Summit Corporation PLC : Preliminary Results for the Year Ended 31 January 2012

Summit Corporation plc

("Summit" or "the Company")

PRELIMINARY RESULTS FOR THE YEAR ENDED 31 JANUARY 2012

Oxford, UK, 4 April 2012, Summit (AIM: SUMM), a UK drug discovery company with a portfolio of drug programmes and an innovative Seglin(TM) technology platform for the discovery of new medicines, today reports its preliminary results for the year ended 31 January 2012.

Scientific & Commercial

$1.5m agreement signed with US DMD organisations to fully fund new Phase I clinical trial of potential first-in-class DMD drug candidate SMT C1100

Clinical trial application submitted for SMT C1100 with headline results from Phase I clinical trial anticipated during Q3 2012

Positive results from non-clinical efficacy studies show SMT C1100 increases utrophin in DMD patient muscle cells to levels expected to have therapeutic benefit

Orphan drug status granted to SMT C1100 by the US FDA

Preclinical development studies successfully completed with clinical candidate SMT 19969 having an excellent safety profile (see separate announcement)

Further research milestone achieved in C. difficile programme in collaboration with the Wellcome Trust triggered payment of £925,000

Positive in vivo and in vitro data reported in Alzheimer's disease programme with novel Seglin OGA enzyme inhibitors that have disease modifying potential

Corporate & Financial

Mr Glyn Edwards appointed as Chief Executive Officer with immediate effect (see separate announcement)

Proposed £5.0 million placing and fund raise with new and existing investors - placing of 167 million new Ordinary shares at 3p per share (see separate announcement)

Operational expenditure in-line with expectations

Net loss for 12 months ended 31 January 2012 reduced to £2.7m (31 January 2011: £4.7m)

Barry Price, PhD, Executive Chairman of Summit commented: "We are pleased with the strong progress made by Summit's key drug programmes and Seglin(TM) technology platform during 2011.  With our leading programmes targeting Duchenne Muscular Dystrophy and C. difficile infection expected to enter clinical trials in the coming year, coupled with the appointment of Glyn Edwards as our new Chief Executive, Summit is entering an important and exciting stage in its development as we work to deliver value for our shareholders."

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Summit is an Oxford, UK based drug discovery company with an innovative technology platform called Seglins for the discovery of new medicines, a portfolio of drug programme assets and a commercial strategy of signing multiple early-stage deals.

Seglin(TM) technology is using new chemistry to access biological drug targets that cannot be exploited by conventional drug discovery approaches.  Summit's internal research is currently focussed in high-value therapy areas and the Company will further exploit the technology's wider potential through strategic alliances.  Summit's programme portfolio consists of a number of drug programmes targeting high-value areas of unmet medical need including Duchenne Muscular Dystrophy and C. difficile infections.

Summit's commercial strategy focuses on signing multiple early-stage drug programme and technology platform deals that generate upfront cash, transfer development costs from the Company, and retain valuable upside potential.

Summit is listed on the AIM market of the London Stock Exchange and trades under the ticker symbol SUMM.  Further information is available at www.summitplc.com.

CHAIRMAN'S STATEMENT

The Board is pleased to report advances in its lead development programmes as the Company prepares to commence human clinical studies of its drug candidates: SMT C1100 as a potential first-in-class treatment for the fatal genetic disease, Duchenne Muscular Dystrophy, and SMT19969 as a potential front-line novel antibiotic for the treatment of Clostridium difficile infection.

Summit operates a differentiating business model that aims to provide investors with a portfolio of opportunities for value growth, while simultaneously spreading the risks and costs that are concomitant with the discovery and development of new drugs.

Summit's strategy focuses on developing multiple discovery drug programmes and advancing them through key milestones starting from in vivo proof of concept up to Phase IIa clinical trials.  At the appropriate stage during this development cycle it is our intention to license the programmes to partners in the pharmaceutical industry who will be responsible for subsequent studies, including the expensive late-stage registration trials, as well as product commercialisation.  In negotiating these deals, Summit aims to generate revenues through upfront payments, success based development milestones and sales royalties.

Our approach of developing multiple programmes mitigates against the risks of failure, while also providing a controllable cost base that provides flexibility as to where resources are invested.  The Board believes this strategy provides the opportunity to generate significant value for shareholders and deliver our ambition of creating a sustainable business.

KEY PROGRAMMES AND TECHNOLOGY

To fulfil our business model, Summit is developing over the shorter-term, two high-value drug programmes, while over the longer-term, our approach is underpinned by Seglin(TM) technology.  The Board believes Seglins to be an innovative drug discovery platform and a potential major source of new medicines capable of treating a variety of disease areas.

