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Gurnet Point L.P. enters into agreement to acquire Innocoll Holdings plc

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Gurnet Point L.P., a healthcare investment fund, and Innocoll Holdings
plc (NASDAQ:INNL), a global pharmaceutical and medical device company,
today announced that they have reached an agreement on the terms of a
recommended offer. Under the recommended offer, Gurnet Point will
acquire Innocoll for $1.75 per share in cash, and up to $4.90 in cash
from a contingent value right (CVR), for a total potential per share
value of up to $6.65 or up to approximately $209 million in aggregate.
The initial cash consideration of $1.75 represents a premium of
approximately 120 percent to the closing price per Innocoll Share on
March 10, 2017, the last dealing day prior to the date on which the
anomalous movement in Innocoll's shares commenced (and a premium of
approximately 28 percent to the closing price per Innocoll Share on
March 15, 2017, the day prior to Innocoll initiating the commencement of
the offer period).

During the offer period, Gurnet Point plans to provide a term loan of
$10 million to give Innocoll additional resources needed for the
continued development of XARACOLL within the post-operative pain market.
Innocoll believes that the loan will provide it with the additional
capital needed to prepare for the re-submission of the XARACOLL new drug
application ("NDA") to the U.S. Federal Drug Administration ("FDA") in
order to achieve the milestones related to the CVR.

This transaction builds on Gurnet Point's strategy of investing in life
science, medical technology and healthcare service companies. Since its
initial NASDAQ public offering in 2014, Innocoll has leveraged its
proprietary collagen-based technology to successfully complete two Phase
3 studies for XARACOLL, Innocoll's late-stage surgically implantable and
bioresorbable collagen matrix. XARACOLL was developed to provide
sustained post-operative pain relief through controlled delivery of
bupivacaine at the surgical site.

Innocoll noted that its Board had explored a sale of the company, to
achieve its goal of bringing XARACOLL to market, as well as keeping the
company independent and funding the over $100 million required to fund
operations through 2019 from raising equity or debt. The "go-it-alone"
option was dismissed due to the potential for significant shareholder
dilution and execution risk. A potential license for XARACOLL in the
United States was also investigated, but no suitable partner has been
found.

"Having studied a number of strategic options over the past several
months, our Board and management team believe this strategic transaction
will give Innocoll access to the financial resources it needs to pursue
its goals of bringing XARACOLL through its development to
commercialization, and address important unmet medical needs in the
post-operative pain market. We believe that the combined leadership of
the two companies, supported by Gurnet Point's financial strength, will
better position Innocoll to pursue a successful filing and subsequent
commercialization of XARACOLL," said Jonathan Symonds, Chairperson of
Innocoll. "The Innocoll directors unanimously support the offer, which
represents a significant premium to the recent share price. In addition,
the CVR allows shareholders to participate in the continued development
of XARACOLL without further investment."

The directors of Innocoll and major shareholders, including holdings
managed by Fortress, Morgan Stanley, Sofinnova and Unique Technologies,
have provided irrevocable undertakings to vote in favor of the scheme.
In total, management, directors and shareholders have provided
irrevocable undertakings representing 46% of the issued ordinary share
capital of Innocoll. Details of these irrevocable undertakings,
including the circumstances in which they cease to be binding, are set
out in the announcement pursuant to Rule 2.5 of the Irish Takeover Rules
made by Gurnet Point, Gurnet Bidco and Innocoll today.

"Gurnet Point intends to work with Innocoll's team to help bring
XARACOLL to market by infusing substantial additional capital for its
continued development and regulatory approval. We have great respect for
Tony Zook and his team at Innocoll and look forward to investing in the
business and assisting with the approval of XARACOLL and its
commercialization," said Christopher Viehbacher, Managing Partner at
Gurnet Point Capital.

Innocoll had expected to receive FDA approval of XARACOLL this year. On
December 29, 2016, Innocoll announced that it had received a Refusal to
File Letter from the FDA for XARACOLL. Among other points, the FDA
indicated that XARACOLL should be characterized as a drug-device
combination product and that additional clinical and nonclinical
information on XARACOLL may be required. To provide this information,
Innocoll proposes to conduct an additional short-term pharmacokinetic
study and several short-term non-clinical toxicology and
biocompatibility studies.

