FOUNDERS QUIT AS GOLDSHIELD SETTLES NHS CLAIM
(22 June 2007)

The Directors of Goldshield, Ajit & Kirti Patel, have agreed a settlement with the NHS which had brought charges against the group for alleged anti-competitive cartel conduct in connection with the supply to the NHS of generic drugs. Under the terms of the settlement Goldshield have agreed, without admission of liability, to pay the NHS the sum of £4 million.

The pharmaceutical group added that chief executive Ajit Patel and chief operating officer Kirti Patel have decided to resign to focus on the case with the Serious Fraud Office (SFO). Finance director Rakesh Patel has been named the new chief executive.

The Department of Health called in the Serious Fraud Office (SFO in 2002, alleging that six companies colluded to limit the supply and inflate the prices of penicillin-based antibiotics and the blood-thinner Warfarin between 1st January1996 and 31st December 2000.

On 10 April 2002, officers of the Metropolitan Police Fraud Squad, executed search warrants at a number of residential and business addresses in England, Scotland and Wales. It was one of the biggest single operations carried out by the SFO, more than 200 officers raided 11 homes and 16 business addresses - including Ajit Patel's house and Goldshield's Croydon offices - seizing files and computer equipment.

The six pharmaceutical companies involved were:Generics UK Ltd, Kent Pharmaceuticals Ltd, Regent-GM Laboratories Ltd, Goldshield Group Plc, Norton Healthcare Ltd, a subsidiary of Ivax Corporation and Ranbaxy (UK) Ltd, a subsidiary of Ranbaxy Laboratories Ltd. In April 2005 Ranbaxy agreed to pay the NHS £4.5 million and to provide co-operation in the context of the ongoing proceedings.

AJIT & KIRTI PATEL TO STEP DOWN

Goldshield Group plc further announced today that it had completed its strategic review. As a result, the Group is to focus upon its core activity Pharmaceutical and Healthcare businesses. Rakesh Patel is to become the Chief Executive and both Ajit Patel and Kirti Patel have decided to resign to focus their attention upon the case with the SFO. Goldshield's board is to be strengthened by the appointment of a new finance director and two new non-executive directors. The group plans to sell certain Indian business and assets and the pharmaceutical division is actively seeking to acquire new products.

Commenting on the announcement, Keith Hellawell, Chairman, said: "Within pharmaceuticals many of the major drug companies are looking to sell products which have or are coming off patent. Goldshield has a strong track record of buying and developing these drugs. The Healthcare business also has opportunities. For example, there are major changes to UK and European drug regulation and these will demand that companies create an internal infrastructure if they wish to stay in the sector. Within Goldshield we have this expertise and structure already and this provides us with an important advantage.

Our distribution platform spreads across the Healthcare systems of sixty countries and we plan to use this potential to grow sales. The settlement with the DoH is important and, I believe that it will help to re-build our relations with the NHS.

We are grateful to Ajit and Kirti Patel for their contributions to the Company since its formation. We recognise that their resignations are necessary to allow them sufficient time to prepare for their cases.

The focus of Goldshield is our core business. I am confident that with management putting its energies in to these areas that we will see a return to growth."