Sosei Subsidiary Heptares and Allergan Announce Global R&D and Commercialization Partnership for Novel Treatments in Alzheimer’s and Other Neurological Disorders

— Adds Selective Muscarinic Agonists Discovered and Developed by
Heptares to Allergan’s Leading CNS Pipeline —

— Reinforces Allergan’s Commitment to Development of Treatments for
Alzheimer’s Disease and Other Neurological Disorders —

— Heptares Eligible to Receive Upfront, R&D and Milestone Payments,
plus Royalties —

TOKYO–(BUSINESS WIRE)–Sosei Group Corporation (“Sosei”; TOKYO Mothers Index: 4565) today
announces that its wholly-owned subsidiary, Heptares Therapeutics has
entered into a definitive agreement with Allergan Pharmaceuticals
International Limited, a wholly owned subsidiary of Allergan plc, a
leading global pharmaceutical company, under which Allergan will license
exclusive global rights to a broad portfolio of novel subtype-selective
muscarinic receptor agonists in development for the treatment of major
neurological disorders, including Alzheimer’s disease.


Under the terms of the agreement, Heptares will receive an upfront
payment of $125 million and is eligible to receive contingent milestone
payments of up to approximately $665 million associated with the
successful Phase 1, 2 and 3 clinical development and launch of the first
three licensed compounds for multiple indications and up to
approximately $2.5 billion associated with achieving certain annual
sales thresholds during the several years following launch. In addition,
Heptares is eligible to receive up to double-digit tiered royalties on
net sales of all products resulting from the partnership. Allergan is
also committing up to $50 million to a research and development program
to be conducted jointly by Allergan and Heptares aimed at advancing
multiple candidates through Phase 2 clinical studies. Allergan will be
responsible for the development of licensed compounds upon initiation of
Phase 2b studies and for subsequent manufacturing and commercialization
of the products.

The agreement covers first-in-class selective small molecule agonists
targeting muscarinic M1 and M4 receptors in the
brain, discovered using Heptares’ proprietary StaR® technology platform.
Allergan will receive exclusive rights to a broad clinical and
preclinical portfolio of M1, M4 and dual M1/M4
agonists, including HTL9936 and HTL18318, selective M1
agonists currently in Phase 1 clinical development.

M1 selective compounds are in development for the potential
treatment of symptomatic cognitive deficits in Alzheimer’s patients,
with the potential upside of better tolerability and a more pronounced
effect compared with available treatments. M4 selective
compounds may provide a novel approach to treat the neurobehavioral
symptoms (psychoses) associated with Alzheimer’s disease and related
neurological disorders, through a different mechanism of action than
available antipsychotics. Combined, dual M1/M4
agonists may be able to treat both cognitive impairment and
neurobehavioral symptoms.

“Cognitive impairment and psychosis are progressive and debilitating
symptoms associated with many CNS diseases, including Alzheimer’s
disease, with few approved therapies available,” said David Nicholson,
Executive Vice President and President, Global Brands Research and
Development at Allergan. “The Heptares M1 compounds have
shown promising results in early development in their ability to
selectively target the M1 receptor without also activating
the M2 or M3 receptors, which are associated with
undesirable side effects. We look forward to advancing these compounds
into the next stages of development, and potentially adding new
approaches to helping physicians treat patients suffering from the
effects of Alzheimer’s disease, an area of medicine where Allergan
remains committed to continued innovation.”

The safety, tolerability and pharmacokinetic profile of HTL9936 were
assessed in a recently completed Phase 1 study. The data provide strong
evidence of a therapeutic window for the selective M1 agonist
mechanism in general, and for progression of HTL9936 and similar
molecules as medicines to treat cognitive disorders. HTL9936 exhibited
good brain penetration and M1 selectivity with no adverse
events typically attributed to the stimulation of M2 and M3
receptors. HTL9936 also exhibited robust and statistically significant
changes in brain electrical activity measured using multiple
electroencephalography (EEG) biomarkers relevant to cognition. These
pro-cognitive effects were seen at low doses and low blood
concentrations that were safe and well tolerated.

Malcolm Weir, Chief Executive Officer of Heptares and Chief R&D Officer
at Sosei, said: “We are delighted that the quality of our muscarinic
agonist candidates, discovered and developed wholly in-house, and our
translational capabilities have been recognized by Allergan, a global
leader in the development and commercialization of treatments for CNS
diseases. We have a highly committed and experienced partner in Allergan
and look forward to working together towards the development of multiple
new breakthrough medicines over the coming years.”

Shinichi Tamura, Chairman and CEO of Sosei Group Corporation, added:
“This new agreement with Allergan marks an important milestone in our
journey to become a global biopharmaceutical company. This agreement
further endorses our strategic decision to acquire Heptares in February
last year, placing its GPCR-directed drug discovery and development
capabilities at the heart of our business.”

This transaction is subject to customary clearances under the
Hart-Scott-Rodino Antitrust Improvements Act.

Sosei was advised by Moelis & Company.

About Muscarinic Receptors

Muscarinic receptors are G protein-coupled receptors (GPCRs) found in
multiple tissues. Until now, attempts to develop medicines that target M1
and M4 receptors have been unsuccessful because of side
effects caused by the activation of M2 and M3
receptors. Selective M1 or M4 agonists that do not
activate M2 or M3 therefore are highly sought
after, and expected to address blockbuster markets.

