into the Undertaking is in material breach of any
             obligation (other than the Completion Delivery Obligations) on its
             part under the Undertaking and, where that breach is capable of
             remedy, it is not remedied to British Biotech's reasonable
             satisfaction,

         then, but without prejudice to any other rights or remedies available
         to British Biotech, British Biotech may without any liability to the
         Ribotargets Shareholders elect to withdraw the Offer by giving notice
         in writing to Ribotargets's Solicitors.

2.       Subject to paragraph 1, the Offer is open for acceptance by every
         recipient until the date upon which the Offer becomes wholly
         unconditional, save as to the Escrow Condition. If the Offer becomes
         unconditional, it will remain open for acceptance for not less than 14
         days from the date on which the Offer became wholly unconditional.

3.       Acceptances of the Offer will be deemed to be withdrawn if the Offeror

         (a) does not deliver to Ribotargets's Solicitors, not later than 5
             Business Days after 31st March, 2003, the British Biotech Balance
             Sheet satisfactory to an Investor Majority, together with such
             supporting information as an Investor Majority may reasonably
             require, demonstrating that the British Biotech Net Working Capital
             was not less than Pound Sterling 23,500,000;

         (b) is in material breach of any obligation on its part under the
             Covenant Deed and, where that breach is capable of remedy, it is
             not remedied to the reasonable satisfaction of an Investor
             Majority.

         Acceptances are otherwise irrevocable.

4.       The Offer will lapse and entirely terminate if all the Conditions have
         not been fulfilled or waived by midnight on 30th April, 2003 or such
         later date as British Biotech and Ribotargets may agree.

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5.       The Ribotargets Shares will be acquired free from all liens, charges,
         and Encumbrances and together with all rights attached to them as at
         the date of Completion.

6.       Any Consideration Shares allotted to a Ribotargets Shareholder located
         in the United States or that is a US Person will be issued in
         certificated form and each share certificate issued to a US Person
         shall bear a legend to the following effect:

         "THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED IN A
         TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
         ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED,
         SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
         SUCH REGISTRATION OR ANY APPLICABLE EXEMPTION THEREFROM. EACH HOLDER OF
         THIS CERTIFICATE AGREES FOR THE BENEFIT OF THE ISSUER THAT IT WILL NOT
         (ON ITS OWN BEHALF OR ON BEHALF OF ANYONE ELSE) OFFER, SELL, TRANSFER,
         PLEDGE OR OTHERWISE DISPOSE OF THE SHARES REPRESENTED HEREBY, EXCEPT:
         (1) TO THE ISSUER; (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
         FILED WITH THE SEC; (3) IN AN OFFSHORE TRANSACTION MEETING THE
         REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES
         ACT; (4) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES
         ACT UNDER RULE 144 (IF AVAILABLE); OR (5) IN ANOTHER TRANSACTION EXEMPT
         FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO A
         TRANSFEREE WHO HAS FURNISHED SUCH CERTIFICATES AND OPINIONS OF COUNSEL
         AS THE ISSUER MAY REQUEST, AND IN THE CASE OF CLAUSES (4) THROUGH (5)
         ABOVE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
         THE UNITED STATES. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THE
         FOREGOING, THE SHARES REPRESENTED HEREBY MAY NOT BE DEPOSITED INTO ANY
         UNRESTRICTED DEPOSITARY RECEIPT FACILITY IN RESPECT OF SHARES OF THE
         ISSUER ESTABLISHED OR MAINTAINED BY A DEPOSITARY BANK. THE HOLDER WILL,
         AND EACH SUBSEQUENT US PERSON IS REQUIRED TO, NOTIFY ANY SUBSEQUENT
         PURCHASER OF SHARES FROM IT OF THE FOREGOING RESTRICTIONS."

7.       This document has been prepared for the purpose of compliance with
         English law. It may not contain all the information required to be
         contained in disclosure documents under Australian law. British Biotech
         is not subject to the continuous disclosure requirements of the
         Corporations Act 2001 (Cth) (the CORPORATIONS ACT) that apply in
         Australia.

8.       The Offer is being made on the basis of Australian Securities &
         Investments Commission Class Order 00/214. Accordingly, the Offer is
         made without a disclosure document for the purposes of the Corporations
         Act.

9.       A Ribotargets Shareholder may not sell any Consideration Shares it
         receives under the Offer in Australia within 12 months after the issue
         of such Consideration Shares, except in circumstances where disclosure
         to investors under Part 6D.2 of the Corporations Act would not be
         required.

10.      Disclosure to investors would not generally be required under Chapter
         6D of the Corporations Act where any Consideration Shares are offered
         for sale:

         (a) on the London Stock Exchange;

         (b) to categories of "professional investors" described in section
             708(11) of the Corporations Act; or

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         (c) to persons who are "sophisticated investors" and meet the criteria
             set out in section 708(8) or 708(10) of the Corporations Act.

         However, Chapter 6D of the Corporations Act is complex and you should
         consult your professional advisors if in any doubt regarding your
         position.

11.      The Consideration Shares will not be offered, directly or indirectly,
         in Belgium in a public transaction (as defined in article 2 of the
         Belgian Royal Decree of 7th July, 1999 on the public nature of the
         financial transactions). The issue of the Consideration Shares has not
         been notified to, and this document and the Form of Acceptance have not
         been approved by, the Belgian Banking and Finance Commission
         ("Commission bancaire et financiere" / "Commissie voor het Bank- en
         Financiewezen"). The Consideration Shares may only be sold in Belgium
         to investors in accordance with the provisions of article 3 of the
         Belgian Royal Decree of 7th July, 1999 on the public nature of the
         financial transactions (PROFESSIONAL INVESTORS), and this document and
         the Form of Acceptance may not be delivered or passed on to any
         investors other than professional investors.

12.      The instructions and authorities contained in, and the terms of, the
         Form of Acceptance constitute part of the terms of the Offer.

13.      The Offer and all acceptances thereof and the Form of Acceptance shall
         be governed by and construed in accordance with English law.

14.      The accidental omission to despatch this document to, or any failure to
         receive the same by, any person to whom the Offer is made, or should be
         made, shall not invalidate the Offer in any way. All communications,
         notices, certificates, documents of title and remittances to be
         delivered by or sent to or from Ribotargets Shareholders will be
         delivered by or sent to or from them (or their designated agents) at
         their own risk. No acknowledgement of receipt of any Form of
         Acceptance, share certificate(s) or other documents of title will be
         given. British Biotech reserves the right to treat acceptances of the
         Offer as valid although not accompanied by the relative share
         certificate(s) and/or other documents of title or otherwise not in
         order.

15.      All powers of attorney and authorities on the terms conferred by or
         referred to in this Appendix I or in the Form of Acceptance are given
         by way of security for the performance of the obligations of the
         Ribotargets Shareholder concerned and are irrevocable in accordance
         with section 4 of the Powers of Attorney Act 1971.

16.      Each Ribotargets Shareholder by whom, or on whose behalf, the Form of
         Acceptance is executed irrevocably undertakes, warrants and agrees to
         and with British Biotech (so as to bind him, his personal
         representatives, heirs, successors and assigns) to the following
         effect:

         (a) that the execution of the Form of Acceptance by it constitutes (i)
             an acceptance of the Offer in respect of the number of Ribotargets
             Shares inserted or deemed to be inserted in the Form of Acceptance,
             subject to the terms and conditions set out or referred to in this
             document and the Form of Acceptance and (ii) a waiver of any rights
             of pre-emption under the Ribotargets Articles or otherwise in
             respect of the transfer of any of the Ribotargets Shares;

         (b) that the Ribotargets Shares in respect of which the Offer is
             accepted or deemed to be accepted by it are sold free from all
             liens, charges or Encumbrances and together with all rights
             attaching thereto as at the date of Completion;

         (c) that British Biotech shall be entitled, once the Offer becomes
             unconditional, to direct the exercise of any votes attaching to any
             Ribotargets Shares in respect of which the

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<PAGE>

             Offer has been accepted or is deemed to have been accepted by it,
             and that the execution of the Form of Acceptance by it constitutes
             an authority to Ribotargets from such Ribotargets Shareholder to
             send any notice which may be required to be sent to him as a member
             of Ribotargets to British Biotech at its registered office, and an
             authority to any director of British Biotech to act as his attorney
             with the power to sign any consent to short notice of a general
             meeting on his behalf and/or to execute a form of proxy in respect
             of such Ribotargets Shares appointing any person determined by
             British Biotech to attend general meetings of Ribotargets and to
             exercise the votes attaching to such Ribotargets Shares on its
             behalf, where relevant, such votes to be cast as British Biotech
             may determine and prior to the Offer becoming unconditional, such
             Ribotargets Shareholder shall exercise his votes in relation to
             such resolutions as may be reasonably necessary to enable the Offer
             to be implemented provided that, in the case of a Ribotargets
             Shareholder executing a Form of Acceptance in the capacity of
             trustee, the appointment of the attorney is made in accordance with
             section 25 of the Trustee Act 1925 and shall be effective for the
             period of 12 months from the date of the Form of Acceptance;

         (d) that the execution of the Form of Acceptance constitutes, subject
             to the Offer becoming unconditional, in accordance with its terms:

             (i)    the irrevocable appointment by it of any director of British
                    Biotech as such Ribotargets Shareholder's attorney, and an
                    irrevocable instruction to the attorney, on behalf of such
                    Ribotargets Shareholder and in his name:

                    (A) to execute and complete all or any form(s) of transfer
                        and/or other document(s) at the attorney's discretion in
                        relation to the Ribotargets Shares referred to in
                        paragraph 1 of the Form of Acceptance in favour of
                        British Biotech or of such other person as
                        British Biotech may direct;

                    (B) to deliver such form(s) of transfer and/or other
                        document(s) at the attorney's discretion together with
                        the certificate(s) and/or other document(s) relating to
                        such Ribotargets Shares for registration; and

                    (C) to do all such other acts and things as may, in the
                        opinion of such attorney, be necessary or expedient for
                        the purpose of, or in connection with, the acceptance of
                        the Offer and to vest in British Biotech or such persons
                        as it may direct such Ribotargets Shares,

                    provided that, in the case of a Ribotargets Shareholder
                    executing a Form of Acceptance in the capacity of trustee,
                    the appointment of the attorney is made in accordance with
                    section 25 of the Trustee Act 1925 and shall be effective
                    for the period of 12 months from the date of the Form of
                    Acceptance

             (ii)   an irrevocable authority and request from it to Ribotargets
                    to register the transfer of its Ribotargets Shares pursuant
                    to the Offer and to deliver any share certificate(s) in
                    respect thereof (or a Share Indemnity in lieu thereof) to
                    British Biotech or as it may direct at the risk of such
                    Ribotargets Shareholder;

         (e) that he will deliver to British Biotech at its registered office
             his share certificate(s) and/or other document(s) of title in
             respect of his Ribotargets Shares, or a Share Indemnity in lieu
             thereof, as soon as possible and in any event prior to the Offer
             becoming unconditional;

                                       11
<PAGE>

         (f) that the terms of this paragraph shall be deemed to be incorporated
             in and form part of the Form of Acceptance, which shall be read and
             construed accordingly;

         (g) that, if he accepts the Offer, he shall do all such acts and things
             as shall be necessary or expedient to vest in British Biotech or
             its nominees the Ribotargets Shares held by him at Completion and
             in respect of which the Offer is accepted, including discharging
             any liens, charges or Encumbrances over such Ribotargets Shares;

         (h) that he agrees to ratify each and every lawful act or thing which
             may be done or effected by any director of British Biotech in the
             exercise of any of his powers and/or authorities hereunder; and

         (i) that, in the event of the Offer being withdrawn or terminating,
             such Form of Acceptance shall constitute his irrevocable authority
             and request to British Biotech to return his Form of Acceptance and
             the relevant share certificate(s) and or the document(s) of title
             in respect of the Ribotargets Shares held by him (or the Share
             Indemnity in lieu thereof) for which he has accepted the Offer by
             ordinary post at his risk to Ribotargets's Solicitors.

         References in this paragraph to Ribotargets Shareholders shall include
         references to the person or persons executing a Form of Acceptance and,
         in the event of more than one person executing a Form of Acceptance,
         the provisions of this paragraph shall apply to them jointly and to
         each of them.

Dated: 21st March, 2003

                                       12
<PAGE>

                                   APPENDIX II

                                   DEFINITIONS

In this document the following definitions apply unless the context requires
otherwise:

A ORDINARY SHARES means the A ordinary shares of Pound Sterling 0.10 each in the
capital of Ribotargets and A ORDINARY SHAREHOLDER means a holder of any of them;

B ORDINARY SHARES means the B ordinary shares of Pound Sterling 0.10 each in the
capital of Ribotargets and B ORDINARY SHAREHOLDER means a holder of any of them;

BRITISH BIOTECH means British Biotech plc (registered number 2304992) whose
registered address is Thames Court, Watlington Road, Oxford, Oxfordshire OX4
6LY;

BRITISH BIOTECH BALANCE SHEET means the consolidated balance sheet of British
Biotech and its subsidiaries as at 31st March, 2003 prepared in the form and
including the items shown in the schedule to the Undertaking headed "British
Biotech Balance Sheet", including, without limitation, full accruals for all
costs incurred in connection with the Offer, and prepared in accordance with the
accounting policies, principles, practices, evaluation rules and procedures,
methods and bases adopted by British Biotech in the preparation of the British
Biotech Management Accounts;

BRITISH BIOTECH MANAGEMENT ACCOUNTS means the unaudited management accounts of
British Biotech for the period of ten months ended 28th February, 2003 in the
Agreed Form;

BRITISH BIOTECH NET WORKING CAPITAL means the net working capital of British
Biotech as at 31st March, 2003 as indicated on line 14 of the British Biotech
Balance Sheet;

BRITISH BIOTECH ORDINARY SHARES means ordinary shares of 5 pence each in the
capital of British Biotech;

BUSINESS DAY means a day (other than a Saturday or Sunday) on which banks are
generally open in London for normal business;

CIRCULAR AND LISTING PARTICULARS means the document dated on or about the date
of this document comprising the combined circular to shareholders and listing
particulars of British Biotech in connection with the Offer;

CODE means The City Code on Takeovers and Mergers;

COMPLETION means completion of the acquisition of the Ribotargets Shares by
British Biotech, in respect of which the Offer has been accepted, and the
admission to listing and trading of the Consideration Shares;

COMPLETION DELIVERY OBLIGATIONS means the obligations specified in clauses
4.4(d)(i) and (iii), 4.4(e)(i), (ii) and (iv) and 4.4(f) of the Undertaking;

COMPULSORY SALE NOTICE means the notice issued or to be issued by Ribotargets
(in accordance with article 7.5.2 of the Ribotargets Articles) to any
Ribotargets Shareholders who have not entered into the Undertaking, giving the
details contained in the Selling Notice and requiring the Ribotargets
Shareholders to sell their holdings of shares in Ribotargets to British Biotech
on the terms contained in the Selling Notice;

CONDITIONS means the conditions set out in paragraph 1 of Part A of Appendix I
to this document;

                                       13
<PAGE>

CONSIDERATION SHARES means the 33,375,889 British Biotech Ordinary Shares to be
allotted and issued credited as fully paid to the Ribotargets Shareholders in
accordance with the terms of the Offer;

CONTRIBUTION DEED means the deed entered into among the Ribotargets Shareholders
and Ribotargets on or before the date of this document pursuant to which, inter
alia, the Relevant Investors will subscribe for further B Ordinary Shares at or
prior to Completion;

COVENANT DEED means the deed poll entered into by British Biotech prior to the
date of this document giving covenants with respect to the conduct of British
Biotech's business pending Completion;

DEFAULTING MEMBER means any member of Ribotargets who fails to comply with the
terms of the Compulsory Sale Notice;

ENCUMBRANCE means any mortgage, charge (fixed or floating), pledge, lien,
option, right to acquire, assignment by way of security, trust arrangement for
the purpose of providing security or any other security interest of any kind,
including retention arrangements and any agreement to create any of the
foregoing;

ESCROW CONDITION means the Condition set out in paragraph 1(d) of Part A of
Appendix I to this document having been satisfied and the Offer not having been
withdrawn before satisfaction of such Condition;

EXECUTIVE has the meaning given to it in the Undertaking;

FORM OF ACCEPTANCE means the form of acceptance and authority accompanying this
document;

INVESTOR MAJORITY means the holders of at least 65 per cent. by nominal value of
the B Ordinary Shares and the A Ordinary Shares;

LONDON STOCK EXCHANGE means London Stock Exchange plc;

NEW RIBOTARGETS SHARES means the B Ordinary Shares which are subscribed for by
the Relevant Investors at or prior to Completion in accordance with the terms of
the Contribution Deed;

OFFER means the offer by British Biotech to acquire all the Ribotargets Shares
on the terms and subject to the conditions set out in this document and in the
Form of Acceptance;

OFFICIAL LIST means the official list of the UK Listing Authority;

ORDINARY SHARES means the ordinary shares of Pound Sterling 0.10 each in the
capital of Ribotargets and ORDINARY SHAREHOLDER means a holder of any of them;

RELEVANT INVESTORS means the Ribotargets Shareholders named in column (1) of
schedule 4 to the Contribution Deed;

RIBOTARGETS means Ribotargets Holdings plc (registered number 3339154) whose
registered office is at Granta Park, Abington, Cambridge CB1 6GB;

RIBOTARGETS ARTICLES means the articles of association of Ribotargets in force
as at the date of this document;

RIBOTARGETS BALANCE SHEET means the consolidated balance sheet of the
Ribotargets and its subsidiary as at 31st March, 2003 prepared in the form and
including the items shown in the schedule to the Undertaking headed "Ribotargets
Balance Sheet", including, without limitation, full accruals for all costs
incurred in connection with the Offer, and prepared in accordance with the
accounting

                                       14
<PAGE>

policies, principles, practices, evaluation rules and procedures, methods and
bases adopted by Ribotargets in the preparation of the Ribotargets Management
Accounts;

RIBOTARGETS MANAGEMENT ACCOUNTS means the unaudited management accounts of
Ribotargets for the period ended 2nd March, 2003 in the Agreed Form;

RIBOTARGETS NET WORKING CAPITAL means the net working capital of Ribotargets as
at 31st March, 2003 as indicated on line 13 of the Ribotargets Balance Sheet;

RIBOTARGETS SHARES means all the existing issued Ordinary Shares, A Ordinary
Shares or B Ordinary Shares and any further such shares which are allotted or
issued before the date upon which the Offer becomes wholly unconditional (save
only as to the Escrow Condition), including any New Ribotargets Shares which are
issued pursuant to the Contribution Deed, and RIBOTARGETS SHAREHOLDER means a
holder of any of them;

RIBOTARGETS'S SOLICITORS means CMS Cameron McKenna of Mitre House, 160
Aldersgate Street, London EC1A 4DD (ref: MGD);

SECURITIES ACT means the United States Securities Act of 1933, as amended;

SELLING NOTICE means the notice issued or to be issued to Ribotargets by those
Ribotargets Shareholders named in schedule 1 to the Undertaking in accordance
with article 7.5.1 of the Articles;

SUBSIDIARY means a subsidiary for the purposes of the Companies Act 1985;

UK LISTING AUTHORITY means the Financial Services Authority acting in its
capacity as the competent authority for the purposes of Part VI of the Financial
Services and Markets Act 2000;

UNDERTAKING means the undertakings between those Ribotargets Shareholders named
in schedule 1 to that agreement, the Executives and British Biotech dated on or
prior to the date of this document;

UNITED STATES and US PERSON have the meanings given in Rule 902 of Regulation S
under the Securities Act; and

WARRANTIES has the meaning given to it in the Undertaking.

                                       15

<PAGE>

                                DEED OF COVENANT

                              DATED 17th MARCH , 2003

                               BRITISH BIOTECH PLC

                                 ALLEN & OVERY
                                     London

<PAGE>

THIS DEED is executed as a deed poll on 17th March, 2003 by BRITISH BIOTECH PLC
(registered number 2304992) whose registered office is at Thames Court,
Watlington Road, Oxford, Oxfordshire OX4 6LY (the COMPANY).

WHEREAS the Company has agreed with Ribotargets Holdings plc to conduct its
business in accordance with the terms and subject to the conditions set out in
this deed poll.

NOW THIS DEED POLL WITNESSES AND IT IS DECLARED as follows:

1.       INTERPRETATION

1.1      In this deed poll:

         BRITISH BIOTECH GROUP COMPANIES means the Company each of its
         subsidiaries and subsidiary undertakings and BRITISH BIOTECH GROUP
         COMPANY means any of them;

         BUDGET means the 2003 budget for the Company set out in schedule 1;

         CIRCULAR AND LISTING PARTICULARS means the document comprising the
         combined circular to shareholders and listing particulars of the
         Company which is required in connection with the Offer;

         COMPLETION means completion of the acquisition by the Company of the
         entire issued and to be issued share capital of Ribotargets;

         EMPLOYEE includes a director and any officer of the Company whether or
         not he has entered into or works under (or, where the employment has
         ceased, worked under) a contract of employment;

         EXTERNAL COST means any category of expenditure other than an Internal
         Cost;

         INTELLECTUAL PROPERTY RIGHTS means rights in trade marks, rights in
         designs, patents, copyright, moral rights, database rights, rights in
         know-how and all other intellectual property rights in each case
         whether registered or unregistered, together with applications for the
         grant of any of these rights, and together also with all rights or
         forms of protection having equivalent or similar effect to any of the
         foregoing which may subsist anywhere in the world;

         INTERNAL COST means any category of expenditure which falls (on the
         basis of preparation consistent with the Company's prior financial
         year) to be treated as an internal cost for the purposes of preparing
         the Budget;

         OFFER means an offer to acquire the entire issued and to be issued
         share capital of Ribotargets on the terms and subject to the conditions
         to be set out in an offer document to be issued in final form by the
         Company;

         RETIREMENT/DEATH/DISABILITY BENEFIT means any pension, lump sum,
         gratuity or other like benefit given or to be given on retirement or on
         death, or in anticipation of retirement, or, in connection with past
         service, after retirement or death, or to be given on or in
         anticipation of or in connection with any change in the nature of the
         service of the employee in question or given or to be given on or in
         connection with the illness, injury or disability of, or suffering of
         any accident by, an employee;

                                       1
<PAGE>

         RIBOTARGETS means Ribotargets Holdings plc (registered number 3339154)
         whose registered office is at Granta Park, Abington, Cambridge CB1 6GB;

         SCHEMES means the Standard Life Occupational Contracted-in Money
         Purchase Scheme and the Scottish Mutual Group Person Pension Scheme of
         the Company;

         SUBSIDIARY means a subsidiary for the purposes of the Companies Act
         1985; and

         SUBSIDIARY UNDERTAKING has the meaning given in section 258 of the
         Companies Act 1985.

1.2      References to THIS DEED POLL are to this deed poll and the schedule.

1.3      The headings in this deed poll do not affect its interpretation.

2.       CONDUCT OF BUSINESS

2.1      Subject to subclause 2.2 and clause 4, the Company covenants to
         Ribotargets that, pending Completion and except with the prior written
         consent of either:

         (a) Simon Sturge of Granta Park, Abington, Cambridge CB1 6GB; or

         (b) the holders of more than 65 per cent. by nominal value of the
             issued B Ordinary Shares and A Ordinary Shares of Ribotargets,

         such consent not to be unreasonably withheld or delayed, the Company
         shall not (and shall procure that each British Biotech Group Company
         shall not), save for the purposes of Completion or as envisaged in the
         Circular and Listing Particulars:

         (a) incur any expenditure in respect of:

             (i)    any Internal Cost in excess of Pound Sterling 20,000 per
                    item or Pound Sterling 100,000 in aggregate (other than
                    expenditure expressly specified in the Budget in respect of
                    any Internal Cost); and

             (ii)   any External Cost in excess of Pound Sterling 50,000 per
                    item; or

         (b) dispose of or grant any option or right of pre-emption in respect
             of any part of its assets; or

         (c) dispose of or grant any licence in respect of any interest in its
             Intellectual Property Rights other than pursuant to an agreement
             relating to the transfer of materials or a confidentiality
             agreement entered into in the ordinary course of its business; or

         (d) borrow any money; or

         (e) enter into any unusual or abnormal contract or commitment or:

             (i)    grant any lease or third party right in respect of any real
                    estate or transfer or otherwise dispose of any real estate;

             (ii)   make any loan;

             (iii)  enter into any leasing, hire purchase or other agreement or
                    arrangements for payment on deferred terms; or

                                       2
<PAGE>

         (f) declare, make or pay any dividend or other distribution; or

         (g) grant, issue or redeem any mortgage, charge, debenture or other
             security or give any guarantee or indemnity; or

         (h) make any change in the terms and conditions of employment of any of
             its directors or employees or employ or terminate the employment of
             any person save for cause; or

         (i) make, or announce to any person any proposal to make, any change
             or addition to any retirement/death/disability benefit in respect
             of any of its directors or employees or former directors or former
             employees (or any dependant of any such person) or to the Schemes
             or grant or create any additional retirement/death/disability
             benefit or, without limiting the foregoing, take any action or
             allow any action to be taken in relation to the Schemes other than
             in the ordinary course of administering the Schemes or omit to
             take any action reasonably required for the ordinary operation of
             the Schemes; or

         (j) permit any of its insurances to lapse; or

         (k) create, issue, purchase or redeem any class of share or loan
             capital, or grant any option or right to subscribe any share or
             loan capital; or

         (l) pass any resolution of its shareholders or any class of
             shareholders, whether in general meeting or otherwise; or

         (m) agree, conditionally or unconditionally, to do any of the
             foregoing; or

         (n) in any other way depart from the ordinary course of its day-to-day
             trading.

2.2      Clause 2.1 shall not operate so as to restrict or prevent:

         (a) any matter reasonably undertaken in response to events beyond the
             control of the Company with the intention of minimising any adverse
             effect of such events provided that a director of the Company will
             inform Ribotargets of such matters as soon as reasonably
             practicable;

         (b) completion or performance of any obligations undertaken pursuant to
             any contract or arrangement entered into and disclosed to
             Ribotargets prior to the date of this deed poll;

         (c) any other matter undertaken at the written request of Ribotargets;
             or

         (d) any action or omission which the Company is required to take or
             omit to take by any applicable law or regulation.

2.3      British Biotech shall immediately notify Ribotargets (for the attention
         of Simon Sturge) in writing of any matter or thing which arises or
         becomes known to it before Completion which constitutes (or would after
         the lapse of time constitute) a breach of its undertakings under this
         deed poll.

3.       EGM

         If the Company makes the Offer to the shareholders of Ribotargets, the
         Company covenants to Ribotargets that it will use reasonable endeavours
         to convene an extraordinary general

                                       3
<PAGE>

         meeting of its shareholders, for the purpose of, inter alia, approving
         the purchase of the shares in Ribotargets, as soon as reasonably
         practicable after the date the Offer is made.

4.       TERMINATION

         If the Company does not make the Offer on or before the date which is
         10 days from the date of this deed poll all the provisions of this deed
         poll and all rights and obligations under it (except for this clause
         and clause 5) shall lapse and cease to have effect, including, but
         without limitation, any right to bring or cause to be brought any
         claim, action or proceeding under this deed poll and the Company shall
         have no liability to any person in respect of any rights or obligations
         to or in respect of any person in connection with or pursuant to this
         deed poll, whether present or future, actual or contingent, accrued or
         otherwise.

5.       GENERAL

5.1      The Company shall comply with the terms of this deed poll and shall
         observe and perform the provisions of this deed poll which shall be
         binding on the Company and Ribotargets and all persons claiming through
         or under them respectively.

5.2      This deed poll is governed by and shall be construed in accordance with
         English law.

5.3      The Courts of England shall have exclusive jurisdiction to hear and
         decide any suit, action or proceeding and to settle any disputes which
         may arise in connection with this deed poll.

IN WITNESS of which this deed poll has been executed and has been delivered on
the date which appears first above.

                                       4
<PAGE>

                                   SCHEDULE 1

                                   THE BUDGET

<TABLE>
<CAPTION>
                                                          ACTUAL
                                                         JAN YTD    FEBRUARY    MARCH     APRIL      TOTAL
                                                         -------    --------    -----     -----      -----

<S>                                                     <C>          <C>       <C>       <C>      <C>
Internal Costs
Corporate                                                  3,516        402       419       645      4,983
Directorate                                                3,229        410     2,788       279      6,706  (Additional Pound
Research                                                   1,398        162       177       239      1,976  Sterling 2mil of
Business Development                                         353         25        30        68        476  costs relating to Offer)
Development                                                2,018        253       274       558      3,103
                                                          ------      -----     -----     -----     ------
Total Internal Costs                                      10,514      1,252     3,688     1,790     17,244
                                                          ------      -----     -----     -----     ------

Research Projects                  Actual                     69        51       297        416
Business Development Projects      Projects put together   4,804         21        21        19      4,865
Development Projects                                                    475     2,007     1,224      3,706
Genesoft Costshare                                                        0         0     (295)      (295)
                                                          ------      -----     -----     -----     ------
External Costs research projects                           4,804        565     2,079     1,245      8,692
                                                          ------      -----     -----     -----     ------

                                                          ======      =====     =====     =====     ======
Total Operating Expenditure                               15,318      1,817     5,767     3,035     25,936
                                                          ======      =====     =====     =====     ======
</TABLE>

                                       5
<PAGE>

                                   SIGNATORIES

EXECUTED as a deed by                        )        /s/   Timothy Edwards
BRITISH BIOTECH PLC                          )        Director
acting by                                    )
and                                          )        /s/   A J Weir
                                                      Director/Secretary

                                       6

<PAGE>

                                  UNDERTAKINGS
                  RELATING TO THE OFFER BY BRITISH BIOTECH PLC
                          FOR RIBOTARGETS HOLDINGS PLC

                              DATED 21st MARCH , 2003

                                  THE OFFEREES
                               NAMED IN SCHEDULE 1

                                 THE EXECUTIVES

                                       AND

                               BRITISH BIOTECH PLC

                                 ALLEN & OVERY

                                     London

<PAGE>

                                    CONTENTS

<TABLE>
<CAPTION>
CLAUSE                                                                       PAGE
------                                                                       ----
<S>                                                                         <C>
1.       Interpretation.......................................................1
2.       Undertakings and undertaking to accept the Offer.....................2
3.       Undertaking to make the Offer; Option Holders........................4
4.       Completion...........................................................4
5.       Loans and Guarantees.................................................6
6.       Warranties and Undertakings..........................................6
7.       Lock-up of Consideration Shares......................................7
8.       Confidentiality......................................................7
9.       Notices..............................................................8
10.      Further Assurances...................................................8
11.      Assignments..........................................................8
12.      General..............................................................9
13.      Whole Agreement......................................................9
14.      Governing Law.......................................................10

SCHEDULE

1.       The Offerees........................................................11
2.       The Company.........................................................18
3.       The Subsidiary......................................................19
4.       Warranties..........................................................20
5.       Lock-up of Consideration Shares.....................................23
6.       Pre-Completion......................................................25
7.       British Biotech Balance Sheet.......................................28
8.       Ribotargets Balance Sheet...........................................29
9.       Interpretation......................................................30

Signatories..................................................................35
</TABLE>

<PAGE>

THIS UNDERTAKING is executed as a deed on 21st March, 2003 BETWEEN:

(1)      THE PERSONS whose names and addresses are set out in column A of the
         schedule headed "The Offerees" (each an OFFEREE and together the
         OFFEREES);

(2)      Simon Sturge (MR STURGE) and Susan Lowther (each an EXECUTIVE and
         together the EXECUTIVES), both of Granta Park, Abington, Cambridge, CB1
         6GB; and

(3)      BRITISH BIOTECH PLC (registered number 2304992) whose registered office
         is at Thames Court, Watlington Road, Oxford, Oxfordshire OX4 6LY (the
         OFFEROR).

         BACKGROUND:

(A)      Ribotargets Holdings plc (the COMPANY) is a public company limited by
         shares short particulars of which are set out in the schedule headed
         "The Company".

(B)      The Offerees are legally and beneficially or are beneficially entitled
         to sell the Existing Ribotargets Shares which, together with the Apax
         Shares, comprise all the issued share capital of the Company.

(C)      Pursuant to the Contribution Deed, the Relevant Investors have agreed
         to subscribe for New Ribotargets Shares at or prior to Completion.

(D)      The Offeror intends to make an offer (the OFFER) to acquire the whole
         of the issued and to be issued share capital of the Company on the
         terms and subject to the conditions set out in the drafts of the offer
         document (the OFFER DOCUMENT) and the form of acceptance (the FORM OF
         ACCEPTANCE), each in the Agreed Form.

(E)      The Offerees have entered into a form of waiver on or before the date
         of this document, pursuant to which each Offeree has consented to the
         application to the Panel on Takeovers and Mergers for a waiver of the
         Code in connection with the Offer.

IT IS AGREED as follows:

1.       INTERPRETATION

1.1      In addition to terms defined elsewhere in this undertaking, the
         definitions and other provisions in the schedule headed
         "Interpretation" apply throughout this undertaking unless the contrary
         intention appears.

1.2      In this undertaking, unless the contrary intention appears, a reference
         to a clause, subclause or schedule is a reference to a clause,
         subclause or schedule of this undertaking. The schedules and the
         recitals form part of this undertaking.

1.3      The headings in this undertaking do not affect its interpretation.

1.4      All warranties, representations, covenants, indemnities, agreements and
         obligations given or to be entered into by more than one person in this
         undertaking shall be given or entered into severally (and not jointly).

                                       1
<PAGE>

2.       UNDERTAKINGS AND UNDERTAKING TO ACCEPT THE OFFER

2.1      In consideration of the Offeror agreeing (subject to the conditions set
         out in this undertaking) to make the Offer, each of the Offerees
         undertakes, agrees, warrants and covenants to and with the Offeror on
         the terms set out below in this undertaking.

2.2      Each of the Offerees undertakes, agrees, warrants and covenants to and
         with the Offeror in the following terms:

         (a) it is the beneficial owner of those of the Ribotargets Shares set
             out opposite its name in columns (B), (C) and (D) of the schedule
             headed "The Offerees", and in the case of Apax Europe V-A, L.P.,the
             Apax Shares;

         (b) in the case of the Relevant Investors only, it will at Completion
             be the beneficial owner of the New Ribotargets Shares set out
             opposite its name in column (E) of the schedule headed "The
             Offerees";

         (c) it has all necessary authority to accept (or procure the acceptance
             of) the Offer in respect of all the Ribotargets Shares beneficially
             owned by it and to transfer (or procure the transfer of) all the
             Ribotargets Shares beneficially owned by it free from all liens,
             charges and Encumbrances and together with all rights attaching to
             them;

         (d) subject to clause 2.5, it will accept (or procure the acceptance
             of) the Offer in respect of all the Existing Ribotargets Shares and
             New Ribotargets Shares beneficially owned or to be beneficially
             owned by it and deliver (or procure the delivery of) duly completed
             Form(s) of Acceptance, together with the share certificate(s)
             and/or other document(s) of title and/or evidence of authority in
             accordance with the terms of the Offer, not later than 3.00 p.m. on
             the fifth Business Day after despatch of the Offer Document in
             respect of Existing Ribotargets Shares, and not later than Escrow
             Completion in the case of New Ribotargets Shares;

         (e) unless and until the Offer is withdrawn or terminated, it will not
             (or will procure that the registered holder will not) without the
             prior written consent of the Offeror:

             (i)    sell, transfer, charge, pledge or grant any option over or
                    otherwise dispose of any of the Existing Ribotargets Shares
                    and New Ribotargets Shares beneficially owned or to be
                    beneficially owned by it or any interest in any of the
                    Existing Ribotargets Shares and New Ribotargets Shares
                    beneficially owned or to be beneficially owned by it except
                    to the Offeror under the Offer; or

             (ii)   accept any other offer in respect of any of the Existing
                    Ribotargets Shares and New Ribotargets Shares beneficially
                    owned or to be beneficially owned by it (whether it is
                    conditional or unconditional and irrespective of the means
                    by which it is to be implemented); or

             (iii)  subject to subclause 2.5, withdraw or procure or permit the
                    withdrawal of the acceptances referred to in subclause
                    2.2(d) above in respect of any of the Ribotargets Shares
                    beneficially owned by it;

         (f) it has not dealt, nor has any person on its behalf dealt, in
             British Biotech Ordinary Shares during the period of 12 months
             prior to the date of this undertaking, except as disclosed in Part
             VIII of the Circular and Listing Particulars;

                                       2
<PAGE>

         (g) pending Completion, it will not nor will any person on its behalf
             deal in existing British Biotech Ordinary Shares after the date of
             this undertaking without the prior written consent of the Offeror;

         (h) it will, at its own cost and expense, execute and do (or procure to
             be executed and done by any other necessary party (other than the
             Offeror)) all such deeds, documents, acts and things as the Offeror
             may reasonably require in order to vest any of the Existing
             Ribotargets Shares and New Ribotargets Shares beneficially owned by
             it in the Offeror or its assignee. Notwithstanding the obligations
             of the Offerees under this sub-paragraph, the Offeror shall pay any
             stamp duty in connection with the vesting of the Existing
             Ribotargets Shares and New Ribotargets Shares in the Offeror or its
             assignee; and

         (i) each Offeree acknowledges and agrees for the benefit of the Company
             as well as the Offeror that the issue and allotment to it or its
             nominee of the Consideration Shares in accordance with the Offer
             Document will represent the total consideration payable by the
             Offeror to it in respect of the transfer of the Ribotargets Shares
             beneficially owned by such Offeree under the Offer and,
             notwithstanding the rights attaching to the Ribotargets Shares, the
             allocation of the Consideration Shares among the Offerees as
             specified in the Offer Document is a matter for the Offerees alone
             and the Offeror shall not be responsible for determining the
             allocation of the Consideration Shares among the Offerees or the
             registered holders of the Ribotargets Shares.

2.3      Each Offeree waives and will procure the waiver of all rights of
         pre-emption which it or its nominee may have (whether under a Group
         Company's constitutional documents or otherwise) in respect of the
         proposed transfer to the Offeror of the Ribotargets Shares or any of
         them.

2.4      Each of the Executives shall procure the delivery to the Offeror, not
         later than 5 Business Days after 31st March, 2003, of the Ribotargets
         Balance Sheet satisfactory to the Offeror, together with such
         supporting information as the Offeror may reasonably require,
         demonstrating that the Ribotargets Net Working Capital was not less
         than Pound Sterling8,200,000.

2.5      Acceptances of the Offer will be deemed to be withdrawn if the Offeror:

         (a) does not deliver to the Company's Solicitors, not later than 5
             Business Days after 31st March, 2003, the British Biotech Balance
             Sheet satisfactory to an Investor Majority, together with such
             supporting information as an Investor Majority may reasonably
             require, demonstrating that the British Biotech Net Working Capital
             was not less than Pound Sterling23,500,000;

         (b) is in material breach of any obligation on its part under the
             Covenant Deed and, where that breach is capable of remedy, it is
             not remedied to the reasonable satisfaction of an Investor
             Majority.

         If any acceptances of the Offer are withdrawn or deemed withdrawn in
         accordance with this subclause, all the other clauses of this
         undertaking, except for this subclause, the clause headed
         "Confidentiality" and the clauses after it, together with the
         provisions of the clause and schedule headed "Interpretation", shall
         lapse and cease to have effect.

                                       3
<PAGE>

3.       UNDERTAKING TO MAKE THE OFFER; OPTION HOLDERS

3.1      The Offeror undertakes to each Offeree to make the Offer on the terms
         and conditions set out in the Offer Document immediately upon the
         conditions set out in subclause 3.2 having been satisfied.

3.2      The making of the Offer is conditional on:

         (a) the delivery to the Offeror of:

             (i)    a copy of the duly executed Contribution Deed (certified by
                    the Company Secretary of the Company); and

             (ii)   the Termination Deed duly executed by the Company; and

         (b) the delivery by the Offerees to the Company of the Selling Notice
             duly executed by each of the Offerees and the registered holders of
             the Existing Ribotargets Shares.

3.3      The Executives shall procure that the Letter to Option Holders is
         delivered by the Company to all members of the Ribotargets Option
         Schemes as soon as reasonably practicable after the Offer has been
         made.

3.4      Each of the Executives shall use reasonable endeavours to procure (so
         far as it is lawfully able to procure) that the Conditions specified in
         subparagraphs (h) and (i) of Part A of Appendix I to the Offer Document
         are satisfied on or before 30th April, 2003 (the LONG STOP DATE). If
         all the Conditions are not fulfilled or, where permitted, waived on or
         before the Long Stop Date, or such other date as the parties may agree,
         except for this subclause, the clause headed "Confidentiality" and the
         clauses after it, together with the provisions of the clause and
         schedule headed "Interpretation", all the other clauses of this
         undertaking shall lapse and cease to have effect.

