Placing for cash of 5,465,352 new ordinary shares of 1p each at 30p per share ("Placing")

The Medical House PLC ("the Company") (AIM:MLH), the drug delivery and orthopaedic devices company, announces that the Company has raised £1.64 million through the issue of 5,465,352 new ordinary shares with existing and new investors at 30p per ordinary share, subject, inter alia, to the admission of the new ordinary shares to AIM. These new shares represent approximately 10% of the Company's existing issued share capital. The net proceeds of the Placing of £1.6 million will be used by the Company for general working capital purposes.

Ian Townsend, Chief Executive of the Company, has subscribed for 346,667 new ordinary shares as part of the Placing. This investment of £104,000 increases his total shareholding from 19,879,242 ordinary shares to 20,225,909 ordinary shares. Ian Townsend's resultant shareholding, following completion of the Placing, represents 33.64% of the issued share capital. Prior to the Placing, Ian Townsend's shareholding represented 36.37% of the issued share capital.

As a result of the Placing, the total number of shares in issue will be 60,118,869 ordinary shares.

Application has been made for the 5,465,352 ordinary shares being issued pursuant to the Placing to be admitted to trading on AIM. These new ordinary shares rank pari passu with the existing issued ordinary shares of the Company. It is expected that dealings in these new ordinary shares will commence on 13 October 2006.

For Further Information, please contact:
Ian Townsend Tel: 0114 261 9011
The Medical House

Rebecca Skye Dietrich Tel: 020 7466 5000
Buchanan Communications

Richard Potts Tel: 020 7776 1200
Nomura Code Securities