PRIVATE & CONFIDENTIAL

Interim Results FY 2015/1617 November 2015

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Disclaimer

3

Speakers

Introduction and business overview

James Ward-Lilley, CEO

Financial results

Andrew J Oakley, CFO

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Vectura: Leveraging device & formulation capabilities in inhaled airways disease with hybrid model delivering strong, sustainable shareholder value creation

VecturaStrong fundamentals for sustained growth with a hybrid model

Core capabilities Emerging pipeline Financial platform

• Strong track record of device and formulation development

• Increased leverage potential of nebulised platforms with FAVORITE technology

• Industry leading inhaled large molecule formulation

• Progression of clinical pipeline with balanced risk of:

• Partnered assets

• Wholly owned assets leveraging FAVORITE technology

• ..with potential for future specialist commercial capability

• Strong revenue growth and earnings

• Sustained R&D milestone delivery

• Significant in market revenue growth

• Potential near term generic revenues offer additional upside

• Balance sheet strength

Building through milestones and in-market revenuesFY 2015 breakthrough year – revenue growth of 59% to £58m

2012/13 2013/14 2014/150.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

RoyaltiesMilestonesDevice Sales & Development Services

5

£m

Interim results 2015/16: Highlights

Revenues up 35% to £26.1m • Driven by 67% increase in royalties

• FY financials weighted towards H2

EBITDA up 57% to £4.7m• Result of sustained growth in royalty revenue

Continuous strong news flow• Significant organic growth in royalties

- Increases in partnered product sales

• Good pipeline progress continued- Important generic & branded pipeline development milestones

- Progress on wholly owned assets

- New partnered product approvals

6

...Evolving pipeline is highly valuable

Potential for sustained revenues from milestones and royalties

Significant peak sales potential from late-stage products

Partnered Wholly ownedGenericBranded

321

Pre-clinical Phase I Phase II Phase III Generics Filed

VR588 Severe InflammatoryAirways disease(Global)

VR475Severe Adult Asthma(US)

VR465 (Ablynx)RSV Infection (Global)

VR942 (UCB)InflammatoryAirways disease(Co-development global)

VR647Paediatric Asthma(US)

VR179 (Grifols)Cystic Fibrosis(Global)

VR736 (Ventaleon)Severe Influenza(Global)

VR096 (Janssen)Anti-inflammatory Asthma/COPD(Global)

VR475Severe Adult Asthma(EU)

VR876 (partnered, undisclosed)Serious Lung Disease(Europe)

QVM149(Novartis)Asthma(EU, ROW)

VR315 (partnered, undisclosed)Asthma/COPD(US)

VR506 (partnered, undisclosed)Asthma(US)

VR632 (Sandoz) Asthma(EU)

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2015 key pipeline newsflow

Programme Compound Indication Event Milestone Partner

Phase I

VR942 biologic immuno-modulatory Severe inflammatory respiratory disease

Phase I clinical study commenced UCB

Phase II

VR647 (SCIPE) corticosteroid budesonide Paediatric asthma Positive US FDA meeting Wholly owned

VR096 Novel anti-inflammatory Asthma/COPD Signed global development & licence agreement

Janssen Biotech

Phase III

VR475 EU corticosteroid budesonide severe uncontrolled asthma

Phase III clinical study initiated First sites opened & patient

screening initiated

Wholly owned

VR876 nebulised version of currently marketed drug

Serious lung disease Development milestone €5.0m Undisclosed

QVM149LAMA/LABA/ICS

indacaterol/glycopyrronium bromide/mometasone fuorate

Asthma Announce plans to develop Novartis

Generics

VR632 generic, combination therapy Asthma/COPD Development milestone €0.75m Sandoz

VR315 generic, combination therapy Asthma/COPD Development milestone $3m Undisclosed

Approved

QVA149 USLABA/LAMA

indacaterol/glycopyrronium bromide COPD US FDA approval$22.5m

Total for both QVA149 &

NVA237

Novartis

NVA237 USLAMA

glycopyrronium bromide COPD US FDA approval Novartis

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Financial resultsAndrew J Oakley, CFO

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Financial highlights

Revenue growth EBITDA1 progression Adjusted2 basic EPS

Driven by 67% increase in royalties

+ 35% + 57%

+50%£26.1m £4.7m 1.2p(H1 2014/15: £19.4m) (H1 2014/15: £3.0m) (H1 2014/15: 0.8p)

