LICENSE AND COLLABORATION AGREEMENT

Exhibit 10.1

LICENSE AND COLLABORATION AGREEMENT

     This LICENSE AND COLLABORATION AGREEMENT (this “ Agreement ”), is entered into as of July 8, 2007 (the “ Execution Date ”), by and among F. Hoffmann-La Roche Ltd, a Swiss corporation (“ Roche Basel ”), having a place of business at Grenzacherstrasse 124, CH-4070 Basel, Switzerland, and Hoffmann-La Roche Inc., a New Jersey corporation (“ Roche Nutley ”), having a place of business at 340 Kingsland Street, Nutley, New Jersey 07110, U.S.A. (Roche Basel and Roche Nutley, collectively, “ Licensee ”), and Alnylam Pharmaceuticals, Inc., a Delaware corporation, having a place of business at 300 Third Street, 3rd Floor, Cambridge, Massachusetts 02142, U.S.A. (“ Alnylam ”), and, solely for the purposes set forth in Section 9.15 of this Agreement, Alnylam Europe AG, a German stock corporation, with a registered office in Kulmbach, Germany (“ Alnylam Europe AG ”).

INTRODUCTION

     1. Licensee is engaged in the business of Discovering, Developing, Commercializing and Manufacturing therapeutic products (each as defined below).

     2. Alnylam has developed, acquired and licensed technology useful for the Discovery, Development, Manufacture, characterization and use of therapeutic products that function through the mechanism of RNA interference (“ RNAi ”).

     3. Alnylam desires to grant licenses to such technology to Licensee, and the Parties desire to collaborate on certain research and development activities, in each case upon the terms and conditions set forth in this Agreement.

     NOW, THEREFORE, in consideration of the respective representations, warranties, covenants and agreements contained herein, and for other valuable consideration, the receipt and adequacy of which are hereby acknowledged, Alnylam and Licensee agree as follows:

ARTICLE I

DEFINITIONS

      1.1 Definitions. For the purpose of this Agreement, the following terms, whether used in singular or plural form, shall have the respective meanings set forth below:

     “ Accounting Period ” shall have the meaning set forth in Section 5.8.

     “ Additional Field ” shall mean the treatment or prophylaxis of all Indications in any Supplemental Therapeutic Area, where such treatment or prophylaxis comprises an RNAi Compound complementary to, and functional in mediating the RNAi of, a Target known or believed to be primarily implicated in such Supplemental Therapeutic Area.

     “ Affiliate ” shall mean any Person who directly or indirectly controls or is controlled by or is under common control with another Person. For purposes of this definition, “control” or “controlled” shall mean ownership directly or through one or more

Affiliates, of fifty percent (50%) or more of the shares of stock entitled to vote for the election of directors, in the case of a corporation, or fifty percent (50%) or more of the equity interest in the case of any other type of legal entity, status as a general partner in any partnership, or any other arrangement whereby a Party controls or has the right to control the Board of Directors or equivalent governing body of a corporation or other entity, or the ability to direct the management or policies of a corporation or other entity. The Parties acknowledge that in the case of certain entities organized under the laws of certain countries outside of the United States, the maximum percentage ownership permitted by law for a foreign investor may be less than fifty percent (50%), and that in such case such lower percentage shall be substituted in the preceding sentence, provided that such foreign investor has the power to direct the management and policies of such entity. For purposes of this Agreement, [**], each shall not be deemed an “Affiliate” of Licensee; provided , however , that if Licensee were to assume day-to-day control of either [**], then Licensee shall have the right, at its sole option, to designate [**], as applicable, to be an Affiliate. For purposes of Sections 6.1, 6.2, 9.8, 9.12 (the second sentence only), and 9.14, Alnylam’s Affiliates shall not include [**], any Affiliates of [**] (other than Alnylam and Persons “controlled” by Alnylam on the Execution Date) or any Person that becomes an Affiliate of Alnylam as a result of a [**].

     “ Agreement ” shall have the meaning set forth in the Preamble, and shall include, for the avoidance of doubt, all Exhibits and Schedules attached hereto.

     “ Alnylam Change of Control ” shall be deemed to occur upon the closing of (a) a merger, reorganization or consolidation involving Alnylam in which its shareholders immediately prior to such transaction would hold less than fifty percent (50%) of the securities or other ownership or voting interests representing the equity of the surviving entity immediately after such merger, reorganization or consolidation, or (b) a sale to a Third Party of all or substantially all of Alnylam’s assets or business relating to this Agreement.

     “ Alnylam Third Party Obligations ” shall mean (a) Alnylam’s obligations to, and the rights of, Pre-Existing Alliance Parties and Listed Counterparties with respect to the Licensed Intellectual Property under Pre-Existing Alliance Agreements and Listed Alnylam Third Party Agreements, respectively, and (b) Alnylam Europe AG’s obligations to, and the rights of, Max Planck with respect to certain Architecture and Chemistry Patent Rights under the Max Planck European License Agreement; including without limitation Listed Alnylam Third Party Payment obligations.

     “ Annual Net Sales ” shall mean, with respect to a Licensed Product, the Net Sales of such Licensed Product during a calendar year.

     “ Architecture and Chemistry Intellectual Property ” shall mean Architecture and Chemistry Know-How and Architecture and Chemistry Patent Rights.

