BIOXYNE LIMITED — Capital/Financing Update 2003

Sep 10, 2003

Company's Announcements Office, Australian Stock Exchange PERTH

VIA: asxonline.com.au

Dear Sirs.

VRI BioMedical Limited is pleased to announce that it has successfully completed its fully underwritten rights issue, raising additional equity capital of \$2.8m. The issue was well supported by both institutional and private investors with shareholders subscribing to 51.68% of their entitlements.

Dr Peter French, Chief Executive Officer of VRI, said: "This is a very satisfactory result given the timing of the capital raising. Many shareholders applied for oversubscriptions but unfortunately we were not able to accept these. The shortfall has been taken up by institutional clients of the underwriter and we welcome these new shareholders to the register".

As previously advised, the monies raised will be used for:

•continuation and completion of clinical trials for the company's range of probiotic products; and

*working capital

The rights issue, together with the recent placement to institutional shareholders, has raised over \$4.3 million in new equity for the company. This has considerably strengthened the capital base of the company.

Paul B Magoffin Company Secretary 11^th September 2003

Sydney Unit

Microbiology and Immunology School of Biotechnology and Biomolecular Science University of New South Wales UNSW Sydney 2052 Phone: (61 2) 9385 1593 Fax: (61 2) 9385 1285

VRI BioMedical Limited ACN 084 464 193 ABN 97 084 464 193 Suite G09, 1 Central Avenue, Australian Technology Park, Eveleigh NSW Australia 1430 Phone: (61 2) 9209 4268 Fax: (61 2) 9209 4256 www.vribiomedical.com

Newcastle Unit Level 4, David Maddison Clinical Sciences Building Cnr King and Watts Streets Newcastle NSW 2300 Phone (61 2) 4923 6581 Fax: (61 2) 4923 6205