Rare diseases: SMT C1100 for Duchenne Muscular Dystrophy

I am pleased to report that our most advanced programme, which targets the fatal genetic disease Duchenne Muscular Dystrophy ('DMD') has made significant strides.  Our efforts culminated in December 2011 with the signing of deals collectively worth $1.5 million with a number of US based DMD groups to fund a new Phase I clinical trial on our candidate, SMT C1100.

DMD is caused by the lack of a protein called dystrophin which results in severe and progressive deterioration of all skeletal muscles, as well as the heart and diaphragm.  Currently there is no cure for the disease.

SMT C1100 is a potential disease-modifying drug that works by increasing production of a naturally occurring protein called utrophin to compensate for the missing dystrophin.  A compelling package of non-clinical efficacy data was further enhanced during the period, through the reporting, and subsequent publication in a peer-reviewed scientific journal, of new in vitro efficacy data.  These results showed that treatment of dystrophin deficient muscle cells, taken from DMD patients, with low concentrations of SMT C1100 increased utrophin to levels which are expected to have therapeutic benefit.  These studies were conducted at Oxford University by Professor Dame Kay Davies FRS, a world-leading academic and pioneer of utrophin as a therapeutic approach for DMD.

In November 2011, SMT C1100 was granted orphan drug status by the US FDA.  Our clinical candidate has now been designated as an orphan drug in both Europe and the US, which will provide additional regulatory support and various commercial benefits including extended periods of marker exclusivity.

These activities were important in securing the $1.5 million funding agreements with a number of US DMD groups: Muscular Dystrophy Association, Project Patient Muscular Dystrophy, Charley's Fund, Cure Duchenne, Foundation to Eradicate Duchenne and the Nash Avery Foundation.  These agreements were signed following an extensive due diligence exercise on the programme to provide independent endorsement of our approach.

A new Phase I clinical trial in healthy volunteers will now be conducted and the start of this study remains on-track, with a clinical trial application ('CTA') having been submitted to the UK's Medicine and Healthcare products Regulatory Agency ('MHRA').  If the CTA is approved, headline data from this Phase I study are anticipated in Q3 2012.

A major competitive advantage of SMT C1100 is that it is currently the only programme in clinical development that will benefit all patients with DMD, regardless of their specific genetic mutation.  DMD has a market potential in excess of $1 billion per annum and we therefore believe SMT C1100 represents a high-value licensing opportunity, with a successful outcome from the Phase I trial expected to be a significant value-enhancing milestone for the programme and Company.

Infectious diseases: SMT 19969 for Clostridium difficile infection

Summit's programme developing a new antibiotic to treat Clostridium difficile infection ('CDI') is supported by a prestigious Wellcome Trust award and the programme continued to make excellent progress during the period.

CDI represents a major healthcare threat and has a market potential in excess of $2.5 billion per annum, while the annual cost of care in Europe and North America is estimated at over $7 billion.  In 2010 over 2,700 deaths were reported to be associated with CDI in England and Wales, over five times the rate of deaths caused by MRSA.  Existing treatment options are limited and do not address the major issues of recurrent disease or the emergence of hyper-virulent strains of the infection.

Our lead candidate SMT 19969 has the ideal target profile for a new antibiotic for CDI, namely excellent potency against the bacterium, a very narrow spectrum of activity to prevent recurrent infection and an excellent resistance profile.  SMT 19969 has the potential to become a front-line treatment for initial CDI and the prevention of recurrent episodes, with its profile differentiating it from marketed products and other drugs in development.

In May 2011, SMT 19969 was nominated as a candidate to advance into preclinical studies.  This achieved a significant research milestone in our collaboration with the Wellcome Trust and allowed drawdown of a £925,000 payment that financially supported the preclinical studies.

These preclinical studies have reached a successful conclusion (see separate announcement released today) and we are now able to start planning to advance this drug candidate towards human clinical trials.  Achieving this will be a major development milestone for this programme, which the Company believes, represents another major deal opportunity.

SEGLINTM TECHNOLOGY PLATFORM

A key component in delivering our business model is having the capability to continually generate new drug programes.  The Board believes this capability is addressed and fulfilled through our Seglin(TM) technology, an innovative drug discovery platform that has the potential to identify new medicines to treat a range of major diseases.

In human biology, the function of physiological systems is dependent on proteins, nucleic acids (the building blocks of DNA), carbohydrates (sugars) and lipids (fats).  The importance of proteins and nucleic acids as targets in drug discovery is well established, but carbohydrates have remained largely unexploited.  Advances made in the study of carbohydrates in biological processes (glycobiology) have however led to a greater understanding of the role carbohydrate recognition and processing plays in the progression of disease and has resulted in the identification of a host of new carbohydrate related drug targets.

