Vernalis PLC Regulatory News (VER)

16 July 2010

Vernalis Announces A2A Receptor Antagonist Programme for Parkinson's Disease Continues with Next Generation Compound

Vernalis plc (LSE: VER), a leading development stage pharmaceutical company with a broad pipeline of clinical and early stage programmes, today announced that the company and its partner, Biogen Idec (NASDAQ: BIIB), will continue its novel A2A receptor antagonist programme for Parkinson's disease with a next generation Vernalis compound. Based on findings from preclinical studies, the companies have discontinued development of V2006/BIIB014, also known as vipadenant, in favour of the alternate compound, which is also in development.

Although the companies achieved positive results in Phase II clinical studies, the decision to discontinue vipadenant was based on a review of findings in preclinical toxicology studies. The A2A pathway remains an important focus for drug development in Parkinson's disease, and both companies are committed to developing the most promising candidate in the A2A antagonist portfolio. Vernalis and Biogen Idec expect to progress the next generation compound into Phase I clinical studies in early 2011.

Vernalis and Biogen Idec entered into a collaboration agreement in June 2004 to advance research of Vernalis' adenosine A2A receptor antagonist programme. Under the terms of this agreement, Biogen Idec received exclusive worldwide rights to develop and commercialise Vernalis' lead compound (V2006/BIIB014) along with a back-up compound.

Biogen Idec will continue to fund all development costs under the collaboration and Vernalis can earn milestones and royalties on the successful development and commercialisation of the next generation compound to the extent that milestones have not already been paid for vipadenant.

Ian Garland, CEO of Vernalis commented, "We are, of course, disappointed that development of vipadenant will be discontinued but are encouraged that Biogen Idec is to develop Vernalis' next generation compound as a potential novel treatment for this neurodegenerative disease."

About Parkinson's Disease

Parkinson's disease is a neurodegenerative disease that impacts four to six million people worldwide in which cells that help to regulate movement are unable to produce adequate levels of a chemical messenger called dopamine. Parkinson's disease symptoms occur when approximately 80% of these cells no longer function. Parkinson's disease progresses over time with symptoms including trembling in hands, arms, legs, jaw, and face; stiffness of the limbs and trunk; slowness of movement; and impaired balance and coordination.1

Although there is no cure for Parkinson's disease, there are drugs that treat its symptoms. Some directly boost the level of dopamine in the brain, some prevent the breakdown of dopamine, and others stimulate the same receptors as dopamine. Generally positive in the short-term, these treatments can have troublesome side effects and tend to become less effective over time. There is a critical need to identify different pathways for treating this disease.

About The A2A Pathway

The chemical adenosine plays an important role in the brain in motor co-ordination and movement control. Adenosine A2A receptors are found together with dopamine receptors in critical areas of the brain that are damaged in Parkinson's disease. This close association may allow adenosine A2A receptors to modify the effect of dopamine on brain activity. Blockade of the adenosine A2A receptor may have the potential to compensate for the loss of dopamine and to restore the motor imbalance caused by Parkinson's disease without causing some of the troublesome side effects caused by therapies acting via the dopamine system.

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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 eleven candidates in development, eight 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.

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.

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