Research Update

Data at ERS shows efficacy of once-daily COPD portfolio versus comparators, further establishes dual-bronchodilator QVA149

·; QVA149 demonstrated superior bronchodilation compared to indacaterol 150 mcg, glycopyrronium 50 mcg, salmeterol/fluticasone 50/500 mcg BID, OL tiotropium 18 mcgand placebo1,2

·; Seebri® Breezhaler® (glycopyrronium bromide) demonstrated rapid, sustained bronchodilation and reduced exacerbations similar to OL tiotropium 18 mcg in GLOW pooled data analysis3,4

Chippenham, UK - 3 September 2012: Vectura Group plc ("Vectura"; LSE: VEC) highlights that further data from the once-daily chronic obstructive pulmonary disease (COPD) clinical trial programs were presented today by Novartis at the European Respiratory Society (ERS) Congress. Overall, Novartis presented 14 abstracts, including data from the investigational QVA149 (fixed-dose combination of indacaterol maleate / glycopyrronium bromide) IGNITE Phase III clinical trial program, and the glycopyrronium bromide (Seebri® Breezhaler®) GLOW Phase III clinical trial program.

Among the data presented, three new studies from the investigational QVA149 IGNITE Phase III clinical trial program (SHINE, ILLUMINATE and ENLIGHTEN) demonstrated that QVA149 significantly improved lung function compared to other COPD therapies1,2,6. Data from the GLOW program showed that glycopyrronium 50 mcg once daily provided rapid and sustained bronchodilation, and reduced exacerbations and symptoms when compared to placebo, similar to the levels observed with open-label (OL) tiotropium 18 mcg3,4.

IGNITE data demonstrated the efficacy of the dual-bronchodilator QVA149 (indacaterol maleate / glycopyrronium bromide) and showed a superior effect on lung function and patient-reported outcomes versus comparators1,2,6

SHINE met its primary endpoint by demonstrating that once-daily QVA149 110/50 mcg improved lung function as measured by trough FEV1 compared to once-daily indacaterol maleate 150 mcg (+70mL above indacaterol alone; p1. QVA149 110/50 mcg is an investigational inhaled dry-powder fixed-dose combination medication that provides the equivalent amount of indacaterol as Onbrez (indacaterol maleate) 150 mcg along with glycopyrronium 50 mcg7. QVA149 was also more effective at improving lung function compared to OL tiotropium 18 mcg (+80mL above tiotropium; p1. Mean peak FEV1 at Week 26 was also significantly higher with QVA149 compared to placebo (+330mL, pindacaterol 150 mcg (+120mL; p, glycopyrronium 50 mcg (+130mL; pand OL tiotropium 18 mcg (+130mL; p1. Mean FEV1 area under the curve (AUC) for 0-24hr at Week 26 was significantly higher with QVA149 compared to placebo (+320mL, pindacaterol 150 mcg (+110mL; p, glycopyrronium 50 mcg (+110mL; pand OL tiotropium 18 mcg (+110mL; p1. 

The results also showed that QVA149 improved breathlessness measured by the transition dyspnoea index or TDI (p1. QVA149 was superior to indacaterol 150 mcg and glycopyrronium 50 mcg at reducing use of rescue medication (p1.

ILLUMINATE compared QVA149 110/50 mcg to the twice-daily LABA/ICS salmeterol/fluticasone 50/500 mcg head-to-head over 26 weeks in patients with COPD 2. The study met its primary endpoint by demonstrating that the mean FEV1 area under the curve (AUC) for 0-12hr at Week 26 was significantly higher with QVA149 compared to salmeterol/fluticasone 50/500 mcg (+140mL; p2. Mean FEV1 AUC0-12h was also significantly higher with QVA149 versus salmeterol/fluticasone 50/500 mcg at Day 1 (+70mL; p2 and Week 12 (+120mL; p2. The ILLUMINATE trial also demonstrated that QVA149, in comparison to salmeterol/fluticasone 50/500 mcg, significantly improved breathlessness measured by TDI (p=0.003) and reduced rescue medication use (p=0.019) over 26 weeks2.

ENLIGHTEN demonstrated the efficacy of QVA149 at improving lung function over a 52-week period by showing that QVA149 increased FEV1 and forced vital capacity (FVC) versus placebo at Day 1 and Weeks 3, 6, 12, 26, 39 and 52 (p6. At Week 52, the mean difference in FEV1 compared to placebo at 60 minutes post-dose was +257mL (p6.

