COLLABORATION AND LICENSE AGREEMENTby and between MERCK & CO., INC. and FOXHOLLOW TECHNOLOGIES, INC.

A.

FHT develops and markets minimally invasive plaque excision devices for the treatment of peripheral artery diseases, and owns and maintains the TALON Registry (as further defined below). Merck discovers, develops and markets vaccines and medicines.

B.

FHT and Merck each believe that the other brings significant and complementary strengths to a potentially effective collaboration involving the establishment of methodologies to conduct clinical trials to study atherosclerotic plaque, and the use of excised plaque and related data to identify proteins that may be predictive of cardiovascular events.

C.

Merck and FHT wish to enter into a collaboration on the terms and subject to conditions set out in this Agreement. In addition, Merck desires an option to obtain exclusive licenses under certain intellectual property rights arising from the collaboration, and FHT desires to grant such an option, on the terms and subject to conditions set out in this Agreement.

1.1

“Affiliate” means (a) any corporation or business entity of which fifty percent (50%) or more of the securities or other ownership interests representing the equity, the voting stock or general partnership interest are owned, controlled or held, directly or indirectly, by Merck or FHT; or (b) any corporation or business entity which, directly or indirectly, owns, controls or holds fifty percent (50%) (or the maximum ownership interest permitted by law) or more of the securities or other ownership interests representing the equity, the voting stock or, if applicable, the general partnership interest, of Merck or FHT; or (c) any corporation or business entity of which fifty percent (50%) or more of the securities or other ownership interests representing the equity, the voting stock or general partnership interest are owned, controlled or held, directly or indirectly, by a corporation or business entity described in (a) or (b).

1.2

“Background Package” means the background package submitted to the FDA for the end-of-Phase II meeting between Merck (or its Affiliate) and the FDA to prepare for implementation of a Phase III Clinical Trial.

1.3

“Biological Samples and Data” means:

(a)

biological material (“Material”) directly obtained from human or animals, or derivatives of such materials, and collected or tested under the Collaboration Program.

(b)

information generated from the testing or use of Material, or information concerning the source of such Material (“Data”).

1.4

“Calendar Quarter ” means the respective periods of three (3) consecutive calendar months ending on March 31, June 30, September 30 and December 31.

1.5

“Calendar Year ” means each successive period of twelve (12) months starting on January 1 and ending on December 31.

1.6

“ Change of Control” shall mean with respect to a Party: (a) the sale of all or substantially all of such Party’s assets or business relating to this Agreement; (b) a merger, reorganization or consolidation involving such Party in which the voting securities of such Party outstanding immediately prior thereto cease to represent at least fifty percent (50%) of the combined voting power of the surviving entity immediately after such merger, reorganization or consolidation; or (c) the acquisition by a person or entity, or group of persons or entities acting in concert, of more than fifty percent (50%) of the voting equity securities or management control of such Party.

1.7

“Collaboration Program” means the activities undertaken by the Parties under this Agreement during the Collaboration Program Term. Initial activities are as set out in Article 2 and the Work Plan.

1.8

“Collaboration Program Clinical Study” or “CPCS” means a clinical study conducted under the Collaboration Program in accordance with a protocol that has been approved by the JCC.

1.9

“Collaboration Program Inventions and Results ” means:

(a)

all Biological Samples and Data;

(b)

all Inventions, protocols, results, data, discoveries, formulas, know-how

and trade secrets, including any biomarkers or surrogate markers, assays, tests, clinical trial methodologies, or procedures (in each case whether patentable or otherwise) that were generated in the course of or arise from the performance of the Collaboration Program, or resulting from the analysis of Biological Samples and Data during the Collaboration Program Term or Tail Period; and

(c)

any improvements or enhancements to, or subsequent inventions resulting from, any of the items described in clauses (a) and (b) to the extent such improvements, enhancements or inventions are generated during the Collaboration Program Term or Tail Period; provided , however the term “Collaboration Program Inventions and Results” shall not apply to, and shall exclude, FHT Independent Inventions and Improvements, Excluded Merck Compound Rights, and Merck Independent Inventions and Improvements.

