LICENSE, OPTION AND COLLABORATION AGREEMENT

Exhibit 99.1

Certain confidential information contained in this document, marked by brackets and asterisks, has been omitted pursuant to a request for confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

LICENSE, OPTION AND COLLABORATION AGREEMENT

by and between

ACADIA PHARMACEUTICALS INC.

and

SEPRACOR INC.

This document is the confidential information of both parties hereto.

It should be distributed on a need-to-know basis and kept in a secure area.

LICENSE, OPTION AND COLLABORATION AGREEMENT

T HIS L ICENSE , O PTION AND C OLLABORATION A GREEMENT ( “Agreement” ) is by and between ACADIA P HARMACEUTICALS I NC . , a Delaware corporation ( “ACADIA” ), having an address of 3911 Sorrento Valley Boulevard, San Diego, CA 92121, and S EPRACOR I NC . , a Delaware corporation ( “Sepracor” ), having an address of 84 Waterford Drive, Marlborough, MA 01752.

R ECITALS

W HEREAS , ACADIA has developed expertise and acquired proprietary rights related to [...***...] , as more fully described below;

W HEREAS , Sepracor is engaged in the research, development and commercialization of pharmaceutical products;

W HEREAS , Sepracor and ACADIA desire to enter into a collaborative relationship to identify and develop Muscarinic Compounds (as defined below) for clinical development and commercialization by Sepracor, subject to the terms and conditions set forth herein;

W HEREAS , Sepracor and ACADIA also desire to enter into a collaborative relationship to evaluate Option Compounds (as defined below), and Sepracor wishes to obtain, and ACADIA is willing to grant to Sepracor, a time-limited option to obtain an exclusive license with respect to an Option Compound, subject to the terms and conditions set forth herein; and

W HEREAS , concurrently with this Agreement, Sepracor and ACADIA will enter into a separate common stock purchase agreement pursuant to which Sepracor will purchase and commit to purchase shares of ACADIA’s common stock on the terms provided therein.

A GREEMENT

N OW , T HEREFORE , in consideration of the foregoing premises and the mutual promises, terms, conditions, and covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, ACADIA and Sepracor hereby agree as follows:

For purposes of this Agreement, initially capitalized terms used in this Agreement, whether used in the singular or plural, shall have the following meanings, unless the context clearly requires otherwise:

1.1 “ACADIA Inventions” shall mean all Inventions conceived, or simultaneously conceived and reduced to practice, solely by ACADIA employees, consultants, or contractors in the course and as part of the Research Program.

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1.2 “ACADIA Know-How” shall mean Information not included in the ACADIA Patents or Joint Patents that ACADIA or any of its Affiliates Controls on the Effective Date or during the Research Term that pertains to or arises from the Research Program or the Evaluation or that is necessary for the development, manufacture, use, offer for sale, or sale of any Product, including, without limitation, all such Information that is conceived or developed by ACADIA or any of its Affiliates in the course and as part of the Research Program, and, in each case, any replication or any part of such Information; provided, however, that ACADIA Know-How excludes any such Information relating to ACADIA’s compounds known as ACP-103 and ACP-104, ACP-104 Analogs and/or [...***...] Eyecare Compounds, which is Confidential Information of ACADIA.

1.3 “ACADIA Muscarinic Compounds” shall mean any compound Controlled by ACADIA on the Effective Date, the primary mode of action of which is [...***...] , including, without limitation, ACADIA’s proprietary [...***...] , but subject to exclusion of [...***...] Agonists under the circumstances described in Section 2.3(b). Notwithstanding the foregoing or any other provision of this Agreement to the contrary, neither ACADIA’s compound known as ACP-104 (N-desmethylclozapine) nor any ACP-104 Analogs shall be considered ACADIA Muscarinic Compounds for purposes of this Agreement.

1.4 “ACADIA Patents” shall mean all Patents that ACADIA or any of its Affiliates Controls as of the Effective Date or during the Research Term that are necessary or useful for (a) performance of the Research Program or the Evaluation, or (b) for the development, manufacture, use, import, offer for sale, or sale of any Selected Muscarinic Compound, Licensed Compound or Product, but excluding the Joint Patents, and shall include without limitation the Patents listed in Schedule 1.4 of this Agreement.

1.5 “ACADIA Technology” shall mean the ACADIA Patents, ACADIA Inventions, and ACADIA Know-How.

1.6 “ACP-104 Analogs” shall mean compounds described on Schedule 1.6.

1.7 “Affiliate” shall mean, with respect to either party hereto, any corporation, company, partnership, joint venture, or any other entity controlled by, controlling, or under common control with such party, and shall include any corporation, company, partnership, joint venture, or other entity at least fifty percent (50%) of whose voting stock or participating profit interest is owned or controlled, directly or indirectly, by such party, and any corporation, company, partnership, joint venture, or other entity which owns or controls, directly or indirectly, at least fifty percent (50%) of the voting stock of such party.

1.8 “Back-Up Selected Muscarinic Compound” shall mean any Muscarinic Compound that is designated by Sepracor as a back-up compound for a Primary Selected Muscarinic Compound and any Other Forms of any such Muscarinic Compound.

1.9 “Business Day” shall mean a day on which banks are open for business in both Marlborough, Massachusetts and San Diego, California, excluding Saturdays and Sundays.

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1.10 “Calendar Quarter” shall mean each respective period of three (3) consecutive months ending on March 31, June 30, September 30, and December 31.

1.11 “Chosen Compound” shall mean any Evaluation Compound designated by Sepracor for investigation during the Final Evaluation Period. For the avoidance of doubt, any Option Compound that is an Evaluation Compound designated as a Chosen Compound shall include Other Forms of such Option Compound.

1.12 “Combination Product” shall mean a Product which comprises two (2) or more active pharmaceutical ingredients at least one (1) of which is a Selected Muscarinic Compound.

1.13 “Committee” shall mean the JRC or JDC, as applicable.

1.14 “Confidential Information” shall mean any Information possessed, obtained, developed, or created by or on behalf of a party that is identified by the party as confidential or proprietary, or that a receiving party knows is confidential or proprietary or has a reasonable basis to believe is confidential or proprietary.

1.15 “Control” or “Controlled” shall mean, with respect to any Information, Patent or other intellectual property right, the legal authority or right (whether by ownership, license or otherwise) of a party hereto to grant access, a license or a sublicense of or under Information, Patents, or intellectual property rights to another party hereto, or to otherwise disclose proprietary or trade secret information to such other party, without breaching the terms of any agreement with a Third Party, or misappropriating the proprietary or trade secret information of a Third Party.

1.16 “Effective Date” shall mean the later of (a) the date on which Sepracor executes this Agreement, and (b) the date on which ACADIA executes this Agreement.

1.17 “Eszopiclone Compounds” shall mean: a) 6–(5–chloro–2–pyridinyl)-6,7–dihydro-7–oxo–5H–pyrrolo[3,4b]pyrazin–5–y–l4– methylpiperazine–1–carboxylate or 6–(5-chloropyri-2-dyl)-5–(4-methylpiperazin–1–yl)carbonyloxy–7–oxo–6,7–dihydro–5H– pyrrolo[3,4b]pyrazine,            also known as zopiclone; b) racemic zopiclone; c) (+)-zopiclone or eszopiclone; d) (-)-zopiclone; e) metabolites of any of a) through d); f) all salts, solvates, or clathrates of any of a) through e); and g) all polymorphs, crystals forms, amorphorous forms, or co-crystals of any of the foregoing.

1.18 “Evaluation” shall mean Sepracor’s assessment of Option Compounds to determine Sepracor’s interest in obtaining a license to make, develop, use, promote, and commercialize Fixed Co-Formulation Products.

