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					       Michael Ashton
       Chief Executive
   Banc of America Securities
Specialty Pharmaceuticals Conference
            29 July 2004
                           NASDAQ:SKYE LSE:SKP
                           www.skyepharma.com
                           UK tel: +44 (0)207 491 1777
                           US tel: +1 (212) 753 5780
 Legal statement
This presentation does not constitute or form part of any offer for sale or subscription or solicitation of any offer to buy or
subscribe for any securities in SkyePharma PLC nor shall it or any part of it form the basis of or be relied on in connection
with any contract or commitment whatsoever. This presentation is only being distributed to persons who fall within Article 8
of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) (No 2) Order 1997 or Article 11(3) of the
Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1996, as amended.


This presentation includes certain forward-looking statements with respect to certain development projects, potential
collaborative partnerships, results of operations and certain plans and objectives of SkyePharma including, in particular,
the statements regarding potential sales revenues from Paxil CR, targeted sales revenues from other products both
currently marketed and under development, possible launch dates for new products, and our revenue and profit guidance
for the 2004 financial year. By their very nature forward-looking statements involve risk and uncertainty that could cause
actual results and developments to differ materially from those expressed or implied. The significant risks related to
SkyePharma’s business which could cause our actual results and developments to differ materially from those forward-
looking statements are discussed in SkyePharma’s SEC filings under the caption “Risk Factors”.


SkyePharma reports under UK GAAP. Where US dollar equivalents have been provided for convenience in this
presentation, a fixed exchange rate of $1.85 = £1 has been used throughout. These dollar equivalent numbers do not
imply restatement from UK GAAP to US GAAP.


This presentation was updated on 19th July 2004                                                                                   2
What is drug delivery?




         Not “truck” delivery!
Drug delivery – making good drugs better

We normally work on drugs already proven safe and
effective
     low risk of clinical failure
     short development times
     low development cost
     contrast with biotech!




We rely on partners for sales and marketing

                                                    4
Pharma pipelines are drying up
                     M a jo r n e w c h e m ic a l e n tity a n d b io lo g ic
                                  s u b m is s io n s to F D A
 80

 70

 60

 50

 40

 30

 20

 10

  0
       1993       1994   1995    1996    1997    1998      1999      2000   2001   2002   2003
 S ourc e: F DA                         NCE s       O riginal biologic s

                                                                                                 5
Drug delivery deals still getting done…
                                     Number of Drug Delivery Deals 1993-2003

                     140

                     120

                     100
     Delas in year




                     80

                     60

                     40

                     20

                      0
                           1993   1994   1995   1996   1997   1998   1999   2000   2001   2002   2003


Source: Windhover
                                                                                                        6
…but deal values lower than biotech
                                 Value of Drug Delivery vs Biotech deals


                            90
                            80
  Average deal value $ mn




                            70
                            60
                            50
                            40
                            30
                            20
                            10
                            0
              Drug delivery - all Drug delivery -    Biotech - all   Biotech - clinicals
                   phases             clinicals        phases
 NB excludes deals for products that have been approved
Source: Windhover                                                                          7
  SkyePharma in brief
 UK-domiciled speciality pharmaceutical company
 originally founded 1983, IPO 1996
 listed London (SKP), New York (ADR, SKYE)
 market capitalisation £380/$710 mn
 (19 Jul: 61p/share, $11.43/ADR)

 small equity stakes held by GlaxoSmithKline,
Novartis and Kowa

                                                   8
Two business models
                    Contract drug delivery project        Self-funded project
                          Example: Paxil CR              Example: DepoDur
                                                              Medium
      Risk                       Low
                                                      NB much lower than for a NCE

     Return                      Low                               High


Out-licence stage           Start of project             Late-stage clinical trials

                    Partner (reimburses SkyePharma)           SkyePharma
   R&D costs
                               $5-10 mn                         $25-50 mn
   Milestone                    Modest                            High
   payments                    <$10 mn                         $50-100 mn
                                 Low                              High
  Royalty rate
                                 3-7%                            20-50%

                                                                                      9
A transforming business
                           Developing own
 Drug delivery                                          Integrated pharmaceutical
                           products for out-
 service provider                                       developer
                           licence
Nine Ten approved products
    FDA approvals validate three of our five delivery technologies
    Foradil Certihaler “approvable” letter (Oct ‘03) validates fourth (pulmonary)
Strong clinical pipeline
    1 Filed, 4 x Phase III, 3 x Phase II
Changing quality of earnings:
Strategic emphasis on royalty income over upfront milestone payments
Royalty income to replace milestones as main revenue source, driven by

Now: Paxil CR, Xatral® OD/Uroxatral®, Solaraze®, DepoCyt®
Future: Foradil® Certihaler ®, DepoDur, HFA-formoterol, Propofol IDD-D
                                                                                      10
Global infrastructure
                                   London (HQ)



                                                   Basel

                                                   Lyon
                   Montreal
                                                                       Osaka