Exploiting these new targets has proved a challenge to the pharmaceutical industry with conventional screening collections used by the wider industry having limited success in generating programme leads.  Summit is pioneering the development of Seglins, a chemistry technology platform that opens up new areas of chemical space.  Seglin(TM) technology has the potential to provide access to these new carbohydrate related targets as Seglins molecules are carbohydrate mimics with intrinsic biological activity and excellent drug properties.  It is our belief therefore that Seglins are ideally placed to exploit both these carbohydrate targets, as well as other drug targets.

Alzheimer's disease programme

Our main internal focus has been on the development of the Seglin programme targeting Alzheimer's disease and related neurological disorders.  This programme has made good progress with positive in vitro and in vivo data being reported during the last 12 months.

Alzheimer's disease is a progressive, debilitating neurodegenerative disorder and is the most common form of dementia.  It remains an area of high unmet medical need with treatment options remaining limited to ones that only provide symptomatic relief.  One of the characteristics of the disease is the formation of neurofibrillary tangles ('NFT') or toxic aggregates of tau protein, which contribute to the death of nerve cells in the brains of Alzheimer's patients.  Notably, independent scientific studies have been reported which place a greater emphasis on the importance of tau and protein tangles in the cause and spread of the disease.

Summit's approach is to inhibit an enzyme called OGA.  Independent scientific studies have highlighted how inhibiting OGA can prevent tau from forming the toxic NFTs making the enzyme an attractive target for the development of potential disease modifying drugs.  Using Seglin(TM) technology, in vitro efficacy was established in human cells through the identification of potent and highly selective Seglin small molecule inhibitors of OGA.  In vivo studies subsequently showed these Seglins were able to penetrate the blood brain barrier and enter the central nervous system ('CNS'), an important prerequisite for treating CNS disorders.  In addition the Seglin displayed excellent oral bioavailability with no adverse effects being observed.

During the period, Summit established a number of new, early-stage screening programmes with a focus on diseases in areas of existing internal expertise such as rare and infectious diseases.  Preliminary data from these early screening studies has been encouraging with potential start points identified for new discovery projects.  We look forward to reporting on the progress on these opportunities in the future.

Your Board continually evaluates all drug programme opportunities in order to decide where to focus Summit's scientific and financial resources and how to best deliver for our shareholders a return on their investment.  Our internal activities have been outlined above, but Summit also has a number of other programmes that target a diverse set of therapy areas to illustrate the broad utility of the platform.  These programmes include SMT C2100 (malignant melanoma), SMT 14224 (diabetes) and SMT 15000 (bio-terrorism) and positive data both in vitro and in in vivo disease models has been generated in all of the above.  These programmes remain of commercial value and interest to external parties and scientific activities remain on-going to advance these projects through to development milestones.

The potential utility of Seglins encompasses a broad range of different therapy areas and multiple drug targets.  The scale of the opportunity afforded by Seglins creates further commercial openings for Summit as our current internal activities only represent a fraction of what is possible in the search for new drug leads.  Interest from third parties in accessing our technology platform continues to be strong with Summit remaining in confidential discussions with interested companies, a number of whom are conducting evaluation and profiling studies.

Producing drug programmes, which are scientifically robust, is a prerequisite of being able to deliver commercial deals that will further develop our revenue streams.  It was the strength of the scientific data the Company had generated that supported the conclusion of the agreement with a number of DMD organisations and this was achieved against a backdrop of an increasingly austere and challenging global environment.

With our two most advanced programmes having the potential to achieve key development milestones in the near-term, coupled with the opportunities provided by our technology platform, we continue to ensure that we have a strong pipeline of commercially attractive assets.

With a number of confidential discussions on-going, the Board remains confident of securing further commercial deals for our programme assets and technology platform.

PROPOSED FUNDRAISING

A proposed £5.0 million placing of new Ordinary Shares with new and existing investors was announced separately today.  These additional funds will support the continued scientific development of our key assets, which include the C. difficile and Seglin OGA programmes, whilst the funds will also provide the Company with the opportunity of benefiting from key programme development milestones being reached.  Importantly, this includes milestones being reached in the DMD programme when the Phase I trial results read out.  The completion of the fund raise requires the support of our existing shareholders and the directors believe that a successful conclusion is in the best interests of our investors.  If the fund raise does not receive shareholder approval the Company will need to seek alternative sources of finance to enable it to continue as a going concern.

As reported separately today, I am pleased to announce that Mr Glyn Edwards has joined Summit with immediate effect as our new Chief Executive Officer.  Glyn brings to the role a wealth of experience garnered from a thirty-year career in the life sciences industry, including a proven commercial track record that has included the execution of major licensing deals.  The Board believes Glyn will be an invaluable addition to the team and that he is joining the Group at what promises to be a pivotal time in the development of your Company.  Glyn will also join the Board of Directors, while I will assume my previous role as Non-Executive Chairman.

