Second Research Milestone Achieved

19 December 2011

LSE: VER

Vernalis plc and H.Lundbeck A/S

Achieve Second Research Milestone in Drug Discovery Collaboration

Vernalis plc, today announces it has achieved a further research milestone in its drug discovery collaboration with H.Lundbeck A/S (Lundbeck). As a result, Vernalis will receive a payment of £0.4m from Lundbeck in recognition of this achievement and the collaboration now progresses into its third stage.

The collaboration, which began in December 2010, utilises Vernalis' fragment and structure-based drug discovery platform against a kinase target. Under the terms of this collaboration Vernalis will receive fees and a potential share in the downstream success of the product in the form of milestones and royalties on sales. The financial terms of this collaboration are not disclosed.

Ian Garland, CEO of Vernalis commented: "We are delighted with the progress of this collaboration and the continued validation of our fragment and structure-based drug discovery platforms. We look forward to continued success in our collaboration with Lundbeck".

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About Vernalis

Vernalis is a revenue generating development stage pharmaceutical company with significant expertise in drug development. The Group has one marketed product, frovatriptan for the acute treatment of migraine, and eight candidates in development, seven of which are designated priority programmes. Four of these priority development programmes are currently unpartnered and three are partnered. Pipeline programmes are derived from both our own research activities where we have significant expertise in fragment and structure based drug discovery, as well as from collaborations. Our technologies, capabilities and products are endorsed by collaborations with Endo, GSK, Lundbeck, Menarini, Novartis and Servier.

For further information about Vernalis, please visit www.vernalis.com

Vernalis Forward-Looking Statement

This news release may contain forward-looking statements that reflect the Company's current expectations regarding future events including the clinical development and regulatory clearance of the Company's products, the Company's ability to find partners for the development and commercialisation of its products, as well as the Company's future capital raising activities. Forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors including the success of the Company's research strategies, the applicability of the discoveries made therein, the successful and timely completion of clinical studies, the uncertainties related to the regulatory process, the ability of the Company to identify and agree beneficial terms with suitable partners for the commercialisation and/or development of its products, as well as the achievement of expected synergies from such transactions, the acceptance of frovatriptan and other products by consumers and medical professionals, the successful integration of completed mergers and acquisitions and achievement of expected synergies from such transactions, and the ability of the Company to identify and consummate suitable strategic and business combination transactions.