Approval in Japan

Approval for once-daily Seebri® Inhalation Capsules as maintenance COPD treatment in Japan

·; Seebri®Inhalation Capsules 50 mcg approved as maintenance COPD treatment will be available to patients and physicians in Japan by year-end

·; Marks first approval for glycopyrronium bromide in COPD, with approval also expected in the EU in 2012

·; GLOW trials showed Seebri ® Inhalation Capsules improved lung function, reduced shortness of breath, reduced exacerbations, and improved quality of life up to 52 weeks versus placebo1-4

·; GLOW2 study showed Seebri® Breezhaler® provided 24-hour bronchodilation and is superior to placebo and similar to open-label tiotropium in improving lung function2

Chippenham, UK - 28 September 2012: Vectura Group plc ("Vectura"; LSE: VEC) confirms the information released today by Novartis announcing that the Japanese Ministry of Health, Labour and Welfare (MHLW) has approved Seebri® (glycopyrronium bromide) Inhalation Capsules 50 mcg administered through the Breezhaler® device, as a once-daily, long-term, inhaled maintenance bronchodilator treatment for the relief of various symptoms due to airway obstructive disease in chronic obstructive pulmonary disease (chronic bronchitis and emphysema).This marks the first approval for glycopyrronium, with approval also expected in the EU in 2012.

Dr Chris Blackwell, Chief Executive of Vectura, commented:

"The approval of Seebri® Inhalation Capsules in Japan is an important event for Vectura, triggering a $2.5 million milestone and further validation of our late stage respiratory platform. Seebri® Inhalation Capsules provides doctors and patients with a much needed, once-daily, treatment option for COPD, a condition that can lead to death and is increasing in prevalence in Japan and worldwide."

The MHLW approved Seebri® Inhalation Capsules based on data from the Novartis Phase III GLOW trials which demonstrated the safety and efficacy of glycopyrronium 50 mcg and involved 2,159 COPD patients from Japan and around the world who required maintenance treatment1-4.

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Enquiries

Notes for editors

About Seebri® (glycopyrronium bromide)

Seebri® (glycopyrronium bromide) Inhalation Capsules is a long acting muscarinic antagonist (LAMA) developed as a once-daily inhaled maintenance therapy for the treatment of COPD. Glycopyrronium bromide was exclusively licensed to Novartis in April 2005 by Vectura and its co-development partner Sosei. Phase III data from the GLOW 1, 2 and 3 studies demonstrated that glycopyrronium increased patients' lung function over a 24-hour period compared to placebo with a fast onset of action at first dose, and improved exercise endurance versus placebo1,2,3. The US filing for Seebri® Breezhaler® is expected in 2014.

About the Phase III GLOW trials

The GLOW trials showed that glycopyrronium, when compared to placebo, significantly improved lung function over the first four hours after morning dosing and that this benefit was sustained for 24 hours over a 52-week period2. Patients on glycopyrroniumdemonstrated improved lung function, reduced shortness of breath, reduced exacerbations, reduced use of rescue medication, and improved quality of life compared to placebo1-4.

GLOW1 was a 26-week, randomized, double-blind, placebo-controlled study. The study demonstrated the clinically significant superiority of glycopyrroniumversus placebo for lung function improvements at 12 weeks (primary endpoint) measured by trough FEV1 (p1.

GLOW2 demonstrated a similar magnitude of effect and also showed that glycopyrronium was similar to open-label (OL) tiotropium over 52 weeks measured by improvements in trough FEV1 compared to placebo. In addition to demonstrating benefits in terms of lung function, glycopyrronium exhibited a rapid onset of action within five minutes at first dose and reduced exacerbations. Significant benefits in both breathlessness and health-related quality of life (HRQL), as measured by the Transition Dyspnea Index (TDI) and St. George's Respiratory Questionnaire (SGRQ) compared to placebo, were also demonstrated. GLOW2 was a 52-week, randomized, double-blind, placebo-controlled study with OL tiotropium 18 mcg as an active exploratory arm2.

The GLOW3 study showed that after glycopyrronium was administered in the morning, patients experienced improved exercise tolerance from the first dose onward. Overall, patients treated with glycopyrronium experienced a significant 21% improvement in exercise endurance versus placebo at the end of the study (day 21), with a significant 10% increase from day one (both p3.

GLOW4 was a 52-week study in a Japanese population that examined the safety profile of glycopyrronium using OL tiotropium 18 mcg administered in the Handihaler® device as an active control. The data from this study showed that glycopyrronium had a similar safety profile to OL tiotropium4. In all studies, glycopyrronium was shown to have an overall safety profile similar to placebo4.

Seebri® (glycopyrronium bromide) Inhalation Capsules is a long-acting muscarinic antagonist (LAMA), a type of bronchodilator that is recommended in COPD global treatment strategies as maintenance therapy. Also approved in Japan is the Novartis product Onbrez® (indacaterol)Inhalation Capsules (150 mcg once-daily), a long-acting beta2 agonist (LABA) for the maintenance bronchodilator treatment of airflow obstruction in adult patients with COPD5.

Novartis is currently developing a fixed-dose combination of glycopyrronium and indacaterol, QVA149, which is expected to be filed in the EU and Japan by the end of 2012.