     “ Architecture and Chemistry Know-How ” shall mean Know-How Controlled by Alnylam as of the Effective Date that relates to (a) the general structure, architecture, or design of double-stranded oligonucleotide molecules which engage RNAi mechanisms in a cell; (b) chemical modifications of double-stranded oligonucleotides (including any modification to the base, sugar or internucleoside linkage, nucleotide mimetics, and any end

modifications) which do not abolish the RNAi activity of the double-stranded oligonucleotides in (a); (c) manufacturing techniques for the double-stranded oligonucleotide molecules or chemical modifications of (a) and (b); or (d) all uses or applications of double-stranded oligonucleotide molecules or chemical modifications in (a) or (b); but excluding (i) Know-How to the extent specifically related to Blocked Targets, and (ii) Delivery Know-How.

     “ Architecture and Chemistry Patent Rights ” shall mean the Patent Rights listed on Schedule C Controlled by Alnylam or, solely in the case of Patent Rights licensed under the Max Planck European License Agreement, by Alnylam Europe AG, each as of the Effective Date, together with any future Patent Rights that claim priority to or common priority with any of the aforementioned Patent Rights, that Cover (a) the general structure, architecture, or design of double-stranded oligonucleotide molecules which engage RNAi mechanisms in a cell; (b) chemical modifications of double-stranded oligonucleotides (including any modification to the base, sugar or internucleoside linkage, nucleotide mimetics, and any end modifications) which do not abolish the RNAi activity of the double-stranded oligonucleotides in (a); (c) manufacturing techniques for the double-stranded oligonucleotide molecules or chemical modifications of (a) and (b); or (d) all uses or applications of double-stranded oligonucleotide molecules or chemical modifications in (a) or (b); but excluding (i) Patent Rights which specifically relate to Blocked Targets, and (ii) Delivery Patent Rights. Notwithstanding anything in this Agreement to the contrary, should it be reasonably determined after the Effective Date that (x) any omitted Patent Rights which Alnylam Controlled as of the Effective Date disclose any Valid Claims that Cover any of clause (a) through (d) above, but excluding any Patent Rights which specifically relate to Blocked Targets and Patent Rights licensed under the [**] Agreement (except as set forth in Section 2.3(b)(ii)), or (y) in the course of prosecution of any Valid Claims under any of the Patent Rights listed on Schedule C , any such Valid Claim either no longer Covers any of clause (a) through (d) above or specifically relates to Blocked Targets, Schedule C shall be amended to reflect the inclusion or deletion, as the case may be, of such Patent Right, to the extent that it does not conflict with the terms of any Listed Alnylam Third Party Agreement or Pre-Existing Alliance Agreement to do so. For the avoidance of doubt, any Patent Rights which are subsequently included on Schedule C pursuant to clause (x) above shall be deemed “Architecture and Chemistry Patent Rights” for all purposes hereunder.

     “ Blocked Target ” shall mean any Target that is subject to a contractual obligation of a Pre-Existing Alliance Agreement that would be breached by the inclusion of such Target as a Designated Target under this Agreement.

     “ Blocked Target List ” shall mean a list of Blocked Targets maintained by the Gatekeeper, as such list may be updated from time to time.

     “ Business Day ” shall mean a day on which banking institutions in Boston, Massachusetts are open for business.

     “[**] Agreement ” shall have the meaning set forth in Section 2.3(b)(ii).

     “ Collaboration Target ” shall have the meaning set forth in Section 4.1.

     “ Combination Product ” shall mean a Licensed Product combined with any other clinically active therapeutic or prophylactic ingredient, mechanism or device.

     “ Commercialization ” or “ Commercialize ” shall mean any and all activities directed to marketing, promoting, detailing, distributing, importing, having imported, exporting, having exported, selling or offering to sell, or seeking to obtain reimbursement for, a product, whether before or after Regulatory Approval for such product has been obtained.

     “ Common Stock Purchase Agreement ” shall mean the Common Stock Purchase Agreement entered into by Licensee and Alnylam on the Execution Date.

     “ Confidential Information ” shall mean the terms of this Agreement and all Know-How or other information, including proprietary information and materials (whether or not patentable) regarding a Party’s technology, products, business information or objectives, that is treated as confidential by the disclosing Party in the regular course of business or is otherwise designated as confidential by the disclosing Party. For the avoidance of doubt, the identity of any Designated Targets, Submitted Targets and Blocked Targets shall be deemed the Confidential Information of both Parties.

     “ Control ” or “ Controlled ” shall mean, with respect to any intellectual property right or other intangible property, the possession by a Party (whether by ownership or license) (other than a license granted pursuant to this Agreement), or “control” (as defined in the definition of “Affiliate” above) over an Affiliate having possession (by ownership or license), of the ability to grant access to, or a license or sublicense of, such rights or property as contemplated under this Agreement.

     “ Cover ”, “ Covered ” or “ Covering ” shall mean, with respect to a Patent Right, that, in the absence of a license granted to a Person under a Valid Claim included in such Patent Right, the practice by such Person of an invention claimed in such Patent Right would infringe such Valid Claim (or, in the case of a Patent Right that is a patent application, would infringe a Valid Claim in such patent application if it were to issue as a patent).

     “ Delivery Intellectual Property ” shall mean Delivery Know-How and Delivery Patent Rights.

     “ Delivery Know-How ” shall mean Know-How Controlled by Alnylam as of the Effective Date that relates to (a) delivery technologies which may be necessary or useful for delivery of double-stranded oligonucleotide molecules; or (b) manufacturing techniques for the delivery technologies of (a); but excluding Know-How to the extent specifically related to Blocked Targets.

