ANIMALCARE GROUP PLC

(the "Company" or the "Group")

Animalcare partners with Orthros Medical in VHH antibody research and development for treatment of canine osteoarthritis

Early development pipeline strengthened in target therapy area through licensing and investment in novel treatments utilising VHH antibodies

24 March 2022. Animalcare Group plc (AIM: ANCR) today announced that it has entered into two early-stage agreements with Netherlands-based Orthros Medical, a company focused on the research and early development of VHH antibodies, also known as small single chain antibody fragments.

Through the collaboration, Animalcare secures a global exclusive licence from Orthros Medical for two preclinical VHH candidates initially addressing canine osteoarthritis. Additionally, the Group is entering into a research and development agreement with Orthros Medical with the objective of adding further projects to the licence agreement.

Under the terms of the deal, Animalcare will make upfront payments to Orthros Medical totalling €500,000 and will fund some early research activities as part of the collaboration. As the two licensed preclinical candidates progress, Orthros Medical may receive development, regulatory and commercial milestone payments up to a total value of €11 million as well as single digit royalties on net sales of the products. These payments are expected to be paid out of the Group's operating cash flow.

The licensed candidates will be developed as mono and combination therapy for local application in osteoarthritic joints to enable pain relief and, potentially, disease modification. The candidate profiles are complementary to Daxocox, the Group's COX-2 inhibitor approved for the treatment of osteoarthritis-related pain in dogs.

Found in llamas and other camelids, small single chain fragments of the variable domain of heavy-chain only antibodies (VHH) offer new opportunities for the research and development of innovative drug treatments for use in human and animal patients.

VHH antibodies feature significant therapeutic advantages over other types of antibody. They are small, relatively easy to engineer, have high specificity and can be quickly cleared from the system thereby promising a good safety profile. VHH-based therapeutics have received regulatory approval in the human health arena.

Jenny Winter, Chief Executive Officer of Animalcare Group plc said: "This partnership represents a key building block in our long-term growth strategy. We are keen to expand our early-stage pipeline by seeking out innovative technologies to meet evolving customer needs in a fast-growing, competitive market. Working with Orthros Medical, we have an exciting opportunity to build our future pain and osteoarthritis portfolio while exploring further potential of Orthros Medical's VHH technology in animals."

Robert Jan Lamers, Chief Executive Officer of Orthros Medical said: "We are excited to combine Orthros Medical's pre-clinical expertise in research and formulation in VHH products with Animalcare's development, regulatory and commercial expertise. We are confident the partnership will generate multiple opportunities to develop novel and differentiated osteoarthritis products for animals."

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.

About Animalcare

Animalcare Group plc is a UK AIM-listed international veterinary development and sales & marketing organisation. Animalcare operates in seven countries and exports to approximately 40 countries in Europe and worldwide. The Group is focused on bringing new and innovative products to market through its own development pipeline, partnerships and via acquisition.

For more information about Animalcare, please visit www.animalcaregroup.com or contact:

About Orthros Medical

Dutch biotech company Orthros Medical focuses on the development of VHH-based therapeutics and diagnostics for animal and human health. The unique properties of single chain VHH antibody fragments offer great opportunities in the treatment and diagnosis of disease. A spin-off of the University of Twente in the Netherlands, Orthros Medical is privately owned and closely collaborates with the university in research and development programmes.

For more information about Orthros, please visit www.orthros-medical.com or contact: