Vernalis and Servier Achieve Research Milestone

6 October 2010

LSE: VER

Vernalis and Servier

Achieve Research Milestone in 2nd Oncology Collaboration

Vernalis plc, a development stage pharmaceutical company with a broad pipeline of clinical and early stage programmes and Servier, second largest privately-owned pharmaceutical company worldwide, today announce they have achieved a research milestone in their three-year oncology drug discovery collaboration initiated in May 2009. As a result, Vernalis will receive a payment of €0.75m from Servier in recognition of the achievement of desired potency and selectivity criteria in the programme.

Under the terms of the collaboration, which uses Vernalis' proprietary fragment and structure-based drug discovery platform, Vernalis receives fees and research milestones and a share in the downstream success of the product in the form of further milestones and royalties on sales. These terms are not disclosed. This is the second collaboration between Vernalis and Servier, the first collaboration is focused on developing two promising oncology targets involved in protein-protein interactions. 

Ian Garland, CEO of Vernalis commented: "Achieving this milestone demonstrates the strength of our fragment and structure-based drug discovery platforms and I look forward to continued success in our collaboration with Servier".

Emmanuel Canet, MD, PhD, President Servier Research and Development, added: "We are very satisfied with this collaboration reaching an important milestone on a truly innovative oncology target. This is a step further in our aim to finalise the discovery of innovative compounds with potential use in therapeutic indications with high unmet medical need. Cancer represents a major cause of mortality worldwide and Servier is committed to providing patients with novel therapeutic approaches for treating this devastating disease"

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About Servier

Servier is the leading independent French pharmaceutical company, established in 1954 by its founder, Jacques Servier, M.D., Pharm.D. The group is established in 140 countries and 85% of Servier products are prescribed outside of France. Sales turnover in 2009 reached 3.6 billion euros. More than 25% of Servier's turnover is invested in Research and Development. The Servier Group counts 19 Internationals Centers of Therapeutic Research, and its principal therapeutic research orientations are cardiovascular diseases, diabetes, neuropsychiatric disorders, cancer, and osteoarticular diseases. More information is available at: http://www.servier.com/

About Vernalis

Vernalis is a development stage pharmaceutical company with significant expertise in taking promising product candidates along a commercially-focused path to market. The Group has one marketed product, frovatriptan for the acute treatment of migraine, and ten candidates in development, seven of which are designated priority programmes. Five of these priority 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 Biogen Idec, Chiesi, Endo, GSK, Menarini, Novartis and Servier.

Vernalis' Structure Based Discovery Capabilities

Vernalis has established a track record for innovation in drug discovery by building and applying a proprietary structure and fragment-based platform which has not only underpinned the Group's research by delivering drug candidates but also formed the basis of a number of collaborations. The company uses and develops fragment and structure-based drug discovery methods for its programmes in order to increase the quality and discovery rate of drug candidate compounds. The Company's approach is to generate as much 3 dimensional protein-molecule structural information as possible in the hit identification phase using virtual screening, a distinctive fragment (small parts of molecules) based discovery process, and molecular modelling. In turn, this structural information is used to design novel hit compounds, often combining key interaction features from a number of fragments and compounds together. These hits are then optimised using structure-guided medicinal chemistry. Drug candidate compounds emerging from this discovery process are regularly reviewed and considered for partnering or internal development.

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 Frova® 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.