H1 2013/14 H1 2014/15 H1 2015/160.0

0.3

0.5

0.8

1.0

1.3

1.5

1.8

Adjusted2 basic EPS progression

Continued EBITDA1 progression as a result of sustained growth in royalty revenue

H1 2013/14 H1 2014/15 H1 2015/160

5

10

15

20

25

30Revenue

H1 2013/14 H1 2014/15 H1 2015/160

0.51

1.52

2.53

3.54

4.55

EBITDA progression

1 Earnings before investment income, finance (losses)/gains, tax, depreciation, amortisation, share-based compensation and adjusted for non-recurring expenditure

2 Adjusted basic EPS is calculated using EBITDA and the weighted average number of shares in the period

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Revenue

Significant organic growth in royalties from recently launched products• Strong growth in royalties from

Novartis/GSK

Important development milestones for VR315 US and VR87627% growth on a constant currency basis

Growing royalties and important milestone achievements

H1 14/15 H1 15/160.0

5.0

10.0

15.0

20.0

25.0

30.0

19.4

26.1

35%

£m

11

Royalty income

Net sales of Seebri® and Ultibro®* by Novartis of $208m + 63% on prior period• Future growth expected from US

launches of recently approved Novartis portfolio

Net sales of GSK products** of £158m + 394% on prior period• Royalties subject to annual cap of

£13m

ADVATE® now accounts for 33% of royalty revenue (H1 14/15 -53%)

53% growth on a constant currency basis

Sustained growth in sales of recently launched products

H1 14/15 H1 15/16

5.5 5.7

3.4

6.30.9

4.5

Baxter Novartis GSK

67%

£m

** Anoro® Ellipta®, Relvar®/Breo® Ellipta® and Incruse ® Ellipta ® are registered trade marks of GSK

* Seebri® Breezhaler®, Ultibro® Breezhaler® are registered trade marks of Novartis AG

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Milestone income

Important milestone achievements during the year• $3m development milestone for VR315

US

• €5m development milestone for VR876

Prior year included upfront signing milestones of $4m for VR506 US• Development of VR506 continues with

undisclosed US partner

NVA237 and QVA149 milestones received in H2 ($22.5m)

Further positive newsflow expected in H2

Continued progress by our partners

H1 14/15 H1 15/160.0

1.0

2.0

3.0

4.0

5.0

6.0

5.55.1

7%

£m

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Operating expenditure1

Increased investment in R&D activities Administrative expenses and cost of sales in-line with prior periodNegligible currency impact

Measured investment in development portfolio

H1 14/15 H1 15/160.0

5.0

10.0

15.0

20.0

25.0

16.4

21.4

30%

£m

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1 R&D excluding depreciation, other administrative expenses and cost of sales

R&D expenses1

Focused investment in our pipeline

• Phase III costs for VR475 (+£1.6m)

• Continued development of FOX® platform (+£1.6m)

• On-going study for VR942 and pre-clinical activities on wholly owned VR588 (+£0.3m)

• Non-recurring costs associated with the closure of our Gemuenden site (+£1.0m)

Measured investment in development portfolio

H1 14/15 H1 15/160.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

12.7

17.2

35%

£m

1 Excluding depreciation

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EBITDA

Driven by 35% top line growth Strong performance during period of increased R&D investment

Strong performance from underlying operations

H1 14/15 H1 15/160.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

3.0

4.7

57%

£m

16

Non-operating expenditure

£1.4m reduction in amortisation expense • Reduction in Innovata charge

• Favourable FX movement on Activaero charge

Increase in share-based compensation as a result of CEO changeInvestment income includes £2.3m ProFibrix deferred consideration

Depreciation, amortisation and financial income

H1 14/15 H1 15/160.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

11.79.7

17%

£m

17

Loss after tax

Loss after tax reduces as a result of sustained revenue growthBasic EPS - loss of 0.7pAdjusted1 basic EPS - earnings of 1.2p

Reducing loss after tax

H1 14/15 H1 15/16-7.0

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0

-5.7

-2.7

53%

£m

1 Adjusted basic EPS is calculated using EBITDA and the weighted average number of shares in the period.

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Cash

Cash inflow from operations of £9.4mFinal consideration payment of €35m re Activaero NVA237 and QVA149 milestones ($22.5m) received in H2

Cash inflow from operations

FY 14/15 H1 15/160.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

90.078.5

13%

£m

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• Anticipate continued growth in royalty revenue from recently launched products