1.10

“Collaboration Program Patent Rights” means any and all patents and patent applications (which for the purposes of this Agreement shall be deemed to include certificates of invention, provisional applications, and applications for certificates of invention) claiming any Collaboration Program Invention and Results.

1.11

“Collaboration Program Term” means the duration of the Collaboration Program, as described more fully in Section 2.8.

1.12

“Combination Product” means a product containing both a Therapeutic Product as well as one or more active ingredients that are other than a Profiled Compound. All references to Product in this Agreement shall be deemed to include Combination Products.

1.13

“Committee” or “JCC” means the committee established to facilitate and direct the Collaboration Program, as more fully described in Section 2.2.2.

1.14

“Competing Pharma Change of Control” means a Change of Control in which the acquirer is a company or group of companies acting in concert (a) for whom collective worldwide sales of pharmaceutical products in the Calendar Year that preceded the year in which the Change of Control was consummated were [ * ] United States dollars [ * ] or more, or (b) who have an active clinical development or commercialization program for any pharmaceutical or diagnostic product intended to treat, prevent and/or diagnose a Major Indication.

1.15

“Control” with respect to intellectual property or tangible property rights (e.g., compounds or information), means the legal authority (whether by ownership or license, other than pursuant to this Agreement) of a Party to grant access to, or a license or sublicense of such intellectual property rights or tangible property.

1.16

“CPCS Samples and Data” is defined in Section 2.4.9(c).

1.17

“CRO” means a contract research organization.

1.18

“Data” is defined in Section 1.3.

1.19

“DDMAC ” means the FDA’s Division of Drug Marketing, Advertising, and Communications.

1.20

“Dose Ranging Product ” means a Therapeutic Product that achieved those Product Non-Exclusivity development milestones [ * ] described in Section 5.5(a)(i) and 5.5(c), or those Product Exclusivity development milestones [ * ] described in Section 5.8(a)(i) and 5.8(c).

1.21

“ EMEA ” means the European Medicines Agency.

1.22

“Enhanced Label Product” means a Therapeutic Product with respect to which any Collaboration Inventions and Results are contained in both: (i) [ * ] and (ii) [ * ] used by Merck or its Affiliates in the United States for such Therapeutic Product.

1.23

“Excluded Merck Compound Rights” means all Merck NCEs (and any uses, formulations or enhancements to the same), and all data on Merck NCEs.

1.24

“ FDA” means the United States Food and Drug Administration.

1.25

“FHT Collaboration Program Inventions and Results” means all Collaboration Program Inventions and Results discovered, developed or invented solely by employees of FHT, or other persons not employed by Merck acting on behalf of FHT.

1.26

“FHT Collaboration Program Patents” means all Collaboration Program Patent Rights that claim FHT Collaboration Program Inventions and Results.

1.27

“FHT Independent Inventions and Improvements ” means: (a) FHT-Controlled technology, methods, devices, and systems for the excision of plaque; (b) the TALON Registry (excluding any Material contained therein that meets the Sample Criteria); (c) any improvements to the items listed in (a) created under the Collaboration Program or independent of the Collaboration Program but after the Effective Date; and (d) FHT patents, patent applications and know-how covering any of the foregoing.

1.28

“Filing” means the acceptance by the first Regulatory Authority of an NDA for filing.

1.29

“First Commercial Sale” means, with respect to any Product or Test, the first sale for end use or consumption of such Product or Test in a country, excluding, however, any sale or other distribution for use in clinical trials.

1.30

“ Indication ” means a separate and distinct disease or medical condition in humans (a) which a Therapeutic Product is intended to treat, and/or prevent, where the Therapeutic Product is either in Phase III Clinical Trials, or is the subject of an NDA; and/or (b) for which a Therapeutic Product has received Marketing Authorization (meaning that such Indication is contained in the Therapeutic Product’s labeling approved by a Regulatory Authority as part of the Marketing Authorization for such Product).

