TR-1: NOTIFICATION OF MAJOR INTEREST IN SHARES

1. Identity of the issuer or the underlying issuer of existing shares to which voting rights are attached:

SKYEPHARMA PLC

2 Reason for the notification (please tick the appropriate box or boxes):

An acquisition or disposal of voting rights

An acquisition or disposal of qualifying financial instruments which may result in the acquisition of shares already issued to which voting rights are attached

An acquisition or disposal of instruments with similar economic effect to qualifying financial instruments

An event changing the breakdown of voting rights

Other (please specify):

Delta adjustment  

X 

3. Full name of person(s) subject to the notification obligation:

D. E. SHAW & CO.,  L.P.

D. E. SHAW & CO. (U.K.) LTD.

4. Full name of shareholder(s) (if different from 3.):

N/A

5. Date of the transaction and date on which the threshold is crossed or reached:

JANUARY 18, 2010

6. Date on which issuer notified:

JANUARY 20, 2010

7. Threshold(s) that is/are crossed or reached:

32, 33, 34, 35, 36% 

8. Notified details:

A: Voting rights attached to shares

Class/type of
shares

if possible using
the ISIN CODE

Situation previous
to the triggering
transaction

Resulting situation after the triggering transaction

Number
of
Shares

Number
of
Voting
Rights

Number
of shares

Number of voting
rights

% of voting rights

Direct

Direct

Indirect

Direct

Indirect

B: Qualifying Financial Instruments

Resulting situation after the triggering transaction

Type of financial
instrument

Expiration
date

Exercise/ 
Conversion 
Period

Number of voting
rights that may be
acquired if the
instrument is
exercised/ converted.

% of voting
rights

C: Financial Instruments with similar economic effect to Qualifying Financial Instruments
xv, xvi

Resulting situation after the triggering transaction

Type of financial instrument

Exercise price

Expiration

date xvii

Exercise/ Conversion period xvii

Number of voting rights instrument refers to

% of voting rightsxix
xx

Contract for Differences

January 13, 2011

3,461,725

Nominal

Delta

("CfD") relating to convertible bond due 2024

14.46%

CfD relating to convertible bond due 2025

December 3, 2010

2,605,081

Nominal

Delta

10.88%

CfD relating to convertible bond due 2025

June 3, 2010

2,605,081

Nominal

Delta

10.88%

Total (A+B+C)

Number of voting rights

Percentage of voting rights

8,671,887

36.22% 

9. Chain of controlled undertakings through which the voting rights and/or the
financial instruments are effectively held, if applicable:

Each of D. E. Shaw & Co., L.P. ("DESCO LP") and D. E. Shaw & Co. (U.K.) Ltd. ("DESCO UK") is notifying solely in its capacity as a discretionary investment manager.  As general partner of DESCO LP, D. E. Shaw & Co., Inc. ("DESCO Inc.") is a parent undertaking of DESCO LP and DESCO UK.  By virtue of David E. Shaw's position as president and sole shareholder of DESCO Inc., which is the general partner of DESCO LP, David E. Shaw is a parent undertaking of DESCO LP and DESCO UK.

Proxy Voting:

10. Name of the proxy holder:

11. Number of voting rights proxy holder will cease to hold:

12. Date on which proxy holder will cease to hold voting rights:

13. Additional information:

14. Contact name:

Stephen Back (Compliance Department)

15. Contact telephone number:

+1 212 478 0000