     “ Delivery Patent Rights ” shall mean Patent Rights listed on Schedule C Controlled by Alnylam as of the Effective Date (or, solely with respect to the Patent Rights covered by any option under Section 2.3(b)(ii) below, as of the effective date of Licensee’s exercise of such option), together with any future Patent Rights that claim priority to or common priority with any of the aforementioned Patent Rights, that Cover (a) delivery technologies necessary or useful for delivery of double-stranded oligonucleotide molecules; or (b) manufacturing techniques for the delivery technologies of (a); but excluding Patent

Rights which relate specifically to Blocked Targets. Notwithstanding anything in this Agreement to the contrary, should it be reasonably determined after the Effective Date that (x) any omitted Patent Rights which Alnylam Controlled as of the Effective Date disclose any Valid Claims that Cover any of clause (a) through (b) above, but excluding any Patent Rights which specifically relate to Blocked Targets and Patent Rights licensed under the [**] Agreement (except as set forth in Section 2.3(b)(ii)), or (y) in the course of prosecution of any Valid Claims under any of the Patent Rights listed on Schedule C , any such Valid Claim either no longer Covers any of clause (a) through (b) above or specifically relates to Blocked Targets, Schedule C shall be amended to reflect the inclusion or deletion, as the case may be, of such Patent Right, to the extent that it does not conflict with the terms of any Listed Alnylam Third Party Agreement or Pre-Existing Alliance Agreement to do so. For the avoidance of doubt, any Patent Rights which are subsequently included on Schedule C pursuant to clause (x) above shall be deemed “Delivery Patent Rights” for all purposes hereunder.

     “ Designated Target ” shall mean (a) at any time during the Novartis Exclusivity Term, any Target which is (i) selected by Licensee pursuant to Section 2.4(a) of this Agreement which is not a Blocked Target, (ii) submitted to Novartis pursuant to Licensee’s exercise of the Designated Target Option pursuant to Section 2.6 of this Agreement, and (iii) rejected or waived by Novartis, as evidenced by Alnylam’s written notice to Licensee pursuant to Section 2.6 of this Agreement; and (b) at any time following the end of the Novartis Exclusivity Term, any Target selected by Licensee pursuant to Section 2.4(a) of this Agreement which is not a Blocked Target. For the avoidance of doubt, (x) if Licensee selects any Target prior to the end of the Novartis Exclusivity Term for submission to Novartis, but such Target is not submitted to Novartis until after the end of the Novartis Exclusivity Term, or (y) if Licensee selects any Target prior to the end of the Novartis Exclusivity Term for submission to Novartis and such Target is submitted to Novartis prior to the end of the Novartis Exclusivity Term, but the time period during which Novartis is obligated to reply does not end until after the end of the Novartis Exclusivity Term, then such Target shall not be deemed a “Designated Target” hereunder until such Target has been rejected or waived by Novartis pursuant to the terms of the Novartis Agreement.

     “ Designated Target Option ” shall have the meaning set forth in Section 2.6.

     “[**]” shall have the meaning set forth in Section 5.5.

     “ Develop ” or “ Development ” shall mean any and all preclinical and clinical drug development activities, including test method development and stability testing, toxicology, animal efficacy studies, formulation, quality assurance/quality control development, statistical analysis, clinical studies, clinical trials and testing, regulatory affairs, product approval and registration, chemical development and Manufacturing development, packaging development and Manufacturing and development documentation efforts in support of development activities anywhere in the world.

     “ Discover ” or “ Discovery ” shall mean any and all research or discovery activities.

     “ Discovery Collaboration ” shall mean collaboration between the Parties regarding the Discovery and/or Development of potential RNAi Compounds directed to a Designated Target [**], pursuant to the terms of Article IV.

     “ Discovery Collaboration Opportunity ” shall have the meaning set forth in Section 4.1.

     “ Effective Date ” shall mean the latest of (a) HSR Clearance Date, (b) if no filing is to be made pursuant to the HSR Act, the Execution Date, and (c) the Closing Date as defined in the Share Purchase Agreement (such date being referred to as the “ Scheduled Date ”), it being understood that the Closing Date of the Share Purchase Agreement and the Effective Date of this Agreement shall occur simultaneously; provided , however , that if between the Execution Date and the Scheduled Date there occurs an event or series of events that result in a material adverse impact upon the Licensed Patent Rights, taken as a whole, (including, for example, the termination of any of the Listed Alnylam Third Party Agreements, or Alnylam’s receipt of written notice of termination from a party to a Listed Alnylam Third Party Agreement (i) that has not been cured prior to the Scheduled Date, or (ii) cannot be cured within the applicable cure period under the Listed Alnylam Third Party Agreement), then Licensee shall have the unilateral right to cause this Agreement not to become effective resulting in no Effective Date; provided , further , that , notwithstanding anything in the parenthetical above to the contrary, if between the Execution Date and the Scheduled Date, Alnylam receives a written notice of termination from a party to a Listed Alnylam Third Party Agreement that results in a material adverse impact upon the Licensed Patent Rights, taken as a whole, and such notice of termination can be cured within the applicable cure period under such Listed Alnylam Third Party Agreement, but such cure period ends after the Scheduled Date, then Licensee shall have the unilateral right (x) to delay the effectiveness of this Agreement until Alnylam has effected the cure, at which time the Effective Date shall be deemed to have occurred, or (y) if the applicable cure period has lapsed without a cure having been effected, to cause this Agreement not to become effective following the end of such cure period, resulting in no Effective Date.

     “ Execution Date ” shall have the meaning set forth in the preamble to this Agreement.

     “ FDA ” shall mean the United States Food and Drug Administration or any successor agency thereto.