1.31

“Information” means all information and data, whether communicated in writing or orally or by any other method, which is provided by one Party to the other Party under this Agreement.

1.32

“Initial Term” is defined in Section 2.8.

1.33

“Initiation” means, with respect to a Phase III Clinical Trial, the administration of the first dose to the first patient in such Phase III Clinical Trial.

1.34

“Invention” means any process, method, composition of matter, article of manufacture, discovery or finding that is conceived and/or reduced to practice in the course of the activities of the Collaboration Program.

1.35

“Joint Collaboration Program Inventions and Results” means all Collaboration Program Inventions and Results discovered, developed or invented jointly by employees of Merck and FHT, or others acting on behalf of Merck and FHT.

1.36

“Joint Patent Rights ” means all Collaboration Program Patent Rights that claim Joint Collaboration Program Inventions and Results.

1.37

“Labeled Product” means any Therapeutic Product with respect to which any Collaboration Inventions and Results are contained in the [ * ] , but are not contained in [ * ] used by Merck or its Affiliates in the United States for such Therapeutic Product.

1.38

“Major Indication” means any of the following Indications[ * ] .

1.39

“ Major Market” means any the following: United States of America, Japan, and either (i) the European Union, in the case of EMEA centralized procedure for drug approval, or (ii) France, Germany, Italy, the United Kingdom, or Spain, in the case where Merck or its Affiliates does not make use of the EMEA centralized procedure for drug approval.

1.40

“Marketing Authorization” means all approvals necessary from the relevant Regulatory Authority to market and sell a Therapeutic Product or Test (including without limitation all applicable pricing and governmental reimbursement approvals even if not legally required to sell Product or Test in a country).

1.41

“Material” is defined in Section 1.3.

1.42

“Merck Collaboration Program Inventions and Results” means all Collaboration Program Inventions and Results discovered, developed or invented solely by employees of Merck, or other persons not employed by FHT acting on behalf of Merck.

1.43

“Merck Collaboration Program Patents” means all Collaboration Program Patent Rights that claim Merck Collaboration Program Inventions and Results.

1.44

“Merck Independent Inventions and Improvements” means (a) Merck-Controlled compounds (including Merck NCEs), methods of treatment, analysis technology, clinical specimens (other than Biological Samples and Data ) , biomarkers, and assays; (b) any improvements on the same created under the Collaboration Program or independent of the Collaboration Program but after the Effective Date; and (c) Merck (including Affiliate) patents, patent applications, and know how covering any of the foregoing.

1.45

“Merck NCE” means any Merck-Controlled Profiled Compound that has not received FDA approval for sale as a human use product at the time it is studied in the Collaboration Program.

1.46

“NDA” means a New Drug Application, Biologics License Application, or Marketing Application Authorization, or similar application or submission for Marketing Authorization filed with a Regulatory Authority to obtain marketing approval for a biological, pharmaceutical or diagnostic product in country or in group of countries within the jurisdiction of the Regulatory Authority.

1.47

“ Option Period ” means the period starting on the Effective Date and ending [ * ] days after the expiration or termination of the Collaboration Program Term, and at any time therein.

1.48

“Party” means Merck or FHT, and “Parties” shall mean Merck and FHT.

1.49

“Patent Rights” means both the FHT Collaboration Program Patent Rights and FHT’s interest in the Joint Collaboration Program Patent Rights.

1.50

“Phase III Clinical Trial” means a human clinical trial that is pivotal to Filing and satisfies the requirements of 21 CFR 312.21(c).

1.51

“Product” means each of the Dose Ranging Product, Labeled Product and Enhanced Labeled Product, and each “Products” means all such products, collectively. “Product” also includes any Combination Product.

1.52

“Product Exclusivity License” is defined in Section 3.1.3(b)(ii).