4.       COMPLETION

4.1      Provided that the Conditions have been satisfied or, where permitted,
         waived (other than the Escrow Condition and the Conditions in
         paragraphs 1(e), (f) and (g) of Part A of Appendix I to the Offer
         Document), the Offerees agree that Completion will take place in two
         stages as follows:

         (a) Escrow Completion will take place at the offices of the Offeror's
             Solicitors (or at such other place as the parties may agree) on the
             Business Day prior to that on which the Escrow Condition is
             expected to be satisfied. At Escrow Completion, all matters and
             things required to be done under subclause 4.4 below will be duly
             performed but all actions and documents will be held in escrow so
             that their terms do not come into force and effect until Completion
             and subject as set out in subclause 4.3; and

         (b) subject to Escrow Completion having taken place in accordance with
             the terms set out above, Completion shall only be conditional upon
             satisfaction of the Escrow Condition and satisfaction or waiver of
             the Conditions in paragraphs 1(e), (f) and (g) of Part A of
             Appendix I to the Offer Document and shall take place immediately
             upon their satisfaction or, where permitted, waiver. Forthwith upon
             Completion taking place all actions, deeds, agreements and
             documents delivered at Escrow Completion shall be released
             therefrom and dated such that their terms shall come into immediate
             full force and effect.

                                       4
<PAGE>

4.2      Pending Completion (and whether or not the Conditions are satisfied or,
         where permitted, waived) the provisions of the schedule headed
         "Pre-Completion" shall apply.

4.3      If Completion does not occur as a result of the Offeror exercising its
         right to withdraw the Offer in any of the circumstances mentioned in
         paragraph 1 of Part B of Appendix I to the Offer Document or otherwise,
         or if this Offer otherwise lapses in accordance with its terms, any
         agreements or documents executed (including transfers of Ribotargets
         Shares or allotments of Consideration Shares) shall be deemed to be of
         no effect and all documents, agreements, papers and other things
         delivered pursuant to this clause or in anticipation of Completion
         shall forthwith be returned to the relevant person.

4.4      At Completion:

         (a) the Relevant Investors shall subscribe for additional B Ordinary
             Shares in accordance with the terms of the Contribution Deed;

         (b) the Executives shall procure that a board meeting of the Company is
             held at which, in accordance with article 7.5.4 of the Articles,
             the directors of the Company shall authorise a person to execute
             and deliver on behalf of each Defaulting Member (if any) the
             necessary transfer(s) as the Offeror may decide to the Offeror of
             any Ribotargets Shares;

         (c) each Offeree shall procure the delivery by it to the Offeror of:

             (i)    a duly executed transfer in favour of the Offeror or its
                    nominee(s) of all the Ribotargets Shares beneficially owned
                    by it other than the Apax Shares; and

             (ii)   the share certificates representing all the Ribotargets
                    Shares other than the Apax Shares (or an express indemnity
                    satisfactory to the Offeror in the case of any found to be
                    missing);

         (d) the Executives shall procure the delivery to the Offeror of:

             (i)    the certificate of incorporation, common seal (if any),
                    minute books, statutory registers and share certificate
                    books of each Group Company;

             (ii)   the resignations of the directors (except Mr Sturge) and the
                    secretary of each Group Company in the Agreed Form; and

             (iii)  copies (certified by the Company Secretary of the relevant
                    Group Company) of the minutes of the meetings referred to in
                    paragraphs (e) and (f) below;

         (e) the Executives shall procure that a board meeting of each Group
             Company is held at which it is resolved that (subject only to the
             satisfaction of the Escrow Condition):

             (i)    such persons as the Offeror nominates are appointed as
                    additional directors and the secretary of that Group
                    Company;

             (ii)   its registered office is changed to such address as the
                    Offeror may require ;

             (iii)  the transfers referred to in subclause 4.4(c)(i) above
                    (subject only to their being duly stamped, which shall be at
                    the cost of the Offeror) are approved for registration; and

                                       5
<PAGE>

             (iv)   its bank mandates are revised in such manner as the Offeror
                    may require.

5.       LOANS AND GUARANTEES

5.1      Each Offeree shall procure that on or before Completion all
         indebtedness due from it or any of its subsidiaries or subsidiary
         undertakings to any Group Company is satisfied in full without payment
         of interest.

5.2      Each Offeree shall procure that on Completion each Group Company is
         released from all guarantees and indemnities given by any Group Company
         in respect of the liabilities of such Offeree or any of its
         subsidiaries or subsidiary undertakings.

6.       WARRANTIES AND UNDERTAKINGS

6.1      On the basis that in making the Offer the Offeror shall not, and shall
         not be entitled to, rely on any representation, warranty, collateral
         contract or other assurance except those set out in this undertaking,
         the Offer Document and Form of Acceptance:

         (a) each Offeree warrants to the Offeror in the terms of the Offerees'
             Warranties in relation to itself only;

         (b) each US Offeree warrants to the Offeror in the terms of the US
             Offerees' Warranties in relation to itself only; and

         (c) Mr Sturge warrants to the Offeror in the terms of the Executive's
             Warranties,

         in each case as at the date of this undertaking and as at Completion.

6.2      The Offerees and Mr Sturge acknowledge that the Offeror has agreed to
         make the Offer in reliance on the warranties and undertakings on their
         part set out in this undertaking.

6.3      Each of the Warranties set out in the several paragraphs of the
         schedule headed "Warranties" is separate and independent and none of
         the Warranties shall be treated as qualified by any actual or
         constructive knowledge on the part of the Offeror.

6.4      Each US Offeree agrees that so long as the Consideration Shares remain
         "restricted securities" (as defined in Rule 144(a)(3) under the
         Securities Act), it will not (on its own behalf or on behalf of anyone
         else) offer, sell, transfer, pledge or otherwise dispose of the
         Consideration Shares except:

         (a) to the Offeror;

         (b) pursuant to an effective registration statement filed with the US
             Securities and Exchange Commission (it being acknowledged that the
             Offeror is under no obligation to file such a registration
             statement);

         (c) in an offshore transaction meeting the requirements of Rule 903 or
             Rule 904 of Regulation S under the Securities Act;

         (d) in a transaction exempt from registration under the Securities Act
             under Rule 144 (if available); or

                                       6
<PAGE>

         (e) in another transaction that is exempt from the registration
             requirements of the Securities Act to a transferee who has
             furnished such certificates and opinions of counsel as the Offeror
             may request,

         and in the case of subclauses 6.4(d) through (e) above, in compliance
         with any applicable securities laws of any state of the United States.
         Each US Offeree acknowledges that any Consideration Shares issued to it
         will be issued in certificated form bearing a legend to the effect of
         the foregoing restrictions in this clause 6.4.

6.5      Each US Offeree acknowledges that the Offeror will rely on the truth
         and accuracy of the certificates and opinions referred to in clause
         6.4(e) and agrees that if it becomes aware (without any obligation to
         make any enquiry in the case of the representations and warranties
         given by a purchaser of its Consideration Shares) that any of the
         representations and warranties made by it or by a purchaser in
         connection with the sale by it of any Consideration Shares are no
         longer accurate, the relevant US Offeree shall promptly notify the
         Offeror.

6.6      Each US Offeree agrees that in the event it transfers the Consideration
         Shares such US Offeree will notify any purchaser of the Consideration
         Shares from it of the resale restrictions relating to the Consideration
         Shares set out in clause 6.4.

6.7      Each US Offeree understands that in connection with any transfer of the
         Consideration Shares by it the Offeror may request, and if so requested
         such US Offeree will furnish, such certificates or other information as
         it may reasonably require to confirm that any such transfer complies
         with the restrictions set out in clause 6.4.

6.8      Each US Offeree agrees that so long as any of the Consideration Shares
         are "restricted securities" within the meaning of Rule 144(a)(3) under
         the Securities Act, it will not deposit such Consideration Shares into
         any unrestricted depositary receipt facility established or maintained
         by a depositary bank.

7.       LOCK-UP OF CONSIDERATION SHARES

         Subject to Completion, the Offerees shall observe and perform those
         provisions of the schedule headed "Lock-up of Consideration Shares" as
         are expressed to be observed and performed by each of them.

8.       CONFIDENTIALITY

8.1      Subject to clause 8.2 and the issue of the Press Release, no Offeree
         shall make, or permit any person connected with it to make, or permit
         any other member of its Offeree's Group to make any announcement or
         disclose any confidential information concerning the Offer, this
         undertaking or any ancillary matter before, on or after Completion.

8.2      Nothing in this clause prevents any announcement being made or any
         confidential information being disclosed:

         (a) with the written approval of the Offeror which in the case of any
             announcement shall not be unreasonably withheld or delayed; or

         (b) to the extent required by law or any competent tax or regulatory
             body to which a party is or may become subject, but a party
             required to disclose any confidential information shall promptly
             notify the Offeror to whom the information relates (where
             practicable and lawful to do so), before disclosure occurs and
             co-operate with those other parties regarding the timing and
             content of such disclosure or any action which

                                       7
<PAGE>

                  those other parties may reasonably elect to take to challenge
                  the validity of such requirement.

8.3      Nothing in this clause prevents disclosure of confidential information
         by any party:

         (a) to the extent that the information is in or comes into the public
             domain other than as a result of a breach of any undertaking or
             duty of confidentiality by any person; or

         (b) to that party's professional advisers, auditors or bankers, but
             before any disclosure to any such person the relevant party shall
             procure that he is made aware of the terms of this clause and shall
             use its reasonable endeavours to procure that each such person
             adheres to those terms as if he were bound by the provisions of
             this clause.

9.       NOTICES

9.1      Any notice or other formal communication given under this undertaking
         must be in writing and may be delivered, or sent by post to the party
         to be served at its address appearing in this undertaking or at such
         other address as it may notify to the other parties under this clause.
         Any notice or other document sent by post shall be sent by prepaid
         first class recorded delivery post (if within the United Kingdom) or by
         prepaid airmail (if its destination is elsewhere).

9.2      Any notice or other communication shall be deemed to have been given:

         (a) if delivered, at the time of delivery; or

         (b) if sent by post, at 10.00 a.m. on the second Business Day after it
             was put into the post.

9.3      In proving the giving of a notice or other formal communication it
         shall be sufficient to prove that delivery was made or that the
         envelope containing the communication was properly addressed and
         posted, either by prepaid first class recorded delivery post or by
         prepaid airmail as the case may be.

10.      FURTHER ASSURANCES

         On or after Completion each Offeree shall, at its own cost and expense,
         execute and do (or procure to be executed and done by any other
         necessary person) all such deeds, documents, acts and things as the
         Offeror may from time to time require in order to vest any of the
         Ribotargets Shares beneficially owned by it, in respect of which the
         Offer is accepted, in the Offeror or its assignee or as otherwise may
         be necessary to give full effect to this undertaking. Notwithstanding
         this clause, the Offerees shall not be liable to pay stamp duty in
         connection with the vesting of their Ribotargets Shares in respect of
         which the Offer is accepted, in the Offeror or its assignee.

11.      ASSIGNMENTS

         None of the rights or obligations of the Offerees under this
         undertaking may be assigned or transferred without the consent of all
         the parties.

                                       8
<PAGE>

12.      GENERAL

12.1     The receipt of the Company's Solicitors for any document to be
         delivered to an Offeree or Executive shall discharge the Offeror's
         obligation to deliver it to that Offeree or Executive.

12.2     Each of the obligations, Warranties and undertakings set out in this
         undertaking (excluding any obligation which is fully performed at
         Completion) shall continue in force after Completion and shall not be
         affected by the waiver of any Condition or notice given by the Offeror
         in respect of any Condition.

12.3     The Offeror may release or compromise in whole or in part the liability
         of any of the Offerees or Executives under this undertaking or grant
         any time or indulgence without affecting the liability of any other
         Offeree or Executive.

12.4     In accordance with article 4.1(a) and 9 of the Articles, each Offeree
         hereby consents to the transfer of the Ribotargets Shares pursuant to
         the terms of the Offer.

12.5     In accordance with clause 10.1 of the Ribotargets Shareholders'
         Agreement, the Investor Majority hereby consent to the transfer of the
         Ribotargets Shares pursuant to the terms of the Offer.

12.6     Time is not of the essence in relation to any obligation under this
         undertaking unless:

         (a) time is expressly stated to be of the essence in relation to that
             obligation; or

         (b) one party fails to perform an obligation by the time specified in
             this undertaking and another party serves a notice on the
             defaulting party requiring it to perform the obligation by a
             specified time and stating that time is of the essence in relation
             to that obligation.

12.7     This undertaking may be executed in any number of counterparts. This
         has the same effect as if the signatures on the counterparts were on a
         single copy of this undertaking.

12.8     The rights of each party under this undertaking:

         (a) may be exercised as often as necessary;

         (b) are cumulative and not exclusive of rights and remedies provided by
             law; and

         (c) may be waived only in writing and specifically.

         Delay in exercising or non-exercise of any such right is not a waiver
         of that right.

12.9     A person who is not a party to this undertaking may not enforce any of
         its terms under the Contracts (Rights of Third Parties) Act 1999 except
         where a term in this undertaking is expressed to be for the benefit of
         such person.

13.      WHOLE AGREEMENT

13.1     This undertaking, and the documents referred to in it and in the Offer
         Document, and the Covenant Deed contain the whole agreement between the
         parties relating to the Offer and the transactions contemplated by this
         undertaking and supersede all previous agreements, whether oral or in
         writing, between the parties relating to these transactions.

                                       9
<PAGE>

13.2     Each Offeree acknowledges that in accepting the Offer, and agreeing to
         enter into this undertaking it has not relied or will not rely on any
         representation, warranty, collateral contract or other assurance
         (except, if any, those set out in this undertaking and the documents
         referred to in it) made by or on behalf of any other party before the
         signature of this undertaking. Each Offeree waives all rights and
         remedies which, but for this subclause, might otherwise be available to
         it in respect of any such representation, warranty, collateral contract
         or other assurance.

13.3     Nothing in the preceding subclause limits or excludes any liability for
         fraud.

14.      GOVERNING LAW

14.1     This undertaking is governed by English law.

14.2     The English courts have exclusive jurisdiction to settle any dispute
         arising out of or in connection with this undertaking and the parties
         submit to the exclusive jurisdiction of the English courts.

14.3     Each Offeree whose registered office or principal private residence is
         not in England and Wales irrevocably appoints Mitre Secretaries Limited
         of Mitre House, 160 Aldersgate Street, London EC1A 4DD as its agent in
         England for service of process, other than those Offerees in the
         schedule headed "The Offerees" numbered 13-24 (who shall appoint Apax
         Partners Ltd of 1 Portland Place, London W1B 1PT) and the Offeree
         numbered 26 (who shall appoint JP Morgan Partners Europe Limited, 14th
         Floor, 125 London Wall, London, EC2Y 5AJ).

14.4     Each Offeree waives any right it may have to a jury trial of any claim
         or cause of action in connection with this undertaking. This
         undertaking may be filed as a written consent to trial by court.

AS WITNESS this undertaking has been executed by the parties (or their duly
authorised representatives) as a deed and has been delivered on the date stated
at the beginning of this undertaking.

                                       10
<PAGE>

                                   SCHEDULE 1

                                  THE OFFEREES

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES      RIBOTARGETS SHARES
                                                                                                           TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
1.   3i Group plc                                       --           1,472,779            683,761                257,255
     91 Waterloo Road
     London SE1 8XP

2.   3i Bioscience Investment Trust plc                 --                  --            170,940                 64,250
     91 Waterloo Road
     London SE1 8XP

3.   Advent VCT plc                                     --             841,590            166,667                     --
     25 Buckingham Gate
     London SW1E 6LD

4.   Advent Private Equity Fund III 'A'                 --                  --            486,573                183,046
     25 Buckingham Gate
     London SW1E 6LD
</TABLE>

                                       11
<PAGE>

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES      RIBOTARGETS SHARES
                                                                                                           TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
5.   Advent Private Equity Fund III 'B'                 --                  --            238,423                 89,694
     25 Buckingham Gate
     London SW1E 6LD

6.   Advent Private Equity Fund III 'C'                 --                  --             66,508                 25,020
     25 Buckingham Gate
     London SW1E 6LD

7.   Advent Private Equity Fund III 'D'                 --                  --            130,819                 49,213
     25 Buckingham Gate
     London SW1E 6LD

8.   Advent Private Equity Fund III                     --                  --             18,823                  7,081
     GmbH & Co KG
     25 Buckingham Gate
     London SW1E 6LD

9.   Advent Private Equity Fund III                     --                  --             15,686                  5,901
     Affiliates
     c/o 25 Buckingham Gate
     London  SW1E 6LD

10.  Advent Management III Limited                      --                  --              4,706                  1,770
     Partnership
     25 Buckingham Gate
     London  SW1E 6LD
</TABLE>

                                       12
<PAGE>

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES       RIBOTARGETS SHARES
                                                                                                            TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
11.  Alan Driver                                     5,700                  --                 --                     --
     5 Kohat Road
     London
     SW19 8LD

12.  Alpinvest Holding NV                               --             625,000            420,438                158,190
     c/o NIB Capital Private Equity NV
     Jachthavenweg 118, 1081 KJ
     The Netherlands

13.  Apax UK V-A, L.P.                                  --           1,854,368                 --                     --
     1 Portland Place
     London W1B 1PT

14.  Apax UK V-B, L.P.                                  --           1,923,995                 --                     --
     1 Portland Place
     London W1B 1PT

15.  Apax Europe V-A, L.P.                              --                  --          1,452,264                546,370
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

16.  Apax Europe V-B, L.P.                              --                  --            261,337                 98,320
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D
</TABLE>

                                       13
<PAGE>

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES      RIBOTARGETS SHARES
                                                                                                           TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
17.  Apax Europe V-C GmbH & Co. KG                      --                  --            148,743                 55,960
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

18.  Apax Europe V-D, L.P.                              --                  --            195,365                 73,500
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

19.  Apax Europe V-E, L.P.                              --                  --            194,688                 73,245
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

20.  Apax Europe V-F, C.V.                              --                  --             34,235                 12,880
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

21.  Apax Europe V-G, C.V.                              --                  --             34,235                 12,880
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D
</TABLE>

                                       14
<PAGE>

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES      RIBOTARGETS SHARES
                                                                                                           TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
22.  Apax Europe V-1 L.P.                               --                  --              1,090                    410
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

23.  Apax Europe V-2 L.P.                               --                  --              1,090                    410
     13-15 Victoria Road
     St Peter Port
     Guernsey GY1 32D

24.  AP V GmbH & Co KG                                  --                  --            258,117                 97,105
     Nussbaumstrasse 8
     80336 Munich
     Germany

25.  Caduceus Private Investment LLP                    --                  --            246,941                 92,970
     c/o Orbimed Advisors
     767 3rd Avenue
     New York NY 10017

26.  J.P. Morgan Partners (BHCA) Limited                --                  --          1,282,052                482,340
     1221 Avenue of the Americas
     New York 10020
     USA

27.  Medical Research Council                      412,500                  --                 --                     --
     20 Park Crescent
     London W1N 4AL
</TABLE>

                                       15
<PAGE>

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES       RIBOTARGETS SHARES
                                                                                                            TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
28.  Orbimed Associates LLC                             --                  --              5,140                  1,950
     c/o Orbimed Advisors
     767 3rd Avenue
     New York NY 10017

29.  PW Juniper Crossover Fund LLC                      --                  --            116,508                 43,830
     c/o Orbimed Advisors
     767 3rd Avenue
     New York NY 10017

30.  Quester VCT 2 Plc                                  --             187,500            196,765                     --
     29 Queen Anne's Gate
     London  SW7H 9BY

31.  Quester VCT 3 Plc                                  --             187,500            196,765                     --
     29 Queen Anne's Gate
     London  SW7H 9BY

32.  Rendex N.V                                         --             625,000                 --                     --
     Straalstraat 2
     B-2170 Antwerpen
     Belgium

33.  Simon Sturge                                   75,000                  --                 --                     --
     Granta Park
     Abington
     Cambridge CB1 6GB
</TABLE>

                                       16
<PAGE>

<TABLE>
<CAPTION>
               (A)                                 (B)                (C)                   (D)                  (E)

                                                 NUMBER OF         NUMBER OF A         NUMBER OF B           NUMBER OF NEW
     NAME AND ADDRESS OF OFFEREE              ORDINARY SHARES    ORDINARY SHARES     ORDINARY SHARES      RIBOTARGETS SHARES
                                                                                                            TO BE SUBSCRIBED
     ---------------------------              ---------------    ---------------     ---------------    ------------------------
<S>                                              <C>               <C>                 <C>                    <C>
34.  Professor Colin S Goodchild                    20,583                  --                 --                     --
     38 Somers Avenue
     Malvern
     Victoria 3144
     Australia

35.  Monash Commercial Proprietary Limited           7,917                  --                 --                     --
     Administration Building 3B
     Monash University
     Monash
     Victoria 3800
     Australia

36.  Dr Ray Nadeson                                  3,167                  --                 --                     --
     PO Box 2297,
     Prahran
     Victoria 3181
     Australia

37.  Biocomm Services Proprietary Limited            1,666                  --                 --                     --
     Level 6
     350 Collins Street
     Melbourne
     Victoria 3000
     Australia
</TABLE>

                                       17
<PAGE>

                                   SCHEDULE 2

                                   THE COMPANY

<TABLE>
<S>                                  <C>
Name:                                 Ribotargets Holdings plc

Registered number:                    3339154

Registered office:                    Granta Park
                                      Abington
                                      Cambridge
                                      CB1 6GB

Date and place of incorporation:      6th June, 1997 at Companies House, London

Directors:                            Mr J C Benjamin
                                      Mr I F Kent (Chairman)
                                      Dr D J C Knowles
                                      Mrs S D Lowther
                                      Mr P Rattle
                                      Dr J Reffin
                                      Mr S J Sturge
                                      Dr D U'Prichard
                                      Mr C H Samler
                                      Dr B C Ross
                                      Dr H Finch

Secretary:                            Mitre Securities Limited
                                      Mitre House
                                      160 Aldersgate Street
                                      London
                                      EC1A 4DD

Accounting reference date:            31st December

Auditors:                             PricewaterhouseCoopers

Authorised capital:                   3,620,500 Ordinary Shares of 10p each
                                      7,928,630 A Ordinary Shares of 10p each
                                      11,000,007 B Ordinary Shares of 10p each
                                      6,220,057 Unclassified Shares of Pound Sterling1 each

Issued capital:                       526,533 Ordinary Shares of 10p each
                                      7,718,233 A Ordinary Shares of 10p each
                                      3,923,808 B Ordinary Shares of 10p each

</TABLE>

                                       18
<PAGE>

                                   SCHEDULE 3

                                 THE SUBSIDIARY

<TABLE>
<S>                                  <C>
Name:                                 Ribotargets Limited

Registered number:                    3219804

Registered office:                    Granta Park
                                      Abington
                                      Cambridge
                                      CB1 6GB

Date and place of incorporation:      4th September, 1996 at Companies House, Cardiff

Directors:                            Dr D J C Knowles
                                      Mrs S D Lowther
                                      Mr S J Sturge

Secretary:                            Mitre Securities Limited
                                      Mitre House
                                      160 Aldersgate Street
                                      London
                                      EC1A 4DD

Accounting reference date:            31st December

Auditors:                             PricewaterhouseCoopers

Authorised capital:                   100 ordinary shares of Pound Sterling1 each

Issued capital:                       2 ordinary shares of Pound Sterling1 each
</TABLE>

                                       19
<PAGE>

                                   SCHEDULE 4

                                   WARRANTIES

                                     PART 1

                              OFFEREES' WARRANTIES

1.       CAPACITY

(a)      Each Offeree has the requisite power and authority to enter into and
         perform, and has taken all necessary action to authorise the execution
         and performance of, its obligations under this undertaking.

(b)      All consents, approvals, authorisations, orders, registrations,
         clearances and qualifications of or with any court or government agency
         or body having jurisdiction over each Offeree or any stock exchange
         authorities required for the execution and delivery by each Offeree of
         this undertaking to be duly and validly authorised, and required for
         Completion, have been obtained or made by each Offeree and insofar as
         they relate to each Offeree, are in full force and effect.

2.       VALID OBLIGATIONS

         This undertaking constitutes valid and binding obligations of each
         Offeree.

3.       OWNERSHIP OF RIBOTARGETS SHARES

(a)      Each Offeree has not given any option, right to acquire, mortgage,
         charge, pledge, lien or other form of security or encumbrance on, over
         or affecting any of the Ribotargets Shares beneficially owned by it
         (save for the grant of floating charges which have not crystallised)
         and there is no agreement or commitment entered into by it to give or
         create any of the foregoing.

(b)      Each Offeree is entitled to transfer or procure the transfer of the
         full legal and beneficial ownership in the Existing Ribotargets Shares
         beneficially owned by it to the Offeror on the terms set out in the
         Offer.

(c)      On Completion, each Relevant Investor shall be entitled to transfer or
         procure the transfer of the full legal and beneficial ownership in the
         New Ribotargets Shares beneficially owned by it to the Offeror on the
         terms set out in the Offer.

4.       NON-US PERSONS

         Other than the US Offerees, each Offeree is not a US Person and was not
         or will not be in the United States (a) at the time the Offer is made,
         (b) on the date of the execution and delivery of this undertaking, and
         (c) on the date of Completion.

5.       ACCURACY OF INFORMATION

         All statements relating to each Offeree in Part VIII of the Circular
         and Listing Particulars are true and accurate and are not misleading by
         omission or by misstatement in the context in which they are made.

                                       20
<PAGE>

                                     PART 2

                             US OFFEREES' WARRANTIES

Each US Offeree hereby represents, warrants and agrees as follows:

1.       Each US Offeree understands that the Consideration Shares (i) have not
         been and will not be registered under the Securities Act, (ii) are
         being sold to the US Offerees in a transaction exempt from the
         registration requirements of the Securities Act and (iii) are
         "restricted securities" as defined by Rule 144(a)(3) under the
         Securities Act.

2.       Each US Offeree is an institutional "accredited investor" as defined in
         Rule 501(a)(1), (2), (3), (7) or (8) of Regulation D under the
         Securities Act.

3.       Each US Offeree is acquiring the Consideration Shares for its own
         account, for investment purposes only and not with a view to any resale
         or distribution of the Consideration Shares.

4.       Each US Offeree has such knowledge, sophistication and experience in
         financial and business matters as to be capable of evaluating the
         merits and risks of its investment in the Consideration Shares. At the
         present time, each US Offeree is able to bear the economic risk of an
         investment in the Consideration Shares, has adequate means to provide
         for its current and contingent needs, has no need for liquidity with
         respect to an investment in the Ribotargets Shares, and can afford a
         complete loss of such investment.

5.       Each US Offeree has access to such financial and other information
         concerning the Offeror and the Consideration Shares as each US Offeree
         has deemed necessary or desirable in connection with the sale of the
         Consideration Shares, has had adequate time to consider whether to
         accept the Offer and has had the opportunity to ask questions of
         representatives of the Offeror concerning the Offer, the Offeror and
         the Consideration Shares.

6.       Each US Offeree has made its own financial decision in respect of the
         Offer and the Consideration Shares on the basis of its independent
         investigation and appraisal of the business, financial condition,
         prospects, creditworthiness, status and affairs of the Offeror and of
         the Consideration Shares. Each US Offeree has informed itself, to the
         extent that each US Offeree deems appropriate, as to the potential tax
         consequences, legal and regulatory requirements and foreign exchange
         restrictions that may be relevant to the sale of the Consideration
         Shares.

                                     PART 3

                             EXECUTIVE'S WARRANTIES

1.       The Existing Ribotargets Shares, the New Ribotargets Shares and the
         Apax Shares will at Completion constitute the whole of the issued and
         allotted share capital of the Company (other than any shares that may
         be allotted and issued under the Ribotargets Option Schemes).

2.       Other than pursuant to the Ribotargets Option Schemes or the
         Contribution Deed, there is no option or right to subscribe any shares
         in the capital of Ribotargets, and there is no agreement or commitment
         to give or create any of the foregoing.

3.       All consents, approvals, authorisations, orders, registrations,
         clearances and qualifications of or with any court or government agency
         or body having jurisdiction over the Group

                                       21
<PAGE>

         Companies required for Completion have been obtained or made and are in
         full force and effect.

                                       22
<PAGE>

                                   SCHEDULE 5

                         LOCK-UP OF CONSIDERATION SHARES

1.       For the purposes of this schedule:

         (a) DISPOSE shall include any dealings in derivatives referenced to
             British Biotech Ordinary Shares (whether or not involving the
             possibility of delivery of British Biotech Ordinary Shares) and
             which in any case indirectly amounts to a disposal;

         (b) INTEREST shall have the meaning given to it in section 208 of the
             Companies Act 1985 excluding section 209 thereof; and

         (c) QUALIFYING OFFEREE means an Offeree whose beneficial holding of
             Lock-up Shares immediately following Completion amounts to less
             than one per cent. of the aggregate issued ordinary share capital
             of the Offeror immediately following Completion.

2.       Subject to paragraph 8 of this schedule, each Offeree covenants to the
         Offeror that it shall not, and its nominees shall not, save with the
         prior written consent of the Offeror, sell, transfer, mortgage, charge,
         pledge, grant options over or otherwise dispose of or enter into any
         agreement or arrangement (whether or not legally binding) to sell,
         transfer, mortgage, charge, pledge, grant options over or otherwise
         dispose of any of the Consideration Shares allotted to it or its
         nominees (LOCK-UP SHARES) or any direct or indirect interest in any
         such Lock-up Shares, or any rights arising from or attached to any such
         Lock-up Shares, or enter into any contract for differences, swap,
         evidence of indebtedness or other derivatives transaction that changes
         in value or determines value by reference to British Biotech Ordinary
         Shares, or enter into any transaction having the same economic effect
         as any of the foregoing at any time during the period of six calendar
         months following Completion (the INITIAL LOCK-UP PERIOD). British
         Biotech agrees and acknowledges that in determining whether to provide
         its written consent to an Offeree's request to release all or any of
         such Offeree's Lock-up Shares in accordance with this paragraph 2 the
         provisions of paragraph 3 of this schedule shall not be taken into
         consideration.

3.       The board of directors of the Offeror may, at its discretion following
         completion by the Offeror of a corporate transaction other than the
         Offer, release the Offerees from the restriction contained in paragraph
         2 above in respect of up to a maximum aggregate number of Lock-up
         Shares equal to 25% of each Offeree's total Lock-up Shares (RELEASED
         SHARES), provided that any disposal of such Released Shares in the
         Initial Lock-up Period shall be made through the Offeror's nominated
         broker (currently Cazenove & Co. Limited).

4.       Subject to paragraphs 5 and 8 of this schedule, each Offeree covenants
         to the Offeror that during the period of eight calendar months after
         the Initial Lock-up Period has expired (the INTERIM LOCK-UP PERIOD) it
         will:

         (a) notify the Offeror or its nominated broker in writing prior to the
             disposal of any Lock-up Shares; and

         (b) not (and will procure that its nominees do not) dispose of any
             Lock-up Shares other than through the Offeror's nominated broker
             (provided that if an Offeree receives an unsolicited offer to
             acquire Lock-up Shares then the preceding provision of this
             subparagraph (b) shall not apply to a disposal to the person who
             made such offer but

                                       23
<PAGE>

             such Offeree shall be obliged to notify the Offeror's nominated
             broker in writing prior to such disposal).

5.       During the Interim Lock-up Period the Qualifying Offerees shall
         together be entitled to dispose of Lock-up Shares up to a maximum
         aggregate of Lock-up Shares equal to three per cent. of the issued
         ordinary share capital of the Offeror immediately following Completion
         without using the Offeror's nominated broker to effect such disposal.

6.       An Offeree wishing to dispose of any Lock-up Shares during the period
         of six months after the Interim Lock-up Period has expired must consult
         with the Offeror's nominated broker about such disposal for a
         reasonable period of time prior to the proposed disposal, including,
         without limitation, with respect to the method and timing of the
         disposal.

7.       Each Offeree undertakes that prior to the end of the Initial Lock-up
         Period it will not acquire or offer to acquire, or cause another person
         to acquire or offer to acquire any direct or indirect interest in any
         British Biotech Ordinary Shares or enter into any agreement or
         arrangement (whether or not legally binding) or do or omit to do any
         act as a result of which it or any person may acquire any direct or
         indirect interest in any British Biotech Ordinary Shares if the effect
         of such act or omission would be to oblige any person to make a
         mandatory offer for the Offeror under Rule 9 of the Code.

8.       Nothing in this schedule shall prevent:

         (a) a disposal pursuant to a court order;

         (b) a renunciation of a right to subscribe for shares where such right
             is derived from the Lock-up Shares or a failure to take up any such
             right;

         (c) if the Offeror makes an offer to its shareholders to purchase its
             own shares or proposes a scheme of arrangement, a disposal or
             agreement to dispose of any Lock-up Shares to the Offeror pursuant
             to that offer or scheme; or

         (d) an Offeree or its nominee from accepting a general offer made for
             all the issued share capital of the Offeror provided such offer is
             recommended by the board of directors of the Offeror.

9.       The provisions of this schedule shall also apply to any other
         securities for the time being representing or derived from the Lock-up
         Shares (whether by way of consolidation, sub-division, capitalisation
         or rights issue or otherwise), other than any such securities as may be
         acquired for cash by way of rights or other issue, and references in
         this clause to the Lock-up Shares shall be construed accordingly.

                                       24
<PAGE>

                                   SCHEDULE 6

                                 PRE-COMPLETION

1.       ACCESS

         Pending Completion the Executives shall:

         (a) procure that the Offeror, its agents and representatives are given
             full access to the properties and to the books and records of the
             Group Companies during normal business hours on any Business Day
             and on reasonable notice to the Executives; and

         (b) provide such information regarding the businesses and affairs of
             the Group Companies as the Offeror may reasonably request,

         in each case insofar as such access and the provision of such
         information is compatible with competition law and, in particular, does
         not involve access to or the provision of business secrets of any of
         the Group Companies.

2.       CONVERSION OF SHARES

         Pending Completion, each Offeree who is a beneficial owner of A
         Ordinary Shares or B Ordinary Shares undertakes that it and its
         nominees shall not exercise its rights, pursuant to articles
         2.2(d)(i)(A) and 2.2(d)(i)(C) of the Articles, to convert any A
         Ordinary Shares or B Ordinary Shares beneficially owned by such Offeree
         into Ordinary Shares.

3.       CONDUCT OF BUSINESS

         Pending Completion each Executive shall exercise all rights and powers
         available to it so as to procure that, except with the written consent
         of the Offeror, such consent not to be unreasonably withheld or
         delayed, no Group Company shall:

         (a) incur any expenditure in respect of:

             (i)    any Internal Cost in excess of Pound Sterling20,000 per item
                    or Pound Sterling100,000 in aggregate (other than
                    expenditure expressly specified in the Ribotargets Budget in
                    respect of any Internal Cost); and

             (ii)   any External Cost in excess of Pound Sterling50,000 per
                    item; or

         (b) dispose of or grant any option or right of pre-emption in respect
             of any part of its assets; or

         (c) dispose of or grant any licence in respect of any interest in its
             Intellectual Property Rights other than pursuant to an agreement
             relating to the transfer of materials or a confidentiality
             agreement entered into in the ordinary course of its business; or

         (d) borrow any money; or

         (e) enter into any unusual or abnormal contract or commitment or:

             (i)    grant any lease or third party right in respect of any real
                    estate or transfer or otherwise dispose of any real estate;

                                       25
<PAGE>

             (ii)   make any loan;

             (iii)  enter into any leasing, hire purchase or other agreement or
                    arrangements for payment on deferred terms; or

         (f) declare, make or pay any dividend or other distribution; or

         (g) grant, issue or redeem any mortgage, charge, debenture or other
             security or give any guarantee or indemnity; or

         (h) make any change in the terms and conditions of employment of any of
             its directors or employees or employ or terminate the employment of
             any person save for cause; or

         (i) make, or announce to any person any proposal to make, any change or
             addition to any retirement/death/disability benefit in respect of
             any of its directors or employees or former directors or former
             employees (or any dependant of any such person) or to the Scheme or
             grant or create any additional retirement/death/disability benefit
             or, without limiting the foregoing, take any action or allow any
             action to be taken in relation to the Scheme other than in the
             ordinary course of administering the Scheme or omit to take any
             action reasonably required for the ordinary operation of the
             Scheme; or

         (j) permit any of its insurances to lapse; or

         (k) save as envisaged by this undertaking, create, issue, purchase or
             redeem any class of share or loan capital, or grant any option or
             right to subscribe any share or loan capital other than pursuant to
             the Contribution Deed; or

         (l) save as required by this undertaking, pass any resolution of its
             shareholders or any class of shareholders, whether in general
             meeting or otherwise other than pursuant to the Contribution Deed;
             or

         (m) agree, conditionally or unconditionally, to do any of the
             foregoing; or

         (n) in any other way depart from the ordinary course of its day-to-day
             trading.

                  Each Offeree shall not give any instruction to the Executives
         or to the Group Companies to effect any of the matters referred to in
         this paragraph 3 and shall, on the written request of the Offeror,
         assist (in so far as it is lawfully able) the Executives and the Group
         Companies in complying with their obligations in this paragraph 3.

4.       QUALIFICATIONS

         Paragraph 3 of this schedule shall not operate so as to restrict or
         prevent:

         (a) any matter reasonably undertaken in response to events beyond the
             control of any Offeree or any Group Company, with the intention of
             minimising any adverse effect of such events provided that an
             Executive will inform the Offeror of such matters as soon as
             reasonably practicable;

         (b) completion or performance of any obligations undertaken pursuant to
             any contract or arrangement entered into and disclosed to the
             Offeror prior to the date of this undertaking;

                                       26
<PAGE>

         (c) any other matter undertaken at the written request of the Offeror;
             or

         (d) any action or omission which any member of the Group is required to
             take or omit to take by any applicable law or regulation.

5.       NOTICE OF ANY CHANGE

5.1      Each Offeree shall immediately notify the Offeror in writing of any
         matter or thing which arises or becomes known to it before Completion
         which:

         (a) constitutes (or would after the lapse of time constitute) a breach
             of its Warranties or the undertakings or other obligations on its
             part under this undertaking; or

         (b) indicates that any statement in Part VIII the Circular and Listing
             Particulars relating to it is or might be untrue or misleading.

5.2      Each Executive shall immediately notify the Offeror in writing of any
         matter or thing which arises or becomes known to him before Completion
         which:

         (a) constitutes (or would after the lapse of time constitute) a breach
             of, in the case of Mr Sturge only, his Warranties or, in the case
             of the Executives, the undertakings or other obligations on his
             part under this undertaking; or

         (b) indicates that any statement in the Circular and Listing
             Particulars relating to the Group Companies is or might be untrue
             or misleading; or

         (c) is or might be material in the context of any assumption or other
             matter relevant to any forecast or statement about the Group
             Companies in the Circular and Listing Particulars.

5.3      Each Offeree and Executive shall take all reasonable steps promptly to
         provide the Offeror with any further information which the Offeror
         reasonably requests of it if:

         (a) the Offeror is notified or otherwise becomes aware of anything such
             as is referred to in the above provision of this paragraph 5; or

         (b) the Offeror becomes aware of a significant change or new matter
             which may require the Offeror to prepare supplementary listing
             particulars.

