You are here: Agreements > Collaboration Agreement > Amendment of the December 18, 2001 Collaboration Agreement

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1.0 Executive Summary

The Pfizer-ArQule collaboration has generated over * file enrichment (FE) compounds in the previous four years that have augmented Pfizer’s repository and contributed to available High Throughput Screening (HTS) hits. As a result, the FE strategy has shifted the emphasis more to hit follow up (HF) and less on FE. A new research plan has been prepared in order to accommodate the new priorities. The new collaboration will continue with developing and producing FE compounds at a reduced rate and include rapid turnaround of smaller HF libraries. In anticipation of the potential uneven workload during the necessary ramp up in HF, there will also be a small number of “large libraries” (LL) available that are planned to be produced in the next two years of the collaboration in order to manage the overall collaboration output. The quarterly output of each type of deliverable will continue to be managed by the Steering Committee to deliver approximately * compounds annually.

*     will be ArQule’s responsibility, whereas * will be Pfizer’s responsibility. FE and LL compounds produced will consist of * and have structures confirmed by mass spectrometry. HF compounds will consist of at least * and have structures confirmed by mass spectrometry. Purity for all compounds will be determined by HPLC *.

All data for these compounds, including physical, analytical, and quality control data, will be stored in an SD file or other format agreed upon by the Steering Committee. The data will be * with the physical samples. If there are samples that do not meet the yield or purity requirement and Pfizer has no interest in them, they will be destroyed and *. In order to ensure full value from the collaboration, Pfizer will provide managerial and scientific staff.

2.0 Introduction

ArQule Inc., located in Woburn MA, is a 300 person oncology drug discovery company focused on improving the discovery process by integrating high throughput chemical synthesis, intelligent library design and high throughput predictive and experimental ADME. Since its inception in 1993, ArQule has established a track record of producing high quality compounds using its industry recognized high throughput parallel synthesis AMAP™ system, which was the basis for establishing the first ArQule/Pfizer collaboration in 1999 followed by the expansion in 2001.

ArQule’s capacity to generate large numbers of compounds fits well with Pfizer’s expertise in the area of high throughput screening. A great portion of all discovery programs are working on leads discovered through HTS, and increasing knowledge of the human genome may well place an even greater reliance on HTS as a pre-requisite for project initiation. The ArQule collaboration will continue to augment Pfizer’s Gene-to-Candidate process in three ways. First, by increasing the size of the screening file, it is likely to increase the proportion of screens that are successful. Second, compounds with a high-speed synthesis heritage will improve the entire efficiency of the hit to candidate process. Third, the early ADME and physical property measures should reduce candidate attrition. Thus, project teams will have more lead compounds available to them, these leads should more closely embody the

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desirable properties of a candidate, and they have the potential to be incorporated into an automated closed loop optimization cycle.

3.0 Collaboration Plan

There are multiple components to the annual production of approximately * FE compounds in the form of approximately * libraries per year and these are very well established and understood by the collaboration team based on the previous four years. The key components in the FE process can be segmented into the following categories: * and *. These same steps are also similar for HF and LL production, however, the range of available parameters and responsibility may be different from FE.

For FE and LL, Pfizer will provide * and * while ArQule will be responsible for * and *. For HF, Pfizer will be responsible for * as well as provide *. ArQule will be responsible for the * and *.

A summary of the research plan details are given in Table 1.

     3.1 Library Ideas

Library ideas for FE development will be provided *, to insure that the ideas * (Section 9.1). If the proposed library idea is cleared, it will be registered as * and *. If the idea is encumbered and does not clear, then it will be *.

HF and LL request will be cleared through a similar process as FE before they are accepted as part of the production plan.

     3.2 Templates

Bulk template provided for protocol development and production will, be obtained through * and provided to ArQule in a timely manner to meet the development and production plan defined by the Steering Committee.

     3.3 Library Design

Library design for FE libraries will continue to be *, as performed currently. A similar approach will be adopted for LL and also be the responsibility of *. Library design criteria may be modified or specific criteria or monomers may be applied to designated libraries as determined by *. Library design for HF will be * and designed libraries with monomer combinations will be *.

     3.4 File Enrichment Protocol Development

Protocol development and the reduction of an idea to a synthetic procedure capable of making *, will be the responsibility of *. The number of automated synthetic and workup steps per protocol is anticipated to average no more than * and *, respectively.

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     3.5 Compound Production

Execution of the developed protocols for FE, HF and LL to produce the * compounds in parallel using the *. The reaction scale for FE will average *. Due to the limited amount of individual templates for LL, the reaction scale will be managed at *. For HF the reaction scale will be adjusted based on the number of steps in the protocol. A one-step protocol will be at approximately *, whereas protocols with two and three steps will be run at * and *, respectively. The reaction scale has a direct impact on the final compound quantity as well as the overall cost, thus it will be appropriately managed by the Steering Committee for cost-effective success. All available technology will be used as necessary to make the compounds of interest.

     3.6 HPLC Purification

HPLC purification will be conducted using the developed purification methods on *. HF and LL protocols that do not have developed purification methods will be reviewed by the analytical staff and a * will be *. Limited purification development will be done for HF and LL libraries and this effort will be reserved for those where little information is available or major difficulties are anticipated.

     3.7 Quality Control

The primary analytical QC method to assess compound * for all compounds produced will be *. * will be the primary sample quantification method. The passing criteria for HPLC purified samples are: *

As analytical and purification technologies evolve, the criteria to best establish the most accurate nature of the final products may be modified by the Steering Committee.

     3.8 Culling and Reformatting

All compounds that meet the acceptance criteria identified in Section 3.7 will be consolidated into full arrays using Pfizer microtiter plates and screening format.

For FE and LL compounds there will be * and the remaining material in a third plate. Compounds * plus the remaining compound in a second microtiter plate and they will be *.

For HF compounds there will be 1 plate (A-plate) with * plus a second plate (B-plate) with *, depending on the requested microtiter plate. Any additional material will be discarded. Compounds * will be * plus the * and they will be *. Compounds * will be * but they will not be *.

The quarterly success payments for FE, LL and HF compounds will be recognized for each compound type independent of the others. All compounds will be delivered * with the associated pertinent information in a SD file. Compounds with unacceptable purity will be removed, discarded and not count towards the annual production goal.

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     3.9 Data Capture and Registration

Protocol development information will be recorded in the * following *. Production information will be recorded in the * as well as maintaining * as necessary. All electronic in-process information will be maintained in the *. Analytical data that supports compound production will be maintained in the * and transmitted to *. All appropriate data supporting compound production * and the requisite information will be included in an SD file that will *.

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     Table 1. Research Plan Summary