1.19 “Evaluation Compound” shall mean an Option Compound selected by Sepracor for Preliminary Evaluation Work during the Preliminary Evaluation Period, and Other Forms of any such Option Compound.

1.20 “Evaluation Results” shall mean the results of the Preliminary Evaluation Work and Evaluation Studies.

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1.21 “Evaluation Studies” shall mean studies or work conducted by or on behalf of Sepracor using Chosen Compounds during the Final Evaluation Period, including without limitation, synthesis of Chosen Compounds, GLP and GMP drug supply manufacturing, in vivo or in vitro genotoxicity, safety pharmacology, toxicology, pharmacokinetics, metabolism, toxicology, formulation, stability, and proof-of-principle studies involving any Chosen Compound, but excluding any studies in humans.

1.22 “Exercise Notice” shall mean Sepracor’s written notice to ACADIA identifying the Chosen Compound for which Sepracor desires to exercise the Option granted in Section 4.3 of this Agreement.

1.23 “ Eyecare Indications ” shall mean diseases, disorders, or conditions involving the eye [...***...] .

1.24 “FDA” shall mean the United States Food and Drug Administration, or any successor agency thereto having the administrative authority to regulate the marketing of human pharmaceutical products or biological therapeutic products, delivery systems and devices in the United States of America.

1.25 “Filing Party” shall mean the party to this Agreement responsible for the preparation, filing, prosecution, and maintenance of an ACADIA Patent, a Product Patent or a Joint Patent.

1.26 “Final Evaluation Period” shall mean the period beginning on the date of Sepracor’s written notice to ACADIA identifying Chosen Compounds and continuing until the earlier of (a) [...***...] such written notice or a later or earlier date as may be agreed upon by the parties in writing, or (b) Sepracor’s exercise of the Option.

1.27 “First Commercial Sale” shall mean, with respect to any Product, the first sale by Sepracor, or any of its Affiliates or Sublicensees, to a Third Party for end use or consumption of such Product in a country after the governing health regulatory authority of such country has granted Regulatory Approval. Sale to an Affiliate or Sublicensee shall not constitute a First Commercial Sale.

1.28 “Fixed Co-Formulation Product” shall mean a pharmaceutical product containing a fixed co-formulation of Licensed Compound and at least one other active ingredient, including all formulations, line extensions and modes of administration thereof.

1.29 “FTE” shall mean the equivalent of a full-time scientist’s work time over a 12-month period (including normal vacations, sick days and holidays). The portion of an FTE year devoted by an employee or consultant to the Research Program shall be determined by dividing the number of full working days during any 12-month period devoted by such employee or consultant to the Research Program by the total number of working days in such 12-month period. Subject to the provisions of Section 3.4(a) of this Agreement, each party understands and agrees that the other party retains complete discretion to change the identity of any individual employee or consultant devoted to the Research Program and/or the frequency and the time

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during which such individual employee’s or consultant’s efforts are devoted to the Research Program.

1.30 “Generic Version” shall mean any pharmaceutical product that is introduced in a country, by an entity other than Sepracor, or its Affiliates or Sublicensees, containing the same or equivalent (by FDA or other regulatory authority standards, on a country-by-country basis) active pharmaceutical ingredient(s) as contained in a Product, including, without limitation, any such pharmaceutical product that is AB-rated or determined to be bioequivalent to a Product by the FDA, or similarly rated by other regulatory authorities outside the United States, on a country-by-country basis.

1.31 “IND” shall mean an Investigational New Drug Application filed with the FDA, or the equivalent application or filing filed with any equivalent agency or governmental authority outside the United States of America (including any supra-national agency such as in the European Union) necessary to commence human clinical trials in such jurisdiction.

1.32 “IND Plan” shall mean a written development plan for the conduct of preclinical toxicology and pharmacokinetic studies of a Product Candidate to support filing of an IND for such Product Candidate.

1.33 “Information” shall mean all tangible and intangible scientific, technical, trade, financial, or business information including, without limitation: a) cells, cell lines, organisms, animal models, genes, gene fragments, gene sequences and loci, probes, DNA, RNA, cDNA libraries, plasmids, vectors, expression systems, antibodies, proteins, and biological substances, and any constituents, progeny, mutants, derivatives or replications thereof or therefrom; b) compounds, solid state forms, compositions of matter, formulations, techniques, processes, methods, trade secrets, formulae, procedures, tests, apparatus, equipment, drawings, schemes, informatics, computer software, source code, computer hardware, data, results, analyses, documentation, reports, testing information (including without limitation, pharmacological, toxicological, preclinical, and clinical test design, methods, protocols, data, results, analyses, and conclusions), quality assurance and quality control information, knowledge, know-how, skill, and experience; c) inventions (whether patentable or not), patent applications, and patent positioning; d) sources of supply, relationships with consultants and employees, finances, financial plans, information relating to investors or potential investors, strategies, tactics, business plans, business developments; e) information concerning the existence, scope, or activities of any research, development, manufacturing, marketing, or other projects, and f) any other information about or belonging to a party, or its suppliers, licensors, licensees, partners, affiliates, customers, or potential suppliers, licensors, licensees, partners, or customers whether communicated in writing, verbally, or electronically, which is provided by one party to the other party or otherwise generated by a party in connection with this Agreement.

1.34 “Inventions” shall mean all inventions conceived, or simultaneously conceived and reduced to practice, in the course and as part of the Research Program.

1.35 “Joint Development Committee” or “JDC” shall mean a committee composed of three (3) representatives from Sepracor and three (3) representatives from ACADIA.

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1.36 “Joint Inventions” shall mean all Inventions conceived, or simultaneously conceived and reduced to practice, jointly by Sepracor employees, consultants, or contractors and ACADIA employees, consultants, or contractors in the course and as part of the Research Program.

1.37 “Joint Muscarinic Compounds” shall mean any compounds, other than ACADIA Muscarinic Compounds or ACADIA’s compound known as ACP-104 (N-desmethylclozapine) or ACP-104 Analogs, the primary mode of action of which is activity as a [...***...] of any one (1) or more of the muscarinic receptor subtypes, including, without limitation, m ₁ [...***...] receptor subtypes, that is identified or developed during the course of the Research Program, but subject to exclusion of [...***...] Agonists under the circumstances described in Section 2.3(b).

1.38 “Joint Patents” shall mean all Patents that claim or disclose a Joint Invention.

1.39 “Joint Research Committee” or “JRC” shall mean a committee composed of three (3) representatives from Sepracor and three (3) representatives from ACADIA that is responsible for overseeing, monitoring, and making decisions relating to scientific aspects of the Research Program and compounds being investigated thereunder until such time as a compound is designated as a Product Candidate.

1.40 “Licensed Compound” shall mean the Chosen Compound that is identified by Sepracor in the Exercise Notice. For the avoidance of doubt, any Option Compound that is a Chosen Compound designated as Licensed Compound shall include Other Forms of such Option Compound.

1.41 “Limited ACADIA Patents” shall mean those ACADIA Patents listed on Schedule 1.41, as may be amended from time to time pursuant to Section 9.2(a)(iv), to which a Third Party has rights to file, prosecute, maintain, defend, or enforce for so long as such Third Party has any such right.

1.42 “[...***...] Agonist” shall mean any compound Controlled by ACADIA on the Effective Date or during the Research Term, the primary mode of action of which is activity as a selective agonist of the [...***...] muscarinic receptor subtype.

1.43 “Major Market” shall mean the [...***...] .

1.44 “Materials” shall have the meaning provided in Section 3.7.