                                       27
<PAGE>

                                   SCHEDULE 7

                          BRITISH BIOTECH BALANCE SHEET

<TABLE>

<S>                                                     <C>           <C>            <C>
1   FIXED ASSETS                                                                       O

    CURRENT ASSETS

2            Interest receivable                            O

3            Tax receivable                                 O

4            Other debtors                                  O

5            Cash & short terms investments                 O            O

    CURRENT LIABILITIES

6            Trade creditors                                O

7            Accruals & other creditors                     O

8            Lease creditors                                O

9            Mortgage                                       O

10           Tax and social security                        O

11           Offer costs                                    O

12           Deferred income                                O           (o)

13  LONG TERM LIABILITIES                                               (o)

14  NET WORKING CAPITAL                                                                O

15  NET ASSETS                                                                         O
</TABLE>

                                       28
<PAGE>

                                   SCHEDULE 8

                            RIBOTARGETS BALANCE SHEET

<TABLE>

<S>                                                     <C>           <C>            <C>
1   FIXED ASSETS                                                                       O

    CURRENT ASSETS

2         Other debtors                                     O

3         Corporation tax receivable                        O

4         Prepayments and accrued income                    O

5         Cash & short terms investments                    O            O

    CURRENT LIABILITIES

6         Trade creditors                                   O

7         Finance lease and hire purchase obligations       O

8         Taxation and social security                      O

9         Other creditors                                   O

10        Accruals and deferred income                      O

11        Offer costs                                       O           (o)

12  LONG TERM LIABILITIES                                               (o)

13  NET WORKING CAPITAL                                                                O

14  NET ASSETS                                                                         O
</TABLE>

                                       29
<PAGE>

                                   SCHEDULE 9

                                 INTERPRETATION

1.       In this undertaking:

         AGREED FORM means, in relation to any document, the form of that
         document which has been initialled for the purpose of identification by
         or on behalf of the Company's Solicitors and the Offeror's Solicitors;

         APAX SHARES means an additional 500 A Ordinary Shares beneficially
         owned by Apax Europe V-A, L.P.;

         A ORDINARY SHARES means the A ordinary shares of Pound Sterling0.10
         each in the capital of the Company;

         ARTICLES means the articles of association of the Company as at the
         date of this undertaking;

         B ORDINARY SHARES means the B ordinary shares of Pound Sterling0.10
         each in the capital of the Company and B ORDINARY SHAREHOLDER means a
         holder of any of them;

         BRITISH BIOTECH BALANCE SHEET means the consolidated balance sheet of
         the Offeror's Group as at 31st March, 2003 prepared in the form and
         including the items shown in the schedule headed "British Biotech
         Balance Sheet", including, without limitation, full accruals for all
         costs incurred in connection with the Offer, and prepared in accordance
         with the accounting policies, principles, practices, evaluation rules
         and procedures, methods and bases adopted by the Offeror in the
         preparation of the British Biotech Management Accounts;

         BRITISH BIOTECH MANAGEMENT ACCOUNTS means the unaudited management
         accounts of the Offeror for the period of ten months ended 28th
         February, 2003 in the Agreed Form;

         BRITISH BIOTECH NET WORKING CAPITAL means the net working capital of
         British Biotech as at 31st March, 2003 as indicated on line 14 of the
         British Biotech Balance Sheet;

         BRITISH BIOTECH ORDINARY SHARES means ordinary shares of 5 pence each
         in the capital of the Offeror;

         BUSINESS DAY means a day (other than a Saturday or Sunday) on which
         banks are generally open in London for normal business;

         CIRCULAR AND LISTING PARTICULARS means the document to be dated on or
         about the date of this undertaking comprising the combined circular to
         shareholders of the Offeror and listing particulars of the Offeror in
         connection with the Offer;

         CODE means The City Code on Takeovers and Mergers;

         COMPANY has the meaning given to it in recital (A);

         COMPANY'S SOLICITORS means CMS Cameron McKenna of Mitre House, 160
         Aldersgate Street, London EC1A 4DD (ref: MGD);

                                       30
<PAGE>

         COMPLETION means completion of the acquisition of the Ribotargets
         Shares, in respect of which the Offer has been accepted, by the Offeror
         and the admission to listing and trading of the Consideration Shares;

         COMPULSORY SALE NOTICE means the notice to be issued by the Company (in
         accordance with article 7.5.2 of the Articles) to each Ribotargets
         Shareholder who has not entered into this undertaking, giving the
         details contained in the Selling Notice and requiring the Ribotargets
         Shareholders to sell their holdings of shares in Ribotargets to the
         Offeror on the terms contained in the Selling Notice;

         CONDITIONS means the conditions set out in paragraph 1 of Part A of
         Appendix I to the Offer Document;

         CONFIDENTIALITY AGREEMENT means the confidentiality agreement between
         the Company and the Offeror dated 6th December, 2002;

         CONSIDERATION SHARES means the 33,375,889 British Biotech Ordinary
         Shares to be allotted and issued to the Ribotargets Shareholders or
         their nominees credited as fully paid in accordance with the terms of
         the Offer Document;

         CONTRIBUTION DEED means the contribution and termination deed in the
         Agreed Form entered into among the existing Ribotargets Shareholders
         and the Company on or before the date of this undertaking pursuant to
         which, inter alia, the Relevant Investors will subscribe for further B
         Ordinary Shares at or prior to Completion;

         COVENANT DEED means the deed poll entered into by British Biotech prior
         to the date of this document giving covenants with respect to the
         conduct of British Biotech's business pending Completion;

         DEFAULTING MEMBER means any member of the Company who fails to comply
         with the terms of the Compulsory Sale Notice;

         EMPLOYEE includes a director and any officer of the Company whether or
         not he has entered into or works under (or, where the employment has
         ceased, worked under) a contract of employment;

         ENCUMBRANCE means any mortgage, charge (fixed or floating), pledge,
         lien, option, right to acquire, assignment by way of security, trust
         arrangement for the purpose of providing security or any other security
         interest of any kind, including retention arrangements and any
         agreement to create any of the foregoing;

         ESCROW COMPLETION means the completion in escrow of the acquisition by
         the Offeror of the Ribotargets Shares, in respect of which the Offer
         has been accepted, save for satisfaction of the Escrow Condition, in
         accordance with the clause headed "Completion";

         ESCROW CONDITION means the Condition in paragraph 1(d) of Part A of
         Appendix I to the Offer Document having been satisfied and the Offer
         not having been withdrawn before satisfaction of such Condition;

         EXECUTIVE'S WARRANTIES means each of the statements set out in Part 3
         of the schedule headed "Warranties";

                                       31
<PAGE>

         EXISTING RIBOTARGETS SHARES means the existing Ordinary Shares, A
         Ordinary Shares and B Ordinary Shares set out opposite each Offeree's
         name in columns (B), (C) and (D) of the schedule headed "The Offerees";

         EXTERNAL COST means any category of expenditure other than an Internal
         Cost;

         FORM OF ACCEPTANCE has the meaning given to it in recital (D);

         GROUP COMPANIES means the Company and the Subsidiary and GROUP COMPANY
         means either of them;

         INTELLECTUAL PROPERTY RIGHTS means rights in trade marks, rights in
         designs, patents, copyright, moral rights, database rights, rights in
         know-how and all other intellectual property rights in each case
         whether registered or unregistered, together with applications for the
         grant of any of these rights, and together also with all rights or
         forms of protection having equivalent or similar effect to any of the
         foregoing which may subsist anywhere in the world;

         INTERNAL COST means any category of expenditure which falls (on the
         basis of preparation consistent with Ribotargets's prior financial
         year) to be treated as an internal cost for the purposes of preparing
         the Ribotargets Budget;

         INVESTOR MAJORITY means the holders of at least 65 per cent. by nominal
         value of the B Ordinary Shares and the A Ordinary Shares;

         LETTER TO OPTION HOLDERS means the letter in the Agreed Form to be sent
         to members of the Ribotargets Option Schemes;

         LONG STOP DATE has the meaning given to it in clause 3.4;

         NEW RIBOTARGETS SHARES means the B Ordinary Shares which are subscribed
         by the Relevant Investors at or prior to Completion in accordance with
         the terms of the Contribution Deed and Clause 4.4;

         OFFER has the meaning given to it in recital (D);

         OFFER DOCUMENT has the meaning given to it in recital (D);

         ORDINARY SHARES means the ordinary shares of Pound Sterling0.10 each in
         the capital of the Company;

         OFFEREE'S GROUP means each Offeree and all its subsidiary undertakings
         and parent undertakings (other than the Group Companies) from time to
         time;

         OFFEREES' WARRANTIES means each of the statements set out in Part 1 of
         the schedule headed "Warranties";

         OFFEROR'S GROUP means the Offeror and all its subsidiary undertakings
         (other than the Group Companies) from time to time;

         OFFEROR'S SOLICITORS means Allen & Overy of One New Change, London EC4M
         9QQ;

         PRESS RELEASE means the press release in the Agreed Form announcing the
         execution of this undertaking, the making of the Offer and the
         publication of the Circular and Listing Particulars;

                                       32
<PAGE>

         RELEVANT INVESTORS means the Ribotargets Shareholders named in column
         (1) of schedule 4 to the Contribution Deed;

         RETIREMENT/DEATH/DISABILITY BENEFIT means any pension, lump sum,
         gratuity or other like benefit given or to be given on retirement or on
         death, or in anticipation of retirement, or, in connection with past
         service, after retirement or death, or to be given on or in
         anticipation of or in connection with any change in the nature of the
         service of the employee in question or given or to be given on or in
         connection with the illness, injury or disability of, or suffering of
         any accident by, an employee;

         RIBOTARGETS BALANCE SHEET means the consolidated balance sheet of the
         Group Companies as at 31st March, 2003 prepared in the form and
         including the items shown in the schedule headed "Ribotargets Balance
         Sheet", including, without limitation, full accruals for all costs
         incurred in connection with the Offer, and prepared in accordance with
         the accounting policies, principles, practices, evaluation rules and
         procedures, methods and bases adopted by the Company in the preparation
         of the Ribotargets Management Accounts;

         RIBOTARGETS BUDGET means the 2003 budget for Ribotargets in the Agreed
         Form;

         RIBOTARGETS MANAGEMENT ACCOUNTS means the unaudited management accounts
         of the Company for the period ended 2nd March, 2003 in the Agreed Form;

         RIBOTARGETS NET WORKING CAPITAL means the net working capital of
         Ribotargets as at 31st March, 2003 as indicated on line 13 of the
         Ribotargets Balance Sheet;

         RIBOTARGETS OPTION SCHEMES means the approved share option plan, the
         unapproved share option plan, the savings-related share option scheme
         and the enterprise management incentive scheme operated by the Company;

         RIBOTARGETS SHAREHOLDERS' AGREEMENT means the Subscription and
         Shareholders' Agreement dated 25th September, 2001 among, inter alia,
         the Company, the Medical Research Council, the New Investors (as
         defined therein) and the Existing Investors (as defined therein);

         RIBOTARGETS SHARES means all the existing issued Ordinary Shares, A
         Ordinary Shares or B Ordinary Shares and any further such shares which
         are allotted or issued before the date upon which the Offer becomes
         wholly unconditional (save only as to the Escrow Condition), including
         any New Ribotargets Shares which are issued pursuant to the
         Contribution Deed, and RIBOTARGETS SHAREHOLDER means a holder of any of
         them;

         SCHEME means the Ribotargets Group Personal Pension Scheme;

         SECURITIES ACT means the United States Securities Act of 1933, as
         amended;

         SELLING NOTICE means the notice in the Agreed Form to be issued by the
         Offerees to the Company in accordance with article 7.5.1 of the
         Articles;

         SUBSIDIARY means the company mentioned in the schedule headed "The
         Subsidiary";

         SUBSIDIARY means a subsidiary for the purposes of the Companies Act
         1985;

         SUBSIDIARY UNDERTAKING and PARENT UNDERTAKING have the meanings given
         in section 258 of the Companies Act 1985;

                                       33
<PAGE>

         TERMINATION DEED means the deed in the Agreed Form between the Company
         and the Offeror pursuant to which paragraph 9 of the Confidentiality
         Agreement is terminated;

         UK LISTING AUTHORITY means the Financial Services Authority acting in
         its capacity as the competent authority for the purposes of Part VI of
         the Financial Services and Markets Act 2000;

         UNITED STATES and US PERSON have the meanings given in Rule 902 of
         Regulation S under the Securities Act;

         US OFFEREE means each of Caduceus Private Investment LLP, Orbimed
         Associates LLC, PW Juniper Crossover Fund LLC (each c/o Orbimed
         Advisors, 767 3rd Avenue, New York NY 10017), J.P. Morgan Partners
         (BHCA) Limited (1221 Avenue of the Americas, New York 10020, USA), Apax
         UK V-A, L.P. (1 Portland Place, London W1B 1PT) and Apax Europe V-A,
         L.P. (13-15 Victoria Road, St. Peter Port, Guernsey GY1 32D) (together,
         the US OFFEREES);

         US OFFEREES' WARRANTIES means each of the statements set out in Part 2
         of the schedule headed "Warranties";

         WARRANTIES means the warranties contained in the clause headed
         "Warranties"; and a person shall be deemed to be CONNECTED with another
         if that person is connected with another within the meaning of section
         839 of the Taxes Act 1988.

2.       Any express or implied reference to an enactment (which includes any
         legislation in any jurisdiction) includes references to:

         (a) that enactment as amended, extended or applied by or under any
             other enactment before or after the date of this undertaking;

         (b) any enactment which that enactment re-enacts (with or without
             modification); and

         (c) any subordinate legislation (including regulations) made (before or
             after signature of this undertaking) under that enactment, as
             re-enacted, amended, extended or applied as described in paragraph
             (a) above, or under any enactment referred to in paragraph (b)
             above,

         in each case except to the extent that any such amendment, extension,
         application or re-enactment made after the date of this undertaking
         increases or would increase the liability of all or any of the
         Offerees.

3.       In this undertaking:

         (a) words denoting persons shall include bodies corporate and
             unincorporated associations of persons;

         (b) references to an individual include his estate and personal
             representatives; and

         (c) references to a party to this undertaking include references to the
             successors or assigns (immediate or otherwise) of that party.

                                       34
<PAGE>

                                   SIGNATORIES

Executed by APAX UK V-A, L.P.                   )
acting by its manager                           )    .......................
APAX PARTNERS LTD acting by:                    )    (Director)
                                                )
                                                )    ......................
                                                )    (Director/Secretary)

Executed as a Deed by APAX UK V-B               )    .......................
acting by its manager                           )    (Director)
APAX PARTNERS LTD acting by:                    )
                                                )    .......................
                                                )    (Director/Secretary)

Executed by APAX EUROPE V - A, L.P.             )    .......................
acting by its investment manager                )    (Director)
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )
                                                )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )    .......................
APAX EUROPE V - B, L.P.                         )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )    ......................
APAX EUROPE V - C GmbH & CO. KG                 )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )    .......................
APAX EUROPE V - D, L.P.                         )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

                                       35
<PAGE>

Executed as a Deed by                           )    .......................
APAX EUROPE V - E, L.P.                         )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by
APAX EUROPE V - F, C.V.                         )    .......................
acting by its investment manager                )    (Director)
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )
                                                     .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )     .......................
APAX EUROPE V - G, C.V.                         )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )    .......................
APAX EUROPE V - 1, L.P.                         )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )    .......................
APAX EUROPE V-2, L.P.                           )    (Director)
acting by its investment manager                )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )    .......................
AP V GmbH & CO. KG                              )    (Director)
acting by its attorney                          )
APAX PARTNERS EUROPE MANAGERS                   )
LTD acting by:                                  )    .......................
                                                     (Director/Secretary)

Executed as a Deed by                           )
3i GROUP PLC acting by its attorney             )
in the presence of:                             )

                                       36
<PAGE>

Executed as a Deed on behalf of                 )
3i BIOSCIENCE INVESTMENT TRUST PLC              )
acting by its manager                           )
3i INVESTMENTS PLC                              )
acting by                                       )
                                                )
as attorney for                                 )
3i INVESTMENTS PLC                              )
in the presence of:                             )
                                                )

Executed as a Deed by ADVENT VCT PLC            )
acting by                                       )    .....................
                                                )     (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VCT PLC                                  )    (Director/Secretary)

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )    (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS acting as manager       )    (Director/Secretary)
of ADVENT PRIVATE EQUITY FUND III 'A'           )

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )     (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS acting as manager       )    (Director/Secretary)
of ADVENT PRIVATE EQUITY FUND III 'B'           )

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )    (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS acting as manager       )    (Director/Secretary)
of ADVENT PRIVATE EQUITY FUND III 'C'           )

                                       37

<PAGE>

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )     (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS acting as manager       )    (Director/Secretary)
of ADVENT PRIVATE EQUITY FUND III 'D'           )

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )    (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS as manager              )    (Director/Secretary)
of ADVENT PRIVATE EQUITY FUND III               )
GMBH & CO. KG                                   )
in the presence of:                             )
                                                )

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )     (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS as manager of           )    (Director/Secretary)
ADVENT MANAGEMENT III LIMITED                   )
PARTNERSHIP                                     )
in the presence of :                            )
                                                )

Executed as a Deed by ADVENT VENTURE PARTNERS   )
acting by                                       )    .......................
                                                )     (Director)
and                                             )
                                                )
for and on behalf of                            )    .......................
ADVENT VENTURE PARTNERS as manager of           )    (Director/Secretary)
ADVENT PRIVATE EQUITY FUND III                  )
AFFILIATES                                      )
in the presence of :                            )
                                                )

                                       38

<PAGE>

Executed as a Deed by QUESTER VCT 2 PLC         )    .......................
acting by                                       )    (Director)
                                                )
and                                             )
                                                )
for and on behalf of                            )    .......................
QUESTER VCT 2 PLC                               )    (Director/Secretary)

Executed as a Deed by QUESTER VCT 3 PLC         )    .......................
acting by                                       )    (Director)
                                                )
and                                             )
                                                )    .......................
for and on behalf of                            )    (Director/Secretary)
QUESTER VCT 3 PLC                               )

Executed as a Deed by                           )
J.P. MORGAN PARTNERS (BHCA), L.P.               )
acting by JPMP MASTER FUND MANAGER, L.P.        )
its General Partner,                            )
by JPMP CAPITAL CORP.,                          )
its General Partner,                            )
by                                              )
Name:                                           )
Title:                                          )
in the presence of:                             )

Executed as a Deed by                           )
                                                )
and                                             )
                                                )
for and on behalf of                            )
THE MEDICAL RESEARCH COUNCIL                    )

Executed as a Deed by ALPINVEST HOLDING NV      )
acting by its sole Managing Director            )
NIB CAPITAL PRIVATE EQUITY NV                   )
and                                             )
                                                )
acting under the authority of                   )
the Company                                     )
ALPINVEST HOLDING NV                            )

                                       39

<PAGE>

Executed as a Deed by ORBIMED CAPITAL LLC       )
acting by                                       )
                                                )
and                                             )
                                                )
for and on behalf of                            )
CADUCEUS PRIVATE INVESTMENTS, LP                )
acting by ORBIMED CAPITAL LLC,                  )
as its general partner                          )

Executed as a Deed by ORBIMED ADVISORS, LLC     )
acting by                                       )
                                                )
and                                             )
                                                )
for and on behalf of                            )
ORBIMED ASSOCIATES LLC                          )
acting by its managing member                   )
ORBIMED ADVISORS, LLC                           )

Executed as a Deed by ORBIMED ADVISORS INC.     )
acting by                                       )
                                                )
and                                             )
                                                )
for and on behalf of                            )
PW JUNIPER CROSSOVER FUND, L.L.C.,              )
acting by                                       )
its managing member PW JUNIPER CROSSOVER        )
MANAGEMENT, L.L.C.                              )
acting by its managing member                   )
ORBIMED ADVISORS INC.                           )

Executed as a Deed by RENDEX N.V.               )
acting by                                       )
                                                )
and                                             )
                                                )
acting under the authority                      )
of that Company                                 )
RENDEX N.V.                                     )

Executed as a Deed by                           )
SIMON STURGE                                    )
in the presence of:                             )

Executed as a Deed by                           )
SUSAN LOWTHER                                   )
in the presence of:                             )

                                       40
<PAGE>

Executed as a Deed by                           )
ALAN DRIVER                                     )
in the presence of:                             )

Executed as a Deed by                           )
PROFESSOR COLIN S. GOODCHILD                    )
in the presence of:                             )

Executed as a Deed by                           )
DR RAY NADESON                                  )
in the presence of:                             )

Executed as a Deed by MONASH COMMERCIAL         )    .......................
PROPRIETARY LIMITED acting by                   )    (Director)
                                                )
and                                             )
                                                )
for and on behalf of                            )    .......................
MONASH COMMERCIAL PROPRIETARY                   )
LIMITED                                         )    (Director/Secretary)

Executed as a Deed by BIOCOMM SERVICES          )    .......................
PROPRIETARY LIMITED acting by                   )    (Director)
                                                )
and                                             )
                                                )
for and on behalf of                            )    .......................
BIOCOMM SERVICES PROPRIETARY LIMITED            )    (Director/Secretary)

Executed as a Deed by                           )    .......................
BRITISH BIOTECH PLC                             )    (Director)
acting by                                       )
and                                             )
                                                )    .......................
                                                     (Director/Secretary)

                                       41<PAGE>
                                                                     Exhibit 4.3

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. IF YOU ARE IN
ANY DOUBT AS TO THE ACTION YOU SHOULD TAKE, AND IF YOU ARE IN THE UK, YOU ARE
RECOMMENDED TO SEEK YOUR OWN PERSONAL FINANCIAL ADVICE IMMEDIATELY FROM YOUR
STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR OTHER INDEPENDENT FINANCIAL
ADVISER DULY AUTHORISED UNDER THE FINANCIAL SERVICES AND MARKETS ACT 2000. IF
YOU ARE OUTSIDE THE UK, YOU SHOULD IMMEDIATELY CONSULT ANOTHER APPROPRIATELY
AUTHORISED INDEPENDENT PROFESSIONAL ADVISER.

IF YOU HAVE SOLD OR OTHERWISE TRANSFERRED ALL OF YOUR VERNALIS SHARES, PLEASE
SEND (EXCEPT AS NOTED BELOW) THIS DOCUMENT AND THE ACCOMPANYING DOCUMENTATION,
TO THE PURCHASER OR TRANSFEREE, OR TO THE STOCKBROKER, BANK OR OTHER AGENT
THROUGH WHOM THE SALE OR TRANSFER WAS EFFECTED, FOR ONWARD TRANSMISSION TO THE
PURCHASER OR TRANSFEREE. NOTWITHSTANDING THE FOREGOING, THE DISTRIBUTION OF THIS
DOCUMENT AND THE ACCOMPANYING DOCUMENTATION IN JURISDICTIONS OTHER THAN THE UK
MAY BE RESTRICTED BY LAW AND THEREFORE PERSONS INTO WHOSE POSSESSION THIS
DOCUMENT OR ANY ACCOMPANYING DOCUMENTATION COMES SHOULD INFORM THEMSELVES ABOUT
AND OBSERVE ANY OF THOSE RESTRICTIONS (IN PARTICULAR, THE RESTRICTIONS SET FORTH
BELOW WITH RESPECT TO THE DISTRIBUTION OF THIS DOCUMENT OR ANY ACCOMPANYING
DOCUMENTATION IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, BELGIUM, SOUTH
AFRICA AND JAPAN). ANY FAILURE TO COMPLY WITH ANY OF THOSE RESTRICTIONS MAY
CONSTITUTE A VIOLATION OF THE SECURITIES LAWS OF ANY SUCH JURISDICTION.

This document should be read in conjunction with the accompanying documents,
including the Form of Acceptance and the Listing Particulars relating to British
Biotech Shares, which have been prepared in accordance with the Listing Rules
made under section 74 of the Financial Services and Markets Act 2000. A copy of
the Listing Particulars has been delivered to the Registrar of Companies in
England and Wales for registration in accordance with section 83 of that Act.
--------------------------------------------------------------------------------
                              RECOMMENDED OFFER BY
                                J.P. MORGAN PLC
                                  ON BEHALF OF
                              BRITISH BIOTECH PLC
                                      FOR
                               VERNALIS GROUP PLC
--------------------------------------------------------------------------------
J.P. Morgan plc, which is regulated in the UK by the Financial Services
Authority, is acting exclusively for British Biotech and no-one else in
connection with the Offer and will not be responsible to any other person for
providing the protections afforded to clients of J.P. Morgan plc or for
providing advice in relation to the Offer.

UBS Investment Bank, which is regulated in the UK by the Financial Services
Authority, is acting exclusively for Vernalis and no-one else in connection with
the Offer and will not be responsible to any other person for providing the
protections afforded to clients of UBS Investment Bank or for providing advice
in relation to the Offer.

TO ACCEPT THE OFFER, THE FORM OF ACCEPTANCE SHOULD BE COMPLETED, SIGNED AND
RETURNED, WHETHER OR NOT YOUR VERNALIS SHARES ARE IN CREST, AS SOON AS POSSIBLE
AND, IN ANY EVENT, SO AS TO BE RECEIVED BY POST OR (DURING NORMAL BUSINESS HOURS
ONLY) BY HAND AT CAPITA IRG PLC, CORPORATE ACTIONS, PO BOX 166, THE REGISTRY, 34
BECKENHAM ROAD, BECKENHAM KENT, BR3 4TH NO LATER THAN 3.00 P.M. ON 18 AUGUST
2003. THE PROCEDURE FOR ACCEPTANCE OF THE OFFER IS SET OUT IN SECTION C OF
APPENDIX I TO THIS DOCUMENT AND IN THE ACCOMPANYING FORM OF ACCEPTANCE. IF YOU
ARE A CREST PERSONAL MEMBER, YOU SHOULD REFER TO YOUR CREST SPONSOR BEFORE
COMPLETING THE ACCOMPANYING FORM OF ACCEPTANCE, AS ONLY YOUR CREST SPONSOR WILL
BE ABLE TO SEND THE NECESSARY TTE INSTRUCTIONS TO CRESTCO.

THE OFFER (AS DEFINED IN THIS OFFER DOCUMENT) IS NOT BEING MADE AND WILL NOT BE
MADE, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM, OR BY USE OF THE MAILS, OR BY
ANY MEANS OR INSTRUMENTALITY OF INTERSTATE OR FOREIGN COMMERCE OF, OR ANY
FACILITIES OF A NATIONAL, STATE OR OTHER SECURITIES EXCHANGE OF, THE UNITED
STATES, CANADA, AUSTRALIA, BELGIUM, SOUTH AFRICA OR JAPAN. THIS INCLUDES, BUT IS
NOT LIMITED TO, POST, FACSIMILE TRANSMISSION, ELECTRONIC MAIL, TELEX, TELEPHONE
AND THE INTERNET. ACCORDINGLY, COPIES OF THIS DOCUMENT, THE FORM OF ACCEPTANCE,
THE ACCOMPANYING LISTING PARTICULARS AND ANY RELATED OFFERING OR SOLICITATION
DOCUMENTS ARE NOT BEING, AND MUST NOT BE, DIRECTLY OR INDIRECTLY, MAILED OR
OTHERWISE TRANSMITTED, FORWARDED, DISTRIBUTED OR SENT INTO OR FROM THE UNITED
STATES, CANADA, AUSTRALIA, BELGIUM, SOUTH AFRICA OR JAPAN AND THE OFFER CANNOT
BE ACCEPTED BY ANY SUCH USE, MEANS, INSTRUMENTS OR FACILITIES OR FROM WITHIN THE
UNITED STATES, CANADA, AUSTRALIA, BELGIUM, SOUTH AFRICA OR JAPAN AND PERSONS
RECEIVING THIS DOCUMENT, THE FORM OF ACCEPTANCE, THE ACCOMPANYING LISTING
PARTICULARS OR ANY OTHER DOCUMENT CONNECTED WITH THE OFFER (INCLUDING
CUSTODIANS, NOMINEES AND TRUSTEES) MUST NOT MAIL OR OTHERWISE TRANSMIT, FORWARD,
DISTRIBUTE OR SEND THEM IN OR INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA,
BELGIUM, SOUTH AFRICA OR JAPAN OR USE SUCH MAILS OR ANY SUCH MEANS, INSTRUMENTS,
OR FACILITIES FOR ANY PURPOSE, DIRECTLY OR INDIRECTLY, IN CONNECTION WITH THE
OFFER. ANY PURPORTED ACCEPTANCE OF THE OFFER RESULTING DIRECTLY OR INDIRECTLY
FROM A VIOLATION OF THESE RESTRICTIONS WILL BE INVALID. The availability of the
Offer to persons who are not resident and located in the United Kingdom is
subject to the laws of the relevant jurisdictions and the restrictions set forth
herein. Persons who are not resident and located in the United Kingdom should
inform themselves about and observe any applicable requirements. Further
information for overseas shareholders is set out in paragraph 6 of section B and
in paragraph (b) of section C of Appendix I to this document. Any person
(including, without limitation, any nominee, trustee or custodian) who would, or
otherwise intends to, or who may have a contractual or legal obligation to,
forward this document and/or any related document to any jurisdiction outside
the United Kingdom should read that paragraph before taking any action.

THIS OFFER DOCUMENT IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES.
SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION
OR AN EXEMPTION FROM REGISTRATION. THE NEW BRITISH BIOTECH SHARES TO BE ISSUED
PURSUANT TO THE OFFER HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE
SECURITIES ACT, OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE
UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR DELIVERED, DIRECTLY OR
INDIRECTLY, IN THE UNITED STATES.

THE RELEVANT CLEARANCES HAVE NOT BEEN, NOR WILL THEY BE, OBTAINED FROM THE
SECURITIES COMMISSION OF ANY PROVINCE OR TERRITORY OF CANADA; NO PROSPECTUS HAS
BEEN LODGED WITH, OR REGISTERED BY THE AUSTRALIAN SECURITIES AND INVESTMENTS
COMMISSION OR THE JAPANESE MINISTRY OF FINANCE; AND THE NEW BRITISH BIOTECH
SHARES HAVE NOT BEEN, NOR WILL THEY BE, REGISTERED UNDER OR OFFERED IN
COMPLIANCE WITH APPLICABLE SECURITIES LAWS OF ANY STATE, PROVINCE, TERRITORY OR
JURISDICTION OF CANADA, AUSTRALIA, BELGIUM, SOUTH AFRICA OR JAPAN. ACCORDINGLY,
THE NEW BRITISH BIOTECH SHARES MAY NOT (UNLESS AN EXEMPTION UNDER RELEVANT
SECURITIES LAWS IS APPLICABLE) BE OFFERED, SOLD, RESOLD OR DELIVERED, DIRECTLY
OR INDIRECTLY, IN OR INTO CANADA, AUSTRALIA, BELGIUM, SOUTH AFRICA OR JAPAN, OR
ANY OTHER JURISDICTION IF TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT
LAWS OF, OR REQUIRE REGISTRATION THEREOF IN SUCH JURISDICTION, OR FOR THE
ACCOUNT OR BENEFIT OF, ANY CANADIAN, AUSTRALIAN, BELGIUM, SOUTH AFRICAN OR
JAPANESE PERSON.
<PAGE>

                BRITISH BIOTECH DIRECTORS AND PROPOSED DIRECTORS

<Table>
<CAPTION>
           BRITISH BIOTECH DIRECTORS                                PROPOSED DIRECTORS
<S>                 <C>                                  <C>             <C>
Peter Fellner       Executive Chairman                   Peter Worrall   Corporate Development Director
Simon Sturge        Chief Executive Officer              John Hutchison  Development Director
Anthony Weir        Finance Director                     George Kennedy  Deputy Chairman
Tim Edwards         Corporate Development Director                       Senior independent Director
Keith Merrifield    Non-executive Director               Carol Ferguson  Non-executive Director
Eugene Williams     Non-executive Director               Peter Read      Non-executive Director
Ian Kent            Non-executive Director
</Table>

         REGISTERED OFFICE OF AND PRINCIPAL ADVISERS TO BRITISH BIOTECH

<Table>
<S>                                             <C>
              REGISTERED OFFICE                         SPONSOR AND FINANCIAL ADVISER
                Thames Court                                   J.P. Morgan plc
               Watlington Road                                 125 London Wall
                   Oxford                                          London
                 Oxfordshire                                      EC2Y 5AJ
                   OX4 6LY
</Table>

<Table>
<CAPTION>
                                    LEGAL ADVISERS
<S>                                             <C>
               Allen & Overy                                       Lovells
               One New Change                                   Atlantic House
                   London                                       Holborn Viaduct
                  EC4M 9QQ                                          London
                                                                   EC1A 2FG
</Table>

<Table>
<S>                                             <C>
                REGISTRARS                                     RECEIVING AGENT
              Capita IRG Plc                                   Capita IRG Plc
               The Registry                                   Corporate Actions
            34 Beckenham Road                                    PO Box 166
                Beckenham                                       The Registry
                   Kent                                       34 Beckenham Road
                 BR3 4TU                                          Beckenham
                                                                     Kent
                                                                   BR3 4TH
</Table>

                       AUDITORS AND REPORTING ACCOUNTANTS
                           PricewaterhouseCoopers LLP
                               1 Embankment Place
                                     London
                                    WC2N 6RH

                         PRINCIPAL ADVISERS TO VERNALIS

<Table>
<S>                                             <C>
             FINANCIAL ADVISER                                 LEGAL ADVISER
            UBS Investment Bank                                Allen & Overy
            1/2 Finsbury Avenue                                One New Change
                   London                                          London
                  EC2M 2PP                                        EC4M 9QQ
</Table>

<Table>
<S>                                             <C>
                  AUDITORS                                 BROKERS TO THE MERGER
         PricewaterhouseCoopers LLP                          Cazenove & Co. Ltd
             1 Embankment Place                                 20 Moorgate
                   London                                          London
                  WC2N 6RH                                        EC2R 6DA
</Table>

                                        i
<PAGE>

                                    CONTENTS

<Table>
<S>      <C>                                                           <C>
Part 1   Letter from the Chairman of British Biotech                     1
Part 2   Letter from the Chairman of Vernalis                            2
Part 3   Letter from JPMorgan                                            5
APPENDICES
I        Conditions and further terms of the Offer                      23
II       Additional information                                         45
         Definitions                                                    62
         Glossary of scientific terms                                   67
</Table>

                                        ii
<PAGE>

                                     PART 1

                  LETTER FROM THE CHAIRMAN OF BRITISH BIOTECH

                             [BRITISH BIOTECH LOGO]

  (British Biotech plc, Incorporated in England and Wales with registered no.
                                    2304992)

                                                               Registered Office
                                                                    Thames Court
                                                                 Watlington Road
                                                                          Oxford
                                                                         OX4 6LY

                                                                    25 July 2003

To Vernalis Shareholders and, for information only, to participants in the
Vernalis Incentive Plans

Dear Vernalis Shareholder

               RECOMMENDED MERGER OF BRITISH BIOTECH AND VERNALIS

On 3 July 2003, the boards of British Biotech and Vernalis announced that they
had agreed the terms of a recommended merger of the two companies. I am pleased
to write to you to seek your support for the Merger.

I believe that the rationale for the Merger is compelling. The creation of a
group with a marketed product (frovatriptan), a broad product pipeline and
established discovery and development expertise will bring real benefits to the
shareholders of both companies. The Merger will produce significant cost
savings, which, along with the financial resources available to the Merged
Group, will mean the Merged Group is well positioned to pursue its strategy of
creating a self-sustaining R&D driven biotechnology company.

Following the Merger, I will be Executive Chairman and Simon Sturge will be
Chief Executive Officer. Further details of the board of the Merged Group, which
will be drawn from British Biotech and Vernalis, are set out in paragraph 11 of
the letter from JPMorgan in Part 3 of this document.

The Merger is being implemented by way of a recommended offer by JPMorgan on
behalf of British Biotech to acquire the entire issued and to be issued share
capital of Vernalis, subject to the terms and conditions set out in the letter
from JPMorgan in Part 3 of this document, Appendix I to this document and in the
accompanying Form of Acceptance. The Offer is being made on the basis of 0.861
New British Biotech Shares for each Vernalis Share. Following the Merger,
assuming full acceptance of the Offer and that no options or conversion rights
over Vernalis Shares or British Biotech Shares are exercised, existing British
Biotech Shareholders will, in aggregate, hold approximately 47 per cent., and
Vernalis Shareholders will, in aggregate, hold approximately 53 per cent., of
the enlarged issued share capital of British Biotech.

THE MERGER HAS THE UNANIMOUS SUPPORT AND RECOMMENDATION OF THE BOARDS OF BOTH
BRITISH BIOTECH AND VERNALIS. I URGE YOU TO ACCEPT THE OFFER AND LOOK FORWARD TO
WELCOMING YOU AS A SHAREHOLDER IN THE MERGED GROUP.

You are advised to read the letter from the Chairman of Vernalis, set out in
Part 2 of this document, and the letter from JPMorgan, set out in Part 3 of this
document, together with the accompanying Listing Particulars, before accepting
the Offer.
                                Yours sincerely,

                               /s/ Peter Fellner
                                 Peter Fellner
                          Chairman of British Biotech

                                        1
<PAGE>

                                     PART 2

                      LETTER FROM THE CHAIRMAN OF VERNALIS

                                [VERNALIS LOGO]
   (Vernalis Group plc, Incorporated in England and Wales with registered no.
                                    3137449)

                                                               Registered office
                                                                   Oakdene Court
                                                                613 Reading Road
                                                                        Winnersh
                                                                       Wokingham
                                                              Berkshire RG41 5UA

                                                                    25 July 2003

To Vernalis Shareholders and, for information only, to participants in the
Vernalis Incentive Plans

Dear Vernalis Shareholder,

               RECOMMENDED MERGER OF BRITISH BIOTECH AND VERNALIS

INTRODUCTION

On 3 July 2003, the Vernalis Board announced that it had reached agreement with
the British Biotech Board on the terms of a recommended merger of British
Biotech and Vernalis. I am now writing to you to explain the background to the
Merger and to explain the reasons why the Vernalis Directors unanimously
recommend that you accept the Offer.

The Merger is structured as a share-for-share offer by British Biotech for
Vernalis on the basis of 0.861 New British Biotech Shares for each Vernalis
Share. Based upon British Biotech's share price of 64.5 pence, being the Closing
Price of a British Biotech Share on 24 July 2003, the last Business Day before
publication of this document, the Offer values each Vernalis Share at
approximately 55.5 pence and the issued ordinary share capital of Vernalis at
approximately L48.6 million.

The terms and conditions of the Offer are set out in the letter from JPMorgan in
Part 3 of this document, in Appendix I to this document and in the accompanying
Form of Acceptance.

BACKGROUND TO AND REASONS FOR THE MERGER

In its preliminary results announcement on 21 March 2003 the Vernalis Board
indicated that, at that time, Vernalis faced a working capital shortfall and
that the Vernalis Board was reviewing funding options. The Vernalis Board also
said that it intended to explore other strategic options.

On 1 May 2003, Vernalis announced its intention to raise L16.0 million (before
expenses) by way of a placing and open offer. Part of the rationale for raising
additional equity funding was to enhance Vernalis' position in any subsequent
discussions with third parties. Following the successful completion of the
placing and open offer on 30 May 2003, Vernalis entered into detailed talks with
British Biotech, which led to the announcement of the Merger on 3 July 2003.

Vernalis has made substantial progress in the last twenty months in the
development of its research and development portfolio, notably with the launch
of frovatriptan in the US and in Europe. However, the financial resources
required to exploit fully the potential of frovatriptan

                                        2
<PAGE>

and, at the same time, to continue to develop all of the key elements of
Vernalis' product portfolio are considerable and likely to be beyond Vernalis'
current financial resources.

The Vernalis Directors believe that the Merged Group will have superior growth
opportunities compared to Vernalis alone. In particular, Vernalis Shareholders
will benefit from the broader product pipeline, established discovery and
development expertise and stronger financial position of the Merged Group.
Vernalis Shareholders will also benefit from the increased scale and liquidity
of the Merged Group.

CURRENT TRADING AND PROSPECTS

Following the US and German launches of frovatriptan in 2002, Vernalis has now
started to receive regular quarterly income from royalties on US and European
sales, and, in the case of Europe, sales revenues from the supply of finished
frovatriptan product to Menarini.

Vernalis' annual report dated 9 May 2003 raised a matter of uncertainty with
respect to the successful completion of the placing and open offer announced on
1 May 2003. On 30 May 2003 Vernalis successfully completed the placing and open
offer of 44,444,445 new shares in Vernalis at 36 pence per share which raised
L14.1 million net of expenses.

During 2003, the expected increased revenues from frovatriptan, together with
the benefit to operating expenses from the L3 million of annualised cost savings
implemented in 2002, should result in a progressive reduction in Vernalis' net
cash outflows.

On 5 June 2003, Vernalis announced that Roche's option over Vernalis' adenosine
A(2A) antagonist research programme in depression had been terminated. As a
result, Vernalis now has complete control over its A(2A) antagonist programmes,
which are targeting a range of indications including Parkinson's disease and
depression.

MANAGEMENT AND EMPLOYEES

Vernalis attaches great importance to retaining the skills and expertise of its
management and employees. The management teams of British Biotech and Vernalis
will be combined in order to obtain the maximum benefit from their skills and
experiences. Although the combination of similar functions will necessarily lead
to some staff reductions, the British Biotech Board and the Vernalis Board
believes that the greater strength, market position and growth prospects for the
Merged Group will generally enhance the career prospects of its remaining
employees.

The British Biotech Board has confirmed that the existing employment rights,
including pension rights, of employees of both British Biotech and Vernalis will
be fully safeguarded.

ACTION TO BE TAKEN

TO ACCEPT THE OFFER, THE FORM OF ACCEPTANCE MUST BE SIGNED AND COMPLETED AND
RETURNED, WHETHER OR NOT YOUR VERNALIS SHARES ARE IN CREST, AS SOON AS POSSIBLE
AND, IN ANY EVENT, SO AS TO BE RECEIVED BY POST OR (DURING NORMAL BUSINESS HOURS
ONLY) BY HAND AT CAPITA IRG PLC, CORPORATE ACTIONS, PO BOX 166, THE REGISTRY, 34
BECKENHAM ROAD, BECKENHAM, KENT, BR3 4TH BY NO LATER THAN 3.00 P.M. ON 18 AUGUST
2003.

THE PROCEDURE FOR ACCEPTANCE IS SET OUT IN PARAGRAPH 15 OF THE LETTER FROM
JPMORGAN IN PART 3 OF THIS DOCUMENT AND IN THE FORM OF ACCEPTANCE.

RECOMMENDATION

The Vernalis Directors, who have been so advised by UBS Investment Bank, its
financial adviser, consider the terms of the Offer to be fair and reasonable. In
providing advice to the Vernalis Directors, UBS Investment Bank has taken into
account the commercial assessments of the Vernalis Directors.

                                        3
<PAGE>

The Vernalis Directors unanimously recommend all Vernalis Shareholders to accept
the Offer, as they have irrevocably undertaken to do in relation to their own
beneficial holdings amounting, in aggregate, to 359,977 Vernalis Shares,
representing approximately 0.4 per cent. of Vernalis' issued share capital.

                                Yours sincerely,

                               /s/ George Kennedy
                                 George Kennedy
                              Chairman of Vernalis

                                        4
<PAGE>

                                     PART 3

                              LETTER FROM JPMORGAN

                                [JPMorgan LOGO]
                                                                 J.P. Morgan plc
                                                                 125 London Wall
                                                                 London EC2Y 5AJ
                                                                  United Kingdom
                                                          (Registered in England
                                                          and Wales, No. 248609)
                                                                    25 July 2003

To Vernalis Shareholders and, for information only, to participants in the
Vernalis Incentive Plans

Dear Vernalis Shareholder

               RECOMMENDED MERGER OF BRITISH BIOTECH AND VERNALIS

1.  INTRODUCTION

It was announced on 3 July 2003 that the boards of British Biotech and Vernalis
had unanimously agreed the terms of a recommended merger of the two companies.
The Offer which will effect the Merger is being made by JPMorgan on behalf of
British Biotech. This letter formally sets out the Offer.