 San Diego
                   New York




FDA/EMA approved         >400 staff worldwide of              Global business
manufacturing            which 50% scientists /            development coverage
facilities                    clinical staff

                                                                                  11
 Key marketed products
       Paxil CR (GlaxoSmithKline)

Xatral OD / Uroxatral (Sanofi-Synthélabo)




                                              12
                                 
Paxil CR  
                                        – defending the Paxil® franchise
Paxil CR has captured ~8% of the US SSRI
antidepressant prescription market
 first US generic competition for Paxil® started
8 September ‘03
      a prescription for Paxil CR cannot be
     substituted with generic paroxetine…
      …but some indirect price pressure
      GSK still actively promoting Paxil CR
    It is very important to keep the sales effort behind Paxil CR
                           John Coombe (GSK’s CFO) Feb 2004


      despite May ‘04 Appeals Court decision,
     GSK still aggressively defending last patent for
     Paxil® (expires end-2006)
 Paxil CR US sales:
      2003: ~$650 mn
      2004: ~$800 mn (est – likely peak)
               Q1’04: $180 mn (+37%)
 SkyePharma royalty rate: low single digits
expect increase from start of US generic competition
                                                                           13
                 ®                              ®
  Xatral OD/Uroxatral                               Sanofi-Synthélabo
   Once-daily Geomatrix formulation of                          250
                                                                        Xatral/UroXatral sale s tre nd 1996-2003


   alfusozin
                                                                                                                          US launch
                                                                                                                           Nov '03




         uroselective alpha-blocker
                                                                 200

                                                                                                U
                                                                                               E launch
                                                                                                Apr '00


         indication: urinary symptoms of BPH                    150




                                                    Sales € mn
   On market in Europe & ROW since 2000                          100



         replacing multidose versions                            50


   USA: Uroxatral
                                                                   0

      new product on US market                                        1996   1997   1998

                                                                                      H1 RoW
                                                                                            1999    2000

                                                                                                   FY RoW
                                                                                                            2001   2002    2003


                                                                                      H1 US        FY US


      launched to urologists Nov ’03
      launched to primary care Mar ‘04
      two USPs:
     • uroselection (no postural hypotension)
     • no ejaculatory side-effects

AUR indication: approved Europe; Ph III US
2003 world sales €222 / $250 mn (+25% CER)
    Q1’04 world sales €72 / $90 mn (+50% CER)
2006 forecast: €500 mn (Sanofi-Synthélabo)
SkyePharma royalty rate: mid-single digits                                                                                    14
Three key near-term
 pipeline products

DepoDur (previously DepoMorphine)
    Foradil Certihaler
     Propofol IDD-D


                                      15
                       
DepoDur                       Endo, Medeus

US:              approved by FDA 18 May ‘04
Europe:          filed Nov ‘03 (EU mutual recognition, UK as reference country)
Clinical trials (~1000 patients) highly statistically significant
           hip/knee surgery, lower abdominal surgery, caesarean section
Sustained-release morphine for relief of pain after surgery
   given as a single epidural injection before/during operation
   morphine released evenly over 48 hours (period of peak post-op. pain)
           minimizes breakthrough pain
           with conventional PCA, patient must react to pain
   no need for catheters and infusion pumps (= savings for hospital)

                      Disadvantages of conventional morphine
      effective analgesic – but short-acting
      repeat doses need a catheter and an infusion pump
      catheter problems main barrier to wider use of epidural analgesia
      epidural route desirable (delivers direct to CSF, needs less morphine than IV)

                                                                                        16
             
DepoDur - potential market
knee replacements &        ~12 million key target surgeries a
revisions                  year across the US and major Europe

                            surgeries associated with an ageing
hip replacements &        population are growing at 6-7% per
revisions                  annum

major abdominal surgery    market research indicates potential
                           for 25% - 40% patient share in major
                           territories. Assumes pricing equivalent
caesarean sections        to IV PCA or epidural infusion ($125 per
                           surgical procedure)
thoracic
                            sales potential: $250+m
vascular
                            exploring scope for premium pricing
                                                                   17
                        
DepoDur - potential endorsed
USA/Canada
     $120m milestone deal with Endo Pharmaceuticals (Dec ‘02)
     rights for DepoDur and Propofol IDD-D
         option on related pipeline products including DepoBupivacaine
     SkyePharma bears development, manufacture costs
     Endo bears marketing costs
     SkyePharma’s share of sales 20-60%
          based on combined sales of DepoDur and Propofol IDD-D
         >50% share if combined sales >$250 mn

Europe
     €100+m milestone deal with Medeus Pharma (Mar ’04)
     rights for DepoDur only throughout Europe
     SkyePharma bears development, manufacture costs
     Medeus bears marketing costs
     SkyePharma share of sales 35-50%
          50% share reached at sales well below €100 mn
Rights for rest of world still available for licence                      18
Foradil Certihaler Novartis/Schering-Plough
Active ingredient formoterol
     fast-onset, long-acting bronchodilator for asthma
     recent major study on maintenance use of formoterol raises value
     SkyePharma developed both Certihaler device and formulation
         formulation keeps powder dry, ensures accurate consistent dose
         now also being used in second collaboration with Novartis (QAB149)
Schering-Plough to market in key US market, Novartis elsewhere
Filed US & Europe Dec ‘02 (launches expected in H2 ‘04)

     FDA “approvable” letter issued Oct ’03
     European approvals 2004 (Switzerland, Austria, Finland….)

