XTLBIO STRATEGY UPDATE

Rehovot, Israel, 15 July 2003 - XTL Biopharmaceuticals Ltd. (XTLbio) announced
today that as part of its continuing review of the business, the Board has
agreed on a plan to further focus the Company's efforts on the development of
its most advanced products in order to optimise the use of its cash resources. 

Key points arising from the review are as follows:

  * All discovery research activities are to be put on hold with immediate
    effect. This will involve a reduction in the Company's headcount from 74 to
    54.
   
  * Cash conservation, including recently-announced waivers of remuneration by
    Executive Directors, will enable previously reported cash resources of $36m
    as of 31 December 2002 to last at least until the first quarter of 2006. As
    a result, the average monthly burn rate will decrease from approximately
    $1.4M to approximately $0.9M. Any revenues that may be generated through
    planned outlicensing/co-development agreements will further augment the
    Company's resources.
   
  * A new licensing committee of experienced Non-Executive Directors has been
    established to help management drive forward the partnering of its most
    advanced programmes.
   
  * The strategy for commercialising HepeX-B for prevention of hepatitis B
    reinfection following liver transplant is unchanged. Negotiations for
    outlicensing the product have resumed and Phase II trials are planned to
    start later this year.
   
  * The HepeX-C antibody programme for prevention of hepatitis C reinfection
    following liver transplant will continue through to the end of Phase II
    trials, during which time XTLbio will seek a co-development partner to
    share future development costs.  Current Phase II trials are expected to be
    completed by the end of 2003.
   
  * The HepeX-C antiviral small molecule programme for chronic hepatitis C will
    complete preclinical studies and XTLbio will take the product through
    clinical trials in chronic hepatitis C patients, to test safety and
    efficacy. These trials are expected to commence in 2004. XTLbio will then
    actively seek to outlicense the product.
   
Commenting on the review, Dr Martin Becker, Chief Executive Officer of XTLbio,
said:

"By focusing on our core expertise in hepatitis and implementing this
cost-optimisation programme, we are accelerating the Company's route to
profitability.  With both of our lead products advancing well through clinical
development, we are confident of delivering increased value for shareholders."

Contacts:

XTLbio

Dr. Martin Becker, President and CEO, Tel: +972-8-930-4440

Financial Dynamics

David Yates, Sarah MacLeod, Tel: +44 (0) 20 7831 3113

About XTLbio

XTL Biopharmaceuticals Ltd. (XTLbio) is a biopharmaceutical company developing
drugs against hepatitis. XTLbio's HepeX(tm) product line - now in clinical trials
- has the potential to introduce revolutionary therapies for viral hepatitis,
including prevention of re-infection in transplanted livers, the Company's
primary focus, and a longer-term cocktail approach in treating chronic illness.
XTLbio believes its primary competitive advantage lies in its patented Trimera(tm)
technology, which enables the development of fully human monoclonal antibodies
and models of human disease for pre-clinical drug validation. Established in
1993, XTLbio became a public company in 2000 with shares traded on the London
Stock Exchange under the symbol XTL.



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