1.45 “Muscarinic Compound” shall mean any ACADIA Muscarinic Compound or Joint Muscarinic Compound, but excluding any [...***...] Eyecare Compound and excluding any [...***...] Agonists under the circumstances described in Section 2.3(b). Notwithstanding the foregoing or any other provision of this Agreement to the contrary, neither ACADIA’s compound known as ACP-104 (N-desmethylclozapine) nor any ACP-104 Analogs shall be considered Muscarinic Compounds for purposes of this Agreement.

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1.46 “Muscarinic Field” shall mean the treatment, prevention, or both, of any disease or disorder in humans, but excluding the prevention or treatment of ocular disease.

1.47 “Muscarinic Product” shall mean a pharmaceutical product containing any Selected Muscarinic Compound (or any Other Forms of the Muscarinic Compound that is a Selected Muscarinic Compound) including, in each case, all formulations, line extensions and modes of administration thereof.

1.48 “NDA” shall mean a New Drug Application (as more fully defined in 21 C.F.R. 314.5 et seq. ) and all amendments and supplements thereto filed with the FDA, or the equivalent application filed with any equivalent agency or governmental authority outside the United States of America (including any supra-national agency such as in the European Union), including all documents, data, and other information concerning a pharmaceutical product which are necessary for gaining Regulatory Approval to market and sell such pharmaceutical product.

1.49 “ [...***...] ” shall mean any [...***...] of Licensed Compound that arise from [...***...] , if any, of Licensed Compound where the product of such [...***...] .

1.50 “Net Sales” shall mean, with respect to a Product, the gross amounts invoiced by Sepracor and its Affiliates and any of their Sublicensees in the United States (but not their respective Sublicensees outside the United States) for sales of Products to Third Parties that are not Affiliates or Sublicensees of the selling party (unless such Affiliate or Sublicensee is the end user of such Product, in which case the amount billed therefor shall be deemed to be the amount that would be billed to a Third Party end user in an arm’s-length transaction), less the following items, as allocable to such Product (if not previously deducted from the amount invoiced): (a) trade, quantity or cash discounts actually allowed (provided that such discounts are not applied disproportionately to Product when compared to the other products of Sepracor, its Affiliates and Sublicensees in the United States, as applicable) including, charge back payments, administrative fees, and rebates granted to managed care organizations, purchasers and reimbursers or to trade customers, including but not limited to, wholesalers and chain and pharmacy buying groups, (b) credits actually allowed for claims, allowances for damaged goods, retroactive price reductions or returned goods, (c) prepaid freight, postage, shipping, customs duties and insurance charges and (d) sales taxes, value added taxes, duties and other governmental charges, rebates or charge backs actually paid in connection with the sale, to the extent not reimbursed (but excluding what are commonly known as income taxes).

In the event that Product is sold in the form of a Combination Product, Net Sales will be calculated by multiplying actual Net Sales (determined in accordance with the first paragraph of this Section 1.50) by the fraction A/(A+B) where: i) A is the invoice price of the Muscarinic Compound(s) contained in the Combination Product if sold separately by Sepracor, or its Affiliates or Sublicensees, during the applicable Calendar Quarter, and ii) B is the invoice price of any other active pharmaceutical component or components in the Combination Product if sold separately by Sepracor, or its Affiliates or Sublicensees, during the applicable Calendar Quarter. If Product is sold in the form of a Combination Product and one (1) or more of the active

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pharmaceutical ingredients of the Combination Product is not sold separately, then Net Sales will instead be calculated as follows:

1) if the Muscarinic Compound(s) contained in the Combination Product is sold separately by Sepracor, or its Affiliates or Sublicensees, but the other active pharmaceutical component(s) contained in the Combination Product is not sold separately by Sepracor, or its Affiliates or Sublicensees, Net Sales (determined in accordance with the first paragraph of this Section 1.50) will be multiplied by the fraction C/D where: a) C is the invoice price of the Muscarinic Compound(s) contained in the Combination Product sold separately during the applicable Calendar Quarter, and b) D is the invoice price of the Combination Product sold separately during the applicable Calendar Quarter;

2) if the Muscarinic Compound(s) contained in the Combination Product is not sold separately by Sepracor, or its Affiliates or Sublicensees, but the other active pharmaceutical component(s) contained in the Combination Product is sold separately by Sepracor, or its Affiliates or Sublicensees, Net Sales (determined in accordance with the first paragraph of this Section 1.50) will be multiplied by the fraction 1-(E/F) where: a) E is the invoice price of the other active pharmaceutical component(s) contained in the Combination Product sold separately during the applicable Calendar Quarter, and b) F is the invoice price of the Combination Product sold separately during the applicable Calendar Quarter; and

3) if neither the Muscarinic Compound(s) contained in the Combination Product nor the other active pharmaceutical component(s) contained in the Combination Product is sold separately by Sepracor, or its Affiliates or Sublicensees, Net Sales (determined in accordance with the first paragraph of this Section 1.50) will be multiplied by the fraction one-half (1/2).

1.51 “Option Compounds” shall mean any compound Controlled by ACADIA as of the Effective Date the primary mode of action of which is activity as a selective inverse agonist of 5HT _2A [...***...] . Notwithstanding the foregoing or any other provision of this Agreement to the contrary, ACADIA’s compound known as ACP-103 shall not be considered an Option Compound for purposes of this Agreement.

1.52 “Option Compound Information” shall mean Information in ACADIA’s Control that (a) is readily available to ACADIA, its Affiliates, or any of their employees, consultants, or contractors at the time such Information is to be provided, and (b) addresses any of the characteristics or properties of Option Compounds, Evaluation Compounds, Chosen Compounds, or Licensed Compound, as applicable, including, without limitation, Information relating to structure, methods or process for synthesis, metabolism, bioavailability, binding assays, functional assays, and any in vivo studies. If such Option Compound Information (i) relates to Option Compounds, it shall include such Information that exists as of the Effective Date, (ii) relates to Evaluation Compounds, it shall include such Information that exists as of the Effective Date and during the Preliminary Evaluation Period, (iii) relates to Chosen Compounds it shall include such Information that exists as of the Effective Date and during the Option Period, or (iv) relates to Licensed Compound it shall include Information that exists as of the Effective Date and during the Option Period.

1.53 “Option Exercise Fee” shall mean [...***...] dollars ($[...***...]) .

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1.54 “Option Period” shall mean, cumulatively, the Preliminary Evaluation Period and the Final Evaluation Period, unless earlier terminated in accordance with Article 12.

1.55 “Other Form” shall mean, with regard to a particular compound, any and all: 1) [...***...] ; 2) [...***...] ; 3) [...***...] ; 4) [...***...] of any of 1), 2), and (if applicable) 3) above; and 5) [...***...] of any of 1), 2), (if applicable) 3), and 4) above; provided, however , with regard to Licensed Compound, the term “Other Form” shall not include [...***...] , and further provided that with regard to Chosen Compounds (including Licensed Compound) the inclusion in the term “Other Form” of [...***...] pursuant clause 3) of this Section 1.55 shall be subject to the provisions of Sections 4.1(b)(ii) and 4.4(b).

1.56 “Patents” shall mean all issued or granted patents and all patent applications worldwide, including without limitation, any and all provisional applications, substitutions, inventor’s certificate, divisions, RCEs, continuations, continuations-in-part, re-examinations, reissues, renewals, registrations, confirmations, extensions, term restorations, supplementary protection certificates, and any other filings thereof.

1.57 “Percentage-Based Payments” shall have the meaning provided in Section 7.7.

1.58 “Phase I Clinical Trial” shall mean a human clinical study conducted in accordance with good clinical practice in a small number of healthy volunteers or patients designed or intended to establish an initial safety profile, pharmacodynamics, or pharmacokinetics of a Product.

1.59 “Phase II Clinical Trial” shall mean a human clinical trial that satisfies the requirements for a Phase II study as defined in 21 C.F.R. 312.21(b) (or its successor regulation).

1.60 “Phase III Clinical Trials” shall mean a human clinical trial that satisfies the requirements for a Phase III study as defined in 21 C.F.R. 312.21(c) (or its successor regulation).

1.61 “Preclinical Development Costs” shall mean actual external costs incurred by ACADIA before the Effective Date, or at Sepracor’s written request after the Effective Date, for conduct of any of the following types of studies using a compound that is at any time designated as a Licensed Compound specifically intended to support the filing of an IND: in vivo and in vitro genotoxicity; safety pharmacology; drug metabolism; pharmacokinetics; general toxicology studies; GLP and GMP drug supply manufacturing; or stability.

1.62 “Preliminary Evaluation Period” shall mean the period beginning upon Sepracor’s receipt of Option Compound Information relating to all Evaluation Compounds pursuant to Section 4.1(a) and continuing until the earlier of (a) the [...***...] anniversary of Sepracor’s receipt of such Information, or a later or earlier date as may be agreed upon by the parties in writing, or (b) the date of Sepracor’s written notice to ACADIA identifying any Chosen Compound.

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1.63 “Preliminary Evaluation Work” shall mean studies or work conducted by or on behalf of Sepracor, at Sepracor’s cost and expense, using Evaluation Compounds that in Sepracor’s sole determination are desirable for selecting Chosen Compounds, including without limitation, synthesis of Evaluation Compounds, binding assays, functional assays, metabolism, bioavailability, stability, and toxicology, but excluding any studies in humans.

1.64 “Primary Selected Muscarinic Compound” shall mean any Muscarinic Compound that, on or before the expiration or termination (other than termination by ACADIA in accordance with Section 12.2 or 12.4) of the Research Term, was designated a Product Candidate, and any Other Forms of any such Muscarinic Compound.

1.65 “Product” shall mean a Muscarinic Product or a Fixed Co-Formulation Product.

1.66 “Product Candidate” shall mean a Selected Muscarinic Compound approved by the JRC as a candidate for further research and development to support Regulatory Approval.

1.67 “Product Candidate Criteria ” shall mean the information, evaluation parameters, and criteria established by the JRC.

1.68 “Product Patents” shall mean a) any and all ACADIA Patents (excluding Limited ACADIA Patents) that contain claims limited to Selected Muscarinic Compounds or Products under development or commercialization by or on behalf of Sepracor or its Affiliates or Sublicensees, including, without limitation, claims directed to an active pharmaceutical ingredient (“API”), Other Forms of an API, compositions comprising an API, formulations, delivery systems, processes for making any of the foregoing, and methods of using such API, Other Forms thereof, Selected Muscarinic Compounds or Products, and b) any and all Joint Patents that contain at least one (1) claim directed to one (1) or more Selected Muscarinic Compounds or Products under development or commercialization by or on behalf of Sepracor or its Affiliates or Sublicensees, including, without limitation, claims directed to an API, Other Forms of an API, compositions comprising an API, formulations, delivery systems, processes for making any of the foregoing, and methods of using such API, Other Forms thereof, Selected Muscarinic Compounds, or Products. For clarification, Product Patents shall not include any ACADIA Patent that contains one (1) or more claims directed to ACP-103, ACP-104, ACP-104 Analogs, [...***...] Eyecare Compounds, any Muscarinic Compound that is not a Selected Muscarinic Compound, or any Option Compound, including, without limitation, claims directed to an API, Other Forms of an API, compositions comprising an API, formulations, delivery systems, processes for making any of the foregoing, and methods of using such API, Other Forms thereof, such compounds, or products based on such compounds.

1.69 “Regulatory Approval” shall mean any and all approvals (including price and reimbursement approvals, if required), licenses, registrations, or authorizations of any country, federal, supranational, state or local regulatory agency, department, bureau or other government entity that are necessary for the manufacture, use, storage, import, transport and/or sale of a Product in such jurisdiction.

1.70 “Research Plan” shall mean the written plan for conducting the Research Program, as amended from time to time by the JRC.

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1.71 “Research Program” shall mean a research program carried out by the parties during the Research Term for the identification and development of one or more Muscarinic Compounds with potential utility for the treatment or prevention of any indication in the Muscarinic Field, including without limitation [...***...] , as more fully described in Articles 2 and 3 of this Agreement and in the Research Plan. For purposes of clarification, the Research Program excludes the Evaluation.

1.72 “Research Term” shall mean the period beginning on the Effective Date and ending on the third anniversary of the Effective Date, subject to termination in accordance with Article 12 and extension for additional, consecutive [...***...] periods by written agreement of the parties.

1.73 “Returned Products” shall mean any Muscarinic Products based on Primary Selected Muscarinic Compounds and their respective Back-Up Selected Muscarinic Compounds, rights to which revert to ACADIA pursuant to Section 6.2(a)(i).

1.74 “Royalty Term” shall mean, in the case of any Product, in any country, the period of time commencing on the First Commercial Sale of such Product in such country and ending upon the later of either (a) [...***...] years after the date of First Commercial Sale of such Product in such country, or such earlier time as a Generic Version of such Product is launched in such country and (b) the expiration of the last to expire of any issued patent within the ACADIA Patents, Joint Patents, or Sepracor Patents arising from Sepracor Inventions, containing a claim directed to such Product or use thereof in such country.

1.75 “Selected Indications” shall mean, for each Primary Selected Muscarinic Compound and any Back-Up Selected Muscarinic Compounds thereof, one or more specific indications in the Muscarinic Field for which, on or before expiration or termination of the Research Term, Sepracor has the then-current good faith intention of pursuing clinical development.

1.76 “Selected Muscarinic Compound” shall mean a Primary Selected Muscarinic Compound or a Back-Up Selected Muscarinic Compound, as applicable.

1.77 “Sepracor Inventions” shall mean all Inventions conceived, or simultaneously conceived and reduced to practice, solely by Sepracor employees, consultants, or contractors in the course and as part of the Research Program.

1.78 “Sepracor Know-How” shall mean Information not included in the Sepracor Patents or Joint Patents that Sepracor or any of its Affiliates Controls on the Effective Date or during the Research Term that pertains to or arises from the Research Program or the Evaluation, or that is necessary for the development, manufacture, use, offer for sale, or sale of any Product, including, without limitation, all such Information that is conceived or developed by Sepracor or any of its Affiliates in the course and as part of the Research Program or the Evaluation, and, in each case, any replication or any part of such Information; provided, however, that Sepracor Know-How excludes any such Information relating to Eszopiclone Compounds, which is Confidential Information of Sepracor.

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1.79 “Sepracor Patents” shall mean all Patents that Sepracor or any of its Affiliates Controls on the Effective Date or during the Research Term that are necessary or useful for (a) performance of the Research Program or the Evaluation, or (b) the development, manufacture, use, import, offer for sale, or sale of any Selected Muscarinic Compound, Licensed Compound or Product, but excluding Joint Patents, and also excluding any Patents directed to Eszopiclone Compounds or the use of Eszopiclone Compounds.

1.80 “Sepracor Technology” shall mean the Sepracor Patents, Sepracor Inventions, and Sepracor Know-How.