QVA149 was generally well tolerated in the SHINE, ILLUMINATE and ENLIGHTEN trials with an incidence of adverse events that was similar between respective groups1,2,6.

GLOW pooled analyses demonstrated that investigational glycopyrronium increased lung function, improved patient outcomes compared to placebo3,4

Results of the first pooled analysis of GLOW1 and GLOW2 data demonstrated that patients on glycopyrronium 50 mcg experienced rapid, sustained and clinically meaningful bronchodilation over 52 weeks3. The improvement in FEV1 was seen within five minutes after the first dose on Day 1 (+90mL at 5 minutes and +144mL at 15 minutes versus placebo; p3. FEV1 AUC for 0-4h, 0-12h, 0-24h and 12-24h for glycopyrronium 50 mcg was statistically significantly greater than placebo (p3. When compared to placebo, glycopyrronium 50 mcg was also numerically higher than OL tiotropium 18 mcg versus placebo at all-time points for trough FEV1 (Day 1 and Weeks 12, 26 and 52)3.

The second pooled analysis of GLOW1 and GLOW2 data found that for patients taking glycopyrronium 50 mcg, the time to first moderate/severe exacerbation was significantly prolonged compared to placebo at both Week 26 (hazard ratio [HR] 0.64; p4. The results were comparable in patients treated with OL tiotropium 18 mcg. Glycopyrronium 50 mcg also significantly lowered the rate of moderate/severe exacerbations versus placebo at Weeks 26 and 52 (both rate ratio [RR] 0.66; p4.

Glycopyrronium 50 mcg improved breathlessness measured by TDI (p4. The results were similar to OL tiotropium 18 mcg compared to placebo4.

About the study designs

SHINEwas a 26 week, multicenter, randomized, double-blind, parallel-group, placebo and active controlled pivotal trial of 2,144 patients with moderate-to-severe COPD to assess efficacy in terms of trough FEV11. Patients were randomized to receive QVA149, indacaterol maleate 150 mcg, glycopyrronium 50 mcg, OL tiotropium 18 mcg or placebo.

ILLUMINATE was a 26 week, multi-center, randomized, double-blind, double dummy, parallel-group study to assess the efficacy, safety and tolerability of once-daily QVA149 compared to twice-daily fixed dose combination of salmeterol/fluticasone 50/500 mcg in patients with moderate-to-severe stable COPD2.

ENLIGHTEN was a 52 week, multicenter, randomized, double-blind, parallel-group, placebo controlled pivotal trial of 339 patients with moderate-to-severe COPD to assess the safety and tolerability of QVA1496.

GLOW1 and GLOW2 were multicenter, randomized, double-blind, placebo controlled,

parallel group studies in patients with moderate-to-severe COPD. GLOW1 was a 26 week study with patients randomized to receive once-daily glycopyrronium 50 mcg or placebo. GLOW2 was a 52 week study with patients randomized to receiveonce-daily glycopyrronium 50 mcg or placebo, and included an exploratory arm to compare the effects of once-daily OL tiotropium 18 mcg versus placebo3,4.

The first pooled analysis assessed the efficacy of once-daily glycopyrronium 50 mcg versus placebo and once-daily OL tiotropium 18 mcg over 26 to 52 weeks in 1,888 patients with moderate-to-severe COPD from clinical trials (GLOW1 and GLOW2)3. The second pooled analysis assessed the efficacy of once-daily glycopyrronium 50 mcg versus placebo and once-daily OL tiotropium 18 mcg at reducing COPD exacerbations, symptoms and improving health status over 26 to 52 weeks in 1,854 patients from clinical trials (GLOW1 and GLOW2)4.

Dr Chris Blackwell, Chief Executive of Vectura, commented:

"We are very encouraged by the substantial body of GLOW and IGNITE data presented at the European Respiratory Society meeting and look forward to the approval of glycopyrronium bromide in Europe and the filing of QVA149 in Europe and Japan."

- Ends -

Enquiries

Notes for editors

About the NVA237/QVA149 Licence Agreement with Novartis

NVA237 (glycopyrronium bromide - Seebri® Breezhaler®) was licensed to Novartis in April 2005 by Vectura and its co-development partner, Sosei. Glycopyrronium bromide is an investigational LAMA developed as a once-daily inhaled maintenance therapy for the treatment of COPD. 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 placebo12-14. In June 2012, the European Medicines Agency's Committee for Medicinal Products for Human Use (CHMP) adopted a positive opinion for the approval of glycopyrronium bromide in Europe under the brand name Seebri® Breezhaler®.

