Study of Pharmacodynamics, Pharmacokinetics, Safety and Tolerability of VAY736 in Patients With Idiopathic Pulmonary Fibrosis

Inclusion Criteria:

1. Written informed consent must be obtained before any assessment is performed.

2. Male and female subjects 40 to 80 years of age inclusive

3. A diagnosis of definite or probable IPF within 5 years of the screening visit, as
defined by Figure 3, Tables 4-6 of the ATS/ERS/JRS/ALAT Diagnostic Guidelines (Raghu
et al 2011)

4. Seropositive at screening for at least one of the following auto-antibodies: RF, ANA,
anti-dsDNA, anti-CCP, Scl-70, SSA (anti-Ro), SSB (anti-La), anti-RNP, anti-Smith,
Jo-1, PL-7, PL-12, EJ, OJ, SRP, Ku, Mi-2, anti-PM/Scl; OR Presence of
hilar/mediastinal adenopathy (>1cm in short-axis diameter), identified by screening
HRCT scan of the chest

5. FVC 50-90% predicted (inclusive)

6. DLCO, corrected for hemoglobin, 30-79% predicted (inclusive)

7. FEV1/FVC >70%

8. Unlikely to die from cause other than IPF within the next 3 years, in the opinion of
the investigator

9. Unlikely to undergo lung transplantation during this trial

10. Able to communicate well with the investigator, to understand and comply with the
requirements of the study.

Exclusion Criteria:

1. Emphysema > fibrosis on screening HRCT (must be confirmed by central reader)

2. Active viral, bacterial or other infections requiring systemic treatment at the time
of screening or enrollment, or history of recurrent clinically significant infection
or of bacterial infections with encapsulated organisms

3. History of major organ, hematopoietic stem cell or bone marrow transplant

4. History of hypersensitivity to any of the study drugs or to drugs of similar chemical
classes (e.g., mAb of IgG1 class) or to any of the constituents of the study drug
(sucrose, L-Arginine hydrochloride, L-histidine, polysorbate 80, hydrochloric acid)

5. Receipt of live/attenuated vaccine within a 2 month period before first dose

6. History of primary or secondary immunodeficiency, including a positive Human
Immunodeficiency Virus (HIV) (Enzyme-linked Immunosorbent Assay (ELISA) and Western
blot) test result

7. History of malignancy of any organ system (other than localized basal cell carcinoma
of the skin, in situ cervical cancer), treated or untreated, within the past 5 years,
regardless of whether there is evidence of local recurrence or metastases

8. Any one of the following screening values of complete blood count laboratory values:
Hemoglobin levels below 8.0 g/dL; Total leukocyte count less than 2,000/μL; Platelets
<100.0 x 109/L; Absolute neutrophil count (ANC) <1.5 x 109/L

9. Any surgical, medical (e.g., uncontrolled hypertension, heart failure or diabetes),
psychiatric or additional physical condition that the Investigator feels may
jeopardize the patient in case of participation in this study

10. Positive hepatitis B surface antigen (HBsAg) with concurrent negative hepatitis B
surface antibody (anti-HBs); or positive total hepatitis B core antibody (anti-HBc)
with concurrent negative anti-HBs; or positive hepatitis C antibody (anti-HCV) unless
it can be documented that the patient has received highly-effective HCV-specific
antiviral therapy, HCV RNA levels are measured, and HCV RNA is undetectable; i.e., any
acute or chronic infection with hepatitis B or hepatitis C

11. Evidence of active or latent tuberculosis (TB) infection, as determined by Quantiferon
test (after anti-TB treatment, patients with history of or latent TB may become
eligible according to national guidelines)

12. Pregnant or nursing (lactating) women, where pregnancy is defined as the state of a
female after conception and until the termination of gestation, confirmed by a
positive human chorionic gonadotropin (hCG) laboratory test