The Innocoll directors believe that, if adequately financed and
successful, such studies may be completed in time for an end of year
re-submission of the XARACOLL NDA. Data from these studies, along with
additional manufacturing information required to address the new
combination product designation by the FDA and other chemistry,
manufacturing and control activities, are also expected to be included
in the re-submission.

If the re-submitted NDA is accepted by the FDA, thereby allowing
XARACOLL to ultimately be approved, the Innocoll directors believe that
Innocoll could be in a position to commercialize XARACOLL by the end of
2018.

Terms of the Transaction

The transaction, which is valued at up to approximately $209 million
(including the maximum amount payable upon achievement of the CVR
milestones listed below), is expected to be implemented by means of a
court-sanctioned scheme of arrangement under Irish law or, with the
consent of the Irish Takeover Panel, a takeover offer if Gurnet Bidco so
chooses. Innocoll's Board of Directors intends to recommend unanimously
that Innocoll shareholders vote or procure votes in favor of the
Transaction.

Under the terms of the acquisition, each CVR represents the right to
receive a specified amount of cash payments, with each payment
conditioned upon the achievement of certain events, called CVR Payment
Events.

These CVR Payment Events are:

  • First CVR Payment Event: Gurnet Bidco will pay $0.70 in cash per CVR
    if on or before December 31, 2018, XARACOLL is approved by the FDA
    with a label covering indications for the treatment of postsurgical
    pain immediately following open abdominal Hernia repair.
  • Second CVR Payment Event: Gurnet Bidco will pay an additional $1.33 in
    cash per CVR if, on or before December 31, 2018, XARACOLL is approved
    by the FDA with a label covering indications for the treatment of
    postsurgical pain immediately following Soft Tissue repair (and not
    limited to hernia repair).
  • Third CVR Payment Event: If the milestone is met, Gurnet Bidco will
    either pay: $1.00 in cash per CVR if, on or before December 31, 2019,
    XARACOLL is approved by the FDA with a label covering indications for
    the treatment of postsurgical pain immediately following Hard Tissue
    repair; or, if not

$0.60 in cash per CVR if, after December 31, 2019 but on or before June
30, 2020, XARACOLL is approved by the FDA with a label covering
indications for the treatment of postsurgical pain immediately following
Hard Tissue repair.

  • Fourth CVR Payment Event: If the milestone is met, Gurnet Bidco will
    either pay: $1.87 in cash per CVR if global net sales of XARACOLL
    exceed $60 million in any four consecutive Calendar Quarters ending on
    or prior to December 31, 2019; or, if not, $1.00 in cash per CVR if
    global net sales of XARACOLL exceed $60 million in any four
    consecutive Calendar Quarters ending on or prior to March 31, 2020.

In the event that none of the CVR Payment Events occur by the relevant
dates, then the CVR will have no value. The minimum payment of the CVR
is zero and the maximum payment is $4.90 in cash per Innocoll Share.

About Gurnet

Gurnet Point is a healthcare investment fund led by Christopher
Viehbacher, managing partner, Gurnet Point Capital. Gurnet Point is
based in Cambridge, Massachusetts, USA, and invests in life sciences and
medical technologies as well as healthcare services across all stages of
development through to commercialization.

About Innocoll

Innocoll is a global, commercial stage specialty pharmaceutical and
medical device company with late stage development programs targeting
areas of significant unmet medical need. Innocoll's shares are listed
for trading on the NASDAQ under the symbol "INNL." Innocoll utilizes its
proprietary collagen-based technology platform to develop biodegradable
and fully bioresorbable products and product candidates which can be
broken down by the body without the need for surgical removal or topical
application. Using its proprietary processes at its manufacturing
facility, Innocoll derives and purifies bovine and equine collagen and
then utilizes its technology platform to incorporate the purified
collagen into its topical and implantable products. Innocoll's
proprietary processes and technologies also enable it to control the
texture, consistency, drug elution dynamics, resorption time and other
physical characteristics of the finished product. All of Innocoll's
native collagen products – from extraction/purification of type-1
collagen through final delivery form – are manufactured at its
certified, integrated plant in Saal, Germany.