1.53

“Product Net Sales” means the gross invoice price of Product sold by Merck, its Affiliates and their respective sublicensees to the first Third Party after deducting, if not previously deducted, from the amount invoiced or received:

1.53.1

trade and quantity discounts other than early pay cash discounts;

1.53.2

returns, rebates, chargebacks and other allowances;

1.53.3

the standard inventory cost of devices or delivery systems used for dispensing or administering Product (such as syringes or inhalation devices, but not packaging);

1.53.4

sales commissions paid to Third Party distributors and/or selling agents, in amounts customary to the trade and to the extent allocable to the Product;

1.53.5

retroactive price reductions that are actually allowed or granted; and

1.53.6

a fixed amount equal to [ * ] to cover bad debt, sales or excise taxes, early payment cash discounts, transportation and insurance, custom duties, and other governmental charges.

1.54

“Profiled Compound” means any chemical compound (including but not limited to small molecules, proteins, antibodies and therapeutic nucleic acids): (a) for which Biological Samples and Data is generated concerning such compound’s effectiveness; or (b) the discovery, identification or development of which utilizes or is based upon Collaboration Program Inventions and Results.

1.55

“ Project Leader” is defined in Section 2.2.1.

1.56

“Promotional Material” means any material for promotion of a Therapeutic Product in the United States that Merck prepares and that it is required to submit to DDMAC on FDA transmittal Form 2253 (pursuant to 21 CFR 314.81) for a Therapeutic Product, including brochures, booklets, detailing pieces, advertisements published in journals, magazines, other periodicals and newspapers, or broadcast through media such as radio, television, and telephone communications systems, to the extent Merck (or its Affiliate) has approved and obtains FDA approval for same for use in the United States.

1.57

“Prospective Registry” means the tissue and data collection registry created under the Collaboration Program, as more fully described in Section 2.4.2.

1.58

“Regulatory Authority” means the FDA, EMEA, and, with respect to Japan, the Japanese governmental regulatory authority involved in granting approvals for the manufacturing, marketing, reimbursement and/or pricing of a Product or Test in the Japan, and any successor governmental authority having substantially the same function.

1.59

“Sample Criteria” is defined in Section 2.4.4.

1.60

“Tail Period” means the [ * ] month period immediately following the end of the Collaboration Program Term.

1.61

“ TALON Registry ” means: (a) FHT’s multi-center registry designed to capture and archive patient outcomes data, as well as all biological material, such as excised plaque using FHT technology, which such registry is expected to be closed prior to or shortly after the Effective Date, and (b) any and all de-identified patient-related clinical and demographic data corresponding to such biological material, as well as any genetic, and genomic data associated with such collections. TALON Registry is further described in Exhibit 1.61.

1.62

“Territory” means all of the countries in the world, and their territories and possessions.

1.63

“Test” means (a) a prognostic test [ * ] and/or (b) a diagnostic test [ * ] ; and/or (ii) [ * ] ; to the extent the test described in (a) or (b) was developed, discovered or identified by Merck using Collaboration Program Inventions and Results.

1.64

“Test Exclusivity License” is defined in Section 3.1.3(b)(i).

1.65

“Test Field” means the development, use and commercialization of Tests.

1.66

“ Test Net Sales ” mean the gross invoice price of Tests sold by Merck, its Affiliates and their respective sublicensees to the first Third Party after deducting, if not previously deducted, from the amount invoiced or received:

1.66.1

trade and quantity discounts other than early pay cash discounts;

1.66.2

allowances actually credited to such Third Party for spoiled, damaged, outdated or returned Tests; and

1.66.3

a fixed amount equal to [ * ] of the amount invoiced to cover bad debt, sales or excise taxes, early payment cash discounts, transportation and insurance, custom duties, and other governmental charges.

1.67

“Therapeutic Product” means any pharmaceutical or biological preparation in final form containing a Profiled Compound for: (a) sale by prescription, over-the-counter or any other method; or (b) administration to human patients in a Phase III Clinical Trial.