SkyePharma return on sales: ~10% (royalty + manufacturing return)              19
                                       
Propofol IDD-D                             Endo, SkyePharma
 improved version of AstraZeneca’s injectable anaesthetic Diprivan
 SkyePharma’s formulation unique - cannot support microbial growth
     no need for a preservative
     2% emulsion (= lower injection volume and less lipid)
     not a generic

 designed for continuous uninterrupted 24-hour sedation
     ICU sedation is fastest-growing segment of Diprivan market

 Ph II completed ($5 mn milestone payment from Endo)
 Ph III to start Q2’04; target filing: 2005; target launch: 2006

 North America: Endo (same terms as DepoDur)
 Europe/Japan: licensees to be appointed

 est. sales potential for Propofol IDD-D: ~$200 mn


                                                                      20
Well-stocked pipeline                                                                                                                     SkyePharma                               Client products


licence or partner                product                  feasibility   Ph.I   Ph.II        Ph.III                          filed                     approved                          marketed
ORAL
GlaxoSmithKline                   Paxil CR
Sanofi-Synthelabo                 Xatral OD/Uroxatral
Roche                             Madopar DR
Therabel                          Coruno
Mundipharma                       Nifedipine
Ratiopharm                        Diclofenac
GlaxoSmithKline                   Requip
Critical Therapeutics             zileuton
Merck KGaA                        Undisclosed
Kowa                              Statin NK-104
Undisclosed                       Undisclosed
King                              Altace

PULMONARY
Novartis                          Foradil Certihaler
AstraZeneca                       Pulmicort HFA
SkyePharma                        Formoterol HFA
Novartis                          QAB 149
SkyePharma                        Formoterol Combi
INJECTABLE
Enzon/MundiPharma/Nippon S’yaku   DepoCyt
Endo / Medeus                     DepoDur
Astralis *                        Psoraxine *                                           * SkyePharma has an option on world rights for PsoraxineTM, exercisable at the end of Phase II
SkyePharma                        DepoBupivacaine
SkyePharma                        HGH
GeneMedix                         Interferon alpha-2b
Chugai                            Undisclosed

TOPICAL
Quintiles/Shire                   Solaraze
Trigenesis                        Multiple
                                  Status is most advanced project

SOLUBILISATION
SkyePharma                        Fenofibrate
Endo / SkyePharma                 Propofol IDD-D
SuperGen                          Busulfan
                                  Multiple
Baxter
                                                                                                                                                                                                    21
Newsflow 2004 – further progress
Filings                                    Product approvals/launches
Requip OD Europe (US 2005)                Paxil CR PMDD intermittent US                       
                                           DepoDur US                    FDA approval 18 May 
Licence agreements                         DepoDur UK
DepoDur (Europe)                      
                                           Launch of DepoCyte Europe                           
Pulmonary product package
                                           Foradil Certihaler US        FDA “approvable” Oct ’03
Unnamed pipeline product               
Dermatology assets                        Foradil Certihaler Europe                          
Propofol IDD-D (Europe)                   Clinical trial progression
DepoBupivacaine (Europe)                  Pulmicort HFA-MDI                      Ph III end 
                                           Propofol IDD-D                        Ph III start
Clinical data publications (by partners)
DepoDur Ph III                           Formoterol HFA-MDI                     Ph III start
American Pain Society, Vancouver 6-9 May   Formoterol+fluticasone HFA-MDI         Ph II/III start
Foradil Certihaler Ph III                Zileuton (Critical Therapeutics)       Ph III start
Uroxatral Ph III                                                                 (COPD)
                                           Psoraxine (Astralis)                  Ph II start 
                                           DepoBupivacaine                       Ph II start

                                                                                               22
Investment highlights
Strategic focus on royalties rather than upfront payments
Ten FDA-approved products validate drug delivery technologies
   - DepoDur approval demonstrates successful development capability

Changing quality of earnings driven by rising royalties from
Paxil CR, Xatral® OD/Uroxatral®, Solaraze, DepoCyt®

- with Foradil® Certihaler®, DepoDur, HFA-formoterol &
Propofol IDD-D close behind
Strong near-term clinical pipeline
       1 Filed, 4 x Phase III, 3 x Phase II
Two major product launches expected in H2 ’04

                                                                        23
Investor relations contacts:
London
Peter Laing, Director of Corporate Communications
44-(0)207-491-1777        plaing@skyepharma.co.uk

New York
Sandra Haughton, US Investor Relations Manager
1-212-753-5780       shaughton@skyepharma.com

                                     NASDAQ:SKYE   LSE:SKP
…and please visit our website        www.skyepharma.com

				
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