Your attention is drawn to the enclosed Listing Particulars which contain
detailed financial and other information in relation to both British Biotech and
Vernalis. A Form of Acceptance and a reply-paid envelope to be used for the
purpose of accepting the Offer are also enclosed.

Following the Merger, assuming full acceptance of the Offer and that no option
or conversion rights over Vernalis Shares or British Biotech Shares are
exercised, existing British Biotech Shareholders will hold, in aggregate,
approximately 47 per cent., and Vernalis Shareholders will hold, in aggregate,
approximately 53 per cent., of the enlarged issued share capital of British
Biotech.

Your attention is drawn to the letter of recommendation from the Chairman of
Vernalis set out in Part 2 of this document, which explains the reasons why the
Vernalis Directors, who have been advised by UBS Investment Bank, unanimously
recommend that all Vernalis Shareholders accept the Offer, as the Vernalis
Directors have irrevocably undertaken to do in respect of their own beneficial
holdings of, in aggregate, 359,977 Vernalis Shares representing approximately
0.4 per cent. of the existing issued share capital of Vernalis. In providing
advice to the Vernalis Directors, UBS Investment Bank have taken into account
the commercial assessments of the Vernalis Directors. The British Biotech
Directors have irrevocably undertaken to vote their holdings of a total of
217,095 British Biotech Shares in favour of the Merger at the forthcoming
British Biotech EGM (representing, in aggregate, approximately 0.3 per cent. of
British Biotech's issued share capital).

The Offer is subject to the conditions, including the approval of British
Biotech Shareholders, and further terms set out in Appendix I to this document.
An extraordinary general meeting of British Biotech Shareholders has been
convened for 11.00 a.m. on 13 August 2003 at which that approval will be sought.

                                        5
<PAGE>

TO ACCEPT THE OFFER YOU SHOULD SIGN AND COMPLETE AND RETURN THE FORM OF
ACCEPTANCE TO CAPITA IRG PLC, CORPORATE ACTIONS, PO BOX 166, THE REGISTRY, 34
BECKENHAM ROAD, BECKENHAM, KENT, BR3 4TH AS SOON AS POSSIBLE AND, IN ANY EVENT,
SO AS TO BE RECEIVED NOT LATER THAN 3.00 P.M. ON 18 AUGUST 2003. THE PROCEDURE
FOR ACCEPTANCE OF THE OFFER IS SET OUT IN PARAGRAPH 15 BELOW, IN SECTION C OF
APPENDIX I TO THIS DOCUMENT AND IN THE FORM OF ACCEPTANCE.

2.  THE OFFER

JPMorgan hereby offers, on behalf of British Biotech, to acquire the Vernalis
Shares, on the terms and subject to the conditions set out in this letter, in
Appendix I to this document and in the Form of Acceptance. The Offer is made on
the following basis:

<Table>
<S>                                            <C>
           FOR EACH VERNALIS SHARE                  0.861 OF A NEW BRITISH BIOTECH SHARE
</Table>

and so in proportion for any other number of Vernalis Shares held.

Fractions of New British Biotech Shares will not be allotted to Vernalis
Shareholders, but the New British Biotech Shares representing the aggregate of
these fractional entitlements will be sold in the market and the net proceeds
will be retained by British Biotech for the benefit of the Merged Group.

Based upon British Biotech's share price of 64.5 pence, being the Closing Price
of a British Biotech Share on 24 July 2003, the last Business Day prior to the
publication of this document, the Merger values each Vernalis Share at
approximately 55.5 pence, and the entire issued share capital of Vernalis at
approximately L48.6 million.

Your attention is drawn to paragraph 15 of this letter, section C of Appendix I
to this document and the Form of Acceptance, which set out the procedure for
acceptance of the Offer and to sections A and B of Appendix I to this document
and the Form of Acceptance which contain the conditions and further terms of the
Offer.

3.  FURTHER TERMS OF THE OFFER

The New British Biotech Shares issued to Vernalis Shareholders will rank pari
passu in all respects with the existing issued British Biotech Shares including
the right to receive all dividends and other distributions (if any) declared,
paid or made by British Biotech after 3 July 2003. However, it is, at present,
intended that no dividends will be paid by the Merged Group. Even if future
operations lead to significant levels of distributable profits, any earnings, of
which there can be no assurance, will be reinvested in the Merged Group's
business and no dividends are expected to be paid in the foreseeable future.

Vernalis Shares will be acquired under the Offer fully paid and free from all
liens, equities, charges, encumbrances and other interests and together with all
rights now or hereafter attaching to them, including the right to receive all
dividends declared, made or paid after 3 July 2003.

The New British Biotech Shares to be issued pursuant to the Offer will be issued
free from all liens, equities, charges, encumbrances and other interests and
will be issued credited as fully paid. The holdings and rights of existing
British Biotech Shareholders will not be affected by the Merger, other than in
respect of the proportion of the total issued share capital of British Biotech
held by them following the Merger.

The Offer is also subject to the terms and conditions set out in Appendix I and
the Form of Acceptance.

Due to the size of Vernalis relative to that of British Biotech, the Offer is
conditional, inter alia, on the approval of British Biotech Shareholders at an
extraordinary general meeting of British Biotech. In addition, as a consequence
of Invesco's interest in British Biotech Shares (which Invesco has confirmed to
British Biotech is approximately 22.0 per cent. of British Biotech's share
capital as at 22 July 2003, the latest practicable date prior to the publication
of this document) Invesco's acceptance of the Offer will be a related party
transaction for the purposes of the Listing Rules and therefore requires the
approval of British Biotech Shareholders other than Invesco. Invesco
                                        6
<PAGE>

will abstain and has undertaken to procure that its associates will abstain from
voting on the Related Party Resolution.

It is intended that the Merged Group will be called Vernalis and be
headquartered in Winnersh near Reading with research and development facilities
in both Winnersh and Cambridge. Appropriate proposals to effect the change of
name from British Biotech plc to Vernalis plc will be put to British Biotech
Shareholders at British Biotech's annual general meeting to be held on 1 October
2003.

4.  IRREVOCABLE UNDERTAKINGS

British Biotech has received irrevocable undertakings from all the Vernalis
Directors to accept the Offer in respect of a total of 359,977 Vernalis Shares
representing approximately 0.4 per cent., in aggregate, of the issued share
capital of Vernalis (including 16,137 Vernalis Shares which will be transferred
to Peter Worrall under the Vernalis Restricted Share Scheme which vest when the
Offer becomes or is declared unconditional, as described in paragraph 13 below).
In addition, British Biotech has received irrevocable undertakings from Invesco,
Gartmore and Jupiter to accept the Offer in respect of, in aggregate, 38,528,070
Vernalis Shares representing approximately 44.1 per cent. of the issued share
capital of Vernalis. The undertakings given by Invesco, Gartmore and Jupiter
will cease to be binding in the event of a competing offer from a third party
being announced before 3.00 p.m. on 18 August 2003 (being the first closing date
of the Offer) which, in the reasonable opinion of the person giving the relevant
undertaking, represents a material improvement to the terms of the Offer. Each
person giving the undertaking would regard an offer of 60.61 pence, or above,
per Vernalis Share (or the equivalent at the time of the announcement of that
offer) as a material improvement to the Offer. Accordingly, British Biotech has
in total received irrevocable undertakings to accept the Offer in respect of, in
aggregate, 38,888,047 Vernalis Shares, representing approximately 44.5 per cent.
of the existing issued share capital of Vernalis.

British Biotech has also received irrevocable undertakings from all the British
Biotech Directors who hold British Biotech Shares to vote in favour of the
resolutions to implement the Merger at the British Biotech EGM in respect of a
total of 217,095 British Biotech Shares, representing approximately 0.3 per
cent., in aggregate, of the existing issued share capital of British Biotech. In
addition, British Biotech has received an irrevocable undertaking from Invesco
to vote in favour of such resolutions in respect of its holding of British
Biotech Shares, representing approximately 22.0 per cent., in aggregate, of the
existing issued share capital of British Biotech as at 22 July 2003 (the latest
practicable date prior to the publication of this document). The undertaking
given by Invesco will cease to be binding in the event of a competing offer from
a third party being announced before 3.00 p.m. on 18 August 2003 (being the
first closing date of the Offer) which, in the reasonable opinion of Invesco,
represents a material improvement to the terms of the Offer (as described
above). Accordingly, subject to what follows, British Biotech has in total
received irrevocable undertakings to vote in favour of such resolutions in
respect of British Biotech Shares, representing approximately 22.3 per cent. of
the existing issued share capital of British Biotech as at 22 July 2003 (the
latest practicable date prior to the publication of this document). The
acceptance of the Offer by Invesco constitutes a related party transaction under
the Listing Rules and therefore Invesco is not entitled to vote on the
resolution to be proposed at the British Biotech EGM in connection with the
approval of the related party transaction.

5.  FINANCIAL EFFECTS OF ACCEPTANCE OF THE OFFER

Under the terms of the Offer, accepting Vernalis Shareholders will receive 0.861
of a New British Biotech Share for each Vernalis Share they hold. The capital
value received for each accepting Vernalis Share is, therefore, dependent on the
market price of British Biotech Shares and, accordingly, will vary over time as
the price of British Biotech Shares fluctuates.

                                        7
<PAGE>
The following table shows, for illustrative purposes only, and on the bases and
assumptions set out in the notes below, the financial effects on capital value
for a Vernalis Shareholder of acceptance of the Offer, if the Offer becomes or
is declared unconditional in all respects:

<Table>
<Caption>
------------------------------------------------------------------------------------------------
                                             AS AT 30 APRIL     AS AT 2 JULY      AS AT 24 JULY
                                                       2003             2003               2003
                                                   (NOTE 1)         (NOTE 2)           (NOTE 3)
                                             --------------    --------------    ---------------
                                            (Pound Sterling)  (Pound Sterling)  (Pound Sterling)
------------------------------------------------------------------------------------------------
<S>                                          <C>               <C>               <C>
Market value of 861 British Biotech
  Shares.................................               508               551                555
Market value of 1,000 Vernalis Shares....               400               495                400
Increase in capital value................               108                56                155
                                             ---------------------------------------------------
THIS REPRESENTS AN INCREASE OF:..........    27.0 PER CENT.    11.3 PER CENT.     38.8 PER CENT.
------------------------------------------------------------------------------------------------
</Table>

Notes:

(1) Based on the Closing Price of 59.0 pence per British Biotech Share on 30
    April 2003 (being the last Business Day prior to the commencement of the
    Offer Period) and the Closing Price of 40.0 pence per Vernalis Share on 30
    April 2003 (being the last Business Day prior to the commencement of the
    Offer Period)

(2) Based on the Closing Price of 64.0 pence per British Biotech Share on 2 July
    2003 (being the last Business Day prior to the announcement of the Merger)
    and the Closing Price of 49.5 pence per Vernalis Share on 2 July 2003 (being
    the last Business Day prior to the announcement of the Merger)

(3) Based on the Closing Price of 64.5 pence per British Biotech Share on 24
    July 2003 (being the last Business Day prior to the publication of this
    document) and the Closing Price of 40.0 pence per Vernalis Share on 30 April
    2003 (being the last Business Day prior to commencement of the Offer Period)

(4) No account has been taken of any liability for taxation (if any) or the
    treatment of fractions of Vernalis Shares in assessing the financial effects
    of acceptance of the Offer

6.  BACKGROUND TO THE MERGER

The Merged Group is committed to creating shareholder value by building on its
established research and development expertise and its broad product pipeline as
well as through further enhancing the potential of frovatriptan, the Merged
Group's marketed product.

     - The Merged Group has the clinical development expertise and financial
       resources to further enhance the potential of frovatriptan. This includes
       the ability to expand into further indications including its use in the
       prophylaxis (prevention) of menstrually associated migraine, as well as
       supporting current licensees in promoting existing indications.

     - The Merged Group will have a broad product pipeline, with product
       candidates in clinical and pre-clinical development and late stage
       research. Its main discovery focus will be in the fields of central
       nervous system disorders and oncology. A key strategic objective will be
       the further partnering of its research and development programmes.

     - The Merged Group intends to capitalise on its strong research and
       development expertise, which has been validated by collaborations with
       Roche, Lilly and Serono.

     - The Merged Group had pro forma Net Cash of L48.4 million as at 31 May
       2003, after deducting the Roche Convertible Loan of L7.0 million (as
       described in paragraph 13 below) which may become repayable at the option
       of Roche as a result of the Merger. The cash position will be enhanced by
       frovatriptan royalties and potential future milestone payments and
       out-licensing fees.

     - The Merger will create significant cash savings through focussing on the
       most commercially attractive research programmes and the removal of
       duplicate corporate overhead costs. These savings are expected to be
       approximately L6.5 million in the first full financial year (to 30 April
       2005) following completion, with a net cash cost of L0.4 million (after
       recognising savings of L1.8 million) in the financial year to 30 April
       2004. The Merged Group aims to reduce combined headcount from 204 (after
       previously announced reductions within British Biotech) to approximately
       130.

                                        8
<PAGE>

     - The Merged Group will be led by Peter Fellner as Executive Chairman and
       Simon Sturge as Chief Executive Officer along with an experienced and
       highly capable management team of existing Vernalis and British Biotech
       personnel. The combined team has established strengths in research and
       development, business development and finance.

     - The Merged Group will be better positioned to participate in the further
       consolidation of the biotechnology sector.

7.  INFORMATION ON BRITISH BIOTECH

British Biotech is an R&D-based biotechnology company, with structure-based drug
design technology and a broad development pipeline. Its strategy is to build a
profitable company through organic growth and by pursuing consolidation
opportunities. The acquisition of RiboTargets in April 2003 gave British Biotech
a discovery base and innovative programmes which are intended to provide one
development candidate each year. At the time of that acquisition British Biotech
stated that further acquisitions or mergers would be necessary in order to build
a more extensive and mature pipeline. This strategy seeks to optimise the
balance of risk, reward and timing for the sustained delivery of therapeutic
drugs to key markets.

British Biotech currently has four product candidates in clinical development
and one in preclinical development. Three of these product candidates are in the
field of cancer treatment, one is for acute thrombotic disorders and one for
community-acquired pneumonia.

Pipeline product candidates include:

     - BB-10153, a novel recombinant human plasminogen, for the treatment of
       acute thrombotic disorders. This is currently in a Phase II study in
       approximately 70 patients with acute myocardial infarction. If this study
       is successful, it is intended to seek a pharma partner to support the
       full development of this compound.

     - BB-10901, a tumour-activated prodrug designed to treat small cell lung
       cancer (SCLC) and other cancers that are CD56-positive. BB-10901, with
       once weekly dosing, is in a Phase II clinical study and, with more
       frequent dosing, is in a Phase I clinical study.

     - MG98, a second generation antisense compound targeted at cancer. This is
       currently in Phase I trials being conducted by British Biotech's partner,
       MethylGene and its co-partner, MGI Pharma, in patients with liquid and
       solid tumours.

     - BB-83698, British Biotech's lead peptide deformylase (PDF) inhibitor,
       targeted at patients hospitalised with community-acquired pneumonia. A
       Phase I study of an intravenous formulation of BB-83698 in healthy
       volunteers is under way.

     - R140, an oral GABA(A) agonist for treating cancer pain. This is in the
       final stages of pre-clinical safety testing and is scheduled to enter
       clinical development by the end of 2003.

British Biotech also has a number of late-stage discovery programmes. These
include a collaboration with Serono evaluating metalloenzyme inhibitors as new
treatments for serious inflammatory disease and a programme to develop a
synthetic, small molecule inhibitor of Hsp90, a drug target predicted to have
relevance to a broad range of cancer types. The Hsp90 inhibitor programme is
scheduled to produce a candidate for pre-clinical development by the end of
2003.

British Biotech's recent acquisition of RiboTargets brought additional discovery
capabilities to the British Biotech group. British Biotech uses structure-based
drug design technologies to identify and progress rapidly lead compounds into
pre-clinical development. These capabilities, combined with a detailed
understanding of the interactions between selected drug targets and small
molecules at the atomic level and of the potential drug-like properties of
compounds early in the process, are designed to accelerate the complex process
of drug discovery.

British Biotech's continuing revenues have been derived primarily from licensing
and collaborative research and development agreements. To the extent that
research and development is not

                                        9
<PAGE>

covered by these agreements, it is funded from British Biotech's own resources.
In addition, British Biotech receives interest income on its cash balances.

Financial information on British Biotech is set out in Part II of the Listing
Particulars. You are advised to read the whole of that document, including the
comparative table in Part II of the Listing Particulars and the other financial
information in Part III of the Listing Particulars.

Details of British Biotech's current trading are set out in paragraph 9 below.

8.  INFORMATION ON VERNALIS

Vernalis' strategy is to build an integrated biotechnology company that
discovers, develops and commercialises drugs for the treatment of diseases
related to the central nervous system. Vernalis is internationally recognised
for its expertise in the field of serotonin, a key neurotransmitter involved in
a large number of common neurological and psychiatric disorders. Vernalis has an
experienced internal discovery team and a development group that has undertaken
international drug development successfully and achieved regulatory approvals in
the United States and Europe.

Vernalis' marketed product, frovatriptan, has received regulatory approvals in
the United States and Europe for the acute treatment of migraine. Frovatriptan
was launched in the US market during June 2002 and, as of May 2003, had achieved
a market share of approximately 2.4 per cent. of the triptan class of drugs.
Frovatriptan was launched in the German market during November 2002 and, as of
May 2003, had achieved a market share of approximately 5.3 per cent. of the
triptan class of drugs. In addition, frovatriptan has recently been launched in
the UK and Irish markets with further European launches expected to follow
during 2003. Frovatriptan is marketed in the US by Elan and UCB and in Europe by
Menarini. A significant sales-related milestone may become due from Elan,
subject to the level of frovatriptan sales in the US. In particular, this one-
off payment will become due if net sales of frovatriptan in the North American
market exceed $100 million in a twelve month period.

In the third quarter of 2002, Vernalis announced positive headline results from
a multi-centre US clinical trial exploring frovatriptan's potential use in the
prophylaxis (prevention) of menstrually associated migraine. The full results of
this Phase IIIb study were presented at the annual meeting of the American
Academy of Neurology in April 2003 and will subsequently be published in key
scientific and clinical journals. Vernalis intends to carry out additional
studies required to enable its partners to apply for US and European regulatory
approvals for the use of frovatriptan in this new indication. No other drugs in
the triptan class are currently approved for prophylactic use in menstrually
associated migraine. The Vernalis Directors believe that if the positive outcome
of the initial study can be reproduced in further studies and a label extension
successfully obtained, it would give frovatriptan a competitive advantage that
could enable Vernalis' partners to increase significantly frovatriptan's market
share and, potentially, to expand the overall size of the market for migraine
therapies.

In addition to frovatriptan, Vernalis currently has one product candidate in
clinical development and one in pre-clinical development. VML 670, a potential
new treatment for sexual dysfunction in patients taking medication for
depression, is currently in Phase II clinical studies. The compound is partnered
with Lilly. VR 2006, a potential treatment for Parkinson's disease, is currently
in pre-clinical development and is un-partnered.

Vernalis also has a number of research programmes. The most advanced include a
programme targeting the 5HT(2C) receptor for the treatment of obesity in
collaboration with Roche and another programme targeting the A(2A) receptor for
the treatment of depression which is currently un-partnered.

For the year ended 31 December 2002, Vernalis reported a loss before taxation of
L18.1 million on turnover of L5.9 million. Vernalis had net liabilities as at
that date of L0.3 million, with Net Cash of L1.7 million. On the basis of the
Closing Price of a Vernalis Share on 24 July 2003 (the last Business

                                        10
<PAGE>

Day prior to the publication of this document) Vernalis' market capitalisation
was approximately L43.7 million.

Financial information on Vernalis is set out in Part III of the Listing
Particulars. You are advised to read the whole of that document, including the
comparative table in Part III of the Listing Particulars and the other financial
information in Part II of the Listing Particulars.

Details of Vernalis' current trading are set out in the following paragraph.

9.  CURRENT TRADING AND PROSPECTS FOR THE MERGED GROUP

BRITISH BIOTECH'S CURRENT TRADING

Since 30 April 2003, progress has been in accordance with British Biotech
management's expectations. The clinical development projects: BB-10153,
BB-10901, MG98 and BB-83698 continue to progress in clinical trials. R140
continues in preclinical development and remains on track to start a Phase I
study by the end of 2003. The research programmes targeted at Hsp90,
inflammation (with Serono) and infection (with GeneSoft) continue to progress in
line with the plans for these projects.

The merger of British Biotech and RiboTargets was completed in April 2003 and
the resultant integration has been largely completed. Combined headcount is
being reduced from 177 to approximately 110 employees by late 2003 and these
measures are expected to achieve the cash outflow reductions predicted at the
time of the merger of L3.1 million in the 12 months to 30 April 2004 and L6.4
million per annum thereafter.

For the year ended 30 April 2003, British Biotech reported a loss before
taxation of L17.5 million on turnover of L1.1 million. British Biotech had net
assets as at that date of L58.1 million, with Net Cash of L41.0 million. On the
basis of the Closing Price of a British Biotech Share on 24 July 2003 (the last
Business Day prior to the publication of this document), British Biotech's
market capitalisation was approximately L43.1 million.

VERNALIS' CURRENT TRADING

Following the US and German launches of frovatriptan in 2002, Vernalis has now
started to receive regular quarterly income from royalties on US and European
sales, and, in the case of Europe, sales revenues from the supply of finished
frovatriptan product to Menarini.

During 2003, expected increased revenues from frovatriptan, together with the
benefit to operating expenses from the L3 million of annualised cost savings
implemented in 2002, should result in a progressive reduction in Vernalis' net
cash outflows.

Vernalis' annual report dated 9 May 2003 raised a matter of uncertainty with
respect to the successful completion of the placing and open offer announced on
1 May 2003. On 30 May 2003 Vernalis successfully completed the placing and open
offer of 44,444,445 new shares in Vernalis at 36 pence per share which raised
L14.1 million net of expenses.

On 5 June 2003, Vernalis announced that Roche's option over Vernalis' adenosine
A(2A) antagonist research programme in depression had been terminated. As a
result, Vernalis has complete control over its A(2A) antagonist programmes,
which are targeting a range of indications including Parkinson's disease and
depression.

PROSPECTS FOR THE MERGED GROUP

The Merged Group will have one marketed product (frovatriptan) and a broad
product pipeline. It will have the cash resources available to further enhance
the potential of frovatriptan. This includes the ability to expand into further
indications including its use in the prophylaxis (prevention) of menstrually
associated migraine, as well as supporting current licensees in promoting
existing indications. The Merged Group expects frovatriptan revenues and
royalties to continue to increase over the course of the current financial year.
                                        11
<PAGE>

Following a review of its portfolio, the Merged Group will focus resources on
the most commercially attractive programmes, focussing on central nervous system
disorders and oncology.

The Merged Group will build on its established drug discovery platform. It will
have the key objective of further partnering its research and development
projects.

The Merger will create a business with a stronger financial position with pro
forma Net Cash of L48.4 million as at 31 May 2003, after deducting the Roche
Convertible Loan of L7.0 million (as described in paragraph 13 below) which may
become repayable at the option of Roche as a result of the Merger. Its cash
position will be enhanced by frovatriptan royalties and potential future
milestone payments and out-licensing fees.

The Merger will generate significant cash savings through focussing on the most
commercially attractive research programmes and the removal of duplicate
corporate overhead costs. These savings are expected to be approximately L6.5
million in the first full financial year (to 30 April 2005) following
completion, with a net cost of L0.4 million (after recognising savings of L1.8
million) in the financial year to 30 April 2004. The Merged Group aims to reduce
combined headcount from 204 (after previously announced reductions within
British Biotech) to approximately 130.

The Merged Group will be better positioned to participate in the further
consolidation of the biotechnology sector.

10.  THE MERGED GROUP'S PRODUCTS

The Merged Group will have one marketed product, Phase IIIb studies proceeding
for an additional indication for that marketed product, three product candidates
in Phase II, two in Phase I, two in pre-clinical development, and a broad range
of discovery programmes in late research. The Merged Group will seek to involve
major pharmaceutical partners for late-stage development and commercialisation
of certain of its products.

The products in the Merged Group's pipeline, before the portfolio review, are as
follows:

<Table>
<Caption>
-------------------------------------------------------------------------------------------------
PRODUCT           DESCRIPTION           PARTNER        STATUS         INDICATION
-------------------------------------------------------------------------------------------------
<S>               <C>                   <C>            <C>            <C>
frovatriptan      5-HT(1B:D) receptor   Elan/UCB*      Marketed       Acute migraine
                  agonist               (US) Menarini
                                        (Europe)
frovatriptan      5-HT(1B:D) receptor   Elan/UCB*      Ph IIIb        Prophylaxis for menstrually
                  agonist               (US) Menarini                 associated migraine
                                        (Europe)
BB-10153          Novel thrombolytic    --             Ph II          Acute thrombotic diseases
VML 670           5HT(1A) receptor      Lilly          Ph II          Sexual dysfunction in
                  agonist                                             patients taking SSRI's for
                                                                      depression
BB-10901          Targeted cytotoxic    ImmunoGen      Ph I/II        Small cell lung cancer
BB-83698          Peptide deformylase   GeneSoft       Ph I           Community acquired
                  inhibitor                                           pneumonia
MG98              Anti-sense DNA        MethylGene     Ph I           Solid tumours/AML
VR 2006           A(2A) receptor        --             Pre-clinical   Parkinson's disease
                  antagonist
R140              Non-sedative          --             Pre-clinical   Severe pain
                  analgesic
Research          5HT(2c) receptor      Roche          Late research  Obesity
                  agonist
</Table>

                                        12
<PAGE>

<Table>
<Caption>
-------------------------------------------------------------------------------------------------
PRODUCT           DESCRIPTION           PARTNER        STATUS         INDICATION
-------------------------------------------------------------------------------------------------
<S>               <C>                   <C>            <C>            <C>
Research          A(2A) receptor        --             Late research  Depression
                  antagonists
Research          Hsp90 Inhibitors      --             Late research  Cancer
Research          Metalloenzyme         Serono         Late research  Inflammation
                  inhibitor
Research          PDF inhibitor         GeneSoft       Late research  Respiratory tract
                                                                      infections
-------------------------------------------------------------------------------------------------
</Table>

Notes:

* UCB is appointed by Elan as its co-promotion partner

On completion of the Merger, the Merged Group will undertake a portfolio review
to focus resources on the most commercially attractive projects.

11.  BOARD OF DIRECTORS

The board of the Merged Group will be drawn from the boards of both British
Biotech and Vernalis. The proposed members of the Merged Group's board are:

EXECUTIVE DIRECTORS

<Table>
<S>                                                 <C>
Peter Fellner--Executive Chairman.................  (Executive Chairman, British Biotech)
Simon Sturge--Chief Executive Officer.............  (Chief Executive, British Biotech)
Tony Weir--Chief Financial Officer................  (Finance Director, British Biotech)
Peter Worrall--Corporate Development Director.....  (Finance Director, Vernalis)
John Hutchison--Development Director..............  (Development Director, Vernalis)
</Table>

NON-EXECUTIVE DIRECTORS

<Table>
<S>                                                 <C>
George Kennedy--Deputy Chairman and Senior
  Independent Director............................  (Chairman, Vernalis)
Carol Ferguson....................................  (Non-executive Director, Vernalis)
Ian Kent..........................................  (Non-executive Director, British Biotech)
Keith Merrifield..................................  (Non-executive Director, British Biotech)
Peter Read........................................  (Non-executive Director, Vernalis)
Eugene Williams...................................  (Non-executive Director, British Biotech)
</Table>

Peter Worrall and John Hutchison, currently finance director and development
director of Vernalis, respectively, will join the board of British Biotech as
Corporate Development Director and Development Director, respectively.

George Kennedy will join the board of British Biotech as Deputy Chairman and
Senior Independent Director.

Carol Ferguson and Peter Read will join the board of British Biotech as
non-executive directors.

Having participated in the planning for the proposed Merger with Vernalis, and
having led the integration of RiboTargets which has now largely been completed,
Tim Edwards will step down from the Board and leave British Biotech on
completion of the Merger.

12.  MANAGEMENT AND EMPLOYEES

British Biotech and Vernalis attach great importance to retaining the skills and
expertise of their management and employees. The management teams of British
Biotech and Vernalis will be combined in order to obtain the maximum benefit
from their skills and experiences. Although the combination of similar functions
will necessarily lead to some staff reductions, the boards of British Biotech
and Vernalis believe that the greater strength, market position and growth
prospects for the Merged Group will generally enhance the career prospects of
its remaining employees.
                                        13
<PAGE>

The British Biotech Board has confirmed that the existing employment rights,
including pension rights, of employees of both British Biotech and Vernalis will
be fully safeguarded.

13.  VERNALIS INCENTIVE PLANS AND ROCHE CONVERTIBLE LOAN

The Offer will extend to any Vernalis Shares issued or unconditionally allotted
while the Offer remains open for acceptance (or such earlier date as, subject to
the rules of the Code, British Biotech may decide) as a result of the exercise
of options or shares being transferred under the Vernalis Incentive Plans. All
options over Vernalis Shares will become exercisable when the Offer becomes or
is declared unconditional in all respects. To the extent that options are not
exercised within the relevant periods specified in the respective rules of each
plan, they will lapse.

Share awards made under the Vernalis Restricted Share Scheme will vest when the
Offer becomes or is declared unconditional in all respects or when British
Biotech becomes bound or entitled to acquire Vernalis Shares under the
compulsory acquisition procedure. On vesting, the Vernalis Shares issued under
the awards will be transferred to the participants.

Under the terms of the Roche Convertible Loan, Vernalis will be required to
notify Roche when Vernalis becomes aware that the right to cast more than 50 per
cent. of the votes at a general meeting of Vernalis has or will become
unconditionally vested in British Biotech. Roche will be entitled, within 30
days of Vernalis giving such notice, to require repayment of the loan with
accrued but unpaid interest to the date of repayment. The Merged Group currently
has the cash resources to make such repayment in full should it be demanded.
Additionally, Roche may elect prior to 13 May 2007 to convert its loan into
approximately 4.2 per cent. of Vernalis' undiluted issued ordinary share
capital, subject to certain adjustments. The conversion price under the Roche
Convertible Loan at which Roche may convert its loan into Vernalis Shares is
currently above the value attributable to a Vernalis Share under the Offer.

14.  UK TAXATION

THE FOLLOWING COMMENTS ARE INTENDED AS A GENERAL GUIDE ONLY AND ARE BASED ON
CURRENT UNITED KINGDOM LEGISLATION AND UNITED KINGDOM INLAND REVENUE PRACTICE AS
AT THE DATE OF THIS DOCUMENT AND SUMMARISE ADVICE RECEIVED BY THE BRITISH
BIOTECH DIRECTORS AS TO THE POSITION OF VERNALIS SHAREHOLDERS WHO (UNLESS THE
POSITION OF NON-UNITED KINGDOM RESIDENT VERNALIS SHAREHOLDERS IS EXPRESSLY
REFERRED TO) ARE RESIDENT OR ORDINARILY RESIDENT IN THE UNITED KINGDOM FOR TAX
PURPOSES AND WHO HOLD THEIR VERNALIS SHARES AS AN INVESTMENT. THEY DO NOT DEAL
WITH CERTAIN CLASSES OF VERNALIS SHAREHOLDERS, SUCH AS DEALERS IN SECURITIES.

CHARGEABLE GAINS

Liability to United Kingdom taxation of chargeable gains will depend on a
Vernalis Shareholder's circumstances.

A Vernalis Shareholder who (either alone or together with persons connected with
him or her) does not hold more than 5 per cent. of, or any class of, shares in
Vernalis should not be treated as having made a disposal of his Vernalis Shares
for the purposes of United Kingdom taxation of chargeable gains to the extent
that he receives New British Biotech Shares in exchange for his Vernalis Shares
under the Offer. Any gain or loss which would otherwise have arisen on a
disposal of his Vernalis Shares will be "rolled-over" into the New British
Biotech Shares, and the New British Biotech Shares will be treated as the same
asset as his Vernalis Shares acquired at the same time and for the same
consideration as he acquired his Vernalis Shares.

Any Vernalis Shareholder who, either alone or together with persons connected
with him, holds more than 5 per cent. of shares in Vernalis is advised that a
clearance application has been made to the UK Inland Revenue under section 138
of the Taxation of Chargeable Gains Act 1992 (TCGA) in respect of the Offer
which means that provided such clearance is received from the Inland Revenue,
any such shareholder will be treated in the manner described in the preceding
paragraph. The Offer is not conditional on such clearance being received.
                                        14
<PAGE>

A Vernalis Shareholder which is a company and which would on a disposal of its
Vernalis Shares qualify for an exemption from corporation tax on chargeable
gains under Schedule 7AC of the TCGA (exemption for disposals by companies with
substantial shareholdings) will not be treated as set out in the two preceding
paragraphs. Instead, such a shareholder will be treated as disposing of its
Vernalis Shares as a result of the Offer becoming or being declared
unconditional in all respects but any gain or loss arising on the disposal will
not be a chargeable gain or an allowable loss for the purposes of United Kingdom
taxation of chargeable gains and the shareholder shall be treated as acquiring
its New British Biotech Shares for an amount equal to the market value of the
Vernalis Shares given up.

On a subsequent disposal of the New British Biotech Shares, a liability to
capital gains tax or corporation tax or an allowable loss may, depending on the
shareholder's respective circumstances (including the availability of any
exemptions, reliefs and allowable losses), arise.

DIVIDENDS

British Biotech will not be required to withhold tax at source when paying a
dividend.

An individual holder of New British Biotech Shares who is resident in the United
Kingdom for tax purposes and who receives a dividend from British Biotech will
be entitled to a tax credit which such shareholder may set off against his total
income tax liability on the dividend. The tax credit will be equal to 10 per
cent. of the aggregate of the dividend and the tax credit (the GROSS DIVIDEND),
which is also equal to one-ninth of the cash dividend received.

Generally, a United Kingdom resident individual shareholder who is not liable to
income tax in respect of the gross dividend will not be entitled to repayment of
the tax credit. A United Kingdom resident individual holder of New British
Biotech Shares who is liable to income tax at the starting or basic rate will be
subject to tax on the dividend at the rate of 10 per cent. of the gross
dividend, so that the tax credit will satisfy in full such shareholder's
liability to income tax in respect of the gross dividend. In the case of a
United Kingdom resident individual shareholder who is liable to income tax at
the higher rate, the tax credit will be set against but not full match his tax
liability on the gross dividend and he will have to account for additional tax
equal to 22.5 per cent. of the gross dividend (which is also equal to 25 per
cent. of the cash dividend received) to the extent that the gross dividend when
treated as the top slice of his income falls above the threshold for higher rate
income tax.

COMPANIES

United Kingdom resident corporate holders of New British Biotech Shares will
generally not be subject to corporation tax on dividends paid by British
Biotech. Those shareholders will not be able to claim repayment of tax credits
attaching to dividends.

PENSION FUNDS AND CHARITIES

United Kingdom resident taxpayers who are not liable to United Kingdom tax on
dividends, including pension funds and charities, will not be entitled to claim
repayment of the tax credit attaching to dividends paid by British Biotech,
although charities will be entitled to limited compensation in lieu of repayable
tax credits until 6 April 2004.

PEPS AND ISAS

Tax credits on dividends paid by British Biotech in respect of shares held in
PEPs or ISAs will be repayable for dividends paid on or before 5 April 2004.

                                        15
<PAGE>

STAMP DUTY AND STAMP DUTY RESERVE TAX (SDRT)

No stamp duty or SDRT will be payable by Vernalis Shareholders who accept the
Offer.

NON-UNITED KINGDOM RESIDENTS

The tax treatment of non-United Kingdom resident Vernalis Shareholders may
differ from that described in the preceding paragraphs. In particular:

(i)  non-United Kingdom resident Vernalis Shareholders will generally not be
     subject to tax in the United Kingdom in respect of any gain accruing to
     them as a result of accepting the Offer;

(ii) non-United Kingdom resident Vernalis Shareholders should note that they
     will generally not be entitled to claim repayment from the United Kingdom
     Inland Revenue in respect of tax credits on dividends on their New British
     Biotech Shares.

Vernalis Shareholders who are not resident in the United Kingdom should consult
their own tax advisers concerning their tax liabilities (in the United Kingdom
and any other country).

THE ABOVE PARAGRAPHS ARE GENERAL IN CHARACTER AND NOT EXHAUSTIVE. IF YOU ARE IN
ANY DOUBT AS TO YOUR TAXATION POSITION YOU SHOULD CONSULT AN APPROPRIATE
PROFESSIONAL ADVISER WITHOUT DELAY.

15.  PROCEDURE FOR ACCEPTANCE OF THE OFFER

Vernalis Shareholders will find enclosed with this document a Form of Acceptance
in relation to the Offer. This section should be read together with the
instructions on, and notes to the Form of Acceptance, which will be deemed to be
part of the terms of the Offer and with section C of Appendix I to this
document.

(a) Procedure for acceptance

    To accept the Offer, you must return the Form of Acceptance, completed and
    signed in accordance with the instructions set out thereon, whether or not
    your Vernalis Shares are in uncertificated form (that is, in CREST). THE
    COMPLETED, SIGNED (AND IF YOU ARE AN INDIVIDUAL, WITNESSED) FORM OF
    ACCEPTANCE, TOGETHER WITH THE RELEVANT SHARE CERTIFICATE(S) AND OR OTHER
    DOCUMENT(S) OF TITLE (IF YOUR VERNALIS SHARES ARE IN CERTIFICATED FORM),
    SHOULD BE SENT BY POST OR (DURING NORMAL BUSINESS HOURS ONLY) DELIVERED BY
    HAND TO CAPITA IRG PLC, CORPORATE ACTIONS, PO BOX 166, THE REGISTRY, 34
    BECKENHAM ROAD, BECKENHAM, KENT, BR3 4TH SO AS TO BE RECEIVED AS SOON AS
    POSSIBLE BUT IN ANY EVENT BEFORE 3.00 P.M. ON 18 AUGUST 2003.

    The enclosed reply paid envelope may be used by Vernalis Shareholders for
    returning the Form of Acceptance within the United Kingdom only. No
    acknowledgement of receipt of the Form of Acceptance, share certificates or
    other documents of title will be given. Any Form of Acceptance received in
    an envelope post marked in or dispatched from a Restricted Jurisdiction or
    otherwise appearing to British Biotech or its agents to have been posted
    from a Restricted Jurisdiction will be rejected as an invalid acceptance of
    the Offer. Further information for Overseas Shareholders is set out in
    paragraph 17 of this letter and paragraph 6 of section B of Appendix I to
    this document.

    You should note that if you hold Vernalis Shares in both certificated and
    uncertificated form (that is, in CREST) you should complete a separate Form
    of Acceptance for each holding. In addition, you should complete a separate
    Form of Acceptance in respect of each member account ID for Vernalis Shares
    held in uncertificated form but under different member account IDs and a
    separate Form of Acceptance in respect of each designation for Vernalis
    Shares held in certificated form but under different designations.
    Additional Forms of Acceptance are available from Capita IRG Plc on
    telephone number 0870 162 3105 (from the United Kingdom only) or if you are
    calling from overseas (other than the United States) +44 (0)20 8639 2157.

                                        16
<PAGE>

     (i)   To accept the Offer

           To accept the Offer in respect of all your Vernalis Shares, you must
           complete Boxes 1 and 3 and, where appropriate, Boxes 5, 6 and/or 7
           and, if your Vernalis Shares are in CREST, Box 4 on the Form of
           Acceptance. In the case of individuals, you must sign Box 2 on the
           Form of Acceptance IN THE PRESENCE OF A WITNESS, WHO SHOULD ALSO SIGN
           IN ACCORDANCE WITH THE INSTRUCTIONS PRINTED THEREON. IN THE CASE OF
           CORPORATIONS, BOX 2 MUST BE SIGNED IN ACCORDANCE WITH THE
           INSTRUCTIONS PRINTED ON THE FORM OF ACCEPTANCE.

     (ii)  To accept the Offer in respect less than all your Vernalis Shares

           To accept the Offer in respect of less than all your Vernalis Shares,
           you must insert in Box 1 on the Form of Acceptance such lesser number
           of Vernalis Shares in respect of which you wish to accept the Offer
           in accordance with the instructions printed thereon. You should then
           follow the procedure set out in (i) above in respect of such lesser
           number of Vernalis Shares. If you do not insert a number in Box 1, a
           valid acceptance will be deemed to be made in respect of all the
           Vernalis Shares held by you.

    IF YOU HAVE ANY QUESTIONS ON HOW TO COMPLETE THE FORM OF ACCEPTANCE, PLEASE
    TELEPHONE CAPITA IRG PLC ON TELEPHONE NUMBER 0870 162 3105 (FROM THE UNITED
    KINGDOM ONLY) OR IF YOU ARE CALLING FROM OVERSEAS (OTHER THAN THE UNITED
    STATES) +44 (0)20 8639 2157.