1.68

“Third Party” shall mean an entity other than Merck and its Affiliates, and FHT and its Affiliates.

1.69

“ Trigger” shall mean the exercise by Merck of its right to obtain either the Product Exclusivity License or Test Exclusivity License, as the case may be, as set forth in Section 3.1.3(b), upon the payment set forth 5.9 and 5.7.1, respectively prior to the end of the Option Period.

1.70

“Work Plan” is described in Section 2.1.

1.71

“Valid Product Patent Claim” means a claim of an issued and unexpired Merck-Controlled patent claiming the composition of matter of a Product which claim has not been revoked or held unenforceable or invalid by a decision of a court or other governmental agency of competent jurisdiction, and which decision is not appealable or has not been appealed within the time allowed for appeal, and which claim has not been disclaimed, denied or admitted by Merck to be invalid or unenforceable through reissue, re-examination or disclaimer or otherwise.

1.72

“Valid Test Patent Claim” means a claim of an issued and unexpired claim within the Collaboration Program Patents Right which claim has not been revoked or held unenforceable or invalid by a decision of a court or other governmental agency of competent jurisdiction, and which decision is not appealable or has not been appealed within the time allowed for appeal, and which claim has not been disclaimed, denied or admitted by Merck to be invalid or unenforceable through reissue, re-examination or disclaimer or otherwise.

2.1

Work Plan. FHT and Merck shall engage in and conduct the Collaboration Program on the terms and subject to the conditions set out in this Agreement. The initial Work Plan attached as Schedule 2.1 is an outline description of specific activities to be undertaken by each of the Parties during the Initial Term. The Project Leaders shall use their good faith efforts to agree upon further details of such activities and develop a complete initial Work Plan for JCC approval no later than fifteen (15) days after the Effective Date. Subject to review and adjustment by the JCC, the Work Plan will set forth expectations with respect to each Party’s relative contributions to the Collaboration Program. The JCC will periodically review, consider and approve revisions to the Work Plan as it deems appropriate. In addition, the Work Plan will be amended to describe with specificity the Collaboration Program Clinical Studies to be undertaken under the Collaboration Program, and the projected timeframe for such studies.

2.2

Collaboration Program Oversight and Management.

2.2.1

Project Leaders. The project leaders (“Project Leaders”) for the Collaboration Program are [ * ] for FHT, and [ * ] for Merck. The Project Leaders shall have responsibility for developing and updating the Work Plan (for approval by the JCC), providing day-to-day direction and oversight of the Collaboration Program,

and presenting the JCC with periodic progress reports (but no less than once per quarter) describing the work performed and the results achieved to date on the Collaboration Program. Each Party is entitled to designate a replacement Project Leader reasonably acceptable to the other Party, but shall notify the other Party in writing as soon as practicable upon the changing of its Project Leader.

2.2.2

Committee. The Parties will establish a joint collaboration committee (the “Committee” or “JCC”) with equal representation from FHT and Merck of no less than two and no more than four representatives each (who may be substituted or replaced by alternates at any time), to direct and oversee the Collaboration Program during the Collaboration Program Term. The JCC will be formed as soon as practicable after the Effective Date to:

(a)

coordinate, implement, review, evaluate and prioritize Collaboration Program activities;

(b)

receive and review reports, results and data concerning research being conducted under the Collaboration Program, and exchange information and materials relating thereto;

(c)

review, consider and approve revisions to the Work Plan and Collaboration Program Clinical Study protocols;

(d)

establish procedures relating to the harvesting, transfer and handling of Biological Samples and Data, and

(e)

determine the protocol to be used in the Prospective Registry, the quality control criteria for CPCS Samples and Data described in Section 2.4.9(c), and the Sample Criteria described in Section 2.4.3.

2.2.3

JCC Chair. Merck shall appoint a representative to act as the JCC Chair. The JCC Chair shall have authority to call JCC meetings, and be responsible for circulating agenda and performing administrative tasks required to assure efficient operation of the JCC, but shall have no additional voting rights.

