SkyePharma : Technology License Agreement

Skyepharma signs exclusive agreement to access Lucideon's abuse deterrent drug delivery technology

First product to be developed for the growing U.S.$11bnU.S. opioid market

LONDON, UK, 7 June, 2016 - Skyepharma PLC (LSE: SKP), the expert oral and inhalation drug development company, announces that its oral business has signed an exclusive feasibility, development and licence agreement with Lucideon Limited, part of Lucideon Group Ltd ('Lucideon'), the international materials development and commercialisation organisation, giving Skyepharma access to Lucideon's iCRT-deter abuse deterrent controlled release technology.

Skyepharma initially intends to use the technology to develop an abuse deterrent formulation of a major opioid for the U.S. market which according to GBI Research is set to grow from $11 billion in 2014 to $17.7 billion by 2021. The companies will collaborate over the coming months to assess the feasibility of using the technology in this novel way. Skyepharma will fund this development work, in line with current R&D spend plans. Lucideon will provide specialist expertise with its technology and Skyepharma's oral business will formulate the product and complete an abuse deterrence challenge study. If the feasibility stage is successful, Skyepharma's oral business plans to develop the product as a generic for the U.S. market.

There is growing awareness of the issue of opioid abuse by public health, governmental and regulatory bodies. The U.S. Centers for Disease Control and Prevention (CDC) now considers prescription drug abuse in the U.S. an epidemic. Additionally, the U.S. Food and Drug Administration (FDA), has called for a far-reaching action plan to reassess the agency's approach to opioid medication. The plan will focus on policies aimed at reversing the epidemic, while still providing patients in pain access to effective relief and will expand access to, and encourage the development of, abuse deterrent formulations of opioid products. As a result, the market for abuse deterrent technologies is expected to grow strongly and there is likely to be demand for more advanced technologies which deter multiple methods of abuse.

Lucideon's iCRT-deter proprietary oral drug delivery platform technology is designed to enable drug products to retain their controlled-release properties regardless of tampering methods such as chewing, crushing and heating.

Skyepharma's oral business has proven expertise in developing controlled-release oral pharmaceutical products and has the capabilities, in its Lyon Facility, to formulate product and manufacture clinical trial supplies.

Lucideon is eligible for appropriate milestone payments as the development progresses as well as a single digit share of Skyepharma's royalty revenues from in-market sales of the product. Assuming a successful development, the investment by Skyepharma is expected to be c. £4 million over four years, which is within Skyepharma's existing guidance for overall investment in research and development.

Peter Grant, Chief Executive Officer of Skyepharma, commented:

'The agreement with Lucideon is an exciting development for Skyepharma's oral business. It combines leading and innovative technology from Lucideon with Skyepharma's proven oral pharmaceutical development capabilities to address a major need in a very large and growing market. If the feasibility study is successful, this could provide additional development and clinical trial supply work for the Lyon Facility where the manufacturing business is due to return to Skyepharma on expiry of the lease to Aenova on 30 June 2016. The route to market is also highly innovative - the generic (ANDA) route to filing provides a relatively rapid potential for approval, whilst opening up further opportunities should regulators seek to require greater abuse deterrence in marketed opioids.'

Tony Kinsella, Chief Executive of Lucideon, said:

'The partnership with Skyepharma's oral business demonstrates how Lucideon's technologies reach into multiple industries and we are delighted to be collaborating with a company with a strong track record in successful partnerships. We are pleased that our technology will be combined with Skyepharma's pharmaceutical development expertise to extend our reach further into the healthcare sector. We hope to have further opportunities to collaborate with Skyepharma using our iCRT family of technologies. This contract demonstrates the strength of our growing platform technology portfolio, particularly, but not exclusively, in healthcare markets.'

-Ends-

1. GBI Research report, August 2015: Opioids Overview to 2021: An Assessment of Pain Management and Dependence

2. L. Paulozzi, et al., T: Cdc Grand Rounds: Prescription Drug Overdoses - A U.S. Epidemic MMWR 61(01); 10-13. (2012)

3. FDA press release 4 February 2016

For further information, please contact:

About Skyepharma

Skyepharma combines proven scientific expertise with validated proprietary drug delivery technologies to develop innovative oral and inhalation pharmaceutical products. The Group is eligible for revenues from 16 approved products in the areas of inhalation, oral, topical and injectable drug delivery as well as generating income from the development of further products and technology licenses. The products developed by the Group are marketed throughout the world by big pharma as well as speciality pharmaceutical companies. For more information, visitwww.skyepharma.com

About Lucideon

Lucideon is a leading international provider of materials development, commercialisation, testing and assurance. The company improves the competitive advantage and profitability of its clients by providing them with the expertise and innovative thinking that they need to optimise their materials, products and processes. Through its offices and laboratories in the UK, US and the Far East, Lucideon services high-technology sectors including healthcare, ceramics, aerospace and energy. For more information, visitwww.lucideon.com

About Lucideon's iCRT-deter technology

iCRT-deter is Lucideon's proprietary oral drug delivery platform technology that provides abuse deterrent controlled release properties. The technology incorporates active molecules within the porous matrix and is designed to enable drug products to retain their controlled-release properties during tampering methods such as chewing, crushing and heating.

· Extremely hard structure that is very difficult to crush.

· Particulate technology that allows individual particles to retain their properties even if crushed.

· Extremely high melting point to deter injection.

· Low solubility and large particle sizes unsuitable for injection through suspension.