(b) Vernalis Shares in uncertificated form (that is, in CREST)

    If your Vernalis Shares are in uncertificated form, you should insert in Box
    4 of the Form of Acceptance the participant ID and member account ID under
    which such shares are held by you in CREST and otherwise complete and return
    the Form of Acceptance as described above. In addition, you should take (or
    procure to be taken) the action set out below to transfer the Vernalis
    Shares in respect of which you wish to accept the Offer to an escrow
    balance, specifying Capita IRG Plc (in its capacity as a CREST participant
    under Capita IRG Plc participant ID referred to below) as the Escrow Agent,
    as soon as possible and IN ANY EVENT SO THAT THE TRANSFER TO ESCROW SETTLES
    NOT LATER THAN 3.00 P.M. ON 18 AUGUST 2003.

    IF YOU ARE A CREST PERSONAL MEMBER, YOU SHOULD REFER TO YOUR CREST SPONSOR
    BEFORE TAKING ANY ACTION. Your CREST sponsor will be able to confirm details
    of your participant ID and the member account ID under which your Vernalis
    Shares are held. In addition, only your CREST sponsor will be able to send
    the TTE instruction to CRESTCo in relation to your Vernalis Shares. You
    should send (or, if you are a CREST sponsored member, procure that your
    CREST sponsor sends) a TTE instruction to CRESTCo which must be properly
    authenticated in accordance with CRESTCo's specifications and which must
    contain, in addition to the other information that is required for a TTE
    instruction to settle in CREST, the following details:

     (i)   the number of Vernalis Shares to be transferred to an escrow balance;

     (ii)  your member account ID. This must be the same member account ID as
           the member account ID that is inserted in Box 4 of the Form of
           Acceptance;

     (iii) your participant ID. This must be the same participant ID as the
           participant ID that is inserted in Box 4 of the Form of Acceptance;

     (iv)  the participant ID of the Escrow Agent (Capita IRG Plc, in its
           capacity as a CREST Receiving Agent). This is RA10;

     (v)   the member account ID of the Escrow Agent. This is VERNALIS;

     (vi)  the Form of Acceptance Reference Number (REFERENCE NUMBER). This is
           the Reference Number that appears in Box 4 on page 3 of the Form of
           Acceptance. This Reference Number should be inserted in the first
           eight characters of the shared note field on the TTE instruction.
           Such insertion will enable Capita IRG Plc to match the transfer to
           escrow

                                        17
<PAGE>
            to your Form of Acceptance. YOU SHOULD KEEP A SEPARATE RECORD OF
            THIS REFERENCE NUMBER FOR FUTURE REFERENCE;

     (vii)  the intended settlement date. This should be as soon as possible
            and, in any event, not later than 3.00 p.m. on 18 August 2003;

     (viii) the Corporate Action ISIN. This is GB0009260091;

     (ix)   the Corporate Action Number for the Offer: this is allocated by
            CRESTCo and can be found by viewing the relevant Corporate Action
            details in CREST; and

     (x)    input with standard delivery instruction of priority 80.

     After settlement of the TTE instruction, you will not be able to access the
     Vernalis Shares concerned in CREST for any transaction or charging purposes
     unless the Offer lapses or is withdrawn. If the Offer becomes or is
     declared unconditional in all respects, the Escrow Agent will transfer the
     Vernalis Shares concerned to itself in accordance with paragraph (d) and
     (e) of section C of Appendix I to this document.

     You are recommended to refer to the CREST Manual published by CRESTCo for
     further information on the CREST procedures outlined above. For ease of
     processing, you are requested, wherever possible, to ensure that a Form of
     Acceptance relates to only one transfer to escrow.

     If no Reference Number, or an incorrect Reference Number, is included on
     the TTE instruction, British Biotech may treat any number of Vernalis
     Shares transferred to an escrow balance in favour of the Escrow Agent
     specified above from the participant ID and member account ID identified in
     the TTE instruction as relating to any Form(s) of Acceptance which
     relate(s) to the same member account ID and participant ID (up to the
     number of Vernalis Shares inserted or deemed to be inserted on the Form(s)
     of Acceptance concerned).

     YOU SHOULD NOTE THAT CRESTCO DOES NOT MAKE AVAILABLE SPECIAL PROCEDURES IN
     CREST FOR ANY PARTICULAR CORPORATE ACTION. NORMAL SYSTEM TIMINGS AND
     LIMITATIONS WILL THEREFORE APPLY IN CONNECTION WITH A TTE INSTRUCTION AND
     ITS SETTLEMENT. YOU SHOULD THEREFORE ENSURE THAT ALL NECESSARY ACTION IS
     TAKEN BY YOU (OR BY YOUR CREST SPONSOR) TO ENABLE A TTE INSTRUCTION
     RELATING TO YOUR VERNALIS SHARES TO SETTLE PRIOR TO 3.00 P.M. ON 18 AUGUST
     2003. IN THIS CONNECTION, YOU ARE REFERRED IN PARTICULAR TO THOSE SECTIONS
     OF THE CREST MANUAL CONCERNING PRACTICAL LIMITATIONS OF THE CREST SYSTEM
     AND TIMINGS.

     British Biotech will make an appropriate announcement if any of the details
     contained in this paragraph 15(b) alter for any reason in any respect that
     is material to Vernalis Shareholders.

(c)  Vernalis Share certificates not readily available or lost

     If you wish to accept the Offer and your Vernalis Shares are in
     certificated form but your share certificate(s) and/or other document(s) of
     title is/are not readily available or is/are lost, you should still
     complete, sign and return the Form of Acceptance as stated above so as to
     arrive no later than 3.00 p.m. on 18 August 2003, together with any
     relevant documents you have available and a letter stating that the balance
     will follow or that you have lost one or more of your certificates and/or
     other documents of title or that they are not readily available. You should
     then arrange for the relevant share certificate(s) and/or other documents
     of title to be delivered, by post or by hand, to the appropriate address
     given above, as soon as possible thereafter. No acknowledgement of receipt
     of document(s) will be given.

     If any of your share certificate(s) have been lost, you should write to
     Vernalis's registrars, who are Lloyds TSB Registrars, The Causeway,
     Worthing, West Sussex, BN99 6DA advising them of the loss and requesting a
     letter of indemnity for completion. When completed in accordance with the
     instructions given, the letter of indemnity must be lodged with Capita IRG
     Plc, Corporate Actions, PO Box 166, The Registry, 34 Beckenham Road,
     Beckenham, Kent, BR3 4TH in support of the Form of Acceptance. 18
<PAGE>

(d) Deposits of Vernalis Shares into, and withdrawals of Vernalis Shares from,
    CREST

    Normal CREST procedures (including timings) apply in relation to any
    Vernalis Shares that are, or are to be, converted from uncertificated to
    certificated form, or from certificated to uncertificated form, during the
    course of the Offer (whether any such conversion arises as a result of a
    transfer of Vernalis Shares or otherwise). Holders of Vernalis Shares who
    are proposing so to convert any such Vernalis Shares are recommended to
    ensure that the conversion procedures are implemented in sufficient time to
    enable the person holding or acquiring the Vernalis Shares as a result of
    the conversion to take all necessary steps in connection with an acceptance
    of the Offer (in particular, as regards delivery of share certificate(s) or
    other document(s) of title or transfers to an escrow balance as described
    above) prior to 3.00 p.m. on 18 August 2003.

(e) Validity of acceptances

    British Biotech and JPMorgan reserve the right, subject to the terms of the
    Offer and the Code, to treat as valid in whole or in part any acceptance of
    the Offer which is not entirely in order or which is not accompanied by the
    relevant TTE instruction or (as applicable) the relevant share
    certificate(s) and/or other document(s) of title. In that event, the
    consideration under the Offer will only be despatched in the manner set out
    below when the acceptance is entirely in order, after the relevant TTE
    instruction has settled or (as applicable) the relevant share certificate(s)
    and/or other document(s) of title or indemnities satisfactory to British
    Biotech and JPMorgan has/have been received.

(f) Overseas shareholders

    The attention of Vernalis Shareholders who are citizens, nationals or
    residents of, or located in, or who have a registered office in,
    jurisdictions outside the United Kingdom (and any person, including without
    limitation, any custodian nominee or trustee who have a legal or contractual
    obligation to forward this document to any jurisdiction outside the United
    Kingdom) is drawn to paragraph 6 of section B and paragraph (b) of section C
    of Appendix I to this document and to the relevant provisions of the Form of
    Acceptance.

    The availability of the Offer to persons not resident and located in the
    United Kingdom is subject to the laws of the relevant jurisdictions and the
    restrictions set forth herein. Any persons who are subject to the laws of
    any jurisdiction other than the United Kingdom should inform themselves
    about and observe any applicable requirements.

    The Offer is not being made and will not be made, directly or indirectly, in
    or into the United States, Canada, Australia, Belgium, South Africa or
    Japan. Accordingly, any accepting Vernalis Shareholder who is unable to give
    the warranties set out in paragraph (b) of section C of Appendix I will be
    deemed not to have accepted the Offer.

    All Vernalis Shareholders (including, without limitation, nominees, trustees
    or custodians) who would, or otherwise intend to, or have a legal or
    contractual obligation to forward this document and/or the Form of
    Acceptance to any jurisdiction outside the United Kingdom, should read the
    further details in this regard which are contained in paragraph 6 of section
    B and in paragraph (b) of section C of Appendix I before taking any action.

    IF YOU ARE IN ANY DOUBT AS TO THE PROCEDURE FOR ACCEPTANCE, PLEASE CONTACT
    CAPITA IRG PLC BY TELEPHONE ON 0870 162 3105 OR IF YOU ARE CALLING FROM
    OVERSEAS (OTHER THAN THE UNITED STATES) +44 (0)20 8639 2157. YOU ARE
    REMINDED THAT, IF YOU ARE A CREST PERSONAL MEMBER IN RESPECT OF YOUR
    VERNALIS SHARES, YOU SHOULD CONTACT YOUR CREST SPONSOR BEFORE TAKING ANY
    ACTION.

16.  LISTING, SETTLEMENT AND DEALINGS

Application has been made to the UK Listing Authority for the New British
Biotech Shares to be admitted to the Official List and to the London Stock
Exchange for admission of such New British

                                        19
<PAGE>

Biotech Shares to trading on its market for listed securities. These
applications are expected to become effective and dealings in the New British
Biotech Shares on the London Stock Exchange's market for listed securities are
expected to commence at 8.00 a.m. London time on the first Business Day
following the day on which the Offer becomes or is declared unconditional in all
respects (save for any condition relating to Admission).

The New British Biotech Shares will not be listed on any other stock exchanges
and have not been registered with the SEC under the Securities Act, although
British Biotech Shares will continue to be registered under the US Securities
Exchange Act of 1934, as amended, and will therefore continue to be subject to
SEC reporting requirements. British Biotech's American Depositary Shares will
continue to be quoted on the NASDAQ National Market System.

THE OFFER IS NOT BEING MADE AND WILL NOT BE MADE DIRECTLY OR INDIRECTLY IN, OR
BY USE OF THE MAILS OF, OR BY ANY MEANS OR INSTRUMENTALITY OF INTERSTATE OR
FOREIGN COMMERCE OF, OR ANY FACILITIES OF A NATIONAL SECURITIES EXCHANGE OF, THE
UNITED STATES. THIS INCLUDES, BUT IS NOT LIMITED TO, FACSIMILE TRANSMISSION,
ELECTRONIC MAIL, TELEX, TELEPHONE AND THE INTERNET. ACCORDINGLY, COPIES OF THIS
DOCUMENT, THE FORM OF ACCEPTANCE, THE ACCOMPANYING LISTING PARTICULARS AND ANY
RELATED OFFERING OR SOLICITATION DOCUMENTS ARE NOT BEING, AND MUST NOT BE,
MAILED OR OTHERWISE TRANSMITTED, DISTRIBUTED OR FORWARDED IN OR INTO THE UNITED
STATES. ANY PURPORTED ACCEPTANCE OF THE OFFER RESULTING DIRECTLY OR INDIRECTLY
FROM A VIOLATION OF THESE RESTRICTIONS WILL BE INVALID.

THIS DOCUMENT IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES.
SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION
OR AN EXEMPTION FROM REGISTRATION. THE NEW BRITISH BIOTECH SHARES TO BE ISSUED
PURSUANT TO THE OFFER HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE
SECURITIES ACT OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE
UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR DELIVERED, DIRECTLY OR
INDIRECTLY, IN THE UNITED STATES.

If British Biotech receives acceptances under the Offer in respect of 90 per
cent. or more of the Vernalis Shares and the Offer becomes or is declared
unconditional in all respects, British Biotech intends to exercise its rights
pursuant to the provisions of sections 428 to 430F (inclusive) of the Companies
Act to acquire compulsorily any remaining Vernalis Shares.

When the Offer becomes or is declared unconditional in all respects, British
Biotech intends to procure the making of an application by Vernalis to the UK
Listing Authority for the cancellation of the listing of Vernalis Shares on the
Official List and for the cancellation of the admission to trading in Vernalis
Shares on the London Stock Exchange's market for listed securities. The
cancellation of the listing of Vernalis Shares will significantly reduce the
liquidity and marketability of any Vernalis Shares not assented to the Offer and
their value may be affected in consequence.

It is also proposed that, following the Offer becoming or being declared
unconditional in all respects and after the Vernalis Shares are delisted,
Vernalis will be re-registered as a private company under the relevant
provisions of the Companies Act.

Subject to the Offer becoming or being declared unconditional in all respects,
settlement of the consideration to which any Vernalis Shareholder is entitled
under the Offer will be effected (i) in the case of acceptances received,
complete in all aspects, by the date on which the Offer becomes or is declared
unconditional in all respects, within 14 days of such date, or (ii) in the case
of acceptances received, complete in all respects, after the date on which the
Offer becomes or is declared unconditional in all respects but while the Offer
remains open for acceptance, within 14 days of such receipt as follows:

(a) Vernalis Shares in uncertificated form (that is in CREST)

    Where an acceptance relates to Vernalis Shares in uncertificated form (that
    is in CREST), the New British Biotech Shares to which the relevant accepting
    Vernalis Shareholder is entitled will be issued to such shareholder in
    uncertificated form. British Biotech will procure that

                                        20
<PAGE>

    CRESTCo is instructed to credit the appropriate stock account in CREST of
    the accepting Vernalis Shareholder concerned with such person's entitlement
    to New British Biotech Shares pursuant to the Offer, as the case may be. The
    stock account concerned will be an account under the same participant ID and
    member account ID as appears on the Form of Acceptance of such Vernalis
    Shareholder.

    British Biotech reserves the right to settle all or any part of the
    consideration referred to in this paragraph for all or any accepting
    Vernalis Shareholder(s) in the manner referred to in paragraph (b) below,
    if, for any reason, it wishes to do so.

(b) Vernalis Shares in certificated form (that is not in CREST)

    Where an acceptance relates to Vernalis Shares in certificated form, the New
    British Biotech Shares to which the relevant accepting Vernalis Shareholder
    is entitled will be issued in certificated form. Definitive certificates for
    the New British Biotech Shares will be despatched (but not into the United
    States, Canada, Australia, Belgium, South Africa or Japan) by first class
    post to the address appearing in the register of members of Vernalis or, in
    the case of joint holders, to the joint holder whose name appears first in
    the register of members (or by such other method as may be approved by the
    Panel).

    In relation to New British Biotech Shares to be issued in certificated form
    pursuant to the Offer, temporary documents of title will not be issued
    pending the despatch by post of definitive certificates for such New British
    Biotech Shares. Pending the issue of definitive certificates for such New
    British Biotech Shares, transfers will be certified against the register
    held by British Biotech's registrars, Capita IRG Plc.

All documents and remittances sent by, to, or from Vernalis Shareholders or
their appointed agents will be sent at their own risk.

All mandates and other instructions in force relating to holdings of Vernalis
Shares will, unless and until revoked, continue to apply in relation to payment
and notices by British Biotech in respect of New British Biotech Shares.

Fractions of New British Biotech Shares will not be allotted to Vernalis
Shareholders, but the New British Biotech Shares representing the aggregate of
these fractional entitlements will be sold in the market and the net proceeds
will be retained by British Biotech for the benefit of the Merged Group.

If the Offer does not become or is not declared unconditional in all respects,
(i) share certificates and/or other documents of title will be returned by post
(or by such other method as may be approved by the Panel), within 14 days of the
Offer lapsing, to the person or agent whose name and address (outside the United
States, Canada, Australia, Belgium, South Africa or Japan) is set out in the
appropriate boxes on the Form of Acceptance or, if none is set out, to the
first-named holder at his registered address (outside the United States, Canada,
Australia, Belgium, South Africa or Japan) and (ii) the Escrow Agent will,
immediately after the lapsing of the Offer (or within such longer period as the
Panel may permit, not exceeding 14 days from the lapsing of the Offer), give TFE
instructions to CRESTCo to transfer all relevant Vernalis Shares held in escrow
balances, and in relation to which it is the Escrow Agent for the purposes of
the Offer to the original available balances of the Vernalis Shareholders
concerned.

17.  OVERSEAS SHAREHOLDERS

As regards Overseas Shareholders, the Offer may be affected by the laws of the
relevant jurisdictions. Such Overseas Shareholders should inform themselves
about and observe any applicable legal requirements. It is the responsibility of
Overseas Shareholders to satisfy themselves as to the full observance of the
laws of the relevant jurisdiction in connection therewith, including the
obtaining of any governmental, exchange control or other consents which may be
required, or the compliance with other necessary formalities which are required
to be observed

                                        21
<PAGE>

and the payment of any issue, transfer or other taxes due in such jurisdiction.
Overseas Shareholders should also read paragraph 6 of section B and paragraph
(b) of section C of Appendix I to this document. This document has been prepared
for the purposes of complying with English law, the Code and the Listing Rules
and the information disclosed may be different from that which would have been
disclosed if this document had been prepared in accordance with the laws of the
jurisdictions outside the United Kingdom.

18.  FURTHER INFORMATION

Your attention is drawn to the further information contained in the Appendices
to this document, to the accompanying Form of Acceptance and to the accompanying
Listing Particulars which contains significant additional information about
British Biotech and Vernalis.

19.  ACTION TO BE TAKEN

TO ACCEPT THE OFFER, THE FORM OF ACCEPTANCE MUST BE SIGNED AND COMPLETED AND
RETURNED, WHETHER OR NOT YOUR VERNALIS SHARES ARE IN CREST, AS SOON AS POSSIBLE
AND, IN ANY EVENT, SO AS TO BE RECEIVED BY POST OR (DURING NORMAL BUSINESS HOURS
ONLY) BY HAND AT CAPITA IRG PLC, CORPORATE ACTIONS, PO BOX 166, THE REGISTRY, 34
BECKENHAM ROAD, BECKENHAM, KENT, BR3 4TH BY NO LATER THAN 3.00 P.M. ON 18 AUGUST
2003.

                                Yours sincerely

                                 Julian Oakley
                               Managing Director
                              For and on behalf of
                                J.P. Morgan plc

                                        22
<PAGE>

                                   APPENDIX I

                   CONDITIONS AND FURTHER TERMS OF THE OFFER

Except where the context requires otherwise, references in this Appendix I and
in the Form of Acceptance to: (i) the OFFER shall include any revision,
variation, increase or extension of the Offer; (ii) the OFFER BECOMING
UNCONDITIONAL shall include references to the Offer being declared
unconditional; (iii) the OFFER BECOMING OR BEING DECLARED UNCONDITIONAL shall be
construed as references to the Offer becoming or being declared unconditional as
to acceptances, whether or not any other condition thereof remains to be
fulfilled; (iv) the ACCEPTANCE CONDITION shall mean the condition as to
acceptances applicable to the Offer (as set out in paragraph (a) of section A of
this Appendix 1); (v) an EXTENSION OF THE OFFER shall include a reference to an
extension of the date by which the acceptance condition has to be satisfied;
(vi) ACCEPTANCES OF THE OFFER shall include deemed acceptances of the Offer;
(vii) the OFFER DOCUMENT shall mean this document and any other document
containing the Offer; and (viii) any times and/or dates shall be the relevant
time and/or date in London.

SECTION A: CONDITIONS OF THE OFFER

The Offer is subject to the following conditions:

(a) valid acceptances being received (and not, where permitted, withdrawn) by
    3.00 p.m. on 18 August 2003 (the FIRST CLOSING DATE) or such later time(s)
    and/or date(s) as British Biotech may, subject to the Code, decide in
    respect of not less than 90 per cent. in nominal value (or such lesser
    percentage as British Biotech may decide) of the Vernalis Shares to which
    the Offer relates, provided that this condition will not be satisfied unless
    British Biotech and its wholly-owned subsidiaries shall have acquired, or
    agreed to acquire, pursuant to the Offer or otherwise, Vernalis Shares
    carrying more than 50 per cent. of the voting rights then normally
    exercisable at a general meeting of Vernalis, including for this purpose (to
    the extent, if any, required by the Panel) any such voting rights attaching
    to any Vernalis Shares that are unconditionally allotted or issued before
    the Offer becomes or is declared unconditional as to acceptances whether
    pursuant to the exercise of any subscription or conversion rights or
    otherwise and for the purposes of this condition:

    (i)   shares which have been unconditionally allotted but not issued shall
          be deemed to carry the voting rights they will carry on issue; and

    (ii)  the expression VERNALIS SHARES TO WHICH THE OFFER RELATES shall be
          construed in accordance with sections 428 to 430F (inclusive) of the
          Companies Act;

(b) (i)   the admission to the Official List of the New British Biotech Shares
          (or such of them as are due to be allotted at the time the Offer
          becomes or is declared unconditional in all other respects) becoming
          effective in accordance with the Listing Rules or (if British Biotech
          so determines and subject to the consent of the Panel) the UK Listing
          Authority agreeing to admit such shares to the Official List subject
          only to (x) allotment of such shares and/or (y) the Offer becoming or
          being declared unconditional in all respects; and

    (ii)  the admission to trading on the London Stock Exchange's market for
          listed securities of the New British Biotech Shares (or such of them
          as are due to be allotted at the time the Offer becomes or is declared
          unconditional in all other respects) becoming effective in accordance
          with the rules of the London Stock Exchange or (if British Biotech so
          determines and subject to the consent of the Panel) the London Stock
          Exchange agreeing to admit such shares to trading subject only to (x)
          allotment of such shares and/or (y) the Offer becoming or being
          declared unconditional in all respects;

(c) the passing at an extraordinary general meeting of British Biotech (or any
    adjournment thereof) of such resolution(s) as may be necessary or incidental
    to approve, implement and

                                        23
<PAGE>
    effect the Offer, the acquisition of any Vernalis Shares pursuant to the
    Offer or otherwise and the allotment of New British Biotech Shares pursuant
    to the Offer;

(d) no government or governmental, quasi-governmental, supranational, statutory
    or regulatory body or association, institution or agency (including any
    trade agency) or any court or other body (including any professional or
    environmental body) or person in any jurisdiction (each a RELEVANT
    AUTHORITY) having decided to take, instituted or threatened any action,
    proceeding, suit, investigation, enquiry or reference or enacted, made or
    proposed and there not continuing to be outstanding any statute, regulation,
    order or decision that would or might be reasonably expected to:

     (i)   make the Offer void, unenforceable or illegal or directly or
           indirectly prohibit or otherwise materially restrict, delay or
           interfere with the implementation of, or impose material additional
           conditions or obligations with respect to, or otherwise challenge,
           the Offer or the acquisition of any shares in, or control of,
           Vernalis by British Biotech;

     (ii)  require, prevent or delay the divestiture (or alter the terms of any
           proposed divestiture) by any member of the British Biotech Group or
           the Vernalis Group of all or any part of their respective businesses,
           assets or properties, or impose any limitation on their ability to
           conduct all or any part of their respective businesses and to own any
           of their respective assets or properties in each case to an extent
           which is material in the context of the British Biotech Group taken
           as a whole or, as the case may be, the Vernalis Group taken as a
           whole;

     (iii) impose any limitation on, or result in any delay in, the ability of
           any member of the British Biotech Group to acquire or hold or to
           exercise effectively, directly or indirectly, all or any rights of
           ownership of shares or other securities (or the equivalent) in, or to
           exercise management control over, any member of the Vernalis Group or
           on the ability of any member of the Vernalis Group to hold or
           exercise effectively, directly or indirectly, all or any rights of
           ownership of shares or other securities (or the equivalent) in, or to
           exercise management control over, any other member of the Vernalis
           Group, in each case to an extent which is material in the context of
           the British Biotech Group taken as a whole or, as the case may be,
           the Vernalis Group taken as a whole;

     (iv)  require any member of the British Biotech Group or of the Vernalis
           Group to acquire or offer to acquire any shares or other securities
           (or the equivalent) owned by any third party in any member of the
           Vernalis Group or any member of the British Biotech Group where such
           acquisition would be material in the context of the British Biotech
           Group taken as a whole or, as the case may be, the Vernalis Group
           taken as a whole;

     (v)   impose any limitation on the ability of any member of the British
           Biotech Group or the Vernalis Group to integrate or co-ordinate its
           business, or any part of it, with the business or any part of the
           business of any other member of the British Biotech Group and/or the
           Vernalis Group in each case in a manner which would be material in
           the context of the Merged Group and/or the British Biotech Group
           taken as a whole or, as the case may be, the Vernalis Group taken as
           a whole; or

     (vi)  otherwise adversely affect the business, assets, financial or trading
           position or profits of any member of the British Biotech Group or of
           the Vernalis Group to an extent which is material in the context of
           the Vernalis Group taken as a whole or, as the case may be, the
           British Biotech Group taken as a whole,

    and all applicable waiting and other time periods during which any such
    Relevant Authority could decide to take, institute or threaten any such
    action, proceeding, suit, investigation, enquiry or reference having
    expired, lapsed or been terminated;

(e) all necessary filings having been made and all appropriate waiting periods
    (including any extensions thereof) under any applicable legislation or
    regulation of any jurisdiction having expired, lapsed or been terminated in
    each case in respect of the Offer and the acquisition of
                                        24
<PAGE>

    any shares in, or control of, Vernalis by British Biotech and all
    authorisations, orders, grants, recognitions, confirmations, licences,
    consents, clearances, permissions and approvals (AUTHORISATIONS) necessary
    or appropriate in any jurisdiction for or in respect of the Offer and the
    proposed acquisition of any shares in, or control of, Vernalis by British
    Biotech being obtained in terms and in a form reasonably satisfactory to
    British Biotech and Vernalis from appropriate Relevant Authorities or from
    any persons or bodies with whom any member of the British Biotech Group or
    the Vernalis Group has entered into contractual arrangements (in each case
    where the absence of such authorisation would have a material adverse effect
    on the Vernalis Group taken as a whole) and such authorisations together
    with all authorisations necessary or appropriate for any member of the
    British Biotech Group or the Vernalis Group to carry on its business (where
    such business is material in the context of the British Biotech Group or the
    Vernalis Group taken as a whole) remaining in full force and effect and no
    intimation of any intention to revoke, suspend, restrict or modify or not to
    renew any of the same having been made and all necessary statutory or
    regulatory obligations in any jurisdiction having been complied with;

(f) save as Disclosed there being no provision of any agreement, arrangement,
    licence or other instrument to which any member of the Vernalis Group or
    British Biotech Group is a party or by or to which any such member or any of
    its assets is or may be bound, entitled or subject which, as a result of the
    making or implementation of the Offer or the acquisition or proposed
    acquisition by British Biotech of any shares in Vernalis, or change in the
    control or management of Vernalis or British Biotech, or any member of the
    Vernalis Group or British Biotech Group or otherwise, would or might (in
    either case to an extent which is materially adverse in the context of the
    Vernalis Group or, as the case may be, the British Biotech Group taken as a
    whole) reasonably be expected to result in:

    (i)    any amount of moneys borrowed by or any other indebtedness (actual or
           contingent) of any such member of the Vernalis Group or British
           Biotech Group becoming repayable or capable of being declared
           repayable immediately or earlier than the stated repayment date or
           the ability of such member to borrow monies or incur any indebtedness
           being withdrawn or inhibited;

    (ii)   the creation or enforcement of any mortgage, charge or other
           security interest over the whole or any part of the business,
           property or assets of any such member of the Vernalis Group or
           British Biotech Group or any such security interest (whenever arising
           or having arisen) becoming enforceable;

    (iii)  any assets or interest of any such member of the Vernalis Group or
           British Biotech Group being or falling to be disposed of or charged
           or any right arising under which any such asset or interest could be
           required to be disposed of or charged;

    (iv)   the interest or business of any such member of the Vernalis Group or
           British Biotech Group in or with any other person, firm or company
           (or any agreements or arrangements relating to such interest or
           business) being terminated or adversely affected;

    (v)    any such member of the Vernalis Group or British Biotech Group
           ceasing to be able to carry on business under any name under which it
           presently does so;

    (vi)   the value of any such member of the Vernalis Group or British Biotech
           Group or its financial or trading position being prejudiced or
           adversely affected;

    (vii)  any such agreement, arrangement, licence or other instrument being
           terminated or adversely modified or any onerous obligation arising or
           any adverse action being taken or arising thereunder; or

    (viii) the creation of any liabilities (actual or contingent) by any such
           member;

    and no event having occurred which, under any provision of any agreement,
    arrangement, licence or other instrument to which any member of the Vernalis
    Group or British Biotech

                                        25
<PAGE>
    Group is a party or by or to which any such member or any of its assets may
    be bound or be subject, could result in any events or circumstances as are
    referred to in sub-paragraphs (i) to (viii) of this paragraph (f) in any
    case where such result would be material in the context of the Vernalis
    Group or the British Biotech Group (as the case may be) taken as a whole;

(g) except as Disclosed, no member of the Vernalis Group having since 31
    December 2002, and no member of the British Biotech Group having since 30
    April 2002:

    (i)    issued or agreed to issue or authorised the issue of additional
           shares of any class, or securities convertible into, or rights,
           warrants or options to subscribe for or acquire, any such shares or
           convertible securities save as between Vernalis and wholly-owned
           subsidiaries of Vernalis or between British Biotech and wholly-owned
           subsidiaries of British Biotech prior to 2 July 2003 or upon the
           exercise of rights to subscribe for Vernalis Shares pursuant to
           options granted under the Vernalis Incentive Plans or upon the
           exercise of rights to subscribe for British Biotech Shares pursuant
           to options granted under the British Biotech Share Schemes prior to 2
           July 2003;

    (ii)   recommended, declared, paid or made any bonus, dividend or other
           distribution, whether payable in cash or otherwise, other than a
           distribution by any wholly-owned subsidiary of Vernalis to a member
           of the Vernalis Group or by a wholly-owned subsidiary of British
           Biotech to a member of the British Biotech Group;

    (iii)  implemented or authorised any merger or demerger or (other than in
           the ordinary course of business) acquired or disposed of or
           transferred, mortgaged or charged, or created any other security
           interest over, any asset or any right, title or interest in any
           asset;

    (iv)   implemented or authorised any reconstruction, amalgamation, scheme or
           other transaction or arrangement (other than in the ordinary course
           of business);

    (v)    purchased, redeemed or repaid any of its own shares or other
           securities or reduced or (save for the matters referred to in
           sub-paragraph (i) of this condition) made or authorised any other
           change in its share capital;

    (vi)   made or authorised any change in its loan capital or issued or
           authorised the issue of any debentures or incurred or increased any
           indebtedness or contingent liability;

    (vii)  entered into, varied or terminated, or authorised the entry into,
           variation or termination of, any contract, commitment or arrangement
           (whether in respect of capital expenditure or otherwise) which is
           outside the ordinary course of business or which is of a long term,
           onerous or unusual nature or magnitude or which involves or could
           involve an obligation of a nature or magnitude which is material;

    (viii) entered into any contract, commitment or arrangement which would be
           restrictive on the business of any member of the Vernalis Group or
           the British Biotech Group (other than to a nature and extent which is
           not material in the context of the business concerned);

    (ix)   been unable, or admitted in writing that it is unable, to pay its
           debts or having stopped or suspended (or threatened to stop or
           suspend) payment of its debts generally or ceased or threatened to
           cease carrying on all or a substantial part of its business;

    (x)    (other than in respect of a member which is dormant and was solvent
           at the relevant time) taken any corporate action or had any legal
           proceedings started or threatened against it for its winding-up
           (voluntary or otherwise), dissolution or reorganisation (or for any
           analogous proceedings or steps in any jurisdiction) or for the
           appointment of a receiver, administrator, administrative receiver,
           trustee or similar officer (or for the appointment of any analogous
           person in any jurisdiction) of all or any of its assets and revenues;

                                        26
<PAGE>

     (xi)   waived, compromised or settled any claim which is material;

     (xii)  entered into or varied the terms of any service agreement or
            arrangement with any director or senior executive of Vernalis or
            British Biotech, as the case may be;

     (xiii) made or consented to any significant change to the terms of the
            trust deeds constituting the pension schemes established for its
            directors and/or employees and/or their dependants or to the
            benefits which accrue, or to the pensions which are payable
            thereunder, or to the basis on which qualification for or accrual or
            entitlement to such benefits or pensions are calculated or
            determined, or to the basis upon which the liabilities (including
            pensions) of such pension schemes are funded or made, or agreed or
            consented to, any change to the trustee in each case which is
            material; or

     (xiv)  entered into any contract, commitment or arrangement or passed any
            resolution or made any offer (which remains open for acceptance)
            with respect to, or proposed or announced any intention to effect or
            propose, any of the transactions, matters or events referred to in
            this condition,

    and for the purpose of this condition MATERIAL shall mean material in the
    context of the Vernalis Group or the British Biotech Group (as the case may
    be) in each case taken as a whole;

(h) except as Disclosed, since 31 December 2002 in relation to the Vernalis
    Group, and since 30 April 2002 in relation to the British Biotech Group:

     (i)   no adverse change having occurred in the business, assets, financial
           or trading position or profits or prospects of any member of the
           Vernalis Group or the British Biotech Group which is material in the
           context of the Vernalis Group or the British Biotech Group (as the
           case may be) in each case taken as a whole;

     (ii)  no litigation, arbitration proceedings, prosecution or other legal
           proceedings having been threatened, announced, instituted or
           remaining outstanding by, against or in respect of any member of the
           Vernalis Group or the British Biotech Group or to which any member of
           the Vernalis Group or the British Biotech Group is a party (whether
           as plaintiff or defendant or otherwise) and no investigation by any
           Relevant Authority or other investigative body against or in respect
           of any member of the Vernalis Group or the British Biotech Group
           having been threatened, announced, instituted or remaining
           outstanding by, against or in respect of any member of the Vernalis
           Group or the British Biotech Group which would or might reasonably be
           expected materially and adversely to affect the Vernalis Group or the
           British Biotech Group (as the case may be) in each case taken as a
           whole; and

     (iii) no contingent or other liability having arisen which would or might
           reasonably be expected materially and adversely to affect any member
           of the Vernalis Group or the British Biotech Group taken as a whole;

(i)  British Biotech not having discovered that:

     (i)   any financial, business or other information publicly disclosed at
           any time by any member of the Vernalis Group is misleading, contains
           a misrepresentation of fact or omits to state a fact necessary to
           make the information contained therein not misleading which in any
           case is material and adverse to the financial or trading position of
           the Vernalis Group taken as a whole;

     (ii)  any member of the Vernalis Group is subject to any liability,
           contingent or otherwise, which is not disclosed in the Annual Report
           and Accounts of Vernalis for the year ended 31 December 2002 and
           which is material in the context of the Vernalis Group taken as a
           whole;

                                        27
<PAGE>

     (iii) any past or present member of the Vernalis Group has failed to
           comply with any applicable legislation or regulations of any
           jurisdiction or any notice or requirement of any Relevant Authority
           with regard to the storage, disposal, discharge, spillage, release,
           leak or emission of any waste or hazardous or harmful substance or
           any substance likely to impair the environment or harm human or
           animal health or otherwise relating to environmental matters or that
           there has otherwise been any such storage, disposal, discharge,
           spillage, release, leak or emission (whether or not the same
           constituted non-compliance by any person with any such legislation or
           regulation, and whenever the same may have taken place), any of which
           non-compliance would be likely to give rise to any liability (whether
           actual or contingent) or cost on the part of any member of the
           Vernalis Group and which is material in the context of the Vernalis
           Group taken as a whole; or

     (iv)  there is or is likely to be any obligation or liability (whether
           actual or contingent) to make good, repair, re-instate or clean up
           any property now or previously owned, occupied, operated or made use
           of or controlled by any past or present member of the Vernalis Group
           under any environmental legislation, regulation, notice, circular or
           order of any Relevant Authority in any jurisdiction and which is
           material in the context of the Vernalis Group taken as a whole; and

(j)  Vernalis not having discovered that:

     (i)   any financial, business or other information publicly disclosed at
           any time by any member of the British Biotech Group is misleading,
           contains a misrepresentation of fact or omits to state a fact
           necessary to make the information contained therein not misleading
           which in any case is material and adverse to the financial or trading
           position of the British Biotech Group taken as a whole;

     (ii)  any member of the British Biotech Group is subject to any liability,
           contingent or otherwise, which is not disclosed in the Annual Report
           and Accounts of British Biotech for the year ended 30 April 2002 or
           in British Biotech's preliminary results for the year ended 30 April
           2003 as publicly announced by British Biotech and which is material
           in the context of the British Biotech Group taken as a whole;

     (iii) any past or present member of the British Biotech Group has failed
           to comply with any applicable legislation or regulations of any
           jurisdiction or any notice or requirement of any Relevant Authority
           with regard to the storage, disposal, discharge, spillage, release,
           leak or emission of any waste or hazardous or harmful substance or
           any substance likely to impair the environment or harm human or
           animal health or otherwise relating to environmental matters or that
           there has otherwise been any such storage, disposal, discharge,
           spillage, release, leak or emission (whether or not the same
           constituted non-compliance by any person with any such legislation or
           regulation, and whenever the same may have taken place), any of which
           non-compliance would be likely to give rise to any liability (whether
           actual or contingent) or cost on the part of any member of the
           British Biotech Group and which is material in the context of the
           British Biotech Group taken as a whole; or

     (iv)  there is or is likely to be any obligation or liability (whether
           actual or contingent) to make good, repair, re-instate or clean up
           any property now or previously owned, occupied, operated or made use
           of or controlled by any past or present member of the British Biotech
           Group under any environmental legislation, regulation, notice,
           circular or order of any Relevant Authority in any jurisdiction and
           which is material in the context of the British Biotech Group taken
           as a whole.

British Biotech reserves the right to waive all or any of conditions (d) to (j)
inclusive, in whole or in part provided that subject as below, British Biotech
will only waive such conditions, insofar as they relate to British Biotech, with
Vernalis' consent. Subject as below, British Biotech will waive conditions (d)
to (j) inclusive, insofar as they relate to British Biotech, if so required by
Vernalis in
                                        28
<PAGE>

writing before the Offer becomes or is declared wholly unconditional in all
respects. Vernalis' consent will not be so required, and Vernalis shall not be
entitled to require British Biotech to waive any conditions, if the board of
Vernalis fails to recommend, or withdraws or (in British Biotech's opinion
acting in good faith) modifies adversely its recommendation of, the Offer or
resolves to do the same. Such consent will be deemed to have been given within
two Business Days of written confirmation from British Biotech to Vernalis that
it is in a position to declare the Offer unconditional in all respects, subject
to satisfaction of condition (b), unless either, prior to the expiry of such two
Business Days, any such condition has validly been invoked in relation to
British Biotech or, at any time thereafter but before the Offer becomes or is
declared wholly unconditional in all respects, Vernalis notifies British Biotech
in writing that it withdraws that deemed consent. The Offer will lapse unless
all the above conditions are fulfilled or (if capable of waiver) waived or,
where appropriate, determined by British Biotech and/or Vernalis, as the case
may be, to have been or remain satisfied by midnight on the day which is 21 days
after the later of the First Closing Date and the date on which the Offer
becomes or is declared unconditional as to acceptances (or such later date as
British Biotech may, with the consent of the Panel, decide). British Biotech and
Vernalis shall be under no obligation to waive or treat as fulfilled any of
conditions (d) to (j) inclusive by a date earlier than the date specified above
for the fulfilment thereof notwithstanding that the other conditions of the
Offer may at such earlier date have been waived or fulfilled and that there are
at such earlier date no circumstances indicating that any of such conditions may
not be capable of fulfilment.

If British Biotech is required by the Panel to make an offer or offers for any
Vernalis Shares under Rule 9 of the Code, British Biotech may make such
alterations to the above conditions as are necessary to comply with that Rule.

The Offer will lapse (unless the Panel otherwise consents) if, before the First
Closing Date or the date when the Offer becomes unconditional as to acceptances
(whichever is the later), the acquisition of Vernalis is referred to the
Competition Commission or the European Commission either initiates proceedings
under Article 6(1)(c) of Council Regulation (EEC) 4064/89 or, following a
referral to a competent authority in the United Kingdom under Article 9(1)
thereof, the proposed acquisition or any matter arising therefrom is then
referred to the Competition Commission.

If the Offer lapses it will cease to be capable of further acceptance. Vernalis
Shareholders who have accepted the Offer and British Biotech shall then cease to
be bound by acceptances delivered on or before the date on which the Offer
lapses.

As used in this section A:

    BRITISH BIOTECH GROUP means British Biotech and its subsidiary undertakings,
    associated undertakings and any other undertakings in which British Biotech
    and such undertakings (aggregating their interests) have a substantial
    interest;

    VERNALIS GROUP means Vernalis and its subsidiary undertakings, associated
    undertakings and any other undertakings in which Vernalis and such
    undertakings (aggregating their interests) have a substantial interest; and

    for these purposes SUBSIDIARY UNDERTAKING, ASSOCIATED UNDERTAKING and
    UNDERTAKING have the meanings given by the Companies Act 1985 (but for these
    purposes ignoring paragraph 20(1)(b) of Schedule 4A to the Companies Act
    1985) and SUBSTANTIAL INTEREST means a direct or indirect interest in 20 per
    cent or more of the equity capital of an undertaking.

