For Immediate Release: 5 Novemeber 2007

The Medical House PLC

Extension to Major Development, Licence and Supply Agreement
£3m in near term payments - £2m payable immediately

The Medical House PLC (“TMH” or the “Company”) (AIM:MLH), the drug delivery specialist, is pleased to announce that it has agreed to extend the term of the Development, Licence and Supply Agreement for its ASI disposable autoinjector which was signed in December 2006 with a leading global pharmaceutical company. TMH has recently commenced work on the pre-commercial phase of the agreement’s development programme.

The original agreement was for an initial supply period of five years with projected revenues to TMH of £27 million, of which £18 million was for technology access, or licence, fees. The agreement now has an initial supply period of at least six years and, at the request of TMH’s partner, may be extended to approximately 16 years.

Revenue projections for the revised agreement are now c. £34 million of which c. £23 million are for licence payments in respect of TMH’s proprietary ASI technology. The minimum payments to TMH under the agreement are also being increased to £20.5 million over the revised initial six-year term of supply, of which c. £15 million is in licence fees.

Under the new terms of the agreement, and included in the forecasted revenues, TMH will receive a total of £3million in respect of pre-commercialisation licence fees with £2 million being paid immediately with further payments totalling £1 million being paid quarterly up until April 2009.

The project to customise a specific variant of the ASI autoinjector under this agreement has made excellent progress, including achievement of key regulatory approvals. The ongoing pre-commercial phase of the development programme will result in additional development monies to TMH of approximately £900,000 over the next 18 months.

As previously reported, and in order to focus on ongoing projects and new opportunities in development and licensing of its drug delivery technologies, the Company is actively pursuing options in relation to its orthopaedic sub-contract engineering and manufacturing business, which could include a disposal.

Ian Townsend, Chairman, The Medical House PLC, said:
“We are very pleased to further increase the scope, and extend the term, of this deal.
The agreement to extend the term not only reflects the strong relationship between ourselves and our partner, but also underlines the significance of our ASI technology, and this particular project, to both companies. The immediate licence payment of £2 million will considerably enhance the financial profile of the Company and demonstrates the strength of commitment to this agreement by both parties.

For reasons of commercial confidentiality, we have so far been unable to disclose the identity of our partner, however we feel that this extension, and upfront licence payments will further assure shareholders of the scale and significance of this agreement. We also look forward to updating the market on our partner’s identity in due course.

I see this as a major landmark in the Company’s development and, as we look to concentrate our efforts of developing and licensing our proprietary medical device technologies.

“Finally, I would also like to pay tribute to all my team who have worked so hard to bring about this success; we are all looking forward to a great deal more in the future.”

-Ends-

For further information:

The Medical House PLCIan Townsend, Chairman Tel: 0114 261 9011www.themedicalhouse.com
Buchanan CommunicationsTim Anderson / Rebecca Skye Dietrich 020 7466 5000
Nomura Code Securities LimitedRichard Potts 020 7776 1200

Notes to Editors:
About The Medical House
There is a growing trend in the pharmaceutical industry towards the use of needle-based disposable autoinjectors for self-injection. The “ASI” is TMH’s first autoinjector system following the development of a range of needle-free devices which are already successfully in use. TMH’s ASI autoinjector technology allows injections to be easily and safely undertaken by patients themselves or by other non-clinicians such as family members and colleagues and are applicable to both elective therapies and emergency situations.

In December 2006, TMH announced that it had entered into a development, licensing and supply agreement for the ASI with a leading global pharmaceutical partner, for delivery of an, as-yet, undisclosed drug. TMH’s revenues from this agreement, consisting of development, supply and technology access fees, are projected to be in the region of £27m over an initial five year period, with technology access fees comprising approximately £18m of these revenues.

TMH signed its first deal for the ASI in June 2006 with Martindale Products and Specials, part of Cardinal Health Inc, in an initial five-year contract to supply the ASI system for use with an, as-yet, undisclosed pharmaceutical product, in the United Kingdom. The combined product is to incorporate TMH’s ASI and Martindale’s pre-filled syringe. The agreement has projected revenues for TMH of £3m over an initial supply period of 5 years.

In December 2005, TMH announced an agreement with a European Government Agency to develop a disposable autoinjector for emergency administration of specific pharmaceutical compounds, based on TMH’s ASI autoinjector. Within this project, TMH’s client is making the required capital investment and covering the costs of design and development. In March 2007, it was announced that TMH had been commissioned by this Agency to enter into a second phase of development within the project, which involves TMH developing and manufacturing devices, according to defined operational and functional requirements, for technical assessment, over an anticipated 12 months project duration. Within the second phase of the project, TMH will receive up to £1m, subject to achieving agreed milestones, in relation to the cost of the project including associated design and development activities.

In September 2004, TMH signed an agreement with Serono to develop and supply a new needle-free injector for use with its human growth hormone. This licence and supply agreement is for an initial period of 5 years with projected revenues for TMH of £4.3m.

Historically, the majority of the group’s turnover has come from its orthopaedic company, Eurocut Limited, which designs and manufactures instruments and systems used in surgical procedures for many of the world’s leading orthopaedic companies. With the increasing significance of its drug delivery division, the group has been considering its options for Eurocut.

Please note that the information required by Rule 26 of the AIM Rules for Companies (February 2007) is available under the heading 'AIM Rule 26' within the 'Investor Relations' section on the Company's website at www.themedicalhouse.com