1.81 “Sleep Field” shall mean the treatment, prevention, or management, or any combination thereof, as a primary objective, of any condition, disturbance, disease, or disorder in humans the principal effect(s) of which are (i) on [...***...] , or (ii) to [...***...] , and also including, without limitation, any such condition, disturbance, disease, or disorder where the treatment, prevention, or management, or any combination thereof, of any such condition, disturbance, disease, or disorder may result, as a secondary objective, in [...***...] associated with or arising from any of the foregoing conditions, disturbances, diseases, or disorders. For clarification, the Sleep Field excludes [...***...] (including, without limitation, where the treatment, prevention, or management, or any combination thereof, of any of the foregoing conditions, disturbances, diseases, disorders, or psychoses may result, as a secondary objective, in [...***...] (excluding anything recited in the first sentence of this Section 1.81) associated with or arising from any of the foregoing conditions, disturbances, diseases, disorders or psychoses).

1.82 “Stock Purchase Agreement” shall mean the agreement discussed in more detail in Section 7.1.

1.83 “Sublicensee” shall mean a Third Party to whom Sepracor or any of its Affiliates has granted a license or sublicense to develop, make, have made, use, distribute for sale, promote, market, offer for sale, sell, have sold, import, or export Products, beyond the mere right to purchase Products from Sepracor or its Affiliates. For the avoidance of doubt, the parties agree that a Third Party acquiring all or substantially all of the business of Sepracor or its

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Affiliates, whether by merger, sale of stock, sale of assets, or otherwise, shall not be a Sublicensee.

1.84 “Sublicensing Revenues” shall mean the amount actually received by Sepracor or an Affiliate of Sepracor from any and all Sublicensees (excluding any amounts described in the proviso below) arising from the license or sublicense of the right, [...***...] , to develop, make, have made, use, distribute for sale, promote, market, offer for sale, sell, have sold, import or export Products. Sublicensing Revenues shall include up-front or license fees, milestone payments, royalties paid to Sepracor or any of its Affiliates by a Sublicensee based on such Sublicensee’s sale of Products, premiums above the fair market value on sales of securities, annual maintenance fees and any other payments in respect of the grant to such Sublicensee of a license or sublicense of the right, [...***...] , to develop, make, have made, use, distribute for sale, promote, market, offer for sale, sell, have sold, import or export Products (with any of the foregoing consideration received by Sepracor or its Affiliate other than in the form of cash to be valued at its fair market value as of the date of receipt); provided, however, that Sublicensing Revenues shall not include any payments tied directly to the provision of goods and services by Sepracor or its Affiliate to such Sublicensee (including, without limitation, any amounts received as reimbursement of costs or expenses actually incurred by Sepracor or its Affiliate for research, development, manufacturing (including, without limitation, packaging, samples, storage, and shipping), marketing, and payment of government fees) to compensate Sepracor or its Affiliate for the fair market value of the provision of such goods and services, or payments for securities (other than premiums above the fair market value of such securities).

1.85 “Successful Completion” shall mean, with respect to a Phase II Clinical Trial of a Product, that Sepracor has received the final report of the results of such Phase II Clinical Trial and Sepracor has not terminated all development of such Product within [...***...] of receipt of such final report and provided ACADIA with written notice thereof.

1.86 “Term” shall have the meaning provided in Section 12.1.

1.87 “Third Party” shall mean any entity other than ACADIA or Sepracor or an Affiliate of ACADIA or Sepracor.

1.88 “Third Party Compound” shall mean certain of the [...***...] Eyecare Compounds listed in Schedule 1.89 as of the Effective Date, which are licensed to a Third Party [...***...] .

1.89 “[...***...] Eyecare Compounds” shall mean specific Muscarinic Compounds and Other Forms thereof (excluding [...***...] as set forth in clause 3) of Section 1.55) that the parties agree are [...***...] , as listed in Schedule 1.89, as may be updated pursuant to Section 3.10(b).

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2.1 Joint Research Committee.

(a) Formation & Chairperson. Promptly after the Effective Date, the parties will form a Joint Research Committee. Each party may change the identity of any or all of its members on the JRC at any time in its sole discretion. One member of the JRC shall be selected to act as the chairperson of the JRC, with each chairperson acting for a term of [...***...] . The chairperson shall be selected [...***...] by ACADIA and Sepracor, and [...***...] shall designate the first chairperson.

(b) JRC Meetings. The JRC shall meet at least four (4) times per calendar year during the Research Term or at such greater frequency as the JRC agrees. Such meetings may be conducted by videoconference, teleconference or in person, as agreed by the parties (except that at least two (2) of such meetings per year shall be conducted in person), and the parties shall agree upon the time of meetings. A reasonable number of additional representatives of a party may attend meetings of the JRC in a non-voting capacity.

(c) Reports. Within [...***...] after each meeting, the JRC chairperson will provide the parties with a written report describing, in reasonable detail, the status of the Research Program, a summary of the results and progress to date, the issues requiring resolution, and the agreed resolution of previously reported issues.

(d) Period. The JRC shall remain in place until the expiration or termination of the Research Term.

2.2 Joint Research Committee Functions and Powers. The responsibilities of the JRC shall be as follows:

(a) reviewing scientific information and data for Muscarinic Compounds, and for Muscarinic Compounds that satisfy Product Candidate Criteria, voting on approval of such Muscarinic Compounds as Product Candidates;

(b) developing and approving the Research Plan within [...***...] of the Effective Date;

(c) overseeing and monitoring the progress of the Research Program;

(d) determining the total number (which shall not be less than [...***...] nor more than [...***...] at any given time, and shall be subject to the provisions of Section 3.4) and functional mix of ACADIA chemistry, in vitro biology and in vivo biology FTEs to be devoted to the Research Program; and

(e) sharing information generated in the course of the Preliminary Evaluation Work and the Evaluation Studies.

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2.3 Joint Research Committee Decision-Making.

(a) Voting. Decisions of the JRC shall be made by unanimous vote, with each member present at or participating in such meeting having one vote; provided, however, that present or participating members of a party shall have the right to vote by proxy for members of that party who do not attend or participate. No vote of the JRC may be taken unless at least two (2) of each party’s representatives are present for the JRC vote.

(i) If the JRC is unable to reach a unanimous vote on any matter, then the matter shall be referred to the Chief Scientific Officer of ACADIA and the Executive Vice President, Research and Development, of Sepracor for further discussion and resolution. These officers shall have [...***...] to attempt in good faith to resolve the matter and thereby make the decision on behalf of the JRC.

(ii) If the officers referred to in Section 2.3(a)(i) above are unable to reach an agreement at the end of the [...***...] period, then the matter shall be referred to the Chief Executive Officer of ACADIA and the Chief Executive Officer of Sepracor. The CEOs shall have [...***...] to attempt in good faith to resolve the matter and thereby make the decision on behalf of the JRC.

(iii) If the CEOs are unable to reach an agreement on such matters at the end of the [...***...] period referred to in Section 2.3(a)(ii) above, then Sepracor shall have the right to make the final decision on behalf of the JRC, but in no event will Sepracor have the right to increase the number of ACADIA FTEs beyond [...***...] FTEs in any year of the Research Term without ACADIA’s written consent.

(b) Reversion of [...***...] Agonists. If (i) the JRC determines, in accordance with Section 2.3(a) above, at any time during the Research Term, that research and development of [...***...] Agonists is not being currently pursued under the Research Program or in good faith planned to be pursued under the Research Program during the Research Term as reflected in the Research Plan, or (ii) at the end of the Research Term, there is not at least one (1) [...***...] Agonist that has been designated as a Primary Selected Muscarinic Compound, then, effective upon the date of such determination under subsection (i) or the end of the Research Term under the circumstances described in subsection (ii), as applicable, all [...***...] Agonists shall be excluded from the definition of Muscarinic Compounds for purposes of this Agreement (including, without limitation, the license granted to Sepracor under Section 6.1(a)) and shall no longer be subject to this Agreement, and ACADIA shall be free to pursue research, development and commercialization of [...***...] Agonists for any indication, itself or with its Affiliates and Third Parties.