                                        29
<PAGE>

SECTION B: CERTAIN FURTHER TERMS OF THE OFFER

The following further terms apply, unless the context requires otherwise, to the
Offer.

1.  ACCEPTANCE PERIOD

(a) The Offer will initially be open for acceptance until 3.00 p.m. on 18 August
    2003. Although no revision is envisaged, if the Offer is revised it will
    remain open for acceptance for a period of at least 14 days (or such other
    period as may be permitted by the Panel) from the date of the posting of any
    revised offer document to Vernalis Shareholders. Except with the consent of
    the Panel, no revision of the Offer may be made after 9 September 2003 or,
    if later, the date falling 14 days prior to the last date on which the Offer
    can become unconditional.

(b) The Offer, whether revised or not, shall not (except with the consent of the
    Panel) be capable of becoming unconditional after midnight on 23 September
    2003 (or any earlier time and/or date beyond which British Biotech has
    stated that the Offer will not be extended and in respect of which it has
    not withdrawn that statement), nor of being kept open after that time and/or
    date unless it has previously become unconditional, provided that British
    Biotech reserves the right, with the permission of the Panel, to extend the
    Offer to (a) later time(s) and/or date(s). Except with the consent of the
    Panel, British Biotech may only, for the purpose of determining whether the
    acceptance condition has been satisfied, take into account acceptances
    received in respect of which all relevant documents and/or instructions and
    transfers are received by Capita IRG Plc, or purchases of Vernalis Shares
    made, by 1.00 p.m. on 23 September 2003 (or any earlier time and/or date
    beyond which British Biotech has stated that the Offer will not be extended
    and in respect of which it has not withdrawn that statement) or such later
    time and/or date as British Biotech may, with the permission of the Panel,
    decide.

(c) If the Offer becomes or is declared unconditional, the Offer will remain
    open for acceptance for not less than 14 days from the date on which it
    would otherwise have expired. If the Offer has become unconditional and it
    is stated that the Offer will remain open until further notice, then not
    less than 14 days' notice will be given to those Vernalis Shareholders who
    have not accepted the Offer prior to the closing of the Offer.

(d) If a competitive situation (as determined by the Panel) arises after British
    Biotech has made a "no increase" and/or "no extension" statement (as
    referred to in the Code) in relation to the Offer, British Biotech may (if
    it specifically reserves the right to do so at the time such statement is
    made or otherwise with the consent of the Panel), choose not to be bound by
    or withdraw such statement and be free to revise or extend the Offer
    provided it complies with the requirements of the City Code and, in
    particular, that:

     (i)   it announces such withdrawal as soon as possible and in any event
           within four Business Days after the announcement of the competing
           offer or other competitive situation and it gives notice as soon as
           practicable thereafter to Vernalis Shareholders to that effect in
           writing (or, in the case of Vernalis Shareholders with registered
           addresses outside the UK or whom British Biotech knows to be
           nominees, trustees or custodians holding Vernalis Shares for such
           persons, by announcement in the United Kingdom); and

     (ii)  any Vernalis Shareholder who accepts the Offer after the date of the
           "no increase" or "no extension" statement is given a right of
           withdrawal in accordance with paragraph 3(c) of this section B.

    British Biotech may choose not to be bound by the terms of a "no increase"
    or "no extension" statement if, having reserved the right to do so at the
    time such statement is made, it posts an increased or improved offer which
    is recommended for acceptance by the board of Vernalis or in other
    circumstances permitted by the Panel.

(e) For the purposes of determining at any particular time whether the
    acceptance condition has been satisfied, British Biotech shall be entitled
    but shall not be bound (unless otherwise

                                        30
<PAGE>
    required by the Panel) to take into account any Vernalis Shares which have
    been unconditionally allotted or issued before such time (unless before that
    time Capita IRG Plc, on behalf of British Biotech, have received written
    notice, from Vernalis or its agents, at Capita IRG Plc, Corporate Actions,
    PO Box 166, The Registry, 34 Beckenham Road, Beckenham Kent, BR3 4TH, of the
    relevant details of such allotment or issue; telex, e-mail, facsimile or
    other electronic transmission or copies will not be sufficient)

(f) British Biotech reserves the right to treat as valid in whole or in part
    acceptances of the Offer which are not entirely in order or which are not
    accompanied by the relevant share certificate(s) and/or other relevant
    document(s) of title or are not accompanied by the relevant TTE instructions
    (subject to paragraph 5(k) of this section B and section C of this Appendix
    I).

2.  ANNOUNCEMENTS

(a) Without prejudice to paragraph 3(a) of this section B, by 8.00 a.m. on the
    Business Day immediately following the day on which the Offer is due to
    expire or becomes or is declared unconditional or is revised or extended (or
    such later time and/or date as the Panel may agree) (THE RELEVANT DAY),
    British Biotech will make an appropriate announcement and simultaneously
    inform a Regulatory Information Service of the position of the Offer. Such
    announcement will (unless otherwise permitted by the Panel) also state (as
    nearly as practicable) the total number of Vernalis Shares and rights over
    Vernalis Shares:

     (i)   for which acceptances of the Offer have been received;

     (ii)  acquired or agreed to be acquired by or on behalf of British Biotech
           or any persons acting or deemed to be acting in concert with it for
           the purposes of the Offer during the Offer Period;

     (iii) held prior to the Offer Period by or on behalf of British Biotech or
           by persons acting or deemed to be acting in concert with it for the
           purposes of the Offer; and

     (iv)  for which acceptances of the Offer have been received from any person
           acting or deemed to be acting in concert with British Biotech for the
           purposes of the Offer during the Offer Period;

    and will specify the percentage of the Vernalis Shares represented by each
    of these figures.

(b) Any decision to extend the time and/or date by which the acceptance
    condition has to be fulfilled may be made at any time up to, and will be
    announced not later than, 8.00 a.m. on the relevant day (or such later time
    and/or date as the Panel may agree) and the announcement will state the next
    expiry date (unless the Offer is then unconditional, in which case a
    statement may instead be made that the Offer will remain open until further
    notice). In computing the number of Vernalis Shares represented by
    acceptance and/or purchases, there may, at the discretion of British
    Biotech, be included or excluded, for announcement purposes, acceptances and
    purchases not complete in all respects or subject to verification, provided
    that such acceptances and purchases not complete in all respects or subject
    to verification may be counted towards fulfilling the acceptance condition
    in accordance with paragraphs 5(k)(i) and 5(k)(ii) of this section B.

(c) In this Appendix I, save as otherwise specified, references to the making
    of an announcement or giving of notice by or on behalf of British Biotech
    include the release of an announcement to the press by British Biotech's
    public relations consultants or by JPMorgan and the delivery by hand or
    telephone or facsimile, telex transmission, e-mail or other electronic
    transmission of an announcement to a Regulatory Information Service. An
    announcement made otherwise than to a Regulatory Information Service will be
    notified simultaneously to a Regulatory Information Service (unless the
    Panel otherwise agrees).

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<PAGE>

(d) Without limiting the manner in which British Biotech may choose to make any
    public statement and subject to British Biotech's obligations under
    applicable law and the Listing Rules, British Biotech will have no
    obligation to publish, advertise or otherwise communicate any such public
    announcement other than by making a release to a Regulatory Information
    Service.

3.  RIGHTS OF WITHDRAWAL

(a) If British Biotech, having announced the Offer to be unconditional, fails to
    comply by 3.30 p.m. on the relevant day (or such later time and/or date as
    the Panel may agree) with any of the requirements specified in paragraph
    2(a) of this section B, an accepting Vernalis Shareholder may immediately
    thereafter withdraw his, her or its acceptance of the Offer by written
    notice signed by such Vernalis Shareholder (or his, her or its agent duly
    appointed in writing and evidence of whose appointment reasonably
    satisfactory to British Biotech or JPMorgan is produced with the notice) and
    received by post or (during normal business hours only) by hand by Capita
    IRG Plc, Corporate Actions, PO Box 166, The Registry, 34 Beckenham Road,
    Beckenham Kent, BR3 4TH on behalf of British Biotech. Subject to paragraph
    1(b) of this section B, this right of withdrawal may be terminated not less
    than eight days after the relevant day by British Biotech confirming, if
    that be the case, that the Offer is still unconditional, and complying with
    the other requirements specified in paragraph 2(a) of this section B. If any
    such confirmation is given, the first period of 14 days referred to in
    paragraph 1(c) of this section B will run from the date of such confirmation
    and compliance.

(b) If by 3.00 p.m. on 8 September 2003 (or such later time and/or date as the
    Panel may agree) the Offer has not become unconditional, an accepting
    Vernalis Shareholder may thereafter withdraw his, her or its acceptance in
    respect of the Offer by written notice signed by such Vernalis Shareholder
    (or his, her or its agent duly appointed in writing and evidence of whose
    appointment reasonably satisfactory to British Biotech or JPMorgan is
    produced with the notice) and received by post or (during normal business
    hours only) by hand by Capita IRG Plc, Corporate Actions, PO Box 166, The
    Registry, 34 Beckenham Road, Beckenham Kent, BR3 4TH on behalf of British
    Biotech before the earlier of: (i) the time that the Offer becomes
    unconditional; and (ii) the final time for lodgement of acceptances which
    can be taken into account in accordance with paragraph 1(b) of this section
    B.

(c) If, in relation to the Offer, a "no increase" or "no extension" statement
    (in each case as referred to in the Code) has been withdrawn in accordance
    with paragraph 1(d) of this section B, any acceptance of the Offer made
    after the date of such statement may be withdrawn thereafter in the manner
    referred to in paragraph 3(a) of this section B, not later than the eighth
    day after the date on which written notice of the withdrawal of such
    statement is posted to the relevant Vernalis Shareholders.

(d) Except as provided by this paragraph 3, acceptances shall be irrevocable.

(e) In this paragraph 3, WRITTEN NOTICE (including any letter of appointment,
    direction or authority) means notice in writing, bearing the original
    signature(s) of the relevant accepting Vernalis Shareholder(s) or his, her,
    its or their agent(s) duly appointed in writing (evidence of whose
    appointment in a form satisfactory to British Biotech is produced with the
    notice). Telex, e-mail, or facsimile or other electronic transmission or
    copies will not be sufficient to constitute written notice. No notice which
    is post-marked in, dispatched from, or otherwise appears in the reasonable
    opinion of British Biotech or its agents to have been sent from the United
    States, Canada, Australia, Belgium, South Africa or Japan will, save as
    specified in paragraph 6(e) of this section B, be treated as valid.

4.  REVISIONS OF THE OFFER

(a) Although no such revision is envisaged, if the Offer (in its original or any
    previously revised form(s)) is revised (either in its terms and conditions
    or in the value or nature of the

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<PAGE>

    consideration offered or otherwise) and any such revision represents, on the
    date on which such revision is announced (on such basis as JPMorgan may
    consider appropriate) an increase or an improvement (or no diminution) in
    the value of the consideration of the Offer as so revised compared with the
    value of the consideration or terms previously offered, the benefit of the
    revised Offer will, subject to paragraphs 4(d) and (e) and 6 of this section
    B, be made available to Vernalis Shareholders who have accepted the Offer in
    its original or any previously revised form(s) (PREVIOUS ACCEPTORS). The
    acceptance by or on behalf of a previous acceptor of the Offer (in its
    original or any previously revised form(s)) shall, subject as provided in
    paragraphs 4(b), (d) and (e) and 6 of this section B, be deemed an
    acceptance of the Offer as so revised in respect of the Vernalis Shares
    comprised or deemed to be comprised in the original or any previously
    revised acceptance and, subject as aforesaid, shall also constitute an
    authority to British Biotech and/or JPMorgan and/or any director of British
    Biotech and/or any director of JPMorgan as his, her, its or their attorney
    and/or agent with authority to accept any such revised Offer on behalf of
    the previous acceptor and, if such revised Offer includes any alternative
    form or forms of consideration, to make such elections for and/or accept
    such alternative form or forms of consideration in such proportions as such
    attorney in his absolute discretion may determine and to execute on behalf
    of, and in the name of, such previous acceptor all such further documents
    and take such further actions (if any) as may be required to give effect to
    such acceptances and/or elections. In making any such acceptance and/or
    determination as to the alternative form or forms of consideration in
    respect of which such acceptance is to be made, the attorney and/or agent
    shall take into account the nature of any previous acceptances and/or
    elections made by or on behalf of the previous acceptor and such other facts
    or matters as he may reasonably consider relevant.

(b) The powers of attorney and authorities and agency conferred by this
    paragraph 4 and acceptance of a revised Offer pursuant to any of the
    foregoing shall be irrevocable unless and until the previous acceptor
    becomes entitled to withdraw his or her acceptance under paragraph 3 above
    and validly does so.

(c) British Biotech, JPMorgan and their respective agents reserve the right to
    treat an executed Form of Acceptance relating to the Offer (in its original
    or in any previously revised form) which is received after the announcement
    or issue of the Offer in any revised form as a valid acceptance of the
    revised Offer (and, where applicable, a valid election for the alternative
    form(s) of consideration) and such acceptance shall constitute an authority
    and request in the form of paragraph 4(a) of this part B mutatis mutandis on
    behalf of the relevant Vernalis Shareholder.

(d) The deemed acceptances referred to in this paragraph 4 shall not apply and
    the authorities conferred by this paragraph 4 shall not be exercised by
    British Biotech or JPMorgan or any of their respective directors, authorised
    representatives and agents if, as a result thereof, the previous acceptor
    would (on such basis as JPMorgan may consider appropriate) thereby receive,
    under or in consequence of the Offer and/or any alternative pursuant thereto
    as revised or otherwise, less in aggregate consideration under the revised
    Offer than he would have received in aggregate consideration as a result of
    acceptance of the Offer in the form in which it was originally accepted by
    him or on his behalf, having regard to any previous acceptance or election
    originally made by him, unless the previous acceptor has previously
    otherwise agreed in writing.

(e) The deemed acceptances referred to in this paragraph 4 will not apply and
    the authorities conferred by this paragraph will be ineffective in the case
    of a previous acceptor who lodges with Capita IRG Plc in the manner
    specified in paragraph 3(a) of this section B, within 14 days of the posting
    of the document pursuant to which the revision of the Offer is made
    available to Vernalis Shareholders, a Form of Acceptance or some other form
    issued by or on behalf of British Biotech in which the Vernalis Shareholder
    validly elects to receive the consideration receivable by him under such
    revised Offer in some other manner than that set out in his original
    acceptance.

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<PAGE>

5.  GENERAL

(a) Save with the consent of the Panel, the Offer will lapse unless all the
    conditions relating to the Offer have been fulfilled or (if capable of
    waiver) waived or, where appropriate, have been determined by British
    Biotech and/or Vernalis, as the case may be, in its or their reasonable
    opinion to be or remain satisfied, by the later of midnight on (i) 8
    September 2003, (ii) the date which is 21 days after the date on which the
    Offer becomes unconditional as to acceptances and (iii) such date as British
    Biotech may, with the consent of the Panel, decide. If the Offer lapses for
    any reason, the Offer shall cease to be capable of further acceptance and
    British Biotech, JPMorgan and accepting Vernalis Shareholders shall
    thereupon cease to be bound by prior acceptances.

(b) If sufficient acceptances of the Offer are received, British Biotech intends
    to apply the provisions of section 428 to 430F of the Companies Act to
    acquire compulsorily any outstanding Vernalis Shares to which the Offer
    relates.

    Furthermore, British Biotech intends to procure that Vernalis applies to the
    UK Listing Authority for the cancellation of the listing of Vernalis Shares
    on the Official List and to the London Stock Exchange for the cancellation
    of trading of the Vernalis Shares. Such cancellations will take effect no
    earlier than 20 Business Days after the date on which either the Offer
    becomes unconditional in all respects or after the first date of issue of
    the compulsory acquisition notices of under section 429 of the Companies Act
    as appropriate.

(c) All communications, notices, certificates, documents of title, other
    documents and remittances to be delivered by or sent to or from Vernalis
    Shareholders (or their designated agents) will be delivered or sent at their
    own risk.

(d) The expression OFFER PERIOD when used in this document means, in relation to
    the Offer, the period commencing on (and including) 30 April 2003 (being the
    date on which Vernalis first announced the existence of discussions in
    relation to the Offer) and ending at whichever of the following times and
    dates shall be the latest: (i) 3.00 p.m. on 18 August 2003; (ii) the date on
    which the Offer lapses; and (iii) the date on which the Offer becomes or is
    declared unconditional.

(e) All references in this document and in the Form of Acceptance to 18 August
    2003 shall (except in paragraphs 1(a) and 5(d) of this section B and where
    the context otherwise requires), if the expiry date of the Offer is
    extended, be deemed to refer to the expiry date of the Offer as so extended.

(f) Except with the consent of the Panel, settlement of the consideration to
    which any Vernalis Shareholder is entitled under the Offer will be
    implemented in full in accordance with the terms of the Offer without regard
    to any lien, right of set-off, counterclaim or other analogous right to
    which British Biotech or JPMorgan may otherwise be, or claim to be, entitled
    as against such Vernalis Shareholder and will be effected within 14 days of
    the date on which the Offer becomes or is declared unconditional in all
    respects, or 14 days after receipt (while the Offer remains open for
    acceptance) of a valid and complete acceptance, whichever is the later, and
    will be effected in the manner described in paragraph 16 of the letter from
    JPMorgan contained in this document. No consideration will be sent to an
    address in the United States, Canada, Australia, Belgium, South Africa or
    Japan.

(g) The instructions, terms, authorities and provisions contained in or deemed
    to be incorporated in the Form of Acceptance constitute part of the terms of
    the Offer. Words and expressions defined in this document shall have the
    same meaning when used in the Form of Acceptance, unless the context
    otherwise requires. The provisions of this Appendix 1 shall be deemed to be
    incorporated in and form part of the Form of Acceptance.

(h) The Offer, the Form of Acceptance and acceptances and elections in respect
    of the Offer and all contracts made pursuant thereto and action taken or
    made or deemed to be taken or

                                        34
<PAGE>

    made under any of the foregoing shall be governed by and construed in
    accordance with English law and subject to the jurisdiction of the Courts of
    England.

(i) Any omission to despatch this document and/or a Form of Acceptance or any
    notice required to be despatched under the terms of the Offer to, or any
    failure to receive the same by, any person to whom the Offer is made, or
    should be made, shall not invalidate the Offer in any way or create any
    implication that the Offer has not been made to any such person. Copies of
    this document, the Listing Particulars and the Forms of Acceptance may be
    collected during normal business hours from Capita IRG Plc at the address
    set out in paragraph 3(a) of this section B.

(j) Subject to paragraph 5(k) below of this section B, British Biotech and
    JPMorgan reserve the right to treat acceptances of the Offer as valid if
    received by them or on their behalf at any place or places or in any manner
    otherwise than as stated herein or in the Form of Acceptance.

(k) Notwithstanding the right reserved by British Biotech and JPMorgan to treat
    an acceptance of the Offer as valid even though not entirely in order or not
    accompanied by the relevant share certificate(s) and/or other document(s) of
    title or not accompanied by the relevant TTE instruction, except as
    otherwise agreed by the Panel:

     (i)   an acceptance of the Offer will only be counted towards fulfilling
           the acceptance condition if the requirements of Note 4 and, if
           applicable, Note 6 on Rule 10 of the Code are satisfied in respect of
           it;

     (ii)  a purchase of Vernalis Shares by British Biotech or any person
           acting in concert with it or any nominee(s) of any such person will
           only be counted towards fulfilling the acceptance condition if the
           requirements of Note 5 and, if applicable, Note 6 on Rule 10 of the
           Code are satisfied in respect of it; and

     (iii) the Offer will not become unconditional unless Capita IRG Plc has
           issued a certificate to British Biotech and/or JPMorgan or their
           respective agents stating the number of acceptances which have been
           received and the number of Vernalis Shares otherwise acquired
           (whether before or during the Offer Period) which comply with the
           provisions of this sub-paragraph (k).

     A copy of such certificate will be sent to the Panel and to UBS Investment
     Bank as soon as possible after it is issued.

(l)  If the Offer does not become unconditional in all respects:

     (i)   in respect of Vernalis Shares held in certificated form, the Forms of
           Acceptance and share certificate(s) and/or other document(s) of title
           will be returned by post (or such other methods as may be approved by
           the Panel) within 14 days of the Offer lapsing, at the risk of the
           Vernalis Shareholder concerned, to the person or agent whose name and
           address (outside the United States, Canada, Australia, Belgium, South
           Africa or Japan) is set out in Box 3 or Box 7, as the case may be, of
           the Form of Acceptance, or, if no address is set out, the first-named
           holder at his or her registered address (outside the United States,
           Canada, Australia, Belgium, South Africa and Japan); and

     (ii)  in respect of Vernalis Shares held in uncertificated form, Capita
           IRG Plc will, immediately after the lapsing of the Offer (or within
           such longer period as the Panel may permit, not exceeding 14 days of
           the lapsing of the Offer), give TFE instructions to CRESTCo to
           transfer all Vernalis Shares held in escrow balances and in relation
           to which it is the escrow agent for the purposes of the Offer to the
           original available balances of the Vernalis Shareholders concerned.

(m) No acknowledgement of receipt of any Form of Acceptance, remittances,
    transfer by means of CREST, share certificate(s) and/or other document(s) of
    title will be given.

                                        35
<PAGE>

(n) All powers of attorney, appointments of agents and authorities on the terms
    conferred by or referred to in this section B or in the Form of Acceptance
    are given by way of security for the performance of the obligations of the
    Vernalis Shareholder concerned and are irrevocable in accordance with
    Section 4 of the Powers of Attorney Act 1971 except in the circumstances
    where the donor of such power of attorney or authority is entitled to
    withdraw his, her or its acceptance in accordance with paragraph 3 of this
    section B and validly does so.

(o) The Offer extends to persons to whom the Offer is made or should be made not
    resident in the United Kingdom to whom this document, the Form of
    Acceptance, the accompanying Listing Particulars and any related documents
    may not be dispatched or by whom any such documents may not be received. Any
    such persons may collect copies of those documents from Capita IRG Plc,
    Corporate Actions, PO Box 166, The Registry, 34 Beckenham Road, Beckenham,
    Kent, BR3 4TH. British Biotech and JPMorgan reserve the right to notify any
    matter, including the making of the Offer, to all or any Vernalis
    Shareholders with a registered address outside the United Kingdom, or whom
    British Biotech knows to be nominees, trustees or custodians for such
    persons, by announcement in the United Kingdom or by paid advertisement in a
    newspaper published and circulated in the United Kingdom, in which event
    such notice shall be deemed to have been sufficiently given, notwithstanding
    any failure by any such Vernalis Shareholders to receive or see such notice,
    and all references in this document to notice in writing by or on behalf of
    British Biotech or JPMorgan (except in paragraph 3(e) of this section B)
    shall be construed accordingly.

(p) Fractional entitlements to New British Biotech Shares will not be allotted
    or issued to Vernalis Shareholders who accept the Offer (including Vernalis
    Shareholders who are deemed to accept the Offer), but the New British
    Biotech Shares representing the aggregate of these fractional entitlements
    will be sold in the market and the net proceeds will be retained by British
    Biotech for the benefit of the Merged Group and entitlements will be rounded
    down to the nearest whole number of New British Biotech Shares.

(q) Vernalis Shares will be acquired by British Biotech fully paid and free from
    all liens, charges, encumbrances, equitable interests, rights of
    pre-emptions and other third party rights or interests of any nature
    whatsoever and together with all rights now or hereafter attaching thereto,
    including the right to receive and retain all dividends and other
    distributions declared, made or paid after (but not including) 3 July 2003.

(r) The Offer is made at 3.00 p.m. on 25 July 2003 and is capable of acceptance
    thereafter. The Offer is being made by means of this document and by means
    of an advertisement to be published in the Financial Times (London edition)
    on 26 July 2003.

(s) The Offer extends to all Vernalis Shares in issue and to any further
    Vernalis Shares unconditionally allotted or issued prior to the date on
    which the Offer closes (or such earlier date, as British Biotech may,
    subject to the Code, decide).

(t) In relation to any acceptance of the Offer in respect of a holding of
    Vernalis Shares which are held in uncertificated form, British Biotech
    reserves the right to make such alterations, additions or modifications to
    the terms of the Offer as may be necessary or desirable to give effect to
    any purported acceptance of the Offer, whether in order to comply with the
    facilities or requirements of CREST or otherwise, provided such alteration,
    addition or modification is consistent with the requirements of the Code or
    is otherwise made with the consent of the Panel.

(u) The New British Biotech Shares to be issued under the Offer will be issued
    credited as fully paid and will rank pari passu with all other British
    Biotech Shares, including the right to receive in full all dividends and
    other distributions, if any, declared, made or paid after (but not
    including) 3 July 2003.

                                        36
<PAGE>

(v) All references in this document to any statute or statutory provision shall
    include a statute or statutory provision which amends, consolidates or
    replaces the same (whether before or after the date hereof).

(w) References in this section B and in section C of this Appendix I to a
    Vernalis Shareholder will include references to the person or persons
    executing a Form of Acceptance and in the event of more than one person
    executing a Form of Acceptance, such paragraphs will apply to them jointly
    and severally.

(x) Neither British Biotech nor JPMorgan nor any agent or director of JPMorgan,
    nor any person acting on behalf of any of them, shall have any liability to
    any person for any loss or alleged loss arising from any decision as to the
    treatment of acceptances of the Offer or otherwise in connection therewith.

6.  OVERSEAS SHAREHOLDERS

(a) The making of the Offer in, or to certain persons who are Overseas
    Shareholders or to persons who are custodians, nominees of or trustees for
    Overseas Shareholders and the availability of the New British Biotech Shares
    to such persons may be prohibited or affected by the laws of the relevant
    jurisdiction and is subject to the restrictions set forth herein. Such
    Overseas Shareholders should inform themselves about and observe any
    applicable legal requirements. It is the responsibility of any such Overseas
    Shareholders wishing to accept the Offer to satisfy himself or herself,
    itself or themselves as to full observance of the laws of the relevant
    jurisdiction or territory in connection therewith, including the obtaining
    of any governmental exchange control or other consents which may be
    required, or the compliance with other necessary formalities. Any such
    Overseas Shareholders will also be responsible for any payment of any issue,
    transfer or other taxes or other requisite payments due in such jurisdiction
    by whomsoever payable and British Biotech and JPMorgan and any person acting
    on their behalf shall be fully indemnified and held harmless by such
    Overseas Shareholder for any such issue, transfer or other taxes as British
    Biotech or JPMorgan (or any person acting on behalf of either of them) may
    be required to pay. IF YOU ARE AN OVERSEAS SHAREHOLDER AND YOU ARE IN DOUBT
    ABOUT YOUR POSITION, YOU SHOULD CONSULT YOUR PROFESSIONAL ADVISOR IN THE
    RELEVANT JURISDICTION.

(b) In particular, the Offer is not being made and will not be made, directly or
    indirectly, in, into or from the United States, Canada, Australia, Belgium,
    South Africa or Japan or by use of the mails of or by any means or
    instrumentality of interstate or foreign commerce of, or of any facilities
    of a national securities exchange of the United States, Canada, Australia,
    Belgium, South Africa or Japan. This includes, but is not limited to, post,
    facsimile transmission, telex, telephone and the internet. The Offer cannot
    be accepted by any such use, means, instrumentality or facilities.
    Accordingly, copies of this document, the Form of Acceptance, the
    accompanying Listing Particulars and any related offering or solicitation
    documents are not being and must not be mailed or otherwise transmitted,
    forwarded, distributed or sent in, into or from the United States, Canada,
    Australia, Belgium, South Africa or Japan, including to Vernalis
    Shareholders or participants in Vernalis Incentive Plans with registered
    addresses or resident or located in the United States, Canada, Australia,
    Belgium, South Africa or Japan or to persons whom British Biotech knows to
    be nominees, trustees or custodians holding Vernalis Shares for such
    persons. Persons receiving such documents (including, without limitation,
    custodians, nominees and trustees) must not mail or otherwise transmit,
    forward, distribute or send them in, into or from the United States, Canada,
    Australia, Belgium, South Africa or Japan or use such mails or any such
    means, instrumentality or facilities for any purpose, directly or
    indirectly, in connection with the Offer. Any purported acceptance of the
    Offer resulting directly or indirectly from a violation of these
    restrictions will be invalid. Persons wishing to accept the Offer must not
    use such mails or any such means, instrumentality or facilities for any
    purpose directly or indirectly related to acceptance of the Offer. Envelopes
    containing Form(s) of Acceptance postmarked in, or despatched from, or which

                                        37
<PAGE>

    appear to British Biotech or its agents to have been sent from, the United
    States will not be accepted. Envelopes containing Form(s) of Acceptance must
    not be postmarked in Canada, Australia, Belgium, South Africa or Japan or
    otherwise despatched from Canada, Australia, Belgium, South Africa or Japan
    and all acceptors from such jurisdictions must provide addresses outside
    Canada, Australia, Belgium, South Africa or Japan for the despatch of
    certificates in respect to the New British Biotech Shares and/or remittance
    of the Form(s) of Acceptance, share certificate(s) and or other document(s)
    of title.

(c) THIS DOCUMENT IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES.
    SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT
    REGISTRATION OR AN EXEMPTION FROM REGISTRATION. THE NEW BRITISH BIOTECH
    SHARES TO BE ISSUED PURSUANT TO THE OFFER HAVE NOT BEEN, AND WILL NOT BE,
    REGISTERED UNDER THE SECURITIES ACT, OR THE SECURITIES LAWS OF ANY STATE OR
    OTHER JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR
    DELIVERED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES. No prospectus or
    listing particulars in relation to the Offer or the New British Biotech
    Shares to be issued pursuant thereto has been lodged with, or registered by,
    the Australian Securities Commission. The relevant clearances have not been
    and will not be obtained from the securities commission of any province of
    Canada nor have there been or will there be any steps taken to enable the
    New British Biotech Shares to be offered in compliance with applicable laws
    of Belgium, South Africa or Japan. Accordingly, the New British Biotech
    Shares may not (except pursuant to an exemption under such laws) be offered,
    sold, resold or delivered directly or indirectly, in, into or from Canada,
    Australia, Belgium, South Africa or Japan or to, or for the account or
    benefit of, or a person in, or resident in Canada, Australia, Belgium, South
    Africa, Japan or any other jurisdiction in which the Offer would constitute
    a violation of the relevant laws, or require registration thereof, in such
    jurisdiction. In particular, British Biotech will not issue any New British
    Biotech Shares or authorise the delivery of any document of title in respect
    of any New British Biotech Shares to an address in Canada, Australia,
    Belgium, South Africa or Japan or to any person who is unable to make the
    representations and warranties set out in paragraphs (b)(ii) and b(iii) of
    section C of this Appendix I.

    All Vernalis Shareholders (including nominees, trustees or custodians) who
    are Overseas Shareholders or would, or otherwise intend to, forward this
    document and/or its accompanying documentation to Overseas Shareholders
    should seek appropriate advice before taking any action.

(d) Subject to paragraph (e) below, a Vernalis Shareholder will be deemed not to
    have validly accepted the Offer if:

     (i)   he, she or it puts "NO" in Box 5 of the Form of Acceptance and
           thereby is unable to make the representation and warranty set out in
           paragraph (b)(ii) of section C of this Appendix I;

     (ii)  he, she or it puts "NO" in Box 6 of the Form of Acceptance and
           thereby is unable to make the representation and warranty set out in
           paragraph (b)(iii) of section C of this Appendix I;

     (iii) he or she completes Box 3 of the Form of Acceptance with an address
           in Canada, Australia, Belgium, South Africa or Japan or has a
           registered address in Canada, Australia, Belgium, South Africa or
           Japan and in either case he or she does not insert in Box 7 of the
           Form of Acceptance the name and address of a person or agent outside
           Canada, Australia, Belgium, South Africa or Japan to whom he or she
           wishes the consideration to which he or she is entitled under the
           Offer to be sent, subject to the provisions of this paragraph 6 and
           applicable laws; or he or she inserts in Box 7 of the Form of
           Acceptance an address in Canada, Australia, Belgium, South Africa or
           Japan to which he or she wishes the consideration to which he or she
           is entitled under the Offer to be sent or a telephone number in
           Canada, Australia, Belgium, South Africa or Japan in the event of
           queries; or

                                        38

<PAGE>

     (iv)  the Form of Acceptance received from him or her is in an envelope
           postmarked in, despatched from, or otherwise appears, in the
           reasonable opinion of British Biotech or its agents, to have been
           sent from, the United States, Canada, Australia, Belgium, South
           Africa or Japan.

    British Biotech reserves the right, in its sole discretion, to investigate,
    in relation to any acceptance, whether the representations and warranties
    set out in paragraphs (b)(ii) and (b)(iii) of section C of this Appendix I
    could have been truthfully given by the relevant Vernalis Shareholder and if
    such investigation is made and as a result British Biotech determines that
    such representations and warranties could not have been so given, such
    acceptance shall not be valid.

(e) The provisions of this paragraph 6 and/or any other terms of the Offer
    relating to overseas shareholders may be waived, varied or modified as
    regards specific Vernalis Shareholder(s) or on a general basis by British
    Biotech in its absolute discretion, other than for Vernalis Shareholders
    located in, or residents of the United States. In particular, without
    limitation, British Biotech reserves the right, in its sole discretion, to
    (i) treat as valid an acceptance received from (a) persons(s) who is/are
    unable to give the representation and warranty set out in paragraph (b)(iii)
    of section C of this Appendix I, and (ii) either itself or through JPMorgan
    or through its or their respective agents, as agent for such acceptors(s):

     (i)   to sell New British Biotech Shares to which they are otherwise
           entitled under the Offer on behalf of such acceptors(s) on the London
           Stock Exchange within 21 days of such shares being allotted;

     (ii)  to receive the certificates(s) and/or other document(s) of title in
           respect of such New British Biotech Shares and to execute
           instruments(s) of transfer in respect of such New British Biotech
           Shares; and

     (iii) to remit the net proceeds of such sale (after deducting therefrom
           the expenses of sale) as soon as reasonably practicable to the person
           or agent whose name and address outside Canada, Australia, Belgium,
           South Africa and Japan is set out in Box 7 of the Form of Acceptance
           or if none is set out to the first named holder at his or her
           registered address outside Canada, Australia, Belgium, South Africa
           and Japan. British Biotech reserves the right also to arrange for the
           sale of New British Biotech Shares to which overseas shareholders may
           otherwise be entitled pursuant to Part XIIIA of the Companies Act and
           remit the proceeds of such sale, net of expenses, to such overseas
           shareholders instead.

     Neither British Biotech nor JPMorgan nor any person acting on behalf of
     either of them shall have any liability to any person for any loss or
     alleged loss arising from the price, timing or manner of any sale made
     pursuant to the provisions of this paragraph (e) or otherwise in connection
     therewith.

     If, notwithstanding the restrictions described above, any person
     (including, without limitation, custodians, nominees and trustees) whether
     pursuant to a contractual or legal obligation or otherwise forwards this
     document, the Form of Acceptance or any related offering document in, into
     or from, Canada, Australia, Belgium, South Africa or Japan or uses the
     mails or any means or instrumentality (including, without limitation,
     facsimile transmission, telex and telephone) of interstate or foreign
     commerce of, or any facilities of a national securities exchange of,
     Canada, Australia, Belgium, South Africa or Japan in connection with such
     forwarding, such person should (i) inform the recipient of such fact, (ii)
     explain to the recipient that such action may invalidate any purported
     acceptance by the recipient and (iii) draw the attention of the recipient
     to this paragraph 6.

(f)  Save as may be inconsistent with the Code, the provisions of this paragraph
     6 supersede and will apply in lieu of any terms of the Offer inconsistent
     herewith.

                                        39
<PAGE>

(g) Notwithstanding anything to the contrary contained in this document or the
    Form of Acceptance, British Biotech and JPMorgan may make the Offer (with or
    without giving effect to the foregoing paragraphs of this paragraph 6) in
    Canada, Australia, Belgium, South Africa or Japan pursuant to an exemption
    under, or in accordance with, applicable law in Canada, Australia, Belgium,
    South Africa or Japan and in this connection the provisions of paragraph (b)
    of section C of this Appendix I will be varied accordingly.

SECTION C: FORM OF ACCEPTANCE

Each Vernalis Shareholder by whom, or on whose behalf, a Form of Acceptance is
executed irrevocably undertakes, represents, warrants and agrees to and with
British Biotech and JPMorgan and Capita IRG Plc (so as to bind him or her and
his or her personal representatives, heirs, successors and assigns) to the
following effect:

(a) that the execution of the Form of Acceptance (subject to the provisions of
    paragraph 6 of section B of this Appendix I) constitutes:

     (i)   an acceptance of the Offer in respect of the number of Vernalis
           Shares inserted or deemed to be inserted in Box 1 of the Form of
           Acceptance;

     (ii)  if Box 1 of the Form of Acceptance is left blank or a number greater
           than such Vernalis Shareholder's registered holding appears in Box 1
           or the Form of Acceptance is otherwise completed incorrectly but is
           signed, an acceptance by such Vernalis Shareholder of the Offer in
           respect of the total number of Vernalis Shares registered in his,
           her, its or their name in each case;

     (iii) an undertaking to execute any further documents, to take any further
           action and to give any further assurances which may be required to
           enable British Biotech to obtain the full benefit of the terms of
           this Appendix I and/or to perfect any of the authorities expressed to
           be given hereunder,

    in each case, on, and subject to, the terms and conditions set out or
    referred to in this document and the Form of Acceptance and, subject to the
    rights of withdrawal set out in paragraph 3 of section B of this Appendix I,
    each such acceptance and undertaking shall be irrevocable;

(b) that:

     (i)   he or she is irrevocably and unconditionally entitled to transfer the
           Vernalis Shares in respect of which the form of Acceptance is
           completed and the Vernalis Shares in respect of which the Offer is
           accepted or deemed to be accepted are sold fully paid and free from
           all liens, equities, charges, encumbrances and other third party
           rights or interests of any nature whatsoever and together with all
           rights now or hereafter attaching thereto including the right to
           receive all dividends and other distributions declared, made or paid
           after (but not including) 3 July 2003;

     (ii)  unless "NO" is inserted or deemed to be inserted in Box 5 of the
           Form of Acceptance, such Vernalis Shareholder: (1) has not received
           this document, the Form of Acceptance, the Listing Particulars, or
           any offering or solicitation documents in the United States, nor has
           he or she mailed, transmitted or otherwise distributed or forwarded
           any such document in or into the United States; (2) has not utilised,
           directly or indirectly, the mails, or any means or instrumentality of
           interstate or foreign commerce, or the facilities of any national
           securities exchange, of the United States in connection with the
           Offer; (3) was not located in the United States at the time he or she
           accepted the terms of the Offer or at the time he or she returned the
           Form of Acceptance; and (4) if such Vernalis Shareholder is acting in
           a fiduciary, agency or other capacity as an intermediary, then either
           he or she has full investment discretion with respect to the Vernalis
           Shares covered by the Form of Acceptance, or he or she has reason to
           believe that the person

                                        40
<PAGE>

            on whose behalf such Vernalis Shareholder is acting was located
            outside the United States at the time he or she instructed such
            Vernalis Shareholder to accept the Offer.

