(Adds background, shares, analyst reaction)

LONDON, Jan 6 (Reuters) - Vectura Group, a respiratory drugs specialist, will work with Janssen Biotech to develop treatments for asthma and lung disease COPD, it said on Tuesday.

The collaboration will kick off with the development of a drug candidate for intermediate Phase II clinical trials, the British company said.

Janssen, a unit of Johnson & Johnson, will then use Vectura's dry powder inhaler technologies in the development of inhaled therapeutics for airways-related diseases such as asthma, a market worth in excess of $46 billion worldwide, Vectura said.

Shares in Vectura, which also has collaborations with companies including Novartis and GlaxoSmithKline, were trading up 1.3 percent at 133 pence at 0937 GMT.

Finncap analyst Keith Redpath said Vectura would be responsible for pharmaceutical development and preparation for the clinical trial, and he believed it would provide both technology and expertise in dry powder formulation and delivery.

He kept his 202 pence a share price target unchanged.

(Reporting by Paul Sandle; Editing by Mark Potter)