It's the launch OS for the new Verizon iPhone. It contains some of the new features of 4.3, e.g. Personal Hotspots.
Obviously, for a new device, the developers must branch off on a specific IOS release until it is ready for launch.
We won't see this as a release on our devices... it's just a stop gap until we converge all devices on 4.3 in a few weeks time...