     (iii)  unless "NO" is inserted or deemed to be inserted in Box 6 of the
            Form of Acceptance, such Vernalis Shareholder has not received or
            sent copies of this document, the Form of Acceptance, the Listing
            Particulars or any related offering documents in, into or from
            Canada, Australia, Belgium, South Africa or Japan and has not
            otherwise utilised in connection with the Offer, directly or
            indirectly, the mails or any means or instrumentality (including,
            without limitation, facsimile transmission, telex, telephone and
            internet) of interstate or foreign commerce of or any facilities of
            a national securities exchange of Canada, Australia, Belgium, South
            Africa or Japan, was outside Canada, Australia, Belgium, South
            Africa and Japan when the Form of Acceptance was delivered and at
            the time of accepting the Offer; and, in respect of the Vernalis
            Shares to which the Form of Acceptance relates, is not aware that it
            is an agent or fiduciary acting on a non-discretionary basis for a
            principal who has given any instructions with respect to the Offer
            from within Canada, Australia, Belgium, South Africa or Japan and is
            not aware that such principal will hold or acquire any New British
            Biotech Shares in Canada, Australia, Belgium, South Africa or Japan
            and the Form of Acceptance has not been mailed or otherwise sent in,
            into or from Canada, Australia, Belgium, South Africa or Japan or
            signed in Canada, Australia, Belgium, South Africa or Japan and such
            Vernalis Shareholder is accepting the Offer from outside Canada,
            Australia, Belgium, South Africa and Japan;

(c) that the execution of the Form of Acceptance and its delivery to Capita IRG
    Plc constitutes, subject to the Offer becoming unconditional in all respects
    in accordance with its terms and to an accepting Vernalis Shareholder not
    having validly withdrawn his or her acceptance, the irrevocable separate
    appointment of each of British Biotech and JPMorgan and any of their
    respective directors or agents as such shareholder's attorney and/or agent
    and an irrevocable instruction to the attorney and/or agent to complete and
    execute all of any form(s) of transfer and/or other document(s) at the
    discretion of the attorney and/or agent in relation to the Vernalis Shares
    referred to in paragraph (a) above in favour of British Biotech or such
    other person or persons as British Biotech or its agents may direct and to
    deliver such form(s) of transfer and/or other document(s) at the discretion
    of the attorney and/or agent together with the certificate(s) and/or other
    document(s) of title relating to such Vernalis Shares for registration
    within six months of the Offer becoming unconditional in all respects and to
    do all such other acts and things as may in the opinion of the attorney
    and/or agent be necessary for the purposes of, or in the connection with,
    the acceptance of the Offer and to vest in British Biotech or its nominee(s)
    the Vernalis Shares as aforesaid;

(d) that the execution and delivery of the Form of Acceptance constitutes the
    irrevocable appointment of Capita IRG Plc as such shareholder's attorney
    and/or agent and an irrevocable instruction and authority to the attorney
    and/or agent: (i) subject to the Offer becoming unconditional in all
    respects in accordance with its terms and to an accepting Vernalis
    Shareholder not having validly withdrawn his or her acceptance, to transfer
    to itself (or to such other person as British Biotech or its agents may
    direct) by means of CREST all or any of the Relevant Vernalis Shares (but
    not exceeding the number of Relevant Vernalis Shares in respect of which the
    Offer is accepted or deemed to be accepted) or (ii), if the condition
    referred to in (i) of this paragraph (d) is not satisfied, to give
    instructions to CRESTCo, immediately after the lapsing of the Offer (or
    within such longer period as the Panel may permit, not exceeding 14 days
    from the lapsing of the Offer), to transfer all the Relevant Vernalis Shares
    to the original available balance of the accepting Vernalis Shareholder. For
    these purposes RELEVANT VERNALIS SHARES means Vernalis Shares in
    uncertificated form and in respect of which a transfer or transfers to
    escrow has or have been effected pursuant to the procedures described in
    paragraph 16 of the letter from JPMorgan contained in this document and
    where the transfer(s) to escrow was or were made in respect of the Vernalis
    Shares

                                        41
<PAGE>

    held under the same member account ID and participant ID as the member
    account ID and the participant account ID relating to the Form of Acceptance
    (but irrespective of whether or not the Form of Acceptance Reference Number,
    or Form of Acceptance Reference Number corresponding to that appearing on
    the Form of Acceptance concerned, was included in the TTE instruction
    concerned);

(e) that the execution of the Form of Acceptance and its delivery to Capita IRG
    Plc will constitute, subject to the Offer becoming unconditional in all
    respects and to an accepting Vernalis Shareholder not having validly
    withdrawn his or her acceptance, irrevocable authorities and requests:

     (i)   to Vernalis or its agents to procure the registration of the transfer
           of the Vernalis Shares in certificated form pursuant to the Offer and
           the delivery of the share certificate(s) and/or other document(s) of
           title in respect thereof to British Biotech or as it may direct;

     (ii)  subject to the provisions of paragraph 6 of section B of this
           Appendix I, if the Vernalis Shares are in certificated form or if
           either of the provisos in sub-paragraph (iii) of this paragraph (e)
           apply, to British Biotech or its agents to procure the despatch by
           post (or by such other method as may be approved by the Panel) of the
           New British Biotech Shares to which an accepting Vernalis Shareholder
           is entitled, at the risk of such shareholder, to the person or agent
           whose name and address outside Canada, Australia, Belgium, South
           Africa and Japan is set out in Box 7 of the Form of Acceptance, or,
           if no name and address is set out in Box 7, to the first-named holder
           at his or her registered address outside Canada, Australia, Belgium,
           South Africa and Japan;

     (iii) if the Vernalis Shares concerned are in uncertificated form, to
           British Biotech or its agents to issue any New British Biotech Shares
           to which such shareholder is entitled in uncertificated form,
           provided that (aa) British Biotech may (if, for any reason, it wishes
           to do so) determine that all or any of such New British Biotech
           Shares shall be issued in certificated form and (bb) if any Vernalis
           Shareholder concerned is a CREST member whose registered address is
           in Canada, Australia, Belgium, South Africa or Japan, any New British
           Biotech Shares to which such shareholder is entitled shall be issued
           in certificated form and, in either such case, sub-paragraph (ii) of
           this paragraph (e) shall apply;

     (iv)  subject to the provisions of paragraph 6 of section B of this
           Appendix I, to British Biotech or its agents to procure that the
           name(s) of such Vernalis Shareholder(s) is/are entered on the
           register of members of British Biotech in respect of any New British
           Biotech Shares to which such Vernalis Shareholder(s) are or may
           become entitled under the Offer, subject to the terms of the
           memorandum and articles of association of British Biotech; and

     (v)   to British Biotech or its agents to record and act upon any
           instructions with regard to notices or payment mandates which have
           been recorded in the records of Vernalis in respect of such Vernalis
           Shareholder's holding(s) of Vernalis Shares as if such mandates have
           been given in respect of its holding of New British Biotech Shares;

(f) that the execution of a Form of Acceptance constitutes an authority to any
    director of British Biotech or JPMorgan and/or their respective agents
    within the terms of paragraphs 4 and 6 of section B of this Appendix I, to
    execute any further documents and give any further assurance which may be
    required in connection with the foregoing;

(g) that subject to the Offer becoming or being declared unconditional in all
    respects (or, in the case of voting by proxy, if the Offer will become
    unconditional in all respects or lapse immediately upon the outcome of the
    resolution in question, or in such other circumstances as British Biotech
    may require and the Panel may permit) and pending registration:

     (i)   British Biotech or its agents shall be entitled to direct the
           exercise of any votes and any or all other rights and privileges
           (including the right to requisition the convening of a

                                        42
<PAGE>
           general meeting of Vernalis or of any class of its shareholders)
           attaching to any Vernalis Shares in respect of which the Offer has
           been accepted or is deemed to have been accepted and such acceptance
           has not been validly withdrawn; and

     (ii)  the execution of the Form of Acceptance in respect of the Vernalis
           Shares comprised in such acceptance and in respect of which such
           acceptance has not been validly withdrawn:

           (A)  constitutes an authority to Vernalis or its agents from such
                Vernalis Shareholder to send any notice, circular, warrant,
                document or other communication which may be required to be sent
                to him/her as a member of Vernalis in respect of such share
                (including any share certificate(s) or other document(s) of
                title issued as a result of conversion of such Vernalis Shares
                into certificated form) to British Biotech at its registered
                office;

           (B)  constitutes an authority to British Biotech or any director of
                British Biotech to sign any consent to short notice of a general
                or separate class meeting on his or her behalf and/or execute a
                form of proxy (or, as the case may be, an appointment under
                section 375 of the Companies Act) in respect of such Vernalis
                Shares appointing any person nominated by British Biotech to
                attend any general or separate class meeting of Vernalis (and
                any adjournments thereof) and to exercise the votes attaching to
                such shares on his or her behalf, where relevant, such votes to
                be cast so far as possible to satisfy any outstanding conditions
                of the Offer; and

           (C)  constitutes the agreement of such Vernalis Shareholder not to
                exercise any of such rights without the consent of British
                Biotech and the irrevocable undertaking of such Vernalis
                Shareholder not to appoint a proxy to attend any such general
                meeting or separate class meeting;

(h) that he or she will deliver to British Biotech's receiving agent, Capita IRG
    Plc, at the address referred to in paragraph 3(a) of section B of this
    Appendix I, his or her share certificate(s) and/or other document(s) of
    title in respect of all Vernalis Shares (which are in certificated form)
    referred to in paragraph (a) above and in relation to which acceptance has
    not been validly withdrawn or an indemnity acceptable to British Biotech in
    lieu thereof as soon as possible and, in any event, within six months of the
    Offer becoming or being declared unconditional in all respects;

(i) that he or she will give or procure the giving, in accordance with
    paragraph 16 of the letter from JPMorgan contained in this document, of an
    instruction to transfer those of the Vernalis Shares in respect of which the
    Offer has been accepted or is deemed to have been accepted and not validly
    withdrawn held by him or her in uncertificated form (that is, in CREST) to
    the escrow balance within the member's account in accordance with the
    facilities and requirements of CRESTCo, as soon as possible and, in any
    event, so that the transfer to escrow settles within six months of the Offer
    becoming or being declared unconditional in all respects;

(j) that he or she will, if for any reason any Vernalis Shares in respect of
    which a transfer to an escrow balance has been effected in accordance with
    paragraph 16 of the letter from JPMorgan contained in this document are
    converted to certificated form (without prejudice to paragraph (g)(ii)
    above), immediately deliver or procure the immediate delivery of the share
    certificate(s) or other document(s) of title in respect of all such Vernalis
    Shares as so converted to Capita IRG Plc at the address referred to in
    paragraph 3(a) of section B of this Appendix I or to British Biotech at its
    registered office or as British Biotech or its agents my direct;

(k) that the terms and conditions of the Offer contained in this document
    (including, without limitation, the terms in this section C) shall be deemed
    to be incorporated in and form part of the Form of Acceptance which shall be
    read and construed accordingly;

                                        43
<PAGE>

(l) that, if he or she accepts the Offer and does not validly withdraw such
    acceptance, he or she will do all such acts and things as shall, in the
    opinion of British Biotech or Capita IRG Plc be necessary or expedient (i)
    to vest in British Biotech or its nominee(s) or such other persons as it may
    direct the number of Vernalis Shares inserted or deemed to be inserted in
    Box 1 of the Form of Acceptance and (ii) to enable Capita IRG Plc to fulfil
    its functions as Escrow Agent for the purposes of the Offer;

(m) that he or she agrees to ratify each and every act or thing which may be
    done or effected by British Biotech or JPMorgan or Capita IRG Plc or any
    director of British Biotech or any director of JPMorgan or any director of
    Capita IRG Plc of their respective agents or Vernalis or its agents, as the
    case may be, in the proper exercise of any of its and his or her powers
    and/or authorities hereunder (and to indemnify each such person against any
    losses arising therefrom);

(n) that the execution of the Form of Acceptance constitutes his or her
    submission in relation to all matters arising out of the Offer and the Form
    of Acceptance to the jurisdiction of the courts of England and his or her
    agreement that nothing shall limit the right of British Biotech and/or
    JPMorgan and/or any of their directors or authorised representatives to
    bring any action, suit or proceeding arising out of or in connection with
    the Offer and the Form of Acceptance in any other manner permitted by law or
    any court of competent jurisdiction;

(o) that, if any provisions of section B or section C of this Appendix I shall
    be unenforceable or invalid or shall not operate so as to afford British
    Biotech or JPMorgan or Capita IRG Plc or any director or duly appointed
    representative of any of them or their respective agents the benefit or
    authority expressed to be given therein, he or she shall with all
    practicable speed do all such acts and things and execute all such documents
    that may be required to enable those persons to secure the full benefit of
    section B and/or section C of this Appendix I; and

(p) on execution, the Form of Acceptance will take effect as a deed.

References in this section C to a Vernalis Shareholder shall include references
to the person or persons executing a Form of Acceptance and, in the event of
more than one person executing a Form of Acceptance, the provisions of this
section C shall apply to them jointly and to each of them.

                                        44
<PAGE>

                                  APPENDIX II

                             ADDITIONAL INFORMATION

1.  RESPONSIBILITY

The British Biotech Directors, whose names are set out in paragraph 2(a) below,
accept responsibility for the information contained in this document, other than
that relating to the Vernalis Group, the Vernalis Directors and their immediate
families. To the best of the knowledge and belief of the British Biotech
Directors (who have taken all reasonable care to ensure that such is the case),
such information is in accordance with the facts and does not omit anything
likely to affect the import of such information.

The Vernalis Directors , whose names are set out in paragraph 2(b) below, accept
responsibility for the information contained in this document relating to the
Vernalis Group, the Vernalis Directors and their immediate families. To the best
of the knowledge and belief of the Vernalis Directors (who have taken all
reasonable care to ensure that such is the case), such information is in
accordance with the facts and does not omit anything likely to affect the import
of such information.

2.  DIRECTORS OF BRITISH BIOTECH AND OF VERNALIS

(a) The British Biotech Directors are as follows:

<Table>
<S>                                            <C>
Peter Fellner                                  Executive Chairman
Simon Sturge                                   Chief Executive
Anthony Weir                                   Finance Director
Tim Edwards                                    Corporate Development Director
Ian Kent                                       Non-executive Director
Keith Merrifield                               Non-executive Director
Eugene Williams                                Non-executive Director
</Table>

The registered address of British Biotech and the business address of each of
its directors is Thames Court, Watlington Road, Oxford, OX4 6LY.

(b) The Vernalis Directors are as follows:

<Table>
<S>                                            <C>
George Kennedy                                 Chairman
Peter Worrall                                  Chief Financial Officer
Colin Dourish                                  Senior Vice President--Research
John Hutchison                                 Senior Vice President--Development
Carol Ferguson                                 Non-executive Director
Peter Read                                     Non-executive Director
Marvin Jaffe                                   Non-executive Director
</Table>

The registered address of Vernalis and the business address of each of its
directors is Oakdene Court, 613 Reading Road, Winnersh, Wokingham, Berkshire,
RG41 5UA.

3.  MARKET QUOTATIONS

The following table shows the middle market quotations of British Biotech Shares
and Vernalis Shares, as derived from the Daily Official List, for the first
Business Day in each of the six months immediately prior to the date of this
document, for 30 April 2003 (the last business day prior to commencement of the
Offer Period) and for 24 July 2003 (the latest available date prior to the
posting of this document):

                                        45
<PAGE>

<Table>
<Caption>
-----------------------------------------------------------------------------------------
                                                              BRITISH BIOTECH    VERNALIS
DATE                                                                    SHARE       SHARE
-----------------------------------------------------------------------------------------
<S>                                                           <C>                <C>
03/02/03....................................................              85p*       134p
03/03/03....................................................            72.5p*     117.5p
01/04/03....................................................              65p*      31.5p
30/04/03....................................................              59p         40p
01/05/03....................................................              59p       48.5p
02/06/03....................................................              69p       52.5p
01/07/03....................................................              64p       45.5p
24/07/03....................................................            64.5p         50p
-----------------------------------------------------------------------------------------
</Table>

* price of an ordinary share of 5 pence each in the capital of British Biotech
  adjusted to reflect the capital re-organisation of British Biotech completed
  on 22 April 2003

4.  SHAREHOLDINGS AND DEALINGS

For the purposes of this paragraph 4:

DISCLOSURE PERIOD means:

(i)  in respect of subsidiaries of Vernalis, pension funds of Vernalis or a
     subsidiary of Vernalis, financial and other professional advisers of
     Vernalis (other than exempt market makers), persons with whom Vernalis or
     any person who is an associate of Vernalis has an arrangement and persons
     whose investments are managed on a discretionary basis by fund managers
     (other than exempt fund managers) connected with Vernalis, the period
     commencing on 1 May 2003 (being the commencement of the Offer Period) and
     ending on 22 July 2003 (the latest practicable date prior to the posting of
     this document); or

(ii) in all other respects, the period commencing on 1 May 2002 (the date 12
     months prior to the commencement of the Offer Period) and ending on 22 July
     2003 (the latest practicable date prior to the posting of this document);

ARRANGEMENT includes indemnity or option arrangements, and any agreement or
understanding, formal or informal, of whatever nature, relating to relevant
securities of Vernalis or British Biotech which may be an inducement to deal or
refrain from dealing; and

ASSOCIATE means, in relation to Vernalis, any member of Vernalis Group and any
associated company of any member of Vernalis Group, their financial and other
professional advisers, their directors and such directors' immediate families
and their pension funds.

4.1  SHARES OF BRITISH BIOTECH

(a) As at close of business on the last day of the disclosure period, the
British Biotech Directors and their immediate families owned, controlled or (in
the case of the British Biotech Directors) were interested in the following
British Biotech Shares:

<Table>
<Caption>
-------------------------------------------------------------------------------
                                                                      NUMBER OF
                                                                BRITISH BIOTECH
NAME                                                                     SHARES
-------------------------------------------------------------------------------
<S>                                                             <C>
Peter Fellner...............................................             50,000
Simon Sturge................................................             56,435
Anthony Weir................................................             51,728
Tim Edwards.................................................             60,403
Keith Merrifield............................................              1,500
Eugene Williams.............................................                Nil
Ian Kent....................................................                Nil
-------------------------------------------------------------------------------
</Table>

                                        46
<PAGE>
(b) The British Biotech Directors had the following interests in options over
unissued British Biotech Shares under the terms of the British Biotech Share
Schemes as at close of business on the last day of the disclosure period:

<Table>
<Caption>
-------------------------------------------------------------------------------------------------
                                     NUMBER OF SHARES                                      OPTION
NAME                                     UNDER OPTION    OPTION EXERCISE PERIOD    EXERCISE PRICE
-------------------------------------------------------------------------------------------------
<S>                                  <C>                 <C>                     <C>
                                                                                 (Pound Sterling)
Peter Fellner                               2,670,071           04/03 - 04/13             L1.0000
Simon Sturge                                1,367,520           04/06 - 04/13             L0.5850
Anthony Weir                                    2,708           07/96 - 07/03             L6.5163
                                                5,077           07/97 - 07/04             L7.1890
                                                7,615           07/99 - 07/04             L7.1890
                                                1,202           12/00 - 12/06            L42.0000
                                                1,202           12/01 - 12/06            L42.0000
                                                3,078           12/00 - 12/07            L20.3000
                                                3,078           12/02 - 12/07            L20.3000
                                                6,250           09/01 - 09/08             L8.0000
                                                6,250           09/03 - 09/08             L8.0000
                                               12,500           07/02 - 07/09             L4.4000
                                               12,500           07/04 - 07/09             L4.4000
                                              615,380           04/06 - 04/13             L0.5850
                                                  370           10/03 - 03/04             L5.6000
                                                   98           07/97 - 07/04             L1.0000
                                                  196           07/99 - 07/04             L1.0000
                                                1,608           07/98 - 07/05             L1.0000
                                                3,217           07/00 - 07/05             L1.0000
                                               62,500           07/02 - 07/07             L1.0000
                                               62,500           08/03 - 08/08             L1.0000
Tim Edwards                                     2,500           04/00 - 04/07            L47.0000
                                                2,500           04/02 - 04/07            L47.0000
                                                3,540           12/00 - 12/07            L20.3000
                                                3,540           12/02 - 12/07            L20.3000
                                                6,250           09/01 - 09/08             L8.0000
                                                6,250           09/03 - 09/08             L8.0000
                                               12,500           07/02 - 07/09             L4.4000
                                               12,500           07/04 - 07/09             L4.4000
                                              717,940           04/06 - 04/13             L0.5850
                                                1,500           04/99 - 04/04             L1.0000
                                                1,850           07/98 - 07/05             L1.0000
                                                3,700           07/00 - 07/05             L1.0000
                                               62,500           07/02 - 07/07             L1.0000
                                               62,500           08/03 - 08/08             L1.0000
-------------------------------------------------------------------------------------------------
</Table>

                                        47
<PAGE>

(c) As at the close of business on the last day of the disclosure period, the
following persons (other than Vernalis Directors) who have irrevocably committed
themselves to accept the Offer owned or controlled the following British Biotech
Shares:

<Table>
<Caption>
---------------------------------------------------------------------------------
                                                                NUMBER OF BRITISH
NAME                                                               BIOTECH SHARES
---------------------------------------------------------------------------------
<S>                                                             <C>
FUNDS MANAGED BY INVESCO
Costain Pension Scheme                                                     55,586
G C Bateman GRP of Companies                                                5,000
Invesco Geared Opportunist                                                 50,000
Invesco PENS UK Equity                                                      3,534
Invesco Pension Scheme                                                     16,250
Invesco PERP High Income                                                3,243,132
Invesco PERP Income                                                     1,702,556
Invesco PERP Intl Equity                                                1,715,090
Invesco PERP Rupert Child                                                 165,000
Invesco PERP UK Aggressive                                                473,750
Invesco PERP UK Growth                                                  2,240,048
Invesco Recovery Trust 2005                                                40,000
Invesco UK Equity Core Fund                                               256,889
Keystone Investment Trust                                                 309,326
Perpetual Inc & GR INV TST                                                660,762
Perpetual UK Equity Pension                                               195,627
SJP Exempt Invesco MAN FD                                                 195,000
SJP Exempt UK Equity Fund                                                  34,500
SJP High Income Unit Trust                                                667,783
SJP Net Income Dist FD                                                  2,123,314
SJP Net Income Managed Fund                                               279,500
SJP Net UK Equity Fund                                                     42,000
The Shipbuilding IND PENS                                                 178,870
Univ of Sheffield EIP                                                       4,250
FUNDS MANAGED BY GARTMORE
Vidacos Nominees Limited (Finsbury Ave)                                    80,000
BNY GIL Client Account (Nominees) Limited                                 613,195
FUNDS MANAGED BY JUPITER                                                      Nil
---------------------------------------------------------------------------------
</Table>

(d) As at the close of business on the last day of the disclosure period,
Vernalis and companies within the Vernalis Group did not own or control any
British Biotech Shares.

(e) As at the close of business on the last day of the disclosure period, none
of the Vernalis Directors and/or their immediate families owned, controlled or
(in the case of the Vernalis Directors) were interested (beneficially or
otherwise) in any British Biotech Shares.

(f) As at the close of business on the last day of the disclosure period,
financial and other professional advisers to British Biotech and Vernalis (other
than exempt market makers), owned or controlled the following British Biotech
Shares:

<Table>
<Caption>
------------------------------------------------------------------------------------
                                                                   NUMBER OF BRITISH
NAME                                                                  BIOTECH SHARES
------------------------------------------------------------------------------------
<S>                                                             <C>
JPMorgan                                                                   4,919,674
------------------------------------------------------------------------------------
</Table>

(g) The British Biotech Directors, their immediate families and persons who have
irrevocably committed themselves to accept the Offer, and persons acting in
concert with British Biotech have

                                        48
<PAGE>

dealt for value in shares and/or options over shares of British Biotech during
the disclosure period as follows:

<Table>
<Caption>
-----------------------------------------------------------------------------------------------------
                                                                               NUMBER OF    PRICE PER
                                                                                 BRITISH      BRITISH
                                                                                 BIOTECH      BIOTECH
NAME                                        DATE   NATURE OF TRANSACTION          SHARES        SHARE
-----------------------------------------------------------------------------------------------------
<S>                                     <C>        <C>                         <C>         <C>
Peter Fellner........................   06/01/03   Purchase                       50,000          70p
Simon Sturge.........................   23/04/03   Consideration for              56,435          n/a
                                                   RiboTargets acquisition
Anthony Weir.........................   06/01/03   Purchase                       46,408          80p
Tim Edwards..........................   06/01/03   Purchase                       59,403          80p
JPMorgan Partners LLC................   23/04/03   Consideration for           4,919,674          n/a
                                                   RiboTargets acquisition
-----------------------------------------------------------------------------------------------------
</Table>

<Table>
<Caption>
------------------------------------------------------------------------------------------------
                  DATE                                                              PRICE (P)
-----------------------------------------      NATURE OF    NUMBER OF BRITISH    ---------------
FROM                     TO                  TRANSACTION       BIOTECH SHARES    HIGH      LOW
------------------------------------------------------------------------------------------------
<S>                      <C>                 <C>            <C>                  <C>      <C>
INVESCO
01/05/02                 31/07/02               Purchase                  nil      n/a       n/a
01/05/02                 31/07/02                   Sale                  nil      n/a       n/a
01/08/02                 31/10/02               Purchase           25,350,000     3.17      2.42
01/08/02                 31/10/02                   Sale              952,730     6.00      2.55
01/11/02                 31/01/03               Purchase           11,807,200     4.79      2.52
01/11/02                 31/01/03                   Sale                  nil      n/a       n/a
01/02/03                 28/02/03               Purchase                  nil      n/a       n/a
01/02/03                 28/02/03                   Sale                  nil      n/a       n/a
01/03/03                 31/03/03               Purchase            3,300,000     4.03      4.03
01/03/03                 31/03/03                   Sale                  nil      n/a       n/a
01/04/03                 30/04/03               Purchase                  nil      n/a       n/a
01/04/03                 30/04/03                   Sale                1,966    57.94     57.94
01/05/03                 22/07/03               Purchase            3,080,455    72.58     58.41
01/05/03                 22/07/03                   Sale                  nil      n/a       n/a
------------------------------------------------------------------------------------------------
GARTMORE
01/05/02                 31/07/02               Purchase                  nil      n/a       n/a
01/05/02                 31/07/02                   Sale              100,000        7         7
01/08/02                 31/10/02               Purchase                  nil      n/a       n/a
01/08/02                 31/10/02                   Sale            4,151,997     6.04      2.32
01/11/02                 31/01/03               Purchase            5,263,917      2.5       2.5
01/11/02                 31/01/03                   Sale                  nil      n/a       n/a
01/02/03                 28/02/03               Purchase                  nil      n/a       n/a
01/02/03                 28/02/03                   Sale                  nil      n/a       n/a
01/03/03                 31/03/03               Purchase                  nil      n/a       n/a
01/03/03                 31/03/03                   Sale                  nil      n/a       n/a
01/04/03                 30/04/03               Purchase            1,500,000     3.38      3.38
01/04/03                 30/04/03                   Sale                  nil      n/a       n/a
01/05/03                 22/07/03               Purchase              338,380       79      58.5
01/05/03                 22/07/03                   Sale              665,000    71.78     69.79
------------------------------------------------------------------------------------------------
CAZENOVE
01/05/02                 31/07/02               Purchase                  nil      n/a       n/a
01/05/02                 31/07/02                   Sale                  nil      n/a       n/a
01/08/02                 31/10/02               Purchase                  nil      n/a       n/a
01/08/02                 31/10/02                   Sale                  nil      n/a       n/a
01/11/02                 31/01/03               Purchase           17,444,890     5.00      3.00
01/11/02                 31/01/03                   Sale           18,173,106     5.00      3.00
01/02/03                 28/02/03               Purchase                  nil      n/a       n/a
01/02/03                 28/02/03                   Sale                  nil      n/a       n/a
</Table>

                                        49
<PAGE>

<Table>
<Caption>
------------------------------------------------------------------------------------------------
                  DATE                                                              PRICE (P)
-----------------------------------------      NATURE OF    NUMBER OF BRITISH    ---------------
FROM                     TO                  TRANSACTION       BIOTECH SHARES    HIGH      LOW
------------------------------------------------------------------------------------------------
<S>                      <C>                 <C>            <C>                  <C>      <C>
01/03/03                 31/03/03               Purchase                  nil      n/a       n/a
01/03/03                 31/03/03                   Sale                  nil      n/a       n/a
01/04/03                 30/04/03               Purchase               87,805    60.00     57.00
01/04/03                 30/04/03                   Sale              527,218    59.00      3.00
01/05/03                 22/07/03               Purchase              409,267    73.50     57.00
01/05/03                 22/07/03                   Sale              441,672    74.00     58.00
------------------------------------------------------------------------------------------------
</Table>

(h) The British Biotech Directors have had the following dealings in options
over British Biotech Shares under the British Biotech Share Schemes during the
disclosure period:

<Table>
<Caption>
-------------------------------------------------------------------------------------------------------
                                                                                      OPTION
                                    DATE OF                                            MONEY
                         GRANT/      GRANT/                                         PAID FOR   EXERCISE
NAME                   EXERCISE    EXERCISE      NUMBER           EXERCISE PERIOD      GRANT      PRICE
-------------------------------------------------------------------------------------------------------
<S>                    <C>        <C>         <C>         <C>                       <C>        <C>
Peter Fellner........     Grant    23/04/03   2,670,071             04/03 - 04/13        nil      L1.00
Simon Sturge.........     Grant    23/04/03   1,367,520             04/06 - 04/13        nil      L0.58
Anthony Weir.........     Grant    23/04/03     615,380             04/06 - 04/13        nil      L0.58
Tim Edwards..........     Grant    23/04/03     717,940             04/06 - 04/13        nil      L0.58
-------------------------------------------------------------------------------------------------------
</Table>

(i) Financial and other professional advisers to Vernalis (other than exempt
market makers), have dealt for value in shares of British Biotech during the
disclosure period as follows:

<Table>
<Caption>
------------------------------------------------------------------------------------------------
                  DATE                                                              PRICE (P)
-----------------------------------------      NATURE OF    NUMBER OF BRITISH    ---------------
FROM                     TO                  TRANSACTION       BIOTECH SHARES    HIGH      LOW
------------------------------------------------------------------------------------------------
<S>                      <C>                 <C>            <C>                  <C>      <C>
UBS LIMITED
01/05/03                 22/07/03               Purchase                1,500       57        57
01/05/03                 22/07/03                   Sale                1,500       60        57
------------------------------------------------------------------------------------------------
</Table>

Please see paragraph (g) above for details of Cazenove's dealings for value in
British Biotech Shares during the disclosure period.

(j) There has been no redemption or purchase by British Biotech of its own
securities during the disclosure period.

(k) Save as disclosed above, none of the British Biotech Directors, their
immediate families, related trusts and connected persons (within the meaning of
Section 346 of the Companies Act) or any person acting in concert with British
Biotech or persons who have irrevocably committed themselves prior to the
posting of this document to accept the Offer, any person with whom British
Biotech or any person acting in concert with British Biotech has an arrangement,
Vernalis, the Vernalis Directors and their immediate families, related trusts
and connected persons (within the meaning of Section 346 of the Companies Act),
owns or controls or (in the case of the British Biotech Directors and the
Vernalis Directors) is interested in any shares of British Biotech or any
securities convertible into, rights to subscribe for or options (including
traded options) in respect of or derivatives referenced to such shares, nor has
any such person dealt for value therein during the disclosure period. Save as
disclosed above, none of the subsidiaries of Vernalis, pension funds of Vernalis
or of a subsidiary of Vernalis, financial and other professional advisers to
Vernalis (other than exempt market makers) and persons with whom Vernalis or any
person who is an associate of Vernalis has an arrangement and any person whose
investments are managed on a discretionary basis by fund managers (other than
exempt market makers) connected with Vernalis owns or controls any of the shares
of British Biotech or any securities convertible into, rights to subscribe for
or options (including traded options) in respect of or derivatives referenced to
such shares, nor has any such person dealt for value therein during the
disclosure period.

                                        50
<PAGE>

4.2  SHARES OF VERNALIS

(a) As at the last day of the disclosure period, British Biotech did not own or
control any Vernalis Shares.

(b) As at the last day of the disclosure period, none of the British Biotech
Directors and/or their immediate families owned, controlled or (in the case of
British Biotech Directors) were interested in any Vernalis Shares.

(c) As at close of business on the last day of the disclosure period, the
following persons (other than Vernalis Directors whose interests are disclosed
in paragraph (d) below) who have irrevocably committed themselves prior to the
posting of this document to accept the Offer owned or controlled the following
shares of Vernalis:

<Table>
<Caption>
-----------------------------------------------------------------------------
                                                                    NUMBER OF
                                                                     VERNALIS
NAME                                                                   SHARES
-----------------------------------------------------------------------------
<S>                                                             <C>
UNDER THE MANAGEMENT OF INVESCO
Costain Pension Scheme......................................          281,363
Invesco Perp UK Aggressive..................................        1,173,537
Invesco Perp Intl Equity....................................        5,193,500
Perpetual UK Equity Pension.................................        3,830,183
Invesco Perp UK Growth......................................        6,178,636
Invesco Perp Rupert Child...................................          280,000
The Shipbuilding Ind Pens...................................        1,052,211
SJP Net Income Dist Fd......................................        1,250,982
SJP Net Income Managed Fund.................................        1,795,050
SJP Exempt Invesco Man Fd...................................        1,142,304
SJP Net UK Equity Fund......................................          123,749
SJP Exempt UK Equity Fund...................................           94,511
SJP High Income Unit Trust..................................          625,489
Invesco UK Equity Core Fund.................................        1,360,000
UNDER THE MANAGEMENT OF GARTMORE
Vidacos Nominees Limited (Finsbury Avenue)..................        1,045,142
Vidacos Nominees Limited (Molesworth Street)................        2,063,146
BNY GIL Client Account (Nominees) Limited...................        1,526,627
Chase Nominees Limited......................................           35,459
Mellon Nominee (UK) Limited.................................           27,923
Nortrust Nominees Limited...................................          601,642
UNDER THE MANAGEMENT OF JUPITER
United Utilities -- Specialist..............................        1,180,102
Jupiter Income Fund.........................................        8,726,501
-----------------------------------------------------------------------------
</Table>

(Please see page 7 of this document for the terms of the irrevocable
undertakings)

(d) As at close of business on the last day of the disclosure period, the
interests, all of which are beneficial unless otherwise stated, of the Vernalis
Directors, of their immediate families, related trusts and of their connected
persons (within the meaning of Section 346 of the Companies Act) in the share
capital of Vernalis (as shown in the register required to be kept under Section
325 of the Companies Act or which have been notified to Vernalis pursuant to
Sections 324 and 328 of the

                                        51
<PAGE>

Companies Act or which is known to or could with reasonable diligence become
known by the director concerned were as follows:

<Table>
<Caption>
---------------------------------------------------------------------------------------------
                                            NUMBER OF                                  OPTION
                          NUMBER OF          VERNALIS               OPTION           EXERCISE
                           VERNALIS            SHARES             EXERCISE          PRICE PER
NAME                         SHARES      UNDER OPTION               PERIOD     VERNALIS SHARE
---------------------------------------------------------------------------------------------
<S>                       <C>          <C>               <C>                  <C>
GEORGE KENNEDY               34,000                --                   --                 --
COLIN DOURISH               131,003            11,881    20/03/03-19/03/10             252.5p
                                               38,119    20/03/03-19/03/10             252.5p
                                               53,500    07/07/03-06/07/10               216p
                                               62,000    09/07/04-08/07/11               221p
                                                3,443    01/12/06-31/05/07                98p
                                               75,000    02/04/05-01/04/12               145p
                                               80,000    03/01/06-02/01/13             102.5p
JOHN HUTCHISON               41,593(1)         11,881    20/03/03-19/03/10             252.5p
                                               38,119    20/03/03-19/03/10             252.5p
                                               53,500    07/07/03-06/07/10               216p
                                                4,795    25/05/03-24/11/03               202p
                                               62,000    09/07/04-08/07/11               221p
                                               50,000    02/04/05-01/04/12               145p
                                              100,000    03/01/06-02/01/13             102.5p
PETER WORRALL                93,444            50,982    07/04/97-06/04/04                59p
                                               50,982    02/12/97-01/12/04                59p
                                               25,712    12/09/99-11/09/03               462p
                                                5,098    07/03/00-06/03/04               669p
                                               53,500    07/07/03-06/07/10               216p
                                               62,000    09/07/04-08/07/11               221p
                                               75,000    02/04/05-01/04/12               145p
                                              100,000    03/01/06-02/01/13             102.5p
CAROL FERGUSON               32,300(2)             --                   --                 --
PETER READ                    3,000                --                   --                 --
MARVIN JAFFE                  8,500                --                   --                 --
---------------------------------------------------------------------------------------------
</Table>

Notes:

(1) (includes shares held by nominee)

(2) (shares held by nominee)

The Vernalis Directors have given irrevocable undertakings to accept the Offer
in respect of their own beneficial shareholdings.

(e) Vernalis Directors and (so far as the Vernalis Directors are aware having
made due and careful enquiries) their immediate families, related trusts and
connected persons (within the meaning of

                                        52
<PAGE>

Section 346 of the Act) have dealt for value in Vernalis Shares during the
disclosure period as follows:

<Table>
<Caption>
-----------------------------------------------------------------------------------------------------
                                                                               NUMBER OF    PRICE PER
                                                                                VERNALIS     VERNALIS
NAME                                        DATE   NATURE OF TRANSACTION          SHARES       SHARES
-----------------------------------------------------------------------------------------------------
<S>                                     <C>        <C>                         <C>         <C>
George Kennedy.......................   01/05/03   Right to subscribe under       14,000          36p
                                                   Placing & Open Offer
                                        30/05/03   Issue of Shares under          14,000          36p
                                                   Placing & Open Offer
Colin Dourish........................   01/05/03   Right to subscribe under       53,942          36p
                                                   Placing & Open Offer
                                        30/05/03   Issue of Shares under          53,942          36p
                                                   Placing & Open Offer
John Hutchison.......................   01/05/03   Right to subscribe under       17,126          36p
                                                   Placing & Open Offer
                                        30/05/03   Issue of Shares under          17,126          36p
                                                   Placing & Open Offer
Peter Worrall........................   27/09/02   Purchase                       20,000          52p
                                        01/04/03   Transfer of Shares under       30,000          nil
                                                   Restricted Share Scheme
                                        01/05/03   Right to subscribe under       47,124          36p
                                                   Placing & Open Offer
                                        30/05/03   Issue of Shares under          26,124          36p
                                                   Placing & Open Offer
Carol Ferguson.......................   08/01/02   Purchase                        9,000         230p
                                        28/10/02   Purchase                       10,000          77p
                                        01/05/03   Right to subscribe under       13,300          36p
                                                   Placing & Open Offer
                                        30/05/03   Issue of Shares under          13,300          36p
                                                   Placing & Open Offer
Marvin Jaffe.........................   01/05/03   Right to subscribe under        3,500          36p
                                                   Placing & Open Offer
                                        30/05/03   Issue of Shares under           3,500          36p
                                                   Placing & Open Offer
Peter Read...........................   01/05/03   Right to subscribe under        2,100          36p
                                                   Placing & Open Offer
-----------------------------------------------------------------------------------------------------
</Table>

(f) The Vernalis Directors have had the following dealings in options over
Vernalis Shares under the Vernalis Incentive Plans during the disclosure period:

<Table>
<Caption>
------------------------------------------------------------------------------------------------
                                                                              OPTION
                                         DATE OF                               MONEY
                              GRANT/      GRANT/                EXERCISE    PAID FOR    EXERCISE
NAME                        EXERCISE    EXERCISE     NUMBER       PERIOD       GRANT       PRICE
------------------------------------------------------------------------------------------------
<S>                         <C>         <C>         <C>        <C>          <C>         <C>
Colin Dourish...........       Grant    02/04/02     75,000    02/04/05-         Nil        145p
                                                                01/04/12
                               Grant    02/01/03     80,000    03/01/06-         Nil      102.5p
                                                                02/01/13
John Hutchison..........       Grant    02/04/02     50,000    02/04/05-         Nil        145p
                                                                01/04/12
                               Grant    02/01/03    100,000    03/01/06-         Nil      102.5p
                                                                02/01/13
Peter Worrall...........       Grant    02/04/02     75,000    02/04/05-         Nil        145p
                                                                01/04/12
                               Grant    02/01/03    100,000    03/01/06-         Nil      102.5p
                                                                02/01/13
------------------------------------------------------------------------------------------------
</Table>

                                        53
<PAGE>

(g) As at close of business on the last day of the disclosure period, financial
and other professional advisers to British Biotech and Vernalis (other than
exempt market makers), owned or controlled the following Vernalis Shares:

<Table>
<Caption>
-------------------------------------------------------------------------
                                                                NUMBER OF
                                                                 VERNALIS
NAME                                                               SHARES
-------------------------------------------------------------------------
<S>                                                             <C>
JPMorgan                                                          434,858
Cazenove                                                          246,457
-------------------------------------------------------------------------
</Table>

(h) The financial and other professional advisers to British Biotech and
Vernalis (other than exempt market makers) have dealt for value in Vernalis
Shares during the disclosure period as follows:

<Table>
<Caption>
-------------------------------------------------------------------------------------------------
                                                      NATURE OF          NUMBER OF
DATE                                                TRANSACTION    VERNALIS SHARES    PRICE (US$)
-------------------------------------------------------------------------------------------------
<S>                                                 <C>            <C>                <C>
JPMORGAN PARTNERS LLC
03/09/02........................................           Sale            363,725         0.7741
03/09/02........................................           Sale                430         0.7541
04/09/02........................................           Sale             10,847         0.7741
27/09/02........................................           Sale          1,300,000         0.7523
30/09/02........................................           Sale             98,677         0.7817
30/09/02........................................           Sale              1,323         0.7813
02/10/02........................................           Sale            154,998         0.7813
-------------------------------------------------------------------------------------------------
</Table>

<Table>
<Caption>
------------------------------------------------------------------------------------------------
                    DATE                                                            PRICE (P)
--------------------------------------------      NATURE OF          NUMBER OF    --------------
FROM               TO                           TRANSACTION    VERNALIS SHARES     HIGH      LOW
------------------------------------------------------------------------------------------------
<S>                <C>                          <C>            <C>                <C>      <C>
CAZENOVE
1 May 2003         22 July 2003.............       Purchase            139,531       50       50
1 May 2003         22 July 2003.............           Sale                nil      n/a      n/a
------------------------------------------------------------------------------------------------
</Table>

                                        54
<PAGE>

(i) Persons who have irrevocably committed themselves prior to the posting of
this document to accept the Offer, have dealt for value in Vernalis Shares
during the disclosure period as follows:

<Table>
<Caption>
---------------------------------------------------------------------------------------------
                                                              NUMBER OF
                                                NATURE OF      VERNALIS             PRICE PER
DATE                                          TRANSACTION        SHARES    VERNALIS SHARE (p)
---------------------------------------------------------------------------------------------
<S>                                        <C>               <C>           <C>
MANAGED BY GARTMORE
07/05/03                                             Sale        60,000                    50
28/05/03                                         Purchase     5,328,030                    36
02/06/03                                         Purchase        55,000                    50
05/06/03                                             Sale        23,091                  56.5
10/07/03                                         Purchase        80,000                    52
MANAGED BY JUPITER
Jupiter Income Fund
03/07/02                                         Purchase     2,282,000                   149
28/10/02                                         Purchase        25,000                    78
29/10/02                                         Purchase         5,000                    78
29/10/02                                         Purchase        10,000                    78
04/11/02                                         Purchase        10,000                    85
04/11/02                                         Purchase       300,000                  81.5
23/05/03                                         Purchase     2,061,976                    36
28/05/03                                         Purchase     3,718,844                    36
United Utilities -- Specialist
11/10/02                                         Purchase       190,000                    52
23/05/03                                   Rights take-up       278,890                   n/a
28/05/03                                         Purchase       502,797                    36
---------------------------------------------------------------------------------------------
</Table>

<Table>
<Caption>
--------------------------------------------------------------------------------------------------
                    DATE                                                             PRICE (p)
--------------------------------------------      NATURE OF          NUMBER OF    ----------------
FROM                     TO                     TRANSACTION    VERNALIS SHARES      HIGH       LOW
--------------------------------------------------------------------------------------------------
<S>                      <C>                    <C>            <C>                <C>       <C>
INVESCO
01/05/02                 31/07/02...........       Purchase          4,044,000    151.56    141.99
01/05/02                 31/07/02...........           Sale            330,000    147.50    147.50
01/08/02                 31/10/02...........       Purchase          3,595,000     50.13     32.26
01/08/02                 31/10/02...........           Sale             93,000     44.97     35.98
01/11/02                 31/01/03...........       Purchase                nil       n/a       n/a
01/11/02                 31/01/03...........           Sale                nil       n/a       n/a
01/02/03                 28/02/03...........       Purchase                nil       n/a       n/a
01/02/03                 28/02/03...........           Sale                nil       n/a       n/a
01/03/03                 31/03/03...........       Purchase                nil       n/a       n/a
01/03/03                 31/03/03...........           Sale                nil       n/a       n/a
01/04/03                 30/04/03...........       Purchase            515,110     36.00     36.00
01/04/03                 30/04/03...........           Sale                nil       n/a       n/a
01/05/03                 22/07/03...........       Purchase         11,877,405     36.00     25.00
01/05/03                 22/07/03...........           Sale                nil       n/a       n/a
--------------------------------------------------------------------------------------------------
</Table>

(j) There has been no redemption or purchase by Vernalis of its own securities
during the disclosure period.

