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Paul Ward is already running a germ-killing products business supplying to the health-care sector and is seeking investment for his new anti-virus laundry degerent that he hopes to get into shops.

After a brisk pitch which includes confident year three forecasts, Peter Jones wants to know why he values his business at £2 million.

Paul points out that in the first year of trading he made a loss of £50,000 but in the second year has turned this into a £190,000 net profit.

Deborah Meaden is baffled by the dramatic turnaround and Paul admits it is due mainly to the alcohol gels he sells with a 80% mark-up. The growth in sales of these has been driven by the current swine flu scare.

James Caan wants to know more about Paul's customer base and while Paul says it is mainly the private care sector he agrees with James that the hospital market is potentially a huge one and one it would like to exploit.

Paul points out that one of his products has already been trailled by the NHS Innovation Centre and scored 95% on efficiency criteria.

Paul tels James the company currently carries no debts and is funded by cashflow.

With his financials looking so good, Theo Paphitis is puzzled as to why he wants investment in the first place.

Paul says he is trying to capitalise on the opportunity swine flu has presented his company and to pitch his latest product to the wider retail market. What he is really after is the Dragons contacts and expertise in the retail field.

When Theo asks how much equity he is prepared to surrender, Paul replies that he is not prepared to give away more than the 5% he initially pitched for.

This immediately riles Duncan Bannatyne who says unequivocally that on that basis he is out.

Theo says he would love to get involved but not at 5% - he too is out.

Deborah Meaden joins the chorus of disapproval, finding Paul's evaluation "racy", leaving her nowhere to go but to declare herself out.

Peter Jones reminds Paul that unless his equity range is in the 20-40% bracket he can't understand why he is in the Den. He adds that for him to value his business at between £1/2million is "a bit of a joke" but Peter isn't smiling - he is out.

James Caan wants Paul to go over again his three year forecasts and the Lancashire based entrepreneur repeats his escalating figures.

James replies that he likes what Paul has done but, like the other Dragons, disagrees with his evaluation. Nonetheless he is prepared to make Paul an offer - the full £100,000 for a 30% equity. However he is prepared to bring that figure down to 10% in Year 3 if Paul meets the ambitious targets he has set himself.

Paul goes to the back of the Den to consider James's offer but returns and says he cannot surrender so much of the company. On that basis james withdraws his offer and Paul leaves the Den emptyhanded.

The deal done in the Den:

Paul Ward rejects an offer of £100,000 for a performance-related equity from James Caan.