Verona Pharma plc (Nasdaq: VRNA) ("Verona Pharma") and Nuance Pharma Limited ("Nuance Pharma"), today announce that the companies have entered into an agreement granting Nuance Pharma, a Shanghai-based specialty pharmaceutical company, the rights to develop and commercialize ensifentrine in Greater China (mainland China, Taiwan, Hong Kong and Macau). Ensifentrine is an investigational, first-in-class, inhaled, dual inhibitor of the enzymes phosphodiesterase 3 and 4 ("PDE3" and "PDE4"). This dual inhibition enables it to combine both bronchodilator and anti-inflammatory effects in one compound. Verona Pharma is currently conducting a global Phase 3 program evaluating ensifentrine for the maintenance treatment of chronic obstructive pulmonary disease ("COPD"), with sites in the US, Europe and South Korea.

"We are extremely excited about the formation of this strategic partnership with Nuance Pharma to further the development and future commercialization of ensifentrine in Greater China," said David Zaccardelli, Pharm. D., President and CEO of Verona Pharma. "Nuance Pharma's highly talented leadership team has deep experience developing and commercializing respiratory products across China and we look forward to working with them to bring ensifentrine to this important market."

"Ensifentrine is an ideal fit for Nuance Pharma's portfolio, given our focus on developing and commercializing innovative products for the Chinese market," commented Mark G. Lotter, CEO and Co-Founder of Nuance Biotech. "With proven expertise in developing and commercializing global brands, including many leading respiratory products, I have confidence in the Nuance Pharma team's ability to develop and commercialize ensifentrine in Greater China."

Under the terms of the agreement, Verona Pharma has granted Nuance Pharma the exclusive rights to develop and commercialize ensifentrine in Greater China. In return, Verona Pharma will receive an upfront payment of $25 million in cash and an equity interest currently valued at $15 million in Nuance Biotech, the parent company of Nuance Pharma. Verona Pharma is eligible to receive future milestone payments of up to $179 million that are triggered upon achievement of certain clinical, regulatory, and commercial milestones. Verona Pharma is also entitled to tiered double-digit royalties as a percentage of net sales in Greater China.

Nuance Pharma will be responsible for all costs related to clinical development and commercialization in Greater China. A joint steering committee will be established to ensure ensifentrine's clinical development in the region aligns with Verona Pharma's overall global development and commercialization strategy. Nuance Pharma intends to file a Clinical Trial Application with the China Food and Drug Administration later this year and begin clinical studies for the treatment of COPD in Greater China thereafter.