About Cognitive Impairment in Alzheimer’s Disease and other CNS
Diseases
1

Today there is significant unmet medical need and heavy economic burden
across multiple diseases characterized by cognitive impairment and
dementia. In Alzheimer’s disease (AD), currently available drugs provide
limited and transient effects on cognition. Healthcare costs associated
with AD and dementia (estimated at over $640 billion for North America,
Western Europe and Asia-Pacific) including nursing home care, continue
to grow dramatically and new therapies with better and more durable
efficacy are urgently needed. It is estimated that over 45 million
people worldwide have dementia (4.8 million in North America, 7.5
million in Western Europe, 3.6 million in Asia-Pacific) and this is
expected to increase to over 130 million in 2050. Alzheimer’s disease is
the most common cause of dementia and may contribute to 60–70% of cases.
In addition, an estimated 1.4 million patients in the US suffer from
Lewy body dementia.

1Sources: World Health Organization, Alzheimer’s
Disease International, National Institute of Mental Health, Lewy Body
Dementia Association.

About Allergan

Allergan plc (NYSE: AGN), headquartered in Dublin, Ireland, is a unique,
global pharmaceutical company and a leader in a new industry model –
Growth Pharma. Allergan is focused on developing, manufacturing and
commercializing innovative branded pharmaceuticals, high-quality generic
and over-the-counter medicines and biologic products for patients around
the world.

Allergan markets a portfolio of best-in-class products that provide
valuable treatments for the central nervous system, eye care, medical
aesthetics, gastroenterology, women’s health, urology, cardiovascular
and anti-infective therapeutic categories, and operates the world’s
third-largest global generics business, providing patients around the
globe with increased access to affordable, high-quality medicines.
Allergan is an industry leader in research and development, with one of
the broadest development pipelines in the pharmaceutical industry and a
leading position in the submission of generic product applications
globally.

With commercial operations in approximately 100 countries, Allergan is
committed to working with physicians, healthcare providers and patients
to deliver innovative and meaningful treatments that help people around
the world live longer, healthier lives.

For more information, visit Allergan’s website at www.allergan.com.

About Heptares Therapeutics

Heptares is a clinical-stage company creating transformative medicines
targeting G protein-coupled receptors (GPCRs), a superfamily of 375
receptors linked to a wide range of human diseases. Heptares’
proprietary StaR® technology and structure-based drug design (SBDD)
capabilities enable us to engineer and develop drugs for highly
validated, yet historically undruggable or challenging GPCRs. Using this
approach, we are building an exciting pipeline of new medicines (small
molecules and biologics) with the potential to transform the treatment
of Alzheimer’s disease, schizophrenia, cancer immuno-oncology, migraine,
addiction, metabolic disease and other indications. We have partnerships
for our novel candidates and technologies with leading pharmaceutical
and biotechnology companies, including Allergan, AstraZeneca, MedImmune,
MorphoSys, Pfizer and Teva. Heptares is a wholly owned subsidiary of
Sosei Group Corporation. For more information, please visit www.heptares.com
and www.sosei.com/en.

HEPTARES is a registered trademark in the EU, Switzerland, US and
Japan;

StaR® is a registered trademark in
the EU and Japan.

About Sosei

Sosei is a biopharmaceutical company originating from Japan but with
global presence. Sosei’s primary business model is based on identifying
novel and/or differentiated product assets or technology platforms and,
through supporting these in preclinical and clinical development and
establishing commercial partnerships, advancing new medicines to
patients worldwide. For more information about Sosei, please visit www.sosei.com/en.

Sosei Group Corporate Forward-looking statements

This press release contains forward-looking statements, including
statements about the discovery, development and commercialisation of
products. Various risks may cause Sosei’s actual results to differ
materially from those expressed or implied by the forward-looking
statements, including: adverse results in clinical development
programmes; failure to obtain patent protection for inventions;
commercial limitations imposed by patents owned or controlled by third
parties; dependence upon strategic alliance partners to develop and
commercialise products and services; difficulties or delays in obtaining
regulatory approvals to market products and services resulting from
development efforts; the requirement for substantial funding to conduct
research and development and to expand commercialisation activities; and
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prospective investors are cautioned not to rely on any forward-looking
statements. We disclaim any intention or obligation to update or revise
any forward-looking statements, whether as a result of new information,
future events or otherwise
.

Allergan Forward-Looking Statements

Statements contained in this press release that refer to future events
or other non-historical facts are forward-looking statements that
reflect Allergan’s current perspective of existing trends and
information as of the date of this release. Except as expressly required
by law, Allergan disclaims any intent or obligation to update these
forward-looking statements. Actual results may differ materially from
Allergan’s current expectations depending upon a number of factors
affecting Allergan’s business. These factors include, among others, the
difficulty of predicting the timing or outcome of FDA approvals or
actions, if any; the impact of competitive products and pricing; market
acceptance of and continued demand for Allergan’s products; difficulties
or delays in manufacturing; and other risks and uncertainties detailed
in Allergan’s periodic public filings with the Securities and Exchange
Commission, including but not limited to Allergan’s Annual Report on
Form 10-K for the year ended December 31, 2015 (certain of such periodic
public filings having been filed under the “Actavis plc” name). Except
as expressly required by law, Allergan disclaims any intent or
obligation to update these forward-looking statements.

Contacts

Enquiries:
Sosei Group Corporation
Tokyo Office
Harumi
BANSE, +81-(0)3-5210-3399
Investor Relations
hbanse@sosei.com
or
London
Office
Kathryn LYDON, +44-(0)20-7691-0983
Corporate
Communications
klydon@sosei.com