13. Clinically diagnosed AE-IPF or other significant clinical worsening within 3 months of
randomization

14. Other known causes of interstitial lung disease (e.g., domestic or occupational
environmental exposures, drug toxicity) or other identifiable interstitial lung
disease

15. Definitive diagnosis of a connective tissue disease (such as systemic sclerosis,
DM/PM, RA, Sjogren's syndrome, or SLE)

16. Initiation of pulmonary rehabilitation within 60 days of randomization (pulmonary
rehabilitation is prohibited during the period of this trial, except for "maintenance"
rehabilitation, to be documented with a clinical summary from the Rehabilitation
Center)

17. Myocardial Infarction (MI), Cerebrovascular Accident (CVA), Transient Ischemic Attack
(TIA), or hospitalization for arrhythmia or unstable angina within 6 months

18. New York Heart Association (NYHA) class III/IV Congestive Heart Failure (CHF),
Ejection Fraction (EF) <25%

19. Other investigational treatments within 6 months of screening

20. Disability (other than dyspnea) that may limit the completion of 6MWT (angina,
claudication, etc.)

21. Current smoker (must have negative cotinine test)

22. Any current treatment for IPF (except for pirfenidone or nintedanib; but not both)

23. Historical (within 6 months of screening) treatment for IPF with experimental or
off-label modalities including but not limited to oral corticosteroids,
N-Acetylcysteine , cyclophosphamide, mycophenolate, azathioprine, cyclosporine A,
etanercept, or plasmapheresis.

24. Prior use of any B-cell depleting therapy (e.g., rituximab, ofatumumab, or other
anti-CD20 mAb, anti-CD40, anti-CD19,anti-CD22 mAb, anti-CD52 mAb, or anti-BAFF mAb)

25. Receiving any treatment for pulmonary hypertension OR treatment for pulmonary
hypertension anticipated during this trial (in other words, treatment for pulmonary
hypertension is prohibited during this trial), including but not limited to
epoprostanil, iloprostanil, treprostanil, selexipag, bosentan, ambrisentan,
macitentan, sildenafil, tadalafil, and riociguat.

26. History of alcohol and/or drug abuse within the last 2 years

27. Elective surgery planned to take place during this trial

28. Women of child-bearing potential (WOCBP), defined as all women physiologically capable
of becoming pregnant, unless they are using highly effective methods of contraception
for 3 months prior to screening, during dosing, and for 4 months after stopping of
investigational medication.

Highly effective contraception methods include:

- Total abstinence from heterosexual intercourse (when this is in line with the
preferred and usual lifestyle of the patient). Periodic abstinence (e.g. calendar,
ovulation, symptothermal, post-ovulation methods) and withdrawal are not acceptable
methods of contraception.

- Female sterilization (have had surgical bilateral oophorectomy with or without
hysterectomy), total hysterectomy or tubal ligation at least six weeks before taking
investigational drug. In case of oophorectomy alone, only when the reproductive status
of the woman has been confirmed by follow up hormone level assessment.

- Male sterilization (at least 6 months prior to screening). For female subjects on the
study the vasectomized male partner should be the sole partner for that subject.

- Use of oral (estrogen and progesterone), injected or implanted hormonal methods of
contraception or placement of an intrauterine device (IUD) or intrauterine system
(IUS) or other forms of hormonal contraception that have comparable efficacy (failure
rate <1%), for example hormone vaginal ring or transdermal hormone contraception. In
case of use of oral contraception women should have been stable on the same pill for a
minimum of 3 months before taking investigational drug.

Women are considered post-menopausal and not of child bearing potential if they have had 12
months of natural (spontaneous) amenorrhea with an appropriate clinical profile (e.g. age
appropriate, history of vasomotor symptoms) or have had surgical bilateral oophorectomy
(with or without hysterectomy), total hysterectomy or tubal ligation at least six weeks
ago. In the case of oophorectomy alone, only when the reproductive status of the woman has
been confirmed by follow up hormone level assessment is she considered not of child bearing
potential.