• Significant development and regulatory milestones expected in H2 15/16

• Administrative expenses expected to remain in line with FY 14/15

• Anticipated increase in investment for FY 15/16• Clinical trial activities• Full year guidance at lower end of range £40m-£52m

• Continued growth anticipated year on year

Administrative expenses

EBITDA

Revenue

Research and development expenditure

Financial outlook: FY 2015/16

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Business overview

James Ward-Lilley, CEO

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...Evolving pipeline is highly valuable

Potential for sustained revenues from milestones and royalties

Significant peak sales potential from late-stage products

Partnered Wholly ownedGenericBranded

321

Pre-clinical Phase I Phase II Phase III Generics Filed

VR588 Severe InflammatoryAirways Disease(Global)

VR475Severe Adult Asthma(US)

VR465 (Ablynx)RSV Infection (Global)

VR942 (UCB)InflammatoryAirways disease(Co-development global)

VR647Paediatric Asthma(US)

VR179 (Grifols)Cystic Fibrosis(Global)

VR736 (Ventaleon)Severe Influenza(Global)

VR096 (Janssen)Anti-inflammatory Asthma/COPD(Global)

VR475Severe Adult Asthma(EU)

VR876 (partnered, undisclosed)Serious Lung Disease(Europe)

QVM149(Novartis)Asthma(EU, ROW)

VR315 (partnered, undisclosed)Asthma/COPD(US)

VR506 (partnered, undisclosed)Asthma(US)

VR632 (Sandoz) Asthma(EU)

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Using FAVORITE technology

Biologic

Generics

Clear opportunity to leverage FAVORITE approach used in AKITA® JET and FOX® devices

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Faster delivery

Improve lung deposition

Less drug, better economics

Potential to improve outcomes

Range of indications where currently used today:• Asthma• COPD• Bronchiectasis• Cystic Fibrosis

*Meyer et al. 2001; Deposition von therapeutischen Aerosolen in der Lungenperipherie. Aerosole in der inhalationstherapie, ed. G. Scheuch. Vol. 5. 2001, Dustri-Verlag Dr Karl Feistle: München. 93-100.

Tidal breathing*(typical short and abrupt

inhalation pattern)

FAVORITE inhalation*(slow and deep

inhalation)

FAVORITE: Flow And VOlume Regulated Inhalation TEchnology

FAVORITE improves effectiveness of delivery by reducing the impact of variable breathing patterns on drug delivery

Peripheral Airway Depositione.g. Alpha – 1 – antitrypsin and antibiotics

aerosolJust air

Central Airway Depositione.g. bronchodilator applications

Just air aerosol Just air

Clinically relevant improvements in airways function seen in asthma patients following administration of FAVOLIR via AKITA®JET

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Note: AICS-Bud 1 mg = VR475

Mean FEV1 improvement [ml/18weeks]

AICS-Bud AICS-Placebo AICS-Bud CN-Bud +PARI0

100

200

300

1mgn = 80

n = 40 0.5mgn = 39

1mgn = 40

1 Vogelmeier et al, ERJ, Nebulised budesonide using a novel device in patients with oral steroid-dependent asthma. DOI: 10.1183/09031936.00152014 Published 11 December 2014

Benefits/trends also seen in OCS weaning - 80% of patients achieved reduction of OCS of 50% or more @ 14 weeks treatment

VR475 (FAVOLIR) – drug/devicecombination

VR647 (SCIPE) US – drug/devicecombination

AKITA® JET platform – validating FAVORITE technology and establishing opportunities for further indications

“Smart” delivery of nebulised budesonide for the EU market

Developed to reduce exacerbations in severe uncontrolled asthmatics (GINA steps 4 and 5) with a history of exacerbations and/or dependence on oral corticosteroids

Aim to show greater efficacy than conventionally nebulised budesonide and to be more cost effective than mAbs.

