Vectura : Licence Option Exercised

June 30, 2016 at 3:30 PM

Chippenham, UK - 28 June 2016: Vectura Group plc (LSE: VEC)('Vectura'), an industry-leading inhaled airways disease focused business, announces that its partner, Ablynx nv ('Ablynx') is to exercise its commercial licence option on Vectura's smart nebuliser technology and progress its wholly-owned inhaled anti-RSV Nanobody, ALX-0171, into a Phase IIb dose-ranging efficacy study. This follows positive top line results announced in May from the first-in-infant Phase I/IIa study of Ablynx's inhaled ALX-0171 for the treatment of respiratory syncytial virus ('RSV') in infants hospitalised with an RSV infection. The exercise of this option triggers a payment to Vectura. Further milestones are payable linked to development and regulatory progress of the programme and royalties payable on any future net sales of the product.

VR465 (ALX-0171) - Global

ALX-0171 is a Nanobody drug candidate administered through inhalation for the treatment of RSV infections. ALX-0171 is being developed by Ablynx and utilises Vectura's smart nebuliser technology device, FOX, to deliver the Nanobody to patients. The FOX device used in this programme has been adapted for use with neonates and infants.

FOX

The FOX device is a hand-held, self-contained, battery powered inhalation system that delivers nebulised liquid drugs with high performance using a vibrating mesh technology. The mesh-based aerosolisation engine is proprietary to Vectura. As with all of Vectura's smart nebuliser delivery systems, FOX provides targeted inhalation therapy for applications where precise and targeted delivery to the lungs is needed. To achieve this, the device creates a liquid aerosol and co-ordinates delivery after the patient has inhaled using the FAVORITE (Flow And Volume Regulated Inhalation TEchnology) principle for precise delivery to the lungs. The FOX inhalation system also makes use of a flow sensing/controlling valve system, is rechargeable and can be Bluetooth-enabled. FOX is CE marked and 510(k) approved and in April 2014, gained a Red Dot Award for product design.

James Ward-Lilley, Vectura's CEO, commented:

'We are pleased with the confirmation of the progress of this programme and our continued collaboration with Ablynx. This is an important programme in the development of new treatment options for RSV in vulnerable patient populations. This announcement also demonstrates the utility of the Vectura smart nebuliser technology and the value of a strong partnering relationship combining the device capabilities of Vectura and the powerful Nanobodytechnology and development expertise of Ablynx.'

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Enquiries

About RSV and ALX-0171

Respiratory syncytial virus (RSV) is the most common cause of lower respiratory tract infections and the leading viral cause of severe lower respiratory tract disease in infants and young children worldwide. It is the primary cause of infant hospitalisation and virus associated deaths in infants, with estimated global annual infection and hospitalisation rates of 34 million and 3-4 million respectively. It is associated with an estimated 3,000-8,500 deaths in infants <2 years globally per year. In addition, RSV infections have been linked to an increased risk of asthma development later in life. Current treatment of RSV infections is primarily focussed on symptomatic relief, hence the need for an effective and specific anti-RSV therapeutic.

Ablynx's ALX-0171 has been developed to address this unmet medical need and is a potential breakthrough for the treatment of RSV infection in infants. This wholly-owned trivalent Nanobody binds to the F-protein of RSV, thereby inhibiting viral replication and neutralising RSV activity by blocking virus uptake into cells. The physical robustness of the Nanobody allows administration via inhalation directly to the site of infection, i.e. the respiratory tract including the lungs. ALX-0171 has shown a potent anti-viral effect against a broad range of RSV strains in vitro and it has demonstrated a marked therapeutic effect following administration via nebulisation in a neonatal animal model for infant RSV infection. Repeated daily inhalation of ALX-0171 was proven to be well-tolerated in multiple Phase I clinical studies, including a study in subjects with hyper-reactive airways.

About Vectura

Vectura, a FTSE250 company listed on the London Stock Exchange (LSE: VEC), is an industry-leading inhaled airways disease focused business with proprietary formulation and devices across DPI, pMDI and smart nebulisation platforms. With our extensive range of technologies, capabilities and collaborations, we believe we can become a leader in the development of inhalation products, increasing our ability to help patients suffering from respiratory diseases. In June 2016 Vectura completed a merger with Skyepharma PLC.

Vectura has seven inhaled, four non-inhaled and ten oral products marketed by partners with growing global royalty streams, and a portfolio of drugs in clinical development, a number of which havelicence agreements with several global pharmaceutical and biotechnology companies including Hikma, Novartis, Sandoz, Mundipharma, Kyorin, Baxter, GSK, UCB, Ablynx, Grifols, Chiesi, Almirall, Janssen, and Tianjin KingYork.

For further information, please visit Vectura's website at www.vectura.com.

Forward-looking statements

This press release contains forward-looking statements, including statements about the discovery, development and commercialisation of products. Various risks may cause Vectura's actual results to differ materially from those expressed or implied by the forward-looking statements, including: adverse results in clinical development programmes; failure to obtain patent protection for inventions; commercial limitations imposed by patents owned or controlled by third parties; dependence upon strategic alliance partners to develop and commercialise products and services; difficulties or delays in obtaining regulatory approvals to market products and services resulting from development efforts; the requirement for substantial funding to conduct research and development and to expand commercialisation activities; and product initiatives by competitors. As a result of these factors, prospective investors are cautioned not to rely on any forward-looking statements. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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