QVA149 is an investigational inhaled, once-daily, fixed-dose combination of indacaterol maleate and glycopyrronium bromide. QVA149 is being investigated for the treatment of COPD in the Phase III IGNITE clinical trial program. IGNITE is one of the largest international clinical trial programs in COPD comprising 10 studies in total with more than 7,000 patients across 42 countries1,2,6,15-21. The first five studies (ILLUMINATE, SHINE, BRIGHT, ENLIGHTEN, SPARK) have already completed in 2012 with three additional studies (BLAZE, ARISE, BEACON) expected to complete by the end of the year. The studies are designed to investigate efficacy, safety and tolerability, lung function, exercise endurance, exacerbations, breathlessness and quality of life. Initial filings for regulatory approval are expected in Q4 2012 for Europe and Japan. US filing is expected at the end of 2014.

All 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 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 correctly19.

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.

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 worldwide22 and is predicted to be the third leading cause of death by 202023. 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 responsibilities24.

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. Bateman E et al.Benefits of dual bronchodilation with QVA149 once daily versus placebo, indacaterol,

NVA237 and tiotropium in patients with COPD: the SHINE study. [ERS abstract 700179; Session 306; Monday September 3, 2012; 14:45:-16:45].

2. Vogelmeier C et al. Once-daily QVA149 significantly improves lung function and symptoms compared to twice-daily fluticasone/salmeterol in COPD patients: The ILLUMINATE study. [ERS abstract 70045; Session 52; Sunday September 2, 2012; 08:30-10:30].

3. Banerji D et al. Once-daily NVA237 improves lung function in COPD patients: pooled results of theGLOW1 and GLOW2 studies. [ERS abstract 853239; Session 245; Date: September 03, 2012 Time: 12:50-14:40.

4. Banerji D et al. Once-daily NVA237 reduces exacerbations and improves symptoms in COPD patients: a pooled analysis, of the GLOW1 and GLOW2 studies. [ERS abstract 853213; Session 314; Date: September 03, 2012 Time: 14:45-16:45.

5. Mahler D et al. Effectiveness of indacaterol and tiotropium in patients with severe dyspnoea. [ERS abstract 850630; Session 245; Date: September 03, 2012 Time: 12:50-14:40.

6. Dahl R et al. QVA149 administered once daily provides significant improvements in lung function over 1 year in patients with COPD: the ENLIGHTEN study. [ERS abstract 853405; Session 315; Date: September 03, 2012 Time: 14:45-16:45.

7. Novartis data on file

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12. 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 (7 December 2011).

13. Kerwin E, et al. Eur Resp J 2012. Published on July 26, 2012 (doi:10.1183/09031936.00040712).

14. Beeh KM, et al A . Int J Chron Obstruct Pulmon Dis. 2012;7:503-513.

15. QVA149 2305 (BRIGHT). Data on file, Novartis Pharma AG. ClinicalTrials.gov identifier: NCT01294787.

16. QVA149 A2304 (SPARK). Data on file, Novartis Pharma AG. ClinicalTrials.gov identifier: NCT01120691.

17. QVA149 2322 (BLAZE).Data on file, Novartis Pharma AG. ClinicalTrials.gov identifier: NCT01490125.

18. QVA149 1301 (ARISE).Data on file, Novartis Pharma AG. ClinicalTrials.gov identifier: NCT01285492.

19. Onbrez® Breezhaler® (indacaterol) EU Summary of Product Characteristics May 31, 2011 http://www.ema.europa.eu/ema/index.jsp?curl=pages/medicines/human/medicines/001114/human_med_001219.jsp&mid=WC0b01ac058001d124. Last accessed 20 June 2012.

20. FDA Access Data. Spiriva® HandiHaler® Medical Review Part 2, pages 37-38.http://www.accessdata.fda.gov/drugsatfda_docs/nda/2004/21-395_Spiriva.cfm. Last accessed 28 March 2012.

21. FDA Access Data. Advair Medical Review Nov. 17, 2003, Page 133. http://www.accessdata.fda.gov/drugsatfda_docs/nda/2003/021077_S003_ADVAIR_DISKUS.pdf Last accessed 30 March 2012.

22. 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.pdf Last accessed 22 May 2012.

23. Global Initiative for Chronic Obstructive Lung Disease (GOLD). Global Strategy for the Diagnosis, Management, and Prevention of Chronic Obstructive Pulmonary Disease. Updated 2011.

24. 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.