2.2.4

JCC Meetings. The Committee shall meet in accordance with a schedule established by mutual written agreement of the Parties, but no less frequently than once per Calendar Quarter, with the location for such meetings alternating between FHT and Merck facilities (or such other location may be determined by the Committee). Alternatively, the Committee may meet by means of teleconference, videoconference or other similar communications equipment.

2.2.5

JCC Decision Making . The JCC will act by unanimous vote, with each of Merck and FHT having one vote. The members of the JCC will attempt in good faith to reach consensus on all matters brought before the JCC, provided that if consensus on an issue cannot be reached, the issue in dispute will be promptly referred to the Senior Vice President of Merck Research Laboratories responsible

for worldwide licensing and external scientific affairs and the Chief Executive Officer of FHT for resolution, and if they cannot agree:

(a)

FHT will have the final decision-making authority with respect to issues involving the methods or procedures for harvesting and collecting of tissue, and

(b)

Merck will have the final decision-making authority with respect to all other matters subject to decision by the JCC; provided , however, that Merck shall not have the final decision-making authority with respect to decisions which require that FHT expend additional amounts other than those for which it is paid by Merck hereunder pursuant to Section 5.3 and 5.4, including any budgets to be approved by the JCC pursuant to Section 2.4.9(d).

2.2.6

Restrictions on JCC. Notwithstanding anything the contrary in this Agreement, the JCC shall have no power to amend this Agreement (with the exception of the Work Plan as provided in Section 2.1), or to resolve disputes between the Parties with respect to the interpretation of this Agreement, either Party’s performance of its obligations hereunder, or the ownership of intellectual property.

2.3

General Collaboration Program Responsibilities.

2.3.1

FHT and Merck each shall conduct the Collaboration Program obligations in good scientific manner, and in compliance in all material respects with all requirements of applicable laws, rules and regulations and attempt to achieve their respective objectives efficiently and expeditiously. FHT and Merck shall each proceed diligently with the work set out in the Work Plan by using their respective good faith efforts to allocate sufficient time, effort, equipment and facilities to the Collaboration Program. Merck and FHT shall each use personnel with sufficient skills and experience as are required to accomplish the Collaboration Program in accordance with the terms of this Agreement and the Work Plan. Each Party shall bear the cost of performing all approved Work Plan responsibilities assigned to it.

2.3.2

Merck is entitled to utilize the services of its Affiliates and Third Parties to perform its Collaboration Program activities; provided that Merck shall notify in writing FHT periodically as to the identify of any such Merck Affiliates and Third Parties to the extent not disclosed to the JCC. FHT shall be entitled to utilize the service of Third Parties to perform its Collaboration Program activities only upon Merck’s prior written consent, or as specifically set forth in Work Plan. Each Party is entitled to use the services of Third Parties that have been pre-approved by the JCC to carry out routine Collaboration Program activities, without the need for obtaining the other Party’s prior written consent. Notwithstanding any such consent or pre-approval, both Parties shall remain at all times fully liable for its respective responsibilities under the Collaboration Program. Each Party certifies that it has not, and will not, employ or otherwise use in any capacity the services of any person debarred under United States law, including but not limited to Section 21 USC 335a, in performing any portion of its Collaboration Program responsibilities.

2.4

Specific Collaboration Program Responsibilities. Unless otherwise specified in the Work Plan, the Parties will have the following specific Collaboration Program responsibilities.

2.4.1

TALON Registry Biological Samples and Data . FHT owns and shall be responsible for maintaining the TALON Registry, and shall be responsible for providing access to Merck to the Biological Samples and Data resulting from the TALON Registry.