     “ Field ” shall mean the Primary Field and, subject to the exercise by Licensee of a Field Option with respect to any Additional Field(s) pursuant to Section 2.5, any such Additional Field(s).

     “ Field Definition Panel ” shall have the meaning set forth in Section 2.5(a)(iv).

     “ Field Extension Opportunity ” shall have the meaning set forth in Section 2.5(b)(i).

     “ Field Option ” shall have the meaning set forth in Section 2.5(b)(ii).

     “ Field Option Fee ” shall have the meaning set forth in Section 5.6.

     “ First Commercial Sale ” shall mean the first sale of a Licensed Product by or on behalf of Licensee or any of its Affiliates or Licensee Partners to a Third Party in a country following Regulatory Approval of such Licensed Product in that country or, if no such Regulatory Approval or similar marketing approval is required, the date upon which such Licensed Product is first commercially launched in such country.

     “ Future Technology Patent Rights ” shall mean Patent Rights Controlled by a Party after the Effective Date that Cover (a) delivery technologies which may be necessary or useful for delivery of double-stranded oligonucleotide molecules; or (b) manufacturing techniques for the delivery technologies of (a); but excluding (i) Patent Rights which specifically relate to Blocked Targets, and (ii) Licensed Patent Rights.

     “ Gatekeeper ” shall have the meaning set forth in Section 2.4(b).

     “ GLP Toxicology Study ” shall mean a toxicology study that is conducted in compliance with GLP and is required to meet the requirements for filing an IND.

     “ HSR Act ” shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (15 U.S.C. Sec. 18a), and the rules and regulations promulgated thereunder.

     “ HSR Clearance Date ” shall mean the earlier of (a) the second Business Day after the date on which the United States Federal Trade Commission shall notify Licensee and Alnylam of early termination of the applicable waiting period under the HSR Act, or (b) the second Business Day after the date on which the applicable waiting period under the HSR Act expires.

     “ IND ” shall mean an application submitted to a Regulatory Authority to initiate human clinical trials, including (a) an Investigational New Drug application or any successor application or procedure filed with the FDA, or any foreign equivalent thereof, and (b) all supplements and amendments that may be filed with respect to the foregoing.

     “ IND-Enabling Studies ” shall mean pharmacokinetic and toxicology studies required to meet the requirements for filing an IND, including without limitation any GLP Toxicology Study.

     “ Indication ” shall mean any disease or condition, or sign or symptom of a disease or condition.

     “ Initial Discovery Collaboration Opportunity Period ” shall have the meaning set forth in Section 4.1.

     “ Joint Future Technology Committee ” shall have the meaning set forth in Section 3.2.

     “ Know-How ” shall mean any information, inventions, trade secrets or technology, whether or not proprietary or patentable and whether stored or transmitted in oral,

documentary, electronic or other form. Know-How shall include ideas, concepts, formulas, methods, procedures, designs, compositions, plans, documents, data, discoveries, developments, techniques, protocols, specifications, works of authorship, biological materials, and any information relating to research and development plans, experiments, results, compounds, therapeutic leads, candidates and products, clinical and preclinical data, clinical trial results, and Manufacturing information and plans (but excluding any scientific, regulatory, pre-clinical or clinical information or data regarding specific Indications and any marketing, financial, commercial, personnel and other business information and plans).

     “ Kulmbach Facility ” shall have the meaning set forth in Section 3.1(a).

     “ Law ” shall mean any law, statute, rule, regulation, ordinance or other pronouncement having the effect of law of any federal, national, multinational, state, provincial, county, city or other political subdivision, domestic or foreign.

     “ Licensed Collaboration Product ” shall mean any Licensed Product directed to a Designated Target for which the Parties have entered into a Discovery Collaboration pursuant to Article IV.

     “ Licensed Intellectual Property ” shall mean the Licensed Know-How and Licensed Patent Rights.

     “ Licensed Know-How ” shall mean (a) the Architecture and Chemistry Know-How, and (b) the Delivery Know-How.

     “ Licensed Patent Rights ” shall mean (a) the Architecture and Chemistry Patent Rights, and (b) the Delivery Patent Rights.

     “ Licensed Product ” shall mean any RNAi Product (a) whose manufacture, use or sale would, but for the licenses granted pursuant to this Agreement, infringe one or more Valid Claims of the Licensed Patent Rights, or (b) which embodies Licensed Know-How. All references to Licensed Product in this Agreement shall be deemed to include Combination Product, to the extent applicable.

     “ Licensee Partner ” shall mean any Third Party to which a sublicense is granted by Licensee in accordance with Section 2.1(b), including without limitation Third Party distributor whose obligations to Licensee or its Affiliates include responsibility for sales, marketing and/or distribution efforts in a country on behalf of Licensee or its Affiliates, excluding wholesale distributors who purchase Licensed Products from Licensee or its Affiliates in an arm’s length transaction and who have no other obligation to Licensee or its Affiliates.

     “ Listed Alnylam Third Party Agreement ” shall mean an agreement listed on Schedule D-1 .

     “ Listed Alnylam Third Party Payment ” shall have the meaning set forth in Section 5.4(d).

     “ Listed Counterparties ” shall mean the Third Party counterparties to Listed Alnylam Third Party Agreements and their respective successors in interest.

     “ Major Market Countries ” shall have the meaning set forth in Section 2.1(b).

     “ Manufacture ” or “ Manufacturing ” shall mean any and all activities and operations involved in or relating to the manufacturing, quality control testing (including in-process, release and stability testing), releasing or packaging, for pre-clinical, clinical or commercial purposes.