General

This summary should be read in conjunction with the full text of the
Rule 2.5 announcement, being the formal transaction announcement made by
Gurnet Point, Gurnet Bidco and Innocoll earlier today. The Rule 2.5
announcement and this announcement will be made available on a Gurnet
Point website for the purposes of the Acquisition (www.GurnetPointLPOffer.com)
and on Innocoll's website (www.Innocoll.com).
Certain capitalized words used in this announcement and not defined have
the meaning given to such words in the Rule 2.5 announcement. The bases
and sources set out in the Rule 2.5 announcement have been used in this
announcement, unless otherwise stated or the context otherwise requires.
Certain figures included in this announcement have been subjected to
rounding adjustments.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN,
INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.

Important Additional Information for U.S. Investors and Where to Find
It

Innocoll intends to file the Scheme Document, which will also constitute
the proxy statement of Innocoll (the "Proxy Statement"), with the SEC
and mail a copy to Innocoll Shareholders in advance of the Scheme
Meeting and the EGM and in connection with the Acquisition and the
Scheme. INNOCOLL SHAREHOLDERS ARE URGED TO READ THE SCHEME
DOCUMENT/PROXY STATEMENT AND OTHER RELEVANT DOCUMENTS FILED OR TO BE
FILED WITH THE SEC CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION ABOUT INNOCOLL, THE ACQUISITION, THE
SCHEME AND RELATED MATTERS. Innocoll Shareholders will be able to obtain
free copies of the Scheme Document/Proxy Statement and other documents
filed with or furnished to the SEC by Innocoll through the website
maintained by the SEC at www.sec.gov.
In addition, Innocoll Shareholders will be able to obtain free copies of
the Scheme Document/Proxy Statement on www.Innocoll/com/investors.

Participants in the Solicitation

Innocoll, Gurnet Point and Gurnet Bidco and certain of its respective
directors and executive officers and employees may be considered
participants in the solicitation of proxies from the shareholders of
Innocoll in respect of the transactions contemplated by the Scheme
Document/Proxy Statement. Information regarding the persons who may,
under the rules of the SEC, be deemed participants in the solicitation
of the shareholders of Innocoll in connection with the proposed
transactions, including a description of their direct or indirect
interests, by security holdings or otherwise, will be set forth in the
Proxy Statement when it is filed with the SEC. Information regarding
Innocoll's directors and executive officers is contained in Innocoll's
Annual Report on Form 10-K for the fiscal year ended December 31, 2016
which is filed with the SEC. Information concerning the interests of
Innocoll's participants in the solicitation, which may, in some cases,
be different than those of Innocoll's shareholders generally will be set
forth in the Proxy Statement relating to the transaction when it becomes
available.

No Offer or Solicitation

This announcement is for information purposes only and is not intended
to and does not constitute an offer to purchase, sell, subscribe for or
exchange, or the solicitation of an offer to purchase, sell, subscribe
for or exchange or an invitation to purchase, sell, subscribe for or
exchange any securities or the solicitation of any vote or approval in
any jurisdiction pursuant to the Acquisition or otherwise, nor shall
there be any sale, issuance or transfer of securities in any
jurisdiction in contravention of applicable law. The Acquisition will be
made solely by means of the Scheme Document (or, if applicable, the
Takeover Offer Document), which will contain the full terms and
conditions of the Acquisition, including details of how to vote in
respect of the Acquisition. Any decision in respect of, or other
response to, the Acquisition, should be made only on the basis of the
information contained in the Scheme Document (of, if applicable, the
Takeover Offer Document). No offer of securities shall be made except by
means of a prospectus meeting the requirements of section 10 of the
Securities Act.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements included in this announcement are forward-looking and
involve risks and uncertainties that could cause actual results to
differ materially from those expressed or implied by such
forward-looking statements. Forward-looking statements can typically be
identified by the use of forward-looking terminology, such as "expects",
"believes", "may", "will", "could", "should", "intends", "plans",
"predicts", "envisages", "estimates", "forecast", "outlook", "guidance",
"possible", "projects", "potential" or "anticipates" or other similar
words and expressions and include, without limitation, any projections
relating to results of operations and financial conditions of either
Gurnet Point, Gurnet Bidco or Innocoll and their respective subsidiary
undertakings from time to time, as well as plans and objectives for
future operations, expected future revenues, financing plans, expected
expenditures, expected synergies and divestments relating to Gurnet
Point, Gurnet Bidco or Innocoll and discussions of Gurnet Point's,
Gurnet Bidco's or Innocoll's business plan. All forward-looking
statements in this announcement made by Gurnet Point and / or Gurnet
Bidco are based upon information known to Gurnet Point and / or Gurnet
Bidco on the date of this announcement and all forward-looking
statements in this announcement made by Innocoll are based upon
information known to Innocoll on the date of this announcement. Except
as expressly required by law, Gurnet Point, Gurnet Bidco and Innocoll
disclaim any intent or obligation to update or revise these
forward-looking statements. None of Gurnet Point, Gurnet Bidco or
Innocoll undertake any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise, save as may be required by law.