“Smart” delivery of nebulised budesonide for maintenance treatment of asthma in children for the US market

Opportunity to introduce an improved product to an established US market (budesonide is the only nebulised ICS approved in the US) and own sales/partnering potential

Developed to increase precision and reduce dosing time in children

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Programme endorsed by CHMP scientific advice procedure

• Phase III results anticipated in mid 2018

• First sites opened and patient screening initiated

Opportunity to position as add-on therapy before biologics (mAbs) and potential for own sales/partnering

Developed as a maintenance treatment for asthma for the paediatric label only; age range 12 months to 8 years with objective to retain current label/indication for budesonide

FDA agreed 505(b)(2) pathway for development programme

• Anticipate IND filing mid 2016

• Phase III study to start mid 2017 with filing anticipated in H2 2019

Significant market opportunity for nebulised budesonide using FAVORITE approach

EU marketUS IMS reported nebulised budesonide sales

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MAT Q1 2014$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

Total 0.25mg Total 0.5mg Total 1.0mg

*MAT Q1 2014

Source: IMS MPPQUARTERLY Audit

Active diagnosed asthmatics in EU5 (22.1m)1

Patients with an asthma diagnosis receiving 1 or more Rx of OCS p.a. (2.5m)2

Patients with asthma diagnosis receiving 2 or more Rx of OCS with uncontrolled severe asthma (1.0m)2

VR475 (FAVOLIR) programme VR647 (SCIPE) programme

Source: 1Decision Resources PatientBase Base Year 2012 (Accessed 18 February 2014)2Cegedim Strategic Data longitudinal patient databases (LPD)

* Moving annual total

SCIPE targeting paediatric asthma segment of overall nebulised budesonide usage

$m

VR942: Further demonstration of Vectura’s innovative formulation capabilities

Collaborative development with UCB of a biologic for uncontrolled asthma with proprietary DPI device

Add-on maintenance treatment for patients with uncontrolled asthma aged ≥12 years

Novel dry powder product concept and potential platform for further formulation exploitation and inhaled device technology

Validation of inhaled large molecule formulation expertise

Phase I Clinical has commenced• Phase I clinical study top-line data anticipated H1 2016• Selection of final Phase II clinical study design anticipated H1 2016

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US regulatory landscape has changed• Facilitating approval of generic inhaled products

• Vectura and partners are well positioned to play a significant role globally

VR315: Inhaled generics portfolio offer huge further upside

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2016 2017 2018 2019 2020 2021 2022 2023$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

Forecast US sales of Generic Advair

Generic Advair/Seretide Decision Resources Generic Advair/Seretide Global Data

Generic Advair/Seretide Mean

$m

2014 2015 2016 2017 2018 2019 2020$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

Forecast US Sales of Advair

Evaluate

$m

Market opportunity is significant• Substitutability (“AB rating”) suggests rapid update

• Dosage forms and manufacturing capacity very important to maximise opportunity

• Limited competition maintains a high potential value

Advair® Diskus® is a registered trademark of GSK Source: Decision Resources Oct 2015, Global Data Asthma Aug 2014 – Generic Advair/Seretide mean forecastEvaluate consensus from Deutsche Bank to 2020 (08 Sep 15); Bernstein Research to 2020 (20 Jul 15); Bank of America-Merrill Lynch to 2023 (07 Sep 15)

H2 2015-2016 anticipated newsflow

Product/pipeline programme

Compound Indication Event Partner

ApprovedUtibron™ Neohaler® (QVA149)

LABA/LAMAindacaterol/glycopyrronium

bromideCOPD US launch Q1 2016 Novartis

Seebri™ Neohaler® (NVA237)LAMA

glycopyrronium bromide COPD US launch Q1 2016 Novartis

Phase IIIQVM149

LAMA/LABA/ICSindacaterol/glycopyrronium

bromide/mometasone fuorateAsthma Development

milestoneNovartis

Phase IIVR647 (SCIPE) corticosteroid budesonide Paediatric

asthmaStart of adult PK study Q2 2016

Wholly owned

Phase IVR942 Inhaled biologic Uncontrolled

asthmaPhase I clinical top-line data H1 2016

UCB

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Ultibro, Seebri and Neohaler are registered trademarks of Novartis AG. Utibron is a trade mark of Novartis AG

• >20% CAGR to 2022* • Marketed portfolio of partnered products performing well

• Potential for >9 assets to launch through to 2022• Pre-commercialisation milestone potential >US$100m

• Innovation, technology leadership and market validation drives our success

• Licensing deals have potential to accelerate value creation

• Quality of earnings improving• Continued consideration of M&A opportunities to accelerate

strategy

Strong pipelinetargeting a total market size greater than US$25 billion

Potential to grow andmaximise value

Potential for significantorganic revenue growth

Cutting-edge formulationand device technology

Vectura: Leveraging device & formulation capabilities in inhaled airways disease with hybrid model delivering strong, sustainable shareholder value creation

VecturaStrong fundamentals for sustained growth with a hybrid model

* Analysts estimates

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