     “ Max Planck ” shall mean Max Planck Innovation GmbH (formerly Garching Innovation GmbH).

     “ Max Planck European License Agreement ” shall mean Co-Exclusive License Agreement between Max Planck and Alnylam Europe AG (formerly Ribopharma AG), dated July 30, 2003, as amended by the Requirement Amendment effective June 15, 2005.

     “ NDA ” shall mean an application submitted to a Regulatory Authority for marketing approval of a product, including (a) a New Drug Application, Product License Application or Biologics License Application filed with FDA or any successor applications or procedures, or any foreign equivalent thereof, and (b) all supplements and amendments that may be filed with respect to the foregoing.

     “ Net Sales ” shall mean the amount calculated by subtracting from the amount of Adjusted Gross Sales (as defined below) the following:

     (a) With respect to Net Sales in the United States, a lump sum deduction of [**] percent ([**]%) of Adjusted Gross Sales in lieu of those sales-related deductions which are not accounted for by Licensee, its Affiliates and Licensee Partners on a product-by-product basis (e.g. outward freights, postage charges, transportation insurance, packaging materials for dispatch of goods, custom duties, bad debt expense, discounts granted later than at the time of invoicing);

     (b) With respect to Net Sales in the Major Market Countries (other than the U.S.) and Canada, a lump sum deduction of [**] percent ([**]%) of Adjusted Gross Sales in lieu of those sales-related deductions which are not accounted for by Licensee, its Affiliates and Licensee Partners on a product-by-product basis (e.g. outward freights, postage charges, transportation insurance, packaging materials for dispatch of goods, custom duties, bad debt expense, discounts granted later than at the time of invoicing); and

     (c) With respect to Net Sales in all territories other than those set forth in subsections (a) and (b) above, a lump sum deduction of [**] percent ([**]%) of Adjusted Gross Sales in lieu of those sales-related deductions which are not accounted for by Licensee, its Affiliates and Licensee Partners on a product-by-product basis (e.g. outward freights, postage charges, transportation insurance, packaging materials for dispatch of goods, custom duties, bad debt expense, discounts granted later than at the time of invoicing).

     For purposes of this definition of “Net Sales”, “ Adjusted Gross Sales ” shall mean the amount of gross sales of the Licensed Product invoiced by Licensee, its Affiliates and its Licensee Partners to Third Parties less deductions of returns and return reserves (including allowances actually given for spoiled, damaged, out-dated, rejected, returned Licensed Product sold, withdrawals and recalls), rebates and rebate reserves (to the extent consistently applied by Licensee to its products), price reductions, rebates to managed care organizations or social and welfare systems, charge backs or reserves for chargebacks, cash sales incentives (but only to the extent it is a sales related deduction which is accounted for within Licensee on a product-by-product basis), cash discounts, government mandated rebates and similar types of rebates (e.g., Pharmaceutical Price Regulation Scheme, Medicaid, each as consistently applied by Licensee to its products), volume (quantity) discounts, taxes (value added or sales taxes, government mandated exceptional taxes and other taxes directly linked to the gross sales amount).

     In the case where a Licensed Product is a Combination Product, the Parties shall meet approximately [**] prior to commercial launch of such Combination Product to negotiate in good faith and agree to an appropriate adjustment to Net Sales to reflect the relative significance of the RNAi Compound and the other pharmaceutically active agent(s) contained in the Combination Product. If the Parties are unable to agree upon such adjustment to Net Sales, royalties with respect to a Combination Product in a country shall be equal to the rates set forth in Section 5.4(a), multiplied by a fraction whose numerator is Licensee’s published sales price in such country for an equivalent dosage of RNAi Compound contained in a given Combination Product, and whose denominator is Licensee’s published sale prices in such country for an equivalent dosage of all active pharmaceutical ingredients contained therein. If the numerator or denominator cannot be determined in the manner set forth above within ninety (90) days following the meeting between the Parties described in the first sentence of this paragraph, then such matter shall be determined by binding arbitration conducted by one (1) arbitrator in accordance with the rules of Judicial Arbitration and Mediation Services, Inc. (JAMS). The arbitration shall be held in the State of Delaware and shall not last for a period longer than six (6) months. In such arbitration, the arbitrator shall be an independent expert in worldwide marketing in the pharmaceutical industry mutually acceptable to the Parties or, if the Parties are unable to agree upon such arbitrator, shall be selected by the President of the JAMS office located in the State of Delaware.

     “ Novartis ” shall mean Novartis Institutes for BioMedical Research, Inc.

     “ Novartis Agreement ” shall mean the Research Collaboration and License Agreement, effective as of October 12, 2005, by and between Alnylam and Novartis, as amended by the Addendum Re: Influenza Program effective as of December 13, 2005, Amendment No. 1 to such Addendum effective as of March 14, 2006, and Amendment No. 2 to such Addendum effective as of May 5, 2006, and as the same may be amended from time to time after the Execution Date in accordance with Section 2.7(c).

     “ Novartis Exclusivity Term ” shall mean the “Exclusivity Term” as defined in the Novartis Agreement.

     “[**]” shall have the meaning set forth in Section 2.7(b).

     “[**]” shall have the meaning set forth in Section 2.7(b)(ii).

     “ Option Term ” shall mean the period commencing on the Effective Date and ending on the fifth (5th) anniversary thereof.

     “ Other Transaction Documents ” shall mean (a) the Common Stock Purchase Agreement, and (b) the Share Purchase Agreement.

     “ Party ” shall mean Alnylam or Licensee, as the case may be; “ Parties ” shall mean both Alnylam and Licensee.

     “ Patent Rights ” shall mean all patents (including all reissues, extensions, substitutions, confirmations, re-registrations, re-examinations, invalidations, supplementary protection certificates and patents of addition) and patent applications (including all provisional applications, continuations, continuations-in-part and divisionals), and foreign equivalents of any of the foregoing.

     “ Person ” shall mean any corporation, limited or general partnership, limited liability company, joint venture, trust, unincorporated association, governmental body, authority, bureau or agency, any other entity or body, or an individual.

     “ Phase I Study ” shall mean a human clinical trial in any country that would satisfy the requirements of 21 C.F.R. § 312.21(a), as amended from time to time, and the foreign equivalent thereof.

     “ Phase II Study ” shall mean a human clinical trial, for which the primary endpoints include a determination of dose ranges and/or a preliminary determination of efficacy in patients being studied as described in 21 C.F.R. § 312.21(b), or similar clinical study in a country other than the United States.

     “ Phase III Study ” shall mean a human clinical trial that is prospectively designed to demonstrate statistically whether a product is safe and effective for use in humans in a manner sufficient to obtain regulatory approval to market such product in patients having the disease or condition being studied as described in 21 C.F.R. § 312.21(c), or a similar clinical study in a country other than the United States.

     “ Pre-Existing Alliance Agreements ” shall mean the agreements set forth on Schedule E .

     “ Pre-Existing Alliance Parties ” shall mean the Third Party counterparties to Pre-Existing Alliance Agreements and their respective successors in interest.

     “ Primary Field ” shall mean the treatment or prophylaxis of all Indications in the Primary Therapeutic Areas, where such treatment or prophylaxis comprises an RNAi Compound complementary to, and functional in mediating the RNAi of, a Target known or believed to be primarily implicated in one or more Primary Therapeutic Areas.

     “ Primary Therapeutic Area ” shall mean each of the disease area fields set forth on Schedule A to this Agreement.

     “ Product Liability Claim ” shall mean, with respect to a product, any Third Party claim, suit, action, proceeding, liability or obligation involving any actual or alleged death or bodily injury arising out of or resulting from the use of such product.

     “ Regulatory Approval ” shall mean, with respect to a product in a country, the approval of the applicable Regulatory Authority necessary for the marketing and sale of such product in such country.

     “ Regulatory Authority ” shall mean any federal, national, multinational, state, provincial or local regulatory agency, department, bureau or other governmental entity with authority over the marketing, pricing or sale of a pharmaceutical product in a country, including the FDA.

     “ Required Third Party Payments ” shall mean royalty payments to a Third Party made by Licensee under Third Party agreements (other than Listed Alnylam Third Party Agreements or Pre-Existing Alliance Agreements) to license Patent Rights Covering such Third Party’s technology if, in the absence of such license, the licensed use by Licensee of the Licensed Patent Rights licensed by Alnylam under Section 2.1(a) would infringe such Patent Rights; provided , however , that Required Third Party Payments shall not include any royalties or other amounts payable to obtain access to (a) a specific Target or Targets so that such Target or Targets can be the subject of research and development efforts, or (b) Third Party delivery technologies (other than Delivery Patent Rights) which may be necessary or useful for delivery of double-stranded oligonucleotide molecules, or manufacturing techniques for such delivery technologies.

     “ RNAi Compound ” shall mean any compound that, in vitro or otherwise, functions through the mechanism of RNAi and consists of or encodes double-stranded oligonucleotides, and which double-stranded oligonucelotides optionally may be chemically modified to contain modified nucleotide bases or non-RNA nucleotides, and optionally may be administered in conjunction with a delivery vehicle or vector.

     “ RNAi Product ” shall mean any product that contains one or more RNAi Compounds as an active ingredient.

     “ Royalty Term ” shall mean, separately with respect to each Licensed Product in each country, the period commencing on the First Commercial Sale of such Licensed Product in such country (provided that either (x) such Licensed Product is Covered by a Valid Claim of a Licensed Patent Right in such country at the time of such First Commercial Sale in such country, or (y) the Manufacture of such Licensed Product is Covered by a Valid Claim of a Licensed Patent Right in the country or countries in which such Licensed Product is Manufactured) and concluding on the expiration of the later of (a) the last to expire Licensed Patent Right containing a Valid Claim Covering the Development, Commercialization or Manufacture of such Licensed Product in that country, (b) the last to expire Licensed Patent Right containing a Valid Claim Covering the Manufacture of such Licensed Product in the

country or countries in which such Licensed Product was Manufactured, or (c) ten (10) years from the date of First Commercial Sale of such Licensed Product in such country. For the avoidance of doubt, if (x) a Licensed Product is not Covered by a Valid Claim of a Licensed Patent Right in a country at the time of such First Commercial Sale in such country, and (y) the Manufacture of such Licensed Product is not Covered by a Valid Claim of a Licensed Patent Right in the country or countries in which such Licensed Product is Manufactured at the time of First Commercial Sale, but at any time following First Commercial Sale, the Licensed Product, or the Manufacture thereof, is Covered by a Valid Claim of any patent under the Licensed Patent Rights that issues following the time of such First Commercial Sale, then the Royalty Term shall commence with respect to such Licensed Product at the time of such issuance.

     “ Share Purchase Agreement ” shall mean the Share Purchase Agreement entered into by and among Licensee, Licensee’s Affiliate, Alnylam and Alnylam Europe AG on the Execution Date.