2.4 Joint Development Committee.

(a) Formation & Chairperson. Promptly after the selection of the first Product Candidate, the parties will form a Joint Development Committee. Each party may change the identity of any or all of its members on the JDC at any time in its sole discretion. One (1) member of the JDC shall be selected to act as the chairperson of the JDC, with each chairperson acting for a term of [...***...]. The chairperson shall be selected [...***...] by ACADIA and Sepracor, and [...***...] shall designate the first chairperson.

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(b) JDC Meetings. The JDC shall meet at least four (4) times per year during the Research Term and for so long thereafter as any Product Candidate is in preclinical studies conducted prior to filing of an IND for the Product Candidate, or at such greater frequency as the JDC agrees. Such meetings may be conducted by videoconference, teleconference or in person, as agreed by the parties (except that at least two (2) of such meetings per year shall be conducted in person), and the parties shall agree upon the time of meetings. A reasonable number of additional representatives of a party may attend meetings of the JDC in a non-voting capacity.

(c) Reports. Within [...***...] after each meeting, the JDC chairperson will provide the parties with a written report describing, in reasonable detail, the status of development efforts with respect to each Product Candidate, a summary of the results and progress to date, the issues requiring resolution, and the agreed resolution of previously reported issues.

(d) Period. The JDC shall remain in place for so long as any Product Candidate (including any Other Forms of such Product Candidate) remains in preclinical studies conducted prior to IND filing and has not been entered into clinical trials.

2.5 Joint Development Committee Functions and Powers. The responsibilities of the JDC shall be as follows:

(a) developing and approving an IND Plan for each Product Candidate, within [...***...] of the JRC’s selection of such Product Candidate;

(b) overseeing development and regulatory strategies for Product Candidates prior to acceptance of an IND for a Product Candidate;

(c) carrying out the other duties and responsibilities described for it in this Agreement; and

(d) so long as a JDC remains in effect, act as a mechanism for Sepracor to provide updates to ACADIA related to work with Product Candidates following acceptance of an IND for the same.

For purposes of clarification, the JDC’s authority shall be Product-specific (i.e., the JDC shall exercise its rights under this Article 2 on a Product-by-Product basis, commencing as of designation of a Product Candidate and ending at such time as an IND is accepted for a Muscarinic Product based on such Product Candidate (or Other Forms of such Product Candidate)).

2.6 Joint Development Committee Decision-Making. Decisions of the JDC shall be made by unanimous vote, with each member present at or participating in such meeting having one vote; provided, however, that present or participating members of a party shall have the right to vote by proxy for members of that party who do not attend or participate. No vote of the JDC may be taken unless at least two (2) of each party’s representatives on the JDC are present to vote.

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(a) If the JDC is unable to reach a unanimous vote on any matter, then the matter shall be referred to the Chief Scientific Officer of ACADIA and the Executive Vice President, Research and Development, of Sepracor for further discussion and resolution. These officers shall have [...***...] to attempt in good faith to resolve the matter and thereby make the decision on behalf of the JDC.

(b) If the officers referred to in Section 2.6(a) above are unable to reach an agreement by the end of the [...***...] period, then the matter shall be referred to the Chief Executive Officer of ACADIA and the Chief Executive Officer of Sepracor. The CEOs shall have [...***...] to attempt in good faith to resolve the matter and thereby make the decision on behalf of the JDC.

(c) If the CEOs fail to reach an agreement by the end of the [...***...] period referred to in Section 2.6(b) above, then Sepracor shall have the right to make the final decision on behalf of the JDC.

2.7 Product Business Decisions. All business decisions relating to development, promotion, or commercialization of any Product in any country, including, but not limited to, decisions concerning commercial activities, labeling, pricing, reimbursement, trademarks, brand names, logos, packing, package design, sales, package inserts, promotional materials, and promotional activities, and the decision to launch or continue to market any Product in any country, shall be within the sole discretion of Sepracor.

3.1 Objectives; Responsibilities. The parties hereby agree to establish the Research Program, to be conducted by the parties during the Research Term in accordance with the Research Plan, any IND Plan and the terms of this Agreement, with the goal of identifying [...***...] Muscarinic Compounds with potential utility in the Muscarinic Field and developing [...***...] Muscarinic Products for further development and commercialization by Sepracor in the Muscarinic Field, including, without limitation, the treatment or prevention of [...***...] . The initial Research Plan shall be mutually agreed upon in writing by the parties as promptly as practicable (but in any event within [...***...] following the Effective Date). Any amendments or revisions to the Research Plan shall be in writing and shall require unanimous approval of the JRC. During the Research Program, there shall be no limit on the number of Muscarinic Compounds or Product Candidates that are worked on or evaluated.

3.2 Technology Transfer. Commencing immediately after the Effective Date and from time to time thereafter during the Research Term, ACADIA shall disclose to Sepracor such ACADIA Technology as is reasonably necessary to enable Sepracor to carry out its obligations under the Research Program and to exercise fully the licenses granted to Sepracor under this Agreement, and Sepracor shall disclose to ACADIA such Sepracor Technology as is reasonably necessary to enable ACADIA to carry out its obligations under the Research Program and to exercise fully the licenses granted to ACADIA under this Agreement.

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3.3 Performance Standards. Each party shall conduct its activities under the Research Program and any IND Plan in good scientific manner, and in compliance in all material respects with the requirements of applicable laws and regulations and with applicable good laboratory practices, to attempt to achieve its objectives efficiently and expeditiously. Each party shall maintain laboratories, offices and all other facilities reasonably necessary to carry out the activities to be performed by it pursuant to the Research Plan or any IND Plan. In conformity with standard pharmaceutical and biotechnology industry practices and the terms and conditions of this Agreement, each party shall prepare and maintain, or shall cause to be prepared and maintained, complete and accurate written records, accounts, notes, reports, and data with respect to activities conducted pursuant to the Research Plan or any IND Plan and, upon the other party’s written request, shall send legible copies of the aforesaid to the other party, all of which shall be subject to the confidentiality and other obligations of Article 11. Upon reasonable advance notice, each party agrees to make its employees and non-employee consultants reasonably available at their respective places of employment to consult with the other party on issues arising under the Research Program during the Research Term or relating to development or commercialization of Products (provided that, if consultation by employees or consultants of ACADIA relating to development or commercialization of Products requested by Sepracor after the Research Term involves additional laboratory services or performance of preclinical or clinical studies, Sepracor shall reimburse ACADIA for such employees’ or consultants’ time spent carrying out such services or studies in accordance with the terms of a separately negotiated agreement).

3.4 Research Commitment.

(a) Commitment/FTEs. During the Research Term, each party shall use its commercially reasonable efforts to perform its responsibilities under the Research Plan and any IND Plan in accordance with such plan and the terms and conditions of this Agreement. Without limiting the generality of the foregoing, ACADIA shall devote to the performance of its responsibilities under the Research Plan and any IND Plan such number of FTEs as is determined by the JRC in accordance with Article 2, provided that in no event shall ACADIA be obligated to devote more than an aggregate of [...***...] FTEs to all Research Plan and IND Plan activities at any given time, and further provided that, in the event that ACADIA is obligated to devote more than [...***...] FTEs in any year, for that year, Sepracor will increase the research funding described in Section 7.3 of this Agreement by an incremental rate of [...***...] per FTE, subject to Section 3.4(b) below; and further provided that, with respect to staffing of FTEs for the Research Program, ACADIA shall [...***...] .

(b) No Express or Implied Employment. Nothing in this Agreement creates or intends to create, any express or implied employment by Sepracor or its Affiliates of any ACADIA FTE, and no FTE funded by Sepracor in accordance with this Agreement shall be entitled to any Sepracor, or its Affiliates, benefits, including without limitation, employee stock options, employee stock purchase plans, 401(k) programs, health insurance, or workers compensation. ACADIA is responsible for all employee withholding taxes or other taxes owed with regard to any FTE in any country, and shall indemnify and hold Sepracor harmless for any claims, suits, or causes of action relating thereto.

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(c) FTE Reports. At or before each JRC meeting, ACADIA shall provide Sepracor with a quarterly FTE allocation report for the Research Program and a list of the FTEs staffing the Research Program. In addition, Sepracor may request an interim FTE allocation report at any time by providing written notice to ACADIA, and ACADIA shall provide such interim report to Sepracor within [...***...] thereafter; provided , however , that Sepracor may not request an interim report more than one (1) time per Calendar Quarter. The format and content of the FTE allocation report shall be decided by the JRC at its first meeting after the Effective Date.

3.5 Research Reports. Each party shall keep the other party fully informed as to all discoveries and technical developments (including, without limitation, any Inventions) made in the course of performing activities under the Research Plan or any IND Plan. In particular, each party shall prepare, and distribute to all members of the applicable Committee no later than [...***...] prior to the next Committee meeting, a reasonably detailed written summary report, in such form and format and setting forth such information regarding the results and progress of performance of the Research Plan or IND Plan activities, as applicable, as determined from time to time by such Committee. Nothing herein shall require ACADIA or Sepracor to disclose to the other information received from or generated for a Third Party that remains subject to bona fide confidentiality obligations to such Third Party.

3.6 Subcontracts. A party may perform some of its obligations under the Evaluation, the Research Plan, or any IND Plan through one (1) or more subcontractors, provided that (a) none of the other party’s rights hereunder are diminished or otherwise adversely affected as a result of such subcontracting, (b) the subcontractor undertakes in writing obligations of confidentiality and non-use regarding Confidential Information which are substantially the same as those undertaken by the parties pursuant to Article 11 hereof, and (c) the subcontractor is approved by the JRC, provided that Sepracor shall not require approval by the JRC, JDC, or ACADIA with regard to any work performed by subcontractors or on behalf of Sepracor or its Affiliates relating to Product Candidates or development or commercialization of Products. In the event a party performs any of its obligations under the Research Plan or any IND Plan through a subcontractor, then such party will at all times be responsible for the performance and payment of such subcontractor.

3.7 Materials Transfer. In order to facilitate the Research Program and the Evaluation, either party may provide to the other party certain biological materials or chemical compounds Controlled by the supplying party, including, but not limited to, Muscarinic Compounds, Option Compounds or Other Forms of any of the foregoing (collectively, “Materials” ) for use by the other party in furtherance of the Research Program, any IND Plan or the Evaluation, as applicable. Except as otherwise provided under this Agreement, all such Materials delivered to the other party will remain the sole property of the supplying party, will be used only in furtherance of the Research Program or Evaluation in accordance with this Agreement, will not be used or delivered to or for the benefit of any Third Party, except for subcontractors pursuant to Section 3.6, without the prior written consent of the supplying party, and will be used in compliance with all applicable laws, rules and regulations. The Materials supplied under this Agreement must be used with prudence and appropriate caution in any experimental work because not all of their characteristics may be known. Except as expressly set forth herein, THE MATERIALS ARE PROVIDED “AS IS” AND WITHOUT ANY

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REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE OR ANY WARRANTY THAT THE USE OF THE MATERIALS WILL NOT INFRINGE OR VIOLATE ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTY.

3.8 Selected Muscarinic Compounds.

(a) Back-Up Selected Muscarinic Compounds. Upon expiration or termination of the Research Term (other than termination by ACADIA in accordance with Section 12.2 or 12.4), Sepracor shall have the right to designate up to [...***...] Back-Up Selected Muscarinic Compounds for each Primary Selected Muscarinic Compound by providing written notice to ACADIA for each such designation within [...***...] of such expiration or termination.

(b) Selected Indications. With respect to each Primary Selected Muscarinic Compound and Back-Up Selected Muscarinic Compounds thereof, Sepracor shall, by no later than [...***...] following expiration or termination of the Research Term (other than termination by ACADIA in accordance with Section 12.2 or 12.4), provide ACADIA with written notice identifying Selected Indications for the same.

(c) Post-Research Term Rights.

(i) Upon expiration or termination of the Research Term (other than termination by ACADIA in accordance with Section 12.2 or 12.4), all rights (excluding any rights under Sepracor Technology or Sepracor’s interest as an owner of Joint Patents) to any Muscarinic Compound that is not designated as a Selected Muscarinic Compound within [...***...] after the effective date of such expiration or termination shall revert to ACADIA. From and after such time, Sepracor shall not develop, or attempt to develop, any Muscarinic Compound Controlled by ACADIA (excluding Joint Muscarinic Compounds Controlled by both parties), or Other Forms of any such Muscarinic Compound, that is not a Selected Muscarinic Compound, and Sepracor’s license under Section 6.1(a)(iii) shall only apply to Selected Muscarinic Compounds (including Back-Up Selected Muscarinic Compounds designated in accordance with this Section 3.8). For purposes of clarification, and notwithstanding any of the foregoing provisions of this Section 3.8 regarding designation of Selected Indication(s) to the contrary, for so long as Sepracor’s license under Section 6.1(a)(iii) remains in effect with respect to a Selected Muscarinic Compound, Sepracor shall have the exclusive right to develop and commercialize such Selected Muscarinic Compound for any indications in the Muscarinic Field, and ACADIA and its Affiliates shall not have any right to develop, commercialize, or sell (alone or through a Third Party) any Selected Muscarinic Compound outside the Muscarinic Field.

(ii) Upon expiration or termination of the Research Term, except as otherwise specifically provided in Section 6.1(b)(ii), ACADIA shall not have any rights or licenses in, to, or under any Sepracor Technology, or other Patents (excluding Joint Patents) or Information belonging to or provided by Sepracor or its Affiliates, and ACADIA shall not use the same or share it with any Third Party. Upon expiration or termination of the Research Term,

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except as otherwise specifically provided in Section 6.1(a)(iii) and (iv), Sepracor shall not have any rights or licenses in, to, or under any ACADIA Technology, or other Patents (excluding Joint Patents) or Information belonging to or provided by ACADIA or its Affiliates, and Sepracor shall not use the same or share it with any Third Party.

3.9 Exclusivity. Until [...***...] of the expiration or termination of the Research Term (other than termination by ACADIA in accordance Section 12.2 or 12.4), ACADIA shall not develop or commercialize (either directly or through any Third Party) any Muscarinic Compound for use in the Selected Indications. However, if, at any time prior to [...***...] of the expiration or termination of the Research Term (other than termination by ACADIA in accordance with Section 12.2 or 12.4), Sepracor is not engaged in any development or commercialization efforts whatsoever with respect to at least one (1) Selected Muscarinic Compound or Muscarinic Product for any given Selected Indication, or either (i) Sepracor in good faith notifies ACADIA in writing that it intends to abandon research and development of all Selected Muscarinic Compounds or Muscarinic Products for such Selected Indication or (ii) the minutes of any board or committee meeting of Sepracor reflect Sepracor’s abandonment of research and development of all Selected Muscarinic Compounds and Muscarinic Products for such Selected Indication, then the restriction set forth in the first sentence of this Section 3.9 shall terminate with respect to such Selected Indication.