2.4.2

Prospective Registry Components. FHT shall be responsible for collecting the components of the Prospective Registry. The Parties anticipate that the Prospective Registry will be made up of Biological Samples and Data collected from the following sources:

(a)

CPCS subjects who were not provided with any drug compounds, including any Merck NCEs;

(b)

TALON Registry Materials and Data that meet the Sample Criteria; and

(c)

Peripheral arterial disease and coronary disease plaque excision procedures conducted by or on behalf of FHT after the Effective Date that do not involve the study of Profiled Compounds. This category will be made up of Biological Samples and Data collected by physicians using FHT’s excision devices.

2.4.3

Ownership and Delivery of Prospective Registry Material and CPCS Samples and Data . Notwithstanding anything to the contrary in Section 2.7, Merck shall own the Material contained in the Prospective Registry and the CPCS Samples and Data, provided, however, if Merck does not Trigger the Product Exclusivity License, Merck shall provide FHT with reasonable access to Material contained in the Prospective Registry or the CPCS Samples and Data (other than

Material pertaining to Excluded Merck Compound Rights) to the extent such Material may be readily available and capable of being shared with FHT. From time to time during the Collaboration Program Term as reasonably requested by Merck and in accordance with Merck’s reasonable instructions (or as may be set forth in the Work Plan), FHT shall transfer to Merck the Prospective Registry Material and the CPCS Samples and Data, along with a complete set of Data associated with such Material.

2.4.4

Collection of Biological Samples and Data Meeting Sample Criteria . As part of the Prospective Registry protocol described in Section 2.2.2(e), the JCC shall establish criteria (“Sample Criteria”) that Biological Samples and Data comprising the Prospective Registry are intended to meet. FHT shall use commercially reasonable efforts to collect and deliver to Merck:

(a)

[ * ] Biological Samples and Data that satisfy the Sample Criteria, but in no event shall FHT be required to collect and deliver to Merck more than

(b)

[ * ] Biological Samples and Data collected under the JCC-approved protocol.

2.4.5

Compounds and Biological Sample Analysis . Merck shall be responsible for, and shall bear the cost of, providing compounds to be profiled in the Collaboration Program or used in any CPCSs. Merck, itself or through its Affiliates, shall also be responsible for analyzing Biological Samples and Data in an effort to establish plaque biomarkers of atherosclerotic disease activity.

2.4.6

Profiling. During the course of the Collaboration Program Term (provided that the Collaboration Program Term has been extended beyond the Initial Term), Merck will use reasonable commercial efforts to study [ * ] Merck NCEs in either one or more CPCSs or as otherwise utilizing the clinical trial methodology described in Section 2.4.8. If Merck exercises its Product Exclusivity License but fails to have so studied [ * ] Merck NCEs by the [ * ] of the end of the Collaboration Program Term, then FHT’s obligations under Section 2.9 shall expire thirty (30) days after such [ * ] unless, during such thirty (30) day period, Merck pays FHT [ * ] payment for each of such [ * ] Merck NCEs not so studied by the end of such time period.

2.4.7

Regulatory Matters.

(a)

During the Collaboration Program Term and thereafter, Merck shall be solely responsible for, and shall bear the cost of, preparing and submitting registration dossiers for Therapeutic Products, Products and Tests in the Territory; provided , that Merck shall provide FHT with the regulatory reports as described in Section 2.6.1.

(b)

Merck shall, by way of the Project Leaders, keep FHT periodically and reasonably informed of Merck meetings with the FDA involving discussions of Collaboration Program Inventions and Results in connection with milestone events set out in Sections 5.5, 5.6, 5.8 and 5.9. [ * ] .

(c)

Merck shall have sole discretion as to the regulatory strategy and decision making for any Therapeutic Product, Product or Test; provided however, that during the Collaboration Program Term, Merck shall consider in good faith any and all JCC recommendations regarding regulatory strategy with respect to the use of Collaboration Program Inventions and Results.

(d)

All Marketing Authorizations shall be held by and in the name of Merck (or its Affiliates), and Merck (or its Affiliates) shall own all regulatory submissions in connection therewith.