About the NVA237/QVA149 Licence Agreement with Novartis

NVA237 (glycopyrronium bromide - Seebri® Breezhaler®) was licensed to Novartis in April 2005 by Vectura and itsco-development partner, Sosei. It is a LAMA developed as a once-daily inhaled maintenance therapy for the treatment of COPD. Phase III data from the GLOW1, 2 and 3 studies demonstrated that glycopyrronium bromide increased patients' lung function over a 24-hour period compared to placebo with a fast onset of action at first dose, and improved exercise endurance versus placebo1,2,3. Novartis expects to launch NVA237 in 2012 as a once-daily monotherapy for COPD and subsequently as a fixed-dose combination with indacaterol (Onbrez® Breezhaler®), its once-daily, long-acting beta-agonist (LABA), known as QVA149. The dual activity of a muscarinic antagonist and a beta-adrenergic agonist promises to be an effective bronchodilator and, with convenient once-daily dosing as a fixed-dose combination, has the potential to improve compliance and address a large and unmet need for COPD sufferers.

Novartis received European regulatory approval for Onbrez® Breezhaler® in November 2009. It was first launched in the EU in 150 mcg and 300 mcg once-daily doses. Most recently, Novartis launched the 75 mcg once-daily dose in the US under the brand name ArcaptaTM NeohalerTM. It is also available as a 150 mcg once-daily dose in Japan under the brand name Onbrez® Inhalation Capsules.

To date, Vectura has received $35m from Novartis and, under the terms of the licence, could receive up to an additional $152.5m for achievement of regulatory and commercialisation targets for both the monotherapy and the combination product. In addition, royalties on product sales will be received in the event of successful product launches.

All of the Novartis COPD portfolio products are being developed for delivery via the Breezhaler® device, a single-dose dry powder inhaler (SDDPI), which has low air flow resistance, making it particularly suitable for patients with airflow limitation, such as COPD patients. The Breezhaler® device allows patients to hear, feel and see that they have taken the drug correctly6.

About COPD

COPD is a progressive disease associated mainly with tobacco smoking, air pollution or occupational exposure, which can cause obstruction of airflow in the lungs resulting in debilitating bouts of breathlessness. It affects an estimated 210 million people worldwide7 and is predicted to be the third leading cause of death by 20208. Although COPD is often thought of as a disease of the elderly, 50% of patients are estimated to be within the ages of 50 and 65, which means that half of the COPD population are likely to be impacted at the peak of their earning power and family responsibilities9.

About Vectura

Vectura Group plc develops inhaled therapies principally for the treatment of respiratory diseases. Vectura's main products target diseases such as asthma and chronic obstructive pulmonary disease (COPD), a growing market that is currently estimated to be worth in excess of $25bn.

Vectura has six products marketed by its partners and a portfolio of drugs in clinical and pre-clinical development, a number of which have been licensed to major pharmaceutical companies. Vectura has development collaborations and licence agreements with several pharmaceutical companies, including Novartis, Sandoz (the generics arm of Novartis), Baxter and GlaxoSmithKline (GSK).

Vectura seeks to develop certain programmes itself where this will optimise value. Vectura's formulation and inhalation technologies are available to other pharmaceutical companies on an out-licensing basis where this complements Vectura's business strategy. 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.

References

1. D'Urzo A, et al. Efficacy and safety of once-daily NVA237 in patients with moderate-to-severe COPD: the GLOW1 trial. Respiratory Research 2011, 12:156.

2. Kerwin E, et al. Efficacy and safety of NVA237 versus placebo and tiotropium in patients with moderate-to-severe COPD over 52 weeks: The GLOW2 study. Eur Resp J. 2012. Published on July 26, 2012 (doi:10.1183/09031936.00040712). Last accessed 12 September 2012.

3. Beeh K, Drollmann A, Di Scala L, Smith R. Once-daily NVA237 improves exercise endurance from first dose in patients with COPD: the GLOW3 trial. Int J Chron Obstruct Pulmon Dis. 2012; 7:503-513.

4. Sekiya M et al. Safety and efficacy of NVA237 once daily in Japanese patients: the GLOW4 trial. [ERS abstract 853970; Session 245; Hall A-7; Date: Mon 3 Sep Time: 12:50-14:40.]

5. Onbrez® Inhalation Capsules. Japanese SmPC

6. Onbrez® Breezhaler® (indacaterol) EU Summary of Product Characteristics. Available at: http://www.ema.europa.eu/ema/index.jsp?curl=pages/medicines/human/medicines/001114/human_med_001219.jsp&mid=WC0b01ac058001d124. Last Accessed 12 September 2012.

7. Global Alliance Against Chronic Respiratory Diseases (GARD). Global surveillance, prevention and control of chronic respiratory diseases: a comprehensive approach. Available at: http://www.who.int/gard/publications/GARD%20Book%202007.pdfLast accessed 21 August 2012.

8. Global Initiative for Chronic Obstructive Lung Disease (GOLD). Global Strategy for the Diagnosis, Management, and Prevention of Chronic Obstructive Pulmonary Disease. Updated 2011. http://www.goldcopd.org/guidelines-global-strategy-for-diagnosis-management.html. Last accessed 21 August 2012.

9. Fletcher MJ et al. COPD Uncovered: An International survey on the impact of chronic obstructive pulmonary disease (COPD) on a working age population. BMC Public Health. 2011;11:612.