To edit the version number, select the falsely numbered version on the left on iTunes Connect (so NOT the "App Information", but under that the version "1.0.1 Prepare for Submission" etc), scroll down in the right pane to "General App Information" -- just below the App Icon you can see the version number and it's editable! Change it, hit save, and you'll see the version number change on the left side.
(My answer is valid for iTunes Connect web UI as of 5. Jan 2016)