Statements under the Irish Takeover Rules

The directors of Gurnet Bidco and the managers of Waypoint International
GP LLC (in its capacity as general partner of Gurnet Point) accept
responsibility for the information contained in this announcement, other
than the information relating to Innocoll, the Innocoll Group and the
Innocoll directors and members of their immediate families, related
trusts and persons connected with them, for which the Innocoll directors
accept responsibility. To the best of the knowledge and belief of the
directors of Gurnet Bidco and the managers of Waypoint International GP
LLC (in its capacity as general partner of Gurnet Point) (who have taken
all reasonable care to ensure that such is the case), the information
contained in this announcement for which they accept responsibility is
in accordance with the facts and does not omit anything likely to affect
the import of such information.

The Innocoll directors accept responsibility for the information
contained in this announcement relating to Innocoll, the Innocoll Group
and the Innocoll directors and members of their immediate families,
related trusts and persons connected with them, except for statements
made by Gurnet Point and Gurnet Bidco in respect of Innocoll. To the
best of the knowledge and belief of the Innocoll directors (who have
taken all reasonable care to ensure that such is the case), the
information contained in this announcement for which they accept
responsibility is in accordance with the facts and does not omit
anything likely to affect the import of such information.

Evercore Partners International LLP ("Evercore"), which is authorized
and regulated in the United Kingdom by the Financial Conduct Authority,
is acting as Financial Adviser exclusively for Gurnet Point and Gurnet
Bidco and no one else in connection with the Acquisition and the other
matters referred to in this announcement, and will not regard any other
person as its client in relation to the Acquisition and the other
matters referred to in this announcement and will not be responsible to
anyone other than Gurnet Point and / or Gurnet Bidco for providing the
protections afforded to clients of Evercore, nor for providing advice in
relation to the Acquisition or the other matters referred to in this
announcement. Neither Evercore nor any of its subsidiaries, branches or
affiliates owes or accepts any duty, liability or responsibility
whatsoever (whether direct or indirect, whether in contract, in tort,
under statute or otherwise) to any person who is not a client of
Evercore in connection with this announcement, any statement contained
herein or otherwise.

Piper Jaffray & Co. ("Piper Jaffray"), which is a securities
broker-dealer registered with the U.S. Securities and Exchange
Commission ("SEC") and subject to regulation by the SEC and the
Financial Industry Regulatory Authority ("FINRA"), is acting as
financial adviser exclusively for Innocoll and for no one else in
connection with the Acquisition and the other matters referred to in
this announcement, and will not be responsible to anyone other than
Innocoll for providing the protections afforded to clients of Piper
Jaffray or for providing advice in relation to the Acquisition or any
other matters referred to in this announcement.

Disclosure Requirements under the Irish Takeover Rules

Persons interested in 1% or more of any relevant securities in Innocoll
may have disclosure obligations under Rule 8.3 of the Irish Takeover
Panel Act, 1997, Takeover Rules 2013. See the Rule 2.5 announcement of
earlier today for further details.

No Profit Forecast / Asset Valuation

No statement in this announcement is intended to constitute a profit
forecast for any period, nor should any statements be interpreted to
mean that earnings, earnings per share, losses or losses per share will
necessarily be greater or lesser than those for the relevant preceding
financial periods for any of Innocoll, Gurnet Point or Gurnet Bidco as
appropriate. No statement in this announcement constitutes an asset
valuation.

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