QLT announces results from Phase II clinical trials and device study for PPDS

• 90-Day Retention Rate of 81% for Latest Punctal Plug Prototype Device
• No Dose Response Seen with Higher Doses in Phase II Clinical Studies
• Expand Development Plans of the Punctal Plug Delivery System in Allergic Conjunctivitis
• Clinical Results and Plans for Expansion to be Discussed During Today's Conference Call

QLT Inc. (Nasdaq:QLTI) (TSX:QLT) ("QLT" or the "Company") today announced results from Phase II clinical trials and a device study for the punctal plug delivery system (PPDS). These studies are part of a development program that is being conducted by QLT's wholly-owned subsidiary, QLT Plug Delivery, Inc. QLT also announced its plans to expand the program to evaluate a second drug for a new target indication.

Device Retention and New Developments

Recent clinical data on the third-generation punctal plug designs demonstrate a retention rate of 81%, based on available data from 185 eyes with 12 weeks of follow-up. Retention data are derived from a study of healthy volunteers testing several punctal plug prototype designs and from Phase II studies of the latanoprost punctal plug delivery system (L-PPDS) in patients with open-angle glaucoma (OAG) or ocular hypertension (OH), in which the third-generation prototypes were used. Punctal plug designs are continuing to be refined to maximize retention rates. The Company will provide an update on retention rate results by year-end.

In parallel with the punctal plug device refinements, additional activities are focused on optimizing an insertion tool and development of a simple home-use detection system that would allow patients to confirm the presence of the punctal plugs.

L-PPDS Phase II Dosing Trials

The concurrent open-label, multicenter Phase II trials of the punctal plugs investigating the use of higher doses of latanoprost from previous studies did not demonstrate a dose-response. These Phase II clinical trials have evaluated the safety, efficacy, and dosing for L‑PPDS treatment of subjects with OAG and OH. L-PPDS containing latanoprost concentrations of 44 µg, 81 µg, and two different 95 µg formulations have been evaluated. The 95 µg formulations were developed to deliver different average daily doses. The third-generation punctal plug designs were used with the 81 µg and both 95 µg L-PPDS formulations.

Range of the mean intraocular pressure (IOP) change from baseline (mmHg) in the Phase II studies:

The objective of these trials was to identify formulations that achieve a ≥5 mmHg drop in mean IOP. Because a dose-response is not evident across all L-PPDS formulations tested, new nonclinical research efforts are underway to evaluate alternative approaches to improving the delivery of latanoprost to its target receptors inside the eye. The Company will provide an update on the status of its efforts in the fourth quarter of this year.

"I am pleased with the improvements we have made in the punctal plug retention rate. We continue to work to maximize our retention rates and to explore what retention rate may be acceptable for a commercial product," said Bob Butchofsky, President and Chief Executive Officer of QLT. "Although we did not see the dose response in our on-going L-PPDS studies, we now know that there are multiple factors that affect drug delivery from a punctal plug and our research efforts for the latanoprost PPDS will be focused on addressing those factors. Building on that knowledge, the next step for this platform technology will be a clinical trial with olopatadine, a compound which targets ocular tissue on the surface of the eye."

Expansion of Punctal Plug Delivery Platform to Olopatadine and Allergic Conjunctivitis

The second drug candidate selected for the punctal plug delivery platform is olopatadine, an anti-allergy drug. Olopatadine is an active pharmaceutical ingredient that has been approved by the U.S. Food and Drug Administration in an eye drop dosage form for the treatment of the signs and symptoms of allergic conjunctivitis. The PPDS platform may be well-suited for olopatadine delivery to the surface of the eye. Furthermore, retention rates of the third-generation punctal plug over 6 weeks (the intended duration of sustained delivery for this product) are greater than 85%. A short-term, proof-of-concept study to evaluate the preliminary efficacy and safety of a sustained-release olopatadine PPDS for allergic conjunctivitis is expected to begin in the second half of 2010 with results expected by year-end.