3.10 ACADIA Development of [...***...] Eyecare Compounds.

(a) Original [...***...] Eyecare Compounds. Sepracor agrees that ACADIA shall retain all rights (excluding any rights under Sepracor Technology or Sepracor’s interest as an owner of Joint Patents) to pursue, itself or with any Affiliate or Third Party, one (1) or more [...***...] Eyecare Compounds subject to the terms and provisions of this Agreement.

(b) Designation of New [...***...] Eyecare Compounds. From time to time during the Research Term, ACADIA may provide Sepracor written notice identifying one (1) or more Muscarinic Compounds that ACADIA in good faith believes are [...***...] due to one or more factors (such as [...***...] ), and such written notice will provide Sepracor with data to evidence such unsuitability and shall include a request to designate the identified Muscarinic Compounds as [...***...] Eyecare Compounds. Should Sepracor believe, in good faith, that any of such Muscarinic Compounds identified by ACADIA in its written notice are suitable or potentially suitable for [...***...] Sepracor shall provide ACADIA with written notice identifying the Muscarinic Compound(s) described in ACADIA’s notice that Sepracor believes are suitable for [...***...] or that Sepracor believes inadequate information exists at the time to determine whether any such Muscarinic Compound is suitable for [...***...] , and explaining its rationale for such belief, within [...***...] of receipt of such notice from ACADIA, and such Muscarinic Compound(s) shall not be considered [...***...] Eyecare Compounds. If Sepracor notifies ACADIA that Sepracor agrees with ACADIA’s determination of such Muscarinic Compound(s)’ unsuitability for [...***...] , or if Sepracor does not respond to ACADIA’s written notice regarding the unsuitability of such Muscarinic Compound(s) for [...***...] within [...***...] after receipt of such notice, such Muscarinic Compound(s) shall be deemed [...***...] Eyecare Compound(s) and shall cease to be considered Muscarinic Compound(s) for purposes of this Agreement.

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(c) Other Requests. From time to time during the Research Term, ACADIA may, by written notice to Sepracor, request Sepracor’s written consent that ACADIA may pursue research, development and commercialization (either directly or through its Affiliates or any Third Party) for Eyecare Indications of one or more specific Muscarinic Compounds (excluding any Selected Muscarinic Compounds) that are potentially suitable for systemic administration. Sepracor agrees to consider in good faith any such request, and provide ACADIA with written notice of its determination.

4.1 Option Period.

(a) Preliminary Evaluation Period. Within [...***...] of the Effective Date, ACADIA will send Sepracor all then existing Option Compound Information, and a written notice confirming that all then existing Option Compound Information was sent to Sepracor. Within [...***...] of Sepracor’s receipt of all Option Compound Information, Sepracor shall identify to ACADIA, by written notice, [...***...] Evaluation Compounds for the purpose of conducting Preliminary Evaluation Work. Within [...***...] of receipt of Sepracor’s notice identifying Evaluation Compounds, ACADIA will provide Sepracor with Option Compound Information not previously provided to Sepracor relating to Evaluation Compounds, including without limitation methods and processes for synthesizing the same, and to the extent available, reasonable quantities of each Evaluation Compound for purposes of conducting Preliminary Evaluation Work during the Preliminary Evaluation Period.

(b) Selection of Chosen Compounds.

(i) Selection. Sepracor shall have the right, exercisable by written notice to ACADIA from the Effective Date and throughout the Preliminary Evaluation Period, to designate up to [...***...] Chosen Compounds for purposes of conducting Evaluation Studies during the Final Evaluation Period. Sepracor will use good faith efforts to make the designation of the Chosen Compounds as promptly as possible within the Preliminary Evaluation Period. Within [...***...] of ACADIA’s receipt of Sepracor’s notice designating Chosen Compounds, ACADIA shall deliver to Sepracor a reasonably detailed written summary of existing Preclinical Development Costs for each Chosen Compound.

(ii) Identification of Other Forms. By no later than [...***...] from the date of its written notice designating Chosen Compounds pursuant to Section 4.1(b)(i) above, Sepacor shall send ACADIA a written notice providing a cumulative list designating all compounds that Sepracor believes in good faith may be Chosen Compound [...***...] based on scientifically acceptable principles and methods, and the compounds on such list shall thereafter be the only [...***...] for Chosen Compounds included in the term “Other Form” pursuant to clause 3) of Section 1.55.

(c) Evaluation Reports . On a [...***...] during the Option Period, Sepracor will provide to ACADIA the Evaluation Results and a summary of other Sepracor

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Know-How generated in the course of the Preliminary Evaluation Work or Evaluation Studies, which may be provided through the JRC.

(d) Use of Evaluation Results. Except as otherwise provided in this Agreement, Sepracor shall use Option Compound Information, Option Compounds, and Evaluation Results solely for the purpose of carrying out the Evaluation. Without limiting the generality of the foregoing, except as otherwise provided in this Agreement, Sepracor agrees that after the Effective Date it shall not (i) use Option Compounds, Option Compound Information, or Evaluation Results received or generated by Sepracor pursuant to this Agreement in research that is subject to licensing, or similar obligations to any Third Party, (ii) disclose or transfer Option Compounds, Option Compound Information, or Evaluation Results to any Third Party without ACADIA’s prior written consent except as otherwise provided in Section 3.6 of this Agreement, (iii) develop, or attempt to develop, any Other Forms of any Option Compound; or (iv) except as otherwise provided in Section 9.3, file (or cause to be filed) any patent application anywhere in the world containing any Option Compound Information or any results of the Evaluation Studies, or that contains compound claims directed to any Option Compound or Other Forms thereof, or any method of use of any Option Compound or Other Forms thereof, without ACADIA’s prior written consent.

4.2 Extension of Option Period for ACADIA Delay. The Option Period may be extended by the parties if ACADIA does not timely provide the Option Compound Information or the required quantities of Evaluation Compounds in accordance with Section 4.1. If Sepracor in good faith believes that ACADIA has not timely provided such Option Compound Information or Evaluation Compounds, Sepracor shall provide ACADIA with written notice thereof, and the parties shall negotiate in good faith and mutually agree in writing upon an extension of the Option Period that is commensurate with the duration of any delay in the Evaluation caused by ACADIA’s failure to comply with its obligations under Section 4.1.

4.3 Grant of Option. Subject to the terms and conditions of this Agreement, ACADIA hereby grants to Sepracor an option (the “Option” ), exercisable during the Final Evaluation Period with respect to one (1) Chosen Compound, to obtain an exclusive, worldwide, royalty-bearing license, with the right to sublicense, under the ACADIA Technology to develop, make, have made, use, distribute, distribute for sale, promote, sell, offer for sale, have sold, or import Fixed Co-Formulation Products in the Sleep Field.

4.4 Exercise of Option & Licensed Compound Other Forms.

(a) Option Exercise. Subject to the terms and conditions of this Agreement, Sepracor may exercise the Option granted under Section 4.3 at any time during the Final Evaluation Period by sending the Exercise Notice to ACADIA and by paying the Option Exercise Fee to ACADIA in accordance with the terms of Section 7.2 of this Agreement. Sepracor will use commercially reasonable efforts to exercise the Option as promptly as possible within the Final Evaluation Period.

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(b) Licensed Compound Other Forms.

(i) Initial Identification. By no later [...***...] from the date of the Exercise Notice, Sepracor shall send ACADIA a written notice providing a list designating all compounds from the list provided pursuant to Section 4.1(b)(ii) of [...***...] for each of the Chosen Compounds that Sepracor belie