(k) Save as disclosed above, none of British Biotech, the British Biotech
Directors, their immediate families, related trusts and connected persons
(within the meaning of Section 346 of the Companies Act) or any person acting in
concert with British Biotech or persons who have irrevocably committed
themselves prior to the posting of the document to accept the Offer, any person
with whom British Biotech or any person acting in concert with British Biotech
has an arrangement, the Vernalis Directors and their immediate families, related
trusts and connected persons (within the meaning of Section 346 of the Companies
Act), owns or controls or (in the case
                                        55
<PAGE>

of the British Biotech Directors and the Vernalis Directors) is interested in
any shares of Vernalis or any securities convertible into, rights to subscribe
for, or options (including traded options) in respect of or derivatives
referenced to such shares, nor has any such person dealt for value therein
during the disclosure period. Save as disclosed above, none of the subsidiaries
of Vernalis, pension funds of Vernalis or of a subsidiary of Vernalis, financial
or other professional advisers to Vernalis (other than exempt market makers) and
persons with whom Vernalis or any person who is an associate of Vernalis has an
arrangement and any person whose investments are managed on a discretionary
basis by fund managers (other than exempt market markers) connected with
Vernalis owns or controls any of the shares of Vernalis or any securities
convertible into, rights to subscribe for or options (including traded options)
in respect of or derivatives referenced to such shares, nor has any such person
dealt for value therein during the disclosure period.

5.  MATERIAL CONTRACTS

5.1 The following contracts (not being contracts entered into in the ordinary
course of business) have been entered into by members of the British Biotech
Group within the two years immediately prior to the commencement of the Offer
Period and which are or may be material:

(a) Asset sale agreement

    A sale and purchase agreement, dated August 2001 made between British
    Biotech Pharmaceuticals Limited (1), OSI Pharmaceuticals (UK) Limited (OSI)
    (2), British Biotech (3) and OSI Pharmaceuticals Inc. (4), pursuant to which
    OSI purchased certain assets including goodwill, plant and machinery and the
    benefit of various contracts, licences, consents and permissions from
    British Biotech Pharmaceuticals Limited and, on 28 September 2001 took
    assignment of British Biotech's leasehold interests in Isis House, Cowley
    Trading Estate being a lease dated 26 July 1994 between AT&T ISTEL Limited
    (1) British Biotech Pharmaceuticals Limited (2) and British Biotech (3) in
    Windrush Court and Unit 11, County Trading Estate being a lease dated 2
    April 2001 between Rosewood Property Management Limited (1) and British
    Biotech Pharmaceuticals Limited (2) for a consideration comprising a payment
    of L8,700,000 and the assumption by OSI of certain liabilities in respect of
    certain assets transferred. The agreement also transferred a number of
    employees from the employment of British Biotech Pharmaceuticals Limited to
    OSI. The agreement contains warranties and indemnities given by British
    Biotech Pharmaceuticals Limited to OSI in connection therewith. Under the
    terms of the agreement, British Biotech plc and OSI Pharmaceuticals Inc.
    guaranteed the due and punctual performance of British Biotech
    Pharmaceuticals Limited's and OSI's respective obligations under the
    agreement.

(b) Sale proposal relating to the acquisition by British Biotech of RiboTargets

    On 21 March 2003, British Biotech made an offer (the RIBOTARGETS OFFER) to
    RiboTargets shareholders to acquire the entire issued share capital of
    RiboTargets. The RiboTargets Offer comprised the following:

     - for every RiboTargets B ordinary share approximately 2.79 British Biotech
       Shares;

     - for every RiboTargets A ordinary share approximately 0.85 British Biotech
       Shares; and

     - 396,198 British Biotech Shares allocated amongst RiboTargets shareholders
       pro rata to their holdings of RiboTargets ordinary shares immediately
       prior to 23 April 2003.

    British Biotech's acquisition of RiboTargets was completed on 23 April 2003.
    Based on British Biotech's share price of 3.875 pence on 19 March 2003, the
    latest practicable Business Day prior to the announcement of the RiboTargets
    Offer, the aggregate value of the RiboTargets Offer amounted to
    approximately L26 million.

                                        56
<PAGE>

(c) Deed of covenant

    In connection with the RiboTargets Offer, British Biotech entered into a
    deed of covenant dated 17 March 2003 in favour of RiboTargets whereby
    British Biotech agreed to carry on the business of the British Biotech Group
    in the ordinary course pending completion of its acquisition of RiboTargets.

(d) Undertaking

     (i)   On 21 March 2003, in consideration for British Biotech agreeing to
           make the RiboTargets Offer, certain RiboTargets shareholders holding
           in aggregate 100 per cent. of the issued RiboTargets B ordinary
           shares, 99.9 per cent. of the issued RiboTargets A ordinary shares
           and 100 per cent. of the issued RiboTargets ordinary shares, entered
           into an undertaking (the UNDERTAKING) to accept the RiboTargets Offer
           and granted warranties in favour of British Biotech in respect of
           their ownership of the RiboTargets shares. The Undertaking imposes
           restrictions on the ability of the (now, former) RiboTargets
           shareholders who are party to it to sell the British Biotech Shares
           which they received in connection with the RiboTargets Offer (LOCK-UP
           SHARES) without British Biotech's prior approval. Each (now, former)
           RiboTargets shareholder that entered into the Undertaking:

           (a)  may not dispose of any its Lock-up Shares at any time during the
                period of six calendar months following 23 April 2003 (the
                INITIAL LOCK-UP PERIOD);

           (b)  subject as described in (ii) below, during the period of eight
                calendar months after the Initial Lock-up Period has expired
                (the INTERIM LOCK-UP PERIOD) must:

                (x)  notify British Biotech or its nominated broker (currently
                     Cazenove) in writing prior to the disposal of any Lock-up
                     Shares; and

                (y)  must not dispose of any Lock-up Shares other than through
                     British Biotech's nominated broker.

           However, if a (now, former) RiboTargets shareholder who has entered
           into the Undertaking receives an unsolicited offer to acquire Lock-up
           Shares then sub-paragraph (y) above will not apply and such
           RiboTargets shareholder shall only be obliged to notify British
           Biotech's nominated broker in writing prior to such disposal.

     (ii)  During the Interim Lock-up Period the Qualifying Shareholders (as
           defined below) are together entitled to dispose of Lock-up Shares up
           to a maximum aggregate of Lock-up Shares equal to three per cent. of
           the issued ordinary share capital of British Biotech immediately
           following 23 April 2003 without using British Biotech's nominated
           broker to effect such disposal.

    QUALIFYING SHAREHOLDER means a RiboTargets shareholder who has entered into
    the Undertaking whose beneficial holding of Lock-up Shares immediately
    following 23 April 2003 amounted to less than one per cent. of the aggregate
    issued ordinary share capital of the British Biotech immediately following
    23 April 2003.

     (iii) A (now, former) RiboTargets shareholder wishing to dispose of any
           Lock-up Shares in the six months after the Interim Lock-up Period has
           expired must consult with British Biotech's nominated broker about
           such disposal for a reasonable period of time prior to the proposed
           disposal, including, without limitation, with respect to the method
           and timing of the disposal.

     (iv)  In addition, each (now, former) RiboTargets shareholder who has
           entered into the Undertaking agreed, prior to the end of the Initial
           Lock-up Period, not to acquire or offer to acquire, directly or
           indirectly, any British Biotech Shares if the effect would be to
           oblige any person to make a mandatory offer for British Biotech under
           Rule 9 of the Code.

                                        57
<PAGE>

     (v)   The Undertaking contains exemptions which allow the (now, former)
           RiboTargets shareholders that entered into the undertaking to dispose
           of Lock-up Shares, regardless of the restrictions listed above, in
           the following situations:

           (a)  a disposal pursuant to a court order;

           (b)  a renunciation of a right to subscribe for shares where such
                right is derived from the Lock-up Shares or a failure to take up
                any such right;

           (c)  if British Biotech makes an offer to its shareholders to
                purchase its own shares or proposes a scheme of arrangement, a
                disposal or agreement to dispose of any Lock-up Shares to
                British Biotech pursuant to that offer or scheme; or

           (d)  by acceptance of a general offer made for all the issued share
                capital of British Biotech, provided such offer is recommended
                by the board of directors of British Biotech.

5.2 The following contracts (not being contracts entered into in the ordinary
course of business) have been entered into by Vernalis within the two years
immediately prior to the commencement of the Offer Period and which are or may
be material:

(a) Placing and Open Offer Agreement

The Placing and Open Offer Agreement dated 1 May 2003 between Vernalis and
Cazenove, pursuant to which Cazenove agreed: (1) as agent for Vernalis and
subject to the terms and conditions of the Placing and Open Offer Agreement, to
invite qualifying shareholders to subscribe for 30,098,086 new ordinary shares
in Vernalis; (2) subject to the terms and conditions of the Placing and Open
Offer Agreement, to procure subscribers for, or itself subscribe for, all the
new ordinary shares available under the open offer other than the committed open
offer shares (the CLAWBACK SHARES) on the basis that such shares are subject to
recall to satisfy valid applications by qualifying shareholders under the open
offer; (3) subject to the terms and conditions of the Placing and Open Offer
Agreement, to procure subscribers for, or itself subscribe for, 14,346,359 new
ordinary shares in Vernalis pursuant to the firm placing; and (4) to act as
sponsor to Vernalis in connection with admission of its new ordinary shares.

The Placing and Open Offer Agreement contains certain warranties, undertakings
and indemnities given by Vernalis in favour of Cazenove.

Vernalis agreed to pay Cazenove (together with any applicable value added tax):
(1) whether or not admission of the new ordinary shares in Vernalis became
effective, a commitment commission of 0.5 per cent. of the value at the offer
price of the Clawback Shares and (2) subject to admission of the new ordinary
shares in Vernalis a commission of L750,000 plus a placing commission of 0.75
per cent. of the value at the offer price of the Clawback Shares. Out of the
commissions, Cazenove paid placing commissions to such persons (if any) as it
procured to subscribe for Clawback Shares.

Vernalis paid the incidental costs and expenses of and relating to the Placing
and Open Offer.

(b) Roche Convertible Loan

On 13 May 2002 Vernalis entered into a convertible loan agreement with Roche
pursuant to which Roche made a loan to Vernalis of L7 million, convertible at
any time by Roche into ordinary shares in Vernalis at a conversion price of 329
pence per share. Vernalis also has rights to convert the Roche Convertible Loan
in specified circumstances. If not converted the Roche Convertible Loan is
repayable after five years. Interest is payable semi-annually in arrears on 13
May and 13 November in each year. The terms of the Roche Convertible Loan
include an anti-dilution provision that was triggered by the issue of new
ordinary shares in the Placing and Open Offer, the effect of which was to reduce
the conversion price. This would result in Roche receiving an additional
1,576,044 new ordinary shares in Vernalis on conversion of the full amount of
the Roche Convertible Loan. Under the terms of the Roche Convertible Loan,
Vernalis will be required to notify Roche when

                                        58
<PAGE>

Vernalis becomes aware that the right to cast more than 50 per cent. of the
votes at a general meeting of Vernalis has or will become unconditionally vested
in British Biotech. Roche will be entitled, within 30 days of Vernalis giving
such notice, to require repayment of the loan with accrued but unpaid interest
to the date of repayment.

7.  SOURCES AND BASES OF INFORMATION

Unless otherwise stated, financial information relating to British Biotech and
Vernalis has been derived from the published annual report and accounts and/or
interim statements and/or public statements made by the relevant companies for
the relevant periods.

8.  SERVICE CONTRACTS

Particulars of the service contracts between Peter Worrall and John Hutchison as
Proposed Directors and members of the British Biotech Group, which are
conditional upon the Offer becoming or being declared unconditional in all
respects, are set out in paragraph 6.9 of Part VI of the Listing Particulars.

8.1  VERNALIS DIRECTORS' AGREEMENTS AND EMOLUMENTS

The following are details of the service contracts of the Vernalis Directors and
members of the Vernalis Group which have more than twelve months to run and/or
have been entered into or amended within the six months preceding the date of
this document:

(a) Peter Worrall has a service contract with Vernalis dated 9 April 1997 and he
    is stated to have commenced employment on 1 September 1993. His service
    contract is terminable on 12 months' written notice from Vernalis or on six
    months' written notice from him (Vernalis retains the right to pay salary
    and a salary supplement in lieu of notice) and provides for automatic
    termination on him reaching the age of 60 years. His service contract was
    amended with effect from 1 April 2003 such that Mr. Worrall's salary was
    increased from L152,000 per annum to L177,000 per annum. He is eligible to
    receive a performance bonus of up to (but not necessarily all of) 35 per
    cent. of his salary earned during the bonus year, which runs to 31 December.
    He is also entitled, by way of benefits, to medical insurance, life
    assurance and a salary supplement equal to 25 per cent. of his salary from
    which he may make his own arrangements regarding a car and a pension. If,
    during the period of 12 months from the date on which:

        (i)   any person, firm or company has obtained control of Vernalis (as
              defined in section 840 of ICTA); and

        (ii)  any offer such person, firm or company has made to acquire shares
              in the capital of any holding company of Vernalis is declared
              unconditional in all respects,

    either Vernalis or Peter Worrall serves notice to terminate his contract,
    Vernalis shall forthwith make the payment of an amount equal to 12 months'
    salary and salary supplement in lieu of notice.

(b) Colin Dourish has a service contract with Vernalis dated 24 February 2000
    and he is stated to have commenced employment on 1 October 1995. His service
    contract is terminable on 12 months' written notice from Vernalis or on six
    months' written notice from him on or after 1 July 2000 (Vernalis will
    retain the right to pay salary and a salary supplement in lieu of notice)
    and will provide for automatic termination on him reaching the age of 60
    years. His salary is L170,000 per annum. He is eligible to receive a
    performance bonus of up to (but not necessarily all of) 35 per cent. of his
    salary earned during the financial year of Vernalis which runs to 31
    December. He is also entitled, by way of benefits, to medical insurance,
    life assurance and a salary supplement equal to 25 per cent. of his salary
    from which he may make his own arrangements regarding a car and a pension.
    Vernalis currently pays L25,500 per annum on his behalf into a pension plan.
    These pension plan payments are deducted from

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    the 25 per cent. salary supplement paid by Vernalis. If, during the period
    of twelve months from the date on which:

        (i)   any person, firm or company has obtained control of Vernalis (as
              defined in section 840 of ICTA); and

        (ii)  any offer such person, firm or company has made to acquire shares
              in the capital of any holding company of Vernalis is declared
              unconditional in all respects,

    either Vernalis or Colin Dourish serves notice to terminate his contract,
    Vernalis would then forthwith make the payment of an amount equal to 12
    months' salary and salary supplement in lieu of notice.

(c) John Hutchison has a service contract with Vernalis dated 12 April 2000 and
    he is stated to have commenced employment on 4 August 1997. His service
    contract is terminable on 12 months' written notice from Vernalis or on six
    months' written notice from him on or after 1 July 2000 (Vernalis will
    retain the right to pay salary and a salary supplement in lieu of notice)
    and will provide for automatic termination on him reaching the age of 60
    years. His salary is L150,000 per annum. He is eligible to receive a
    performance bonus of up to (but not necessarily all of) 35 per cent. of his
    salary earned during the financial year of Vernalis, which runs to 31
    December. He is also entitled, by way of benefits, to medical insurance,
    life assurance and a salary supplement equal to 25 per cent. of his salary
    from which he may make his own arrangements regarding a car and a pension.
    Vernalis currently pays L22,500 per annum on his behalf into a pension plan.
    The pension plan payment is deducted from the 25 per cent. salary supplement
    paid by Vernalis. If, during the period of twelve months from the date on
    which:

        (i)   any person, firm or company has obtained control of Vernalis (as
              defined in section 840 of ICTA); and

        (ii)  any offer such person, firm or company has made to acquire shares
              in the capital of any holding company of Vernalis is declared
              unconditional in all respects,

     either Vernalis or John Hutchison serves notice to terminate his contract,
     Vernalis would then forthwith make the payment of an amount equal to 12
     months' salary and salary supplement in lieu of notice.

Save as disclosed above, there are no service contracts between any Vernalis
Director and any member of Vernalis Group having more than twelve months to run
and no such contract has been entered into or amended within the six months
preceding the date of this document.

9.  OTHER INFORMATION

(a) Save as disclosed in this document and the Listing Particulars, the
    emoluments of the British Biotech Directors will not be affected by the
    acquisition of Vernalis or by any other associated transaction.

(b) Save as disclosed in this document and the Listing Particulars, no
    agreement, arrangement or understanding (including any compensation
    arrangement) exists between British Biotech or any party acting in concert
    with British Biotech and any of the directors, recent directors,
    shareholders or recent shareholders of Vernalis having any connection with
    or dependence upon or which is conditional on the outcome of the Offer.

(c) No agreement, arrangement or understanding exists whereby any Vernalis
    Shares acquired in pursuance of the Offer will be transferred to any other
    person, save that British Biotech reserves the right to transfer any
    Vernalis Shares to any of its subsidiaries.

(d) None of British Biotech, any person acting in concert with British Biotech,
    Vernalis and any associate of Vernalis has any arrangement (including
    indemnity or option arrangement) or any agreement or understanding, formal
    or informal, of whatever nature with any person,

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    relating to relevant securities of Vernalis or British Biotech which may be
    an inducement to deal or refrain from dealing.

(e) JPMorgan has given and not withdrawn its written consent to the issue of
    this document with the references to its name in the form and context in
    which they appear.

(f) UBS Investment Bank has given and not withdrawn its written consent to the
    issue of this document with the inclusion of its recommendation and the
    references to its name in the form and context in which they appear.

(g) The expenses of, or incidental to, the preparation and implementation of the
    Offer will be paid by British Biotech, if the Offer is successful, or each
    party in respect of its own respective expenses, if the Offer is
    unsuccessful.

(h) All times referred to in this document are London times.

(i) Save as disclosed in this document and/or the Listing Particulars, the
    British Biotech Directors are not aware of any material change in the
    financial or trading position of the British Biotech Group since 30 April
    2003, the date to which the latest audited accounts for British Biotech were
    published.

(j) Save as disclosed in this document and/or the Listing Particulars, the
    Vernalis Directors are not aware of any material change in the financial or
    trading position of the Vernalis Group since 31 December 2002, the date to
    which the latest audited accounts for Vernalis were published.

(k) Save as disclosed in this document or in the Listing Particulars, no
    proposal exists in connection with the Offer that any payment or other
    benefit shall be made or given by British Biotech or any person acting in
    concert with British Biotech for the purpose of the Offer to any Vernalis
    Director as compensation for loss of office or as consideration for, or in
    connection with, his retirement from office.

(l) No agreement or arrangement exists to which British Biotech is a party
    which relates to the circumstances in which it may or may not invoke or seek
    to invoke a condition to the Offer.

10. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the
offices of Allen & Overy, One New Change, London EC4M 9QQ, during usual business
hours on any week day (Saturdays and public holidays excepted) while the Offer
remains open for acceptance:

(a) the Memorandum and Articles of Association of British Biotech;

(b) the memorandum and articles of association of Vernalis;

(c) the published audited consolidated accounts of British Biotech for the last
    two financial years ended 30 April 2003;

(d) the published audited consolidated accounts of Vernalis for the last two
    financial years ended 31 December 2002;

(e) the service agreements referred to in paragraph 8 above;

(f) the material contracts referred to in paragraph 5 above;

(g) the written consents referred to in paragraph 9 above;

(h) copies of the irrevocable commitments to accept the Offer given by the
    persons referred to in paragraph 4 of the letter from JPMorgan contained in
    this document above;

(i) lists of the dealings summarised in paragraph 4 above; and

(j) this document, the Form of Acceptance and the Listing Particulars.

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                                  DEFINITIONS

Admission..................  the admission of the New British Biotech Shares to
                             the Official List and trading on the London Stock
                             Exchange's market for listed securities becoming
                             effective in accordance with, respectively, the
                             Listing Rules and the Admission and Disclosure
                             Standards

Admission and Disclosure
  Standards................  the admission and disclosure standards of the
                             London Stock Exchange

Articles of Association....  the articles of association of British Biotech

Board or British Biotech
  Directors................  the existing directors of British Biotech

British Biotech............  British Biotech plc, registered in England and
                             Wales under number 2304992

British Biotech Group......  British Biotech and its subsidiary undertakings
                             and, where the context so requires, each of them

British Biotech Shares.....  ordinary shares of 5 pence each in the capital of
                             Company

British Biotech Share
  Schemes..................  the British Biotech Group 1992 Share Option Scheme;
                             the British Biotech Executive Share Option Scheme;
                             the British Biotech Group SAYE Share Option Scheme;
                             the British Biotech Deferred Share Bonus Scheme;
                             British Biotech Option Plan (comprising the British
                             Biotech Approved Share Option Plan and the British
                             Biotech Discretionary Share Option Plan) and the
                             British Biotech Savings Related Share Option Plan

British Biotech
  Shareholders.............  existing holders of British Biotech Shares

Business Day...............  any day on which the London Stock Exchange is open
                             for the transaction of business

Capita IRG Plc.............  Capita IRG Plc and its subsidiary undertakings and,
                             where the context so requires, each of them

Cazenove...................  Cazenove & Co. Ltd

certificated or in
  certificated form........  a Vernalis Share which is not in uncertificated
                             form

Closing Price..............  the mid-market price of a share at the close of
                             dealings on the London Stock Exchange as derived
                             from the Daily Official List

Code.......................  the City Code on Takeovers and Mergers

Companies Act..............  the Companies Act 1985 of England and Wales, as
                             amended

Company....................  British Biotech

CREST......................  a relevant system (as defined in the CREST
                             Regulations) in respect of which CRESTCo is the
                             Operator (as defined in the CREST Regulations)

CRESTCo....................  CRESTCo Limited, the operator of CREST

CREST member...............  a person who has been admitted by CRESTCo as a
                             system-member (as defined in the CREST Regulations)

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<PAGE>

CREST participant..........  a person who is, in relation to CREST, a
                             system-participant (as defined in the CREST
                             Regulations)

CREST payment..............  shall have the meaning given in the CREST manual
                             issued by CRESTCo

CREST personal member......  a CREST member admitted to CREST as a sponsored
                             member

CREST Regulations..........  the Uncertificated Securities Regulations 2001 (SI
                             2001 No. 3755), as from time to time amended

CREST sponsor..............  a CREST participant admitted to CREST as a CREST
                             sponsor

Daily Official List........  the daily official list of the London Stock
                             Exchange

Disclosed..................  in relation to British Biotech, means (a) as
                             disclosed in British Biotech's preliminary results
                             for the year ended 30 April 2003; (b) as publicly
                             announced by British Biotech (by delivery of an
                             announcement to an authorised Regulatory
                             Information Service) prior to 2 July 2003; (c) as
                             disclosed in British Biotech's Listing Particulars
                             dated 21 March 2003 and Supplementary Listing
                             Particulars dated 4 April 2003; (d) as disclosed in
                             this document; or (e) as otherwise disclosed in
                             writing to Vernalis by or on behalf of British
                             Biotech prior to 2 July 2003; and in relation to
                             Vernalis, means (a) as disclosed in Vernalis'
                             annual report and accounts for the year ended 31
                             December 2002; (b) as publicly announced by
                             Vernalis (by delivery of an announcement to an
                             authorised Regulatory Information Service) prior to
                             2 July 2003; (c) as disclosed in Vernalis'
                             prospectus dated 1 May 2003; (d) as disclosed in
                             this document; or (e) as otherwise disclosed in
                             writing to British Biotech by or on behalf of
                             Vernalis prior to 2 July 2003

Escrow Agent...............  Capita IRG Plc (in its capacity as a CREST
                             participant under ID RA10)

Elan.......................  Elan Corporation and/or any of its affiliates

Extraordinary General
  Meeting/British Biotech
  EGM......................  the extraordinary general meeting of British
                             Biotech for the purpose, inter alia, of approving
                             the terms of the Offer to be held on 13 August
                             2003, including any adjournment thereof

FDA........................  US Food and Drug Administration

Form of Acceptance.........  the form of acceptance which accompanies this
                             document

Form of Proxy..............  the form of proxy to be used by British Biotech
                             Shareholders at the British Biotech EGM

FSMA.......................  the Financial Services and Markets Act 2000

Gartmore...................  Gartmore Investment Limited

GeneSoft...................  GeneSoft Inc

ICTA.......................  Income and Corporation Taxes Act 1988

ImmunoGen..................  ImmunoGen Inc

Invesco....................  Amvescap plc and its affiliates

JPMorgan...................  J.P. Morgan plc

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<PAGE>
Jupiter....................  Jupiter Asset Management Limited

Lilly......................  Eli Lilly & Company and/or its affiliates

Listing Particulars........  the document dated 25 July 2003 comprising listing
                             particulars of British Biotech in relation to the
                             New British Biotech Shares

Listing Rules..............  the listing rules of the UK Listing Authority made
                             under section 74 of the FSMA

London Stock Exchange......  London Stock Exchange plc

Memorandum of Association..  the memorandum of association of British Biotech

member account ID..........  the identification code or number attached to any
                             member account in CREST

Menarini...................  Menarini International S.A. and/or any of its
                             affiliates

Merged Group...............  British Biotech and its subsidiary undertakings
                             after the completion of the Merger, including
                             Vernalis and its subsidiary undertakings

Merger.....................  the proposed acquisition by British Biotech of the
                             Vernalis Shares pursuant to the Offer and pursuant
                             to the subsequent compulsory acquisition procedure
                             described in paragraph 16 of Part 3 of this Offer
                             Document

Merger Resolution..........  the resolution set out in the notice of the British
                             Biotech EGM seeking the approval of British Biotech
                             Shareholders to the Offer

MethylGene.................  MethylGene Inc

MGI Pharma.................  MGI Pharma Inc.

Net Cash...................  cash at bank and in hand, and short term deposits
                             and investments, less all borrowings, overdrafts,
                             loans, mortgages and finance leases

New British Biotech Shares.  the new British Biotech Shares to be allotted and
                             issued credited as fully paid to Vernalis
                             Shareholders in accordance with the terms of the
                             Offer

Offer......................  the recommended offer made by JPMorgan on behalf of
                             British Biotech to acquire the entire issued and to
                             be issued share capital of Vernalis on the terms
                             and subject to the conditions set out in the Offer
                             Document and the Form of Acceptance including where
                             the context requires, any subsequent revision,
                             variation, increase, extension or renewal thereof

Offer Document.............  this document

Offer Period...............  has the meaning given to it in the Code, and for
                             the purpose of the Offer commenced on 30 April 2003

Official List..............  the official list of the UK Listing Authority

Overseas Optionholders.....  holders of options over British Biotech Shares
                             and/or Vernalis Shares who have registered
                             addresses outside the United Kingdom or are
                             citizens of, or resident or located in, countries
                             other than the United Kingdom

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Overseas Shareholders......  holders of British Biotech Shares and/or Vernalis
                             Shares who have registered addresses outside the
                             United Kingdom or are citizens of, or resident or
                             located in, countries other than the United Kingdom

Panel......................  The Panel on Takeovers and Mergers

participant ID.............  the identification code or membership number used
                             in CREST to identify a particular CREST member or
                             other CREST participant

Placing and Open Offer.....  the placing and open offer carried out by Vernalis
                             under the Placing and Open Offer Agreement

Placing and Open Offer
  Agreement................  the agreement described in paragraph 5.2(a) of
                             Appendix II to this document

Proposed Directors.........  the proposed additional directors of British
                             Biotech following the Merger whose names are listed
                             on page i of this document

Reference Number...........  has the meaning given in paragraph 15 of Part 3 of
                             this document

Registrar of Companies.....  the Registrar of Companies in England and Wales

Regulatory Information
  Service..................  has the meaning given to it in the Listing Rules

Related Party Resolution...  the resolution set out in the notice of British
                             Biotech EGM seeking the approval of British Biotech
                             Shareholders (other than Invesco) to the acceptance
                             of the Offer by Invesco (assuming such acceptance
                             is forthcoming)

Remuneration Committee.....  the remuneration committee of British Biotech from
                             time to time

Resolutions................  the resolutions to be put to the British Biotech
                             Shareholders at the British Biotech EGM relating
                             to, inter alia, the Offer

Restricted Jurisdiction....  United States, Canada, Australia, Belgium, South
                             Africa or Japan

RiboTargets................  RiboTargets Holdings plc

Roche......................  F. Hoffman-La Roche Limited and/or any of its
                             affiliates (including in the context of the Roche
                             Convertible Loan, Roche Finance Limited)

Roche Convertible Loan.....  the L7.0 million convertible loan agreement dated
                             13 May 2002 between Vernalis and Roche, as
                             described in paragraph 13 of Part 3 of this
                             document

SEC........................  Securities and Exchange Commission of the United
                             States

Securities Act.............  the US Securities Act of 1933, as amended

Serono.....................  Serono S.A.

subsidiary undertaking.....  has the meaning given in the Companies Act

TFE instruction............  a transfer from escrow instruction (as described in
                             the CREST manual issued by CRESTCo)

TTE instruction............  a transfer to escrow instruction (as described in
                             the CREST manual issued by CRESTCo)

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<PAGE>
uncertificated or in
  uncertificated form......  a Vernalis Share which is for the time being
                             recorded on the register of members of Vernalis as
                             being held in uncertificated form

UBS Investment Bank........  UBS Limited

UCB........................  UCB Pharma S.A. and/or its subsidiaries and
                             affiliates including UCB Pharma Inc.

UK/United Kingdom..........  the United Kingdom of Great Britain and Northern
                             Ireland

UK Listing Authority/UKLA..  the Financial Services Authority acting in its
                             capacity as the competent authority for the
                             purposes of Part VI of the FSMA

US/United States...........  the United States of America, its territories and
                             possessions, any state or political sub-division of
                             the United States of America and the District of
                             Columbia

Vernalis...................  Vernalis Group plc, registered in England and Wales
                             under number 03137449

Vernalis Board or Vernalis
  Directors................  the directors of Vernalis

Vernalis Group.............  Vernalis and its subsidiary undertakings and, where
                             the content so requires, each of them

Vernalis Incentive Plans...  the Vanguard Medica 1993 Executive Option Scheme;
                             the Vernalis Company Share Option Plan 1996; the
                             Vernalis Savings Related Share Option Scheme; the
                             Vernalis Group plc All Employee Share Ownership
                             Plan and the Vernalis Restricted Share Scheme

Vernalis Restricted Share
  Scheme...................  the Vernalis Restricted Share Scheme and related
                             employee benefit trust

Vernalis Shareholders......  holders of Vernalis Shares

Vernalis Shares............  all the existing issued ordinary shares of 10 pence
                             each in the capital of Vernalis and any further
                             such shares which are unconditionally allotted or
                             issued while the Offer remains open for acceptance
                             or, subject to the provisions of the Code, by such
                             other date as British Biotech may determine

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                          GLOSSARY OF SCIENTIFIC TERMS

acute myocardial infarction
  (AMI)....................  common type of heart attack caused when one of the
                             coronary arteries becomes blocked

acute treatment............  treatment aimed at quickly addressing and
                             ameliorating the symptoms of a disease

adenosine A(2A) antagonist.  a substance which reduces or prevents the effect of
                             adenosine at the adenosine A(2A) receptor site

adenosine A(2A) receptor...  subtype of receptor for adenosine, a
                             neurotransmitter found in the body especially in
                             the nervous system

agonist....................  a substance which enhances biological activity at a
                             receptor site

AML........................  acute myeloid leukaemia; a type of cancer that
                             affects the body's blood forming tissues, resulting
                             in an overabundance of immature white blood cells

analgesic..................  drug that relieves or alleviates pain

antagonist.................  a substance which reduces or prevents the effect of
                             an agonist at a receptor site

antigens...................  substances which are capable of inducing a specific
                             immune response and reacting with the products of
                             that response, i.e. with specific antibodies

antisense compound.........  agent that is specifically designed to target a
                             particular RNA (ribonucleic acid) and hence prevent
                             its action

atomic level...............  the level at which interactions can be observed
                             between the potential drug molecule and the target
                             protein

biotechnology..............  set of biological techniques developed through
                             basic research and now applied to research and
                             product development

cancer.....................  a malignant tumor in which cells grow unrestrained
                             in an organ or tissue in the body. A cancer is
                             usually named after the originating organ

central nervous
  system (CNS).............  pertaining to the brain, cranial nerves and spinal
                             cord. It does not include muscles or peripheral
                             nerves

CD56-positive..............  tumour cells which carry the CD56 antigen on their
                             surface

clinical trial.............  research conducted with patients to evaluate a new
                             treatment or drug

community-acquired
  pneumonia................  an infection caused by inflammation of the lungs
                             and build up of fluid in the lungs, contracted in
                             the community

crystallography............  visualisation of the three-dimensional structure of
                             a molecule, often a protein, through x-ray
                             diffraction of crystallised material

cytotoxic..................  toxic to human and animal cells

enzyme.....................  protein molecule produced by living cells that
                             catalyses chemical reactions of other substances
                             without itself being destroyed or altered upon
                             completion of the reactions

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frovatriptan...............  5-HT(1B/D) receptor agonist for the treatment of
                             migraine

GABA(A) agonist............  agent that mimics the activity of
                             gamma-hydroxybutyric acid at the sub-type A
                             receptor. GABA is a central nervous system
                             neurotransmitter involved with sensory processing
                             throughout the central nervous system

Hsp90 inhibitor............  a substance which prevents the action of heat shock
                             protein 90

inflammation...............  localised protective response elicited by injury or
                             infection of tissue, which serves to destroy,
                             dilute or sequester both the causative agent and
                             the injured tissue

inflammatory disease.......  this covers a number of diseases, including
                             multiple sclerosis, that are characterised by or
                             caused by inflammation

ligand.....................  any molecule that binds to another, in normal usage
                             a soluble molecule such as a neurotransmitter, that
                             binds to a receptor

metalloenzyme inhibitors...  compounds capable of inhibiting an enzyme that
                             require a catalytic metal for activity

migraine...................  a severe, recurring headache, usually affecting
                             only one side of the head, characterised by sharp
                             pain and accompanied by nausea, vomiting, visual
                             disturbances and scintillating appearances of light

multiple sclerosis.........  disorder of the central nervous system involving
                             decreased neurological function associated with the
                             loss of the insulating covering of nerve cells

myeloid leukaemia..........  sub-class of cancer of the white blood cells

neurotransmitter...........  any of a group of substances that are released from
                             neurons of the central or peripheral nervous system
                             to either excite or inhibit another neuron or
                             target cell

NMR studies................  the use of nuclear magnetic resonance spectroscopy
                             to determine the structures of molecules in
                             solution. NMR may also be used to determine
                             ligand-protein interactions and hence provide
                             important information in the drug design process

non-sedative...............  an agent that does not exert a sleep-inducing or
                             tranquilising effect

Parkinson's disease........  progressive neurological disease whose symptoms
                             include shuffling gait, stooped posture, resting
                             tremors, speech impediments, movement difficulties,
                             and an eventual slowing of mental processes and
                             dementia

peptide deformylase (PDF)..  bacterial enzyme essential for the survival and
                             multiplication of bacteria

pharmaceutical.............  pertaining to pharmacy or to drugs

pharmacokinetics...........  the study of the time course of a drug in the body
                             following administration

Phase I clinical trials....  study conducted in healthy subjects to determine
                             the safety, tolerability and pharmacokinetics of a
                             drug

Phase I/II clinical trials.  initial studies in patients with the disease for
                             which the product candidate is being developed,
                             designed to look at safety and get an early
                             indication of biological effect
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Phase II clinical trials...  studies in a limited number of patients to
                             determine the preliminary efficacy of a drug to
                             provide proof-of-concept as well as in some cases
                             evaluate drug doses and to establish drug doses to
                             use in a Phase III clinical trial

Phase II/III clinical
  trials...................  trial in patients that investigates or establishes
                             the efficacy of a drug

Phase III clinical
  trials...................  trial with larger patient numbers to confirm a
                             drug's efficacy and safety, prior to filing for
                             marketing approval

Phase IIIb study...........  clinical trial performed to support marketing
                             conducted after a product licence has been applied
                             for but prior to approval, or clinical trials to
                             support a new indication

plasminogen................  a specific enzyme

pre-clinical studies.......  experiments performed before starting clinical
                             trials to assess a compound and its potential to
                             cause adverse side effects

proof-of-concept...........  study designed to show that a compound has its
                             intended clinical effect

prophylactic...............  agent preventing disease

prophylaxis................  the prevention of disease

protein....................  large molecules made of smaller biological units
                             known as amino acids. Proteins are responsible for
                             the functioning and much of the structure of all
                             living beings

psychiatric disorders......  disorders of the central nervous system producing
                             mental illness

pulmonary embolism.........  lodgement of a blood clot in one of the arteries of
                             the lung

receptor...................  molecular structure within a cell or on the cell
                             surface characterised by selective binding of a
                             specific substance and a specific physiologic
                             effect that accompanies the binding

recombinant protein........  protein produced using DNA combined from two or
                             more different DNA molecules

respiratory tract
  infections...............  infections of the organs and tissues associated
                             with the breathing system

RNA........................  ribonucleic acid; plays a role in transferring
                             information from DNA to the protein-forming system
                             of the cell

R140.......................  alphadalone acetate

SCLC.......................  small cell lung cancer

serotonin..................  5-hydroxytryptamine (5HT), a neurotransmitter

sexual dysfunction.........  disturbance, impairment or abnormality of the
                             functioning of the sexual drive or sexual organs

small cell lung cancer.....  a disease where small malignant (cancer) cells form
                             in the tissues of the lung

solid tumour...............  cancer cells which form a lump

SSRI.......................  selective serotonin reuptake inhibitor; a class of
                             drug used as an antidepressant

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structure-based drug
  design...................  the use of structures determined through
                             crystallography or NMR studies to enhance the
                             process of drug discovery

thrombolysis...............  breakdown or dissolution of a blood clot

thrombolytic...............  agent that causes thrombolysis

thrombotic disorders.......  diseases caused by inappropriate clotting of the
                             blood, for example, heart attack, stroke,
                             peripheral arterial occlusion and deep vein
                             thrombosis

triptan....................  class of compounds that stimulate the 5HT(1)
                             receptor and are used in the treatment of migraine

tumour-activated prodrug...  drug which is inactive until it encounters a cancer
                             cell

5HT(1B/D) receptor.........  subtype of a receptor for 5 hydroxtryptamine
                             (serotonin), a chemical messenger found in the
                             body, especially in the nervous system

5HT(1A) receptor...........  subtype of a receptor for 5 hydroxtryptamine
                             (serotonin), a chemical messenger found in the
                             body, especially in the nervous system

5HT(2A) receptor...........  subtype of a receptor for 5 hydroxtryptamine
                             (serotonin), a chemical messenger found in the
                             body, especially in the nervous system

5HT(2C) receptor...........  subtype of a receptor for 5 hydroxtryptamine
                             (serotonin), a chemical messenger found in the
                             body, especially in the nervous system

                                        70

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00057-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00057-of-00352.parquet"}]]