2.4.8

Clinical Trial Methodology . The Parties shall collaborate on efforts to:

(i)

study and collect Biological Samples and Data, and optimize Biological Samples and Data handling and processing; and

(ii)

[ * ]

2.4.9

Collaboration Program Clinical Studies. FHT is responsible for conducting Collaboration Program Clinical Studies. All CPCSs must be performed under the direction and control of the JCC, in accordance with the terms of the Work Plan and the applicable JCC-approved study protocol. Each CPCS involving a Merck NCE shall be performed under a separate Clinical Study Agreement based on the form of agreement attached as Schedule 2.4.9 to this Agreement and executed by the appropriate parties. FHT shall conduct each CPCS in compliance with all FDA regulations relating to Good Clinical Practice and Clinical Trials, and other applicable regulations.

(a)

CPCS Protocols . Merck shall be responsible for writing all protocols for CPCSs involving Merck NCEs and other Merck-Controlled compounds. FHT shall be responsible for writing all other CPCS protocols, and for obtaining all necessary approvals and appropriate informed consents, in writing, for the collection of Biological Samples and Data for each CPCS. All protocols shall be submitted to the JCC for its review and approval, once they have been reviewed and approved by Merck’s internal scientific review committees.

(b)

Responsibility for CPCS Resources and Costs . Once the JCC has approved a CPCS protocol, FHT shall make available scientific and managerial personnel with sufficient expertise and experience necessary to coordinate and conduct the CPCS. FHT shall have the right to use a CRO to conduct a Collaboration Program Clinical Study, provided that: (i) Merck consents in advance; (ii) the CRO agrees to use only facilities approved in advance by Merck; (iii) the CRO is retained by FHT pursuant to a written agreement; and (iv) the terms of such agreement are approved by Merck (not to be unreasonably withheld). During a given year of the Collaboration Program, to the extent the JCC approves the use by FHT of the services of a CRO in the conduct of any CPCS, and the corresponding budget for such use, and such utilization results in FHT incurring costs during that year over and above the amounts paid to FHT pursuant to Section 5.3 (with respect to the Initial Term), or Section 5.4.1(b) (with respect to any one-year extension of the Collaboration Program Term), then [ * ] such cost overage that is consistent with the approved budget, upon completion of such CPCS.

(c)

Requisite Samples . FHT shall use commercially diligent efforts to collect, pursuant to one or more CPCS, and deliver to Merck the following number of Biological Samples and Data meeting JCC-specified quality control criteria (the “CPCS Samples and Data”):

(i)

In the Initial Term – [ * ] Biological Samples and Data;

(ii)

In the 2 ^nd Collaboration Program Term year – [ * ] Biological Samples and Data, and

(iii)

In the 3 ^rd Collaboration Program Term year – [ * ] Biological Samples and Data.

(d)

Additional CPCSs . The JCC may authorize CPCSs for the purpose of collecting additional CPCS-derived Biological Samples and Data over and above the Requisite Samples in a given year of the Collaboration Program Term. In such case, all costs in FHT scientific and managerial personnel time, FHT expenses, and cost of Third Party services for such additional CPCSs shall be estimated in a budget prepared by the Project Leaders and submitted to the JCC for approval with the understanding that the cost of conducting each such CPCS shall be based upon [ * ] , or the JCC-approved costs charged by any CRO approved pursuant to Section 2.4.4(b) of performing such CPCS. If the JCC approves the budget for such additional CPCSs, then the Parties will meet and discuss in good faith the appropriate cost allocation between the Parties for the performance of such additional CPCSs.

2.4.10

Agreements with Third Parties. If during the Collaboration Program Term FHT believes that one or more Third Parties may possess skills, technology or intellectual property of use to the Parties in the conduct of the Collaboration Program, it shall identify such Third Party to the JCC, and the JCC shall evaluate and recommend to Merck whether or not it should consider entering into discussions with such Third Party to collaborate with, or license intellectual property from, such Third Party (a “Third Party Collaboration Agreement”).