The business has made significant progress during the past year and developments in the current period and beyond offer exciting opportunities for the Company.  Our two lead clinical programmes have the potential to achieve value-enhancing development milestones, which are expected to lead to greater commercial benefit for the business, while progress in our Seglin(TM) technology means that this platform is poised for exploitation over the coming months.

The Board would like to thank all our staff for their efforts and dedication over the last year, which has been instrumental in advancing the business.  Finally, we thank all our shareholders for their continuing support and I look forward to reporting on our future progress.

In December 2011 the Company signed agreements with a number of US DMD organisations to support our development efforts on SMT C1100, the clinical candidate to treat Duchenne Muscular Dystrophy ('DMD'). These agreements (the "DMD Agreements") are worth up to $1.5 million (£0.95 million) and cover the cost of further development through to completion of a Phase I clinical study in healthy volunteers; revenues of £0.3 million have been recognised to date.

Development milestones achieved in the Clostridium difficile programme have triggered further receipts from the Wellcome Trust totalling £1.0 million during the year. These receipts together with a further share issue that raised £1.4 million have enabled the Company to drive its research efforts with total R&D spend increasing by 30% on the previous year to £3.0 million.

As set out in the Chairman's Statement we believe these programmes together with the opportunities from our Seglin(TM) technology platform have raised the opportunity for significant commercial deals.

Cash and operating income and expenditure

Cash at 31 January 2012 was £2.1m (31 January 2011: £3.3m) with net cash used in operating activities for the year ended 31 January 2012 of £2.4m (2010/2011: £2.7 m).  Revenues for the year were £1.6m (2010/11: £0.8m), the increase arising principally from recognition of grant receipts from the DMD Agreements and receipts from the Wellcome Trust for the C.difficile programme.  As set out above, these receipts have helped to drive expenditure on research and development to £3.0m (2010/11: £2.3m).  We have continued to control expenditure on general and administrative costs, which have fallen further to £1.5m (2010/11: £1.7 m). Total remuneration costs have fallen to £1.7m (2010/11: £2.0m).  Average headcount has been maintained at 31.  Total operating expenses have fallen from £6.7m last year to £4.8m for the year ended 31 January 2012.  A reduction in impairment and other provisions totalling £2.2 million has also contributed to this movement.

Losses before interest, tax, depreciation and amortisation and excluding non-recurring items were £2.8m (2010/11: £3.3m).  Net loss for the year was £2.7m (2010/11: £4.7m) and 1.51 pence per share (2010/11 2.82 pence per share).

The Company raised £1.3m net of costs in July 2011 through an issue of 16.8 million new Ordinary shares at 8.00 pence per share, and £0.1 million from the issue of 2.3 million new Ordinary shares upon the partial exercise of a warrant granted in 2009.

As set out in the Chairman's Statement we have made significant progress in the development of the SMT C1100 (DMD programme) and SMT 19969 (C. difficile infection programme) assets. Both of these assets are set to enter Phase I clinical studies during the coming period, which, if successful, are expected to enhance their value considerably.   In addition, we are pleased with the progress of our Seglin discovery programme targeting the enzyme OGA that is implicated in the progression of Alzheimer's disease.  The advances made in this programme also serve to highlight the broader potential of Seglin(TM) technology as we work towards establishing new programmes in other therapy areas.

Confidential discussions and evaluation of our programme assets and Seglin(TM) technology platform remain on-going with a number of third parties although, as set out in the Interim Statement, the prevailing economic conditions preclude reliable forecasting of when agreements may be completed.  We do however remain confident of securing further deals for our programmes and technology platform.

The proposed fundraise through a placing of 166,666,670 new ordinary shares, which was announced separately today, is expected to provide financial resources into Q3 2013 and so strengthen the ability of the Company to exploit the scientific and commercial potential of these assets.

The financial results illustrate that the business continues to operate with good financial discipline with operational expenditure in line with expectations.  The Company has shown further flexibility in its management of cash and its ability to supplement cash raised from shareholders through programme support from the Wellcome Trust and from the DMD Agreements.

It is the belief of the Board that we have raised the opportunities for realisation of significant value growth for our investors through the scientific development and commercialisation of our drug programmes and Seglin(TM) technology platform.

Raymond Spencer, ACA

Chief Financial Officer

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited)

For the year ended 31 January 2012

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (unaudited)

As at 31 January 2012

CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)

For the year ended 31 January 2012

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (unaudited)

For the year ended 31 January 2012 (unaudited)