     “ Submitted Target ” shall have the meaning set forth in Section 2.6.

     “ Supplemental Therapeutic Area ” shall mean each of the disease area fields set forth on Schedule B to this Agreement.

     “ Target ” shall mean (a) a polypeptide or entity comprising a combination of at least one polypeptide and other macromolecules, that is a site or potential site of therapeutic intervention by a therapeutic agent; or a nucleic acid which is required for expression of such polypeptide; (b) variants of a polypeptide (including any splice variant thereof), cellular entity or nucleic acid described in clause (a); or (c) a defined non-peptide entity, including a microorganism, virus, bacterium or single cell parasite; provided that the entire genome of a virus shall be regarded as a single Target.

     “ Technology Transfer Period ” shall have the meaning set forth in Section 3.1(a).

     “ Technology Transfer Plan ” shall have the meaning set forth in Section 3.1(a).

     “ Terminated Patent Rights ” shall have the meaning set forth in Section 5.4(f).

     “ Third Party ” shall mean any Person other than Alnylam or Licensee and their respective Affiliates.

     “ Third Party Infringement Claim ” shall have the meaning set forth in Section 2.8(a)(i).

     “ UBC ” shall mean the University of British Columbia.

     “ UBC Sublicense Agreement ” shall mean the Sublicense Agreement between Tekmira Pharmaceuticals Corporation (formerly INEX Pharmaceuticals Corporation) and Alnylam Pharmaceuticals, Inc., dated January 8, 2007.

     “ Valid Claim ” shall mean a claim (a) of any issued, unexpired patent that has not been revoked or held unenforceable or invalid by a decision of a court or governmental agency of competent jurisdiction from which no appeal can be taken, or with respect to which an appeal is not taken within the time allowed for appeal, and that has not been disclaimed or admitted to be invalid or unenforceable through reissue, disclaimer or otherwise, or (b) of any patent application that has not been cancelled, withdrawn or abandoned, or been pending for more than [**] from the earliest priority date for such patent application.

ARTICLE II

GRANT OF RIGHTS;

INTELLECTUAL PROPERTY MATTERS

      2.1 License Grants.

     (a)  License Grants to Licensee .

          (i) Alnylam hereby grants to Licensee and its Affiliates a non-exclusive, worldwide, perpetual, irrevocable, royalty-bearing right and license, subject to the terms and conditions of this Agreement and to Alnylam Third Party Obligations, under the Licensed Intellectual Property to engage in any and all Discovery, Development, Commercialization and Manufacturing activities in the Field (and, to the extent expressly permitted in Section 2.5(a), any Additional Field), including to make, have made, use, offer for sale, sell and import Licensed Products in the Field (and, to the extent expressly permitted in Section 2.5(a), any Additional Field).

          (ii) Alnylam Europe AG hereby grants to Licensee and its Affiliates a non-exclusive, worldwide, perpetual, irrevocable, royalty-bearing right and license, subject to the terms and conditions of this Agreement and to Alnylam Third Party Obligations, under Alnylam Europe AG’s rights to the Architecture and Chemistry Patent Rights licensed to Alnylam Europe AG pursuant to the terms of the Max Planck European License Agreement, to engage in any and all Discovery, Development, Commercialization and Manufacturing activities in the Field (and, to the extent expressly permitted in Section 2.5(a), any Additional Field), including to make, have made, use, offer for sale, sell and import Licensed Products in the Field (and, to the extent expressly permitted in Section 2.5(a), any Additional Field).

     (b)  Sublicense Rights . Subject to Alnylam Third Party Obligations, Licensee shall have the right to grant sublicenses within the scope of the licenses granted to it in Section 2.1(a), on a Licensed Product-by-Licensed Product basis, to a Third Party in the Field (and, to the extent expressly permitted in Section 2.5(a), any Additional Field) solely for purposes of Developing and/or Commercializing a Licensed Product which has achieved the appropriate stage of Development (as determined by Licensee using its reasonable business judgment in the management of such Licensed Product within its portfolio of products, but in no event [**] other than to Third Party contractors, including contract research organizations, contract employees, consultants, contract manufacturers and the like in connection with the licensed activities); provided , however , that in no event shall Licensee grant any sublicense of

any right granted to Licensee under Section 2.1(a) for the Development and/or Commercialization of any Third Party product unless such product is licensed by Licensee from such Third Party and Licensee and such Third Party are collaborating on the Development and/or Commercialization of such Third Party product. Each such sublicense agreement shall be consistent with the terms and conditions of this Agreement. Licensee shall remain liable to Alnylam and Alnylam Europe AG for each of its sublicensees’ failure to comply with all applicable restrictions, limitations and obligations under the sublicense agreement and this Agreement. No sublicense granted by Licensee hereunder may be assigned, transferred or further sublicensed to any Third Party without the prior written consent of Alnylam or Alnylam Europe AG, as the case may be. Licensee shall provide a redacted copy of such sublicense agreement to Alnylam (such redactions to exclude only the financial terms of such sublicense and other information normally redacted from a document filed with the U.S. Securities and Exchange Commission), (x) if such sublicense impacts upon one or more of the following countries: USA, Germany, France, United Kingdom, Italy, Spain, and Japan (“ Major Market Countries ”), and (y) upon request by Alnylam, in any country other than those listed under clause (x) above.

      2.2 No Other Rights. Only the licenses granted to Licensee under Section 2.1(a) hereof shall be of legal force and effect and are limited to the scope expressly granted. Accordingly, except for the rights expressly granted under Section 2.1(a) hereof, no license, right, title or interest of any nature whatsoever is granted hereunder by implication, estoppel, reliance or otherwise, by Alnylam or Alnylam Europe AG to Licensee, and any of Alnylam’s or Alnylam Europe AG’s rights to Licensed Intellectual Property not specifically licensed to Licensee under Section 2.1(a) hereof shall be retained by Alnylam or Alnylam Europe AG, as the case may be. For purposes of clarity, nothing contained in this Agreement shall prevent or restrict Alnylam or Alnylam Europe AG from (a) granting to any Third Party any non-exclusive licenses under Alnylam’s or Alnylam Europe AG’s rights, as the case may be, in any Licensed Intellectual Property, or (b) subject to the provisions of Section 2.5(b)(i), granting to any Third Party any exclusive licenses under Alnylam’s or Alnylam Europe AG’s rights in any Licensed Intellectual Property outside of the then-current Field.

      2.3 Certain License Limitations.

     (a)  Pre-Existing Alliance Agreements .

          (i) The grants by Alnylam and Alnylam Europe AG under Licensed Intellectual Property set forth in Section 2.1(a) are subject to, and are limited to the extent of, the rights that Alnylam has previously granted and is required to grant under Licensed Intellectual Property to Pre-Existing Alliance Parties under the terms of the Pre-Existing Alliance Agreements. As and to the extent that such rights previously granted to Pre-Existing Alliance Parties under Licensed Intellectual Property (whether such rights are previously or subsequently exercised) lapse, terminate or otherwise revert to Alnylam, they shall be automatically included in the non-exclusive rights under Licensed Intellectual Property granted to Licensee in the Field under Section 2.1(a).

          (ii) Licensee acknowledges that a Pre-Existing Alliance Party may from time to time request rights under Licensed Intellectual Property with respect to a

particular Target that Alnylam is required, pursuant to the terms of a Pre-Existing Alliance Agreement, to grant such rights to such Pre-Existing Alliance Party with respect to such Target.

     (b)  Contractual Obligations under Listed Alnylam Third Party Agreements .

          (i) For the avoidance of doubt, the grants by Alnylam under Licensed Intellectual Property set forth in Section 2.1(a) include, subject to Section 2.3(b)(ii), the sublicense of Licensed Intellectual Property that is not owned by Alnylam or Alnylam Europe AG. Licensee’s rights and licenses under such Licensed Intellectual Property are limited to the rights granted by Listed Counterparties to Alnylam under the Listed Alnylam Third Party Agreements and by Max Planck to Alnylam Europe AG under the Max Planck European License Agreement, and Licensee shall comply, and cause its Affiliates and Licensee Partners to comply, with those restrictions and other terms applicable to sublicensees under such agreements, certain of which restrictions and terms are summarized on Schedule D-2 . Without limiting the generality of the foregoing, Licensee acknowledges that certain obligations are imposed on sublicensees of certain of the sublicensed Licensed Intellectual Property, and agrees to comply (to the extent access to obligations and requirements have been made available to Licensee in unredacted form), and to require its Affiliates and Licensee Partners to comply, with such obligations and requirements. Notwithstanding the above, at the request of Licensee, which request shall be made within the [**] period prior to First Commercial Sale of the first Licensed Product, Alnylam shall use commercially reasonable efforts to seek to harmonize the accounting and royalty reporting provisions under the Listed Third Party Agreements with the accounting and royalty reporting provisions set forth in this Agreement.

          (ii) Notwithstanding anything to the contrary herein, the licenses to Licensed Patent Rights hereunder initially shall not include licenses to Patent Rights licensed by Alnylam or its Affiliates under the Non-Exclusive License Agreement between [**] and Alnylam, dated [**] (the “[**] Agreement ”), which Patent Rights Licensee shall have the option, exercisable upon written notice to Alnylam hereunder, to license, on a Licensed Collaboration Product-by-Licensed Collaboration Product basis, upon commencement of a Discovery Collaboration hereunder. Upon such election, (x) the license granted to Licensee under Alnylam’s rights to Delivery Patent Rights pursuant to Section 2.1(a) shall include such Patent Rights with respect to the designated Licensed Collaboration Product(s), (y) Schedule C shall be amended to include such Patent Rights, and (z) the [**] Agreement shall be deemed a Listed Alnylam Third Party Agreement and Schedule D-1 and Schedule D-2 shall be amended accordingly.

      2.4 Blocked Targets; Gatekeeper.

     (a)  Blocked Targets .

          (i) From time to time during the term of this Agreement but no more frequently than [**] (except as set forth in clause (ii) of this Section 2.4(a)), following an affirmative decision by Licensee to initiate a program directed to the Discovery, Development or Commercialization of RNAi Compounds directed to a particular Target,

Licensee may inquire of the Gatekeeper in writing whether or not such Target is on the Blocked Target List by virtue of being subject to a then-current exclusive or co-exclusive grant, option, right of first refusal or similar right under a Pre-Existing Alliance Agreement. The Gatekeeper shall, within [**] days following the Gatekeeper’s receipt of such complete written request from Licensee, notify Licensee in writing whether or not such Target is on the Blocked Target List; provided , however , that in no event will the Gatekeeper directly or indirectly notify or communicate to any other Alnylam employee or consultant or any Alnylam Affiliate or Third Party the contents or the existence of Licensee’s inquiry hereunder without Licensee’s prior written consent, which may be withheld at Licensee’s sole discretion.

          (ii) If Alnylam becomes aware of the removