REG-Source BioScience: Interim Management Statement

17 November 2009

Source BioScience plc

(`Source BioScience', the `Company' or the `Group')

INTERIM MANAGEMENT STATEMENT

Growing demand for the Group's healthcare services underpins a 10% increase in
Q3 revenues and helps drive further strong cash generation as Source BioScience
builds on first half profitability

Source BioScience plc (LSE: SBS) the provider of diagnostic and screening
services to the healthcare community and genetic analysis and biomolecular
tools to the life science research and pharma biotech sectors, today provides
its Interim Management Statement (`IMS') as required by the UK Listing
Authority's Disclosure and Transparency Rules, relating to the period from 1
July 2009 to 17 November 2009.

Highlights:

* Revenue in Q3 increased by 10% compared with the same period last year

* Extended agreement with Cervical Screening Wales to supply liquid based
cytology equipment and reagents

* Expansion of laboratory capability at University College London with
introduction of new, enhanced technology platform for genotyping

* Significant growth opportunities across the Group as it benefits from
investment programme

* Further product and service portfolio enhancements expected

* Strong balance sheet with £6.8 million of cash underpins investment and
acquisition plans

Financial performance

Unless otherwise stated, the financial information referenced below refers to
the three months ended 30 September 2009, and the corresponding period last
year, this being the latest practicable date to which financial information has
been prepared. Commentary relates to the entire period of this IMS.

The Group has built on the strong start to the financial year and revenues for
the third quarter increased by 10% compared with the same period last year.
Across the Group, performance is in line with current market expectations.

Healthcare has returned a very strong performance compared with the same period
last year, driven by growth in Diagnostic Pathology. In addition to growth in
our core pathology business, we have also undertaken a number of one-off "duty
of care" pathology reviews during the period, which account for a significant
element of the increased revenue. Source BioScience's reputation as an
independent, fully-accredited high quality service provider is instrumental in
securing this type of work.

In this third quarter, revenue from our Cytology operations has returned to
expected normalised levels. This is following the exceptional demand for our
liquid based cytology consumables which we witnessed during the first half of
the year.

Whilst the revenue stream is much more modest, we have also seen increased
demand for our FocalPoint automated cytology imaging platform, with revenues
increased threefold compared with the same period last year. During the first
half of this year we entered into a two year agreement with the Northwest NHS
Region to provide the FocalPoint system for quality assurance applications and
this is largely responsible for the growth in this activity.

Pharma Biotech Services has also performed well during the period. Although
activity can be more unpredictable due to the project-based nature of the work,
the business demonstrated double-digit growth compared with the same period
last year. The growth is largely attributable to the migration of our genomic
capability in the pharma biotech arena, coupled with our established pathology
expertise.

Life Science Research has delivered a mixed performance during this third
quarter, which is typically the seasonal low period for the division,
encompassing the summer holiday period and reduced activity in the academic
sector.

Demand for our DNA sequencing services continues to strengthen. Growth has been
delivered by both our conventional sequencing business and our next generation
sequencing service, with our facility at University College London (`UCL')
proving a real success. We have developed an extremely robust DNA sequencing
service model and have identified opportunities to increase market share in
both the conventional and next generation sequencing markets. We will be
investing further and pursuing these opportunities during the coming months
with the aim of making Source BioScience the first choice provider for DNA
sequencing services.

We also continue to respond to advances in technology across the life science
research sector and remain ahead of the curve in providing access to new
technologies where demand exists. We will shortly be launching an enhanced
genotyping service on a new technology platform from our UCL laboratory.

Financial position

Our balance sheet remains strong with £6.8 million of cash at the date of this
IMS (31 December 2008: £7.6 million).

During the year end we have made scheduled payments totalling £1.1 million in
respect of the acquisitions of Autogen Bioclear and Geneservice. Deferred
consideration on the Geneservice acquisition has now been settled in full.

We have also invested a further £0.7 million in technology platforms to extend
and enhance our capabilities across the Group. This has included significant
investment in our FocalPoint automated imaging platform to support the NHS
cervical cancer screening programme and further expansion of our DNA sequencing
capacity.

Other than noted above, there have been no other significant changes in the
financial position of the Company over the period since the publication of the
Interim Report for the six months ended 30 June 2009.

Commenting on the period and outlook, Dr Nick Ash, Managing Director, said:

"Source BioScience has continued to build on the first half momentum and
profitability, with our Healthcare and Pharma Biotech Services divisions
performing particularly well.

"During 2009 we have invested significantly in our automated imaging capability
in Healthcare, with the acquisition of a further two FocalPoint platforms to
support the NHS cervical cancer screening programme. We are also investing in
the operational infrastructure supporting our Healthcare activities and expect
to reap the efficiency benefits from this investment during 2010.

"The success of our conventional and next generation DNA sequencing service,
using the Illumina Genome Analyzer platform is particularly satisfying. We
remain the only commercial service provider of this technology in the UK and we
are attracting customers from pharmaceutical companies as well as research
institutions. Increasingly, customers are looking to use the resolution of
genetic information this platform yields to understand the genetics of disease,
the response to targeted therapies and to guide development of new drugs. We
believe there are significant opportunities to increase our market share
through appropriate investment in these technologies.

"In addition to the investment opportunities highlighted above to support and
drive organic growth of the business, the Group also has significant cash
resources to support growth through selected and appropriate acquisitions".

Outlook

Source BioScience has maintained good momentum in the year to date, with
increased revenues across the divisions compared with last year and overall
performance in line with expectations.

The Group continues to actively seek earnings enhancing acquisitions and
investment opportunities.

The Company has been cash generative since 2008 and has achieved profitability
during the current year. The Board will continue to equip the business with the
necessary skills, expertise, technology and products to deliver controlled
growth and value to shareholders.

---ENDS---

For further information, please contact:

Source BioScience plc
Nick Ash
Managing Director
Tel: 0115 973 9010
www.sourcebioscience.com

Bishopsgate Communications Ltd
Nick Rome/Gemma O'Hara
Tel: 0207 562 3350
www.bishopsgatecommunications.com

About Source BioScience

Source BioScience (LSE: SBS) is a highly focused healthcare and biotechnology
company providing diagnostic and screening services to the healthcare community
and genetic analyses and biomolecular tools and products to the life science
research and pharma biotech sectors.

Its Healthcare operations provide screening and reference laboratory diagnostic
testing for cancer and other diseases and additional predictive testing for
treatment optimisation for clinicians and patients. Pharma Biotech Services
offers support for early stage therapeutic development, offering a 'one-stop
shop' from tissue pathology, immunohistochemistry, sophisticated image
analysis, biomarker determination and assay development to pharmacogenomics
including genotyping and gene expression analysis. Life Science Research
services provide core laboratory research support from conceptualization to
implementation, calling upon a wide range of cutting-edge technology platforms
including an online catalogue of biomolecular tools. This incorporates DNA
sequencing, whole genome amplification and a comprehensive library of genomic
reagents and clones including cDNA and RNAi, as well as facilitating rapid
access to high quality antibodies, cell cultures, diagnostic assays for cancer
and other genetic testing, and related research tools.

The Group has its headquarters in Nottingham, UK where it operates state of the
art reference laboratory facilities, with additional UK laboratory facilities
in London, Cambridge and Oxford. Source BioScience is CPA, GLP and GCP
accredited and is licensed by the Human Tissue Authority.

Further information about Source BioScience can be found at
www.sourcebioscience.com

Disclaimer

The Interim Management Statement may contain forward-looking statements. By
their nature, forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. Actual outcomes and results may
differ materially from any outcomes or results expressed or implied by such
forward-looking statements. Any forward-looking statements made by or on behalf
of Source BioScience plc speak only as at the date they are made and no
representation or warranty is given in relation to them, including as to their
completeness or accuracy or the basis on which they were prepared. Source
BioScience plc does not undertake to update forward-looking statements to
reflect any changes in the Company's expectations with regard thereto or any
changes in events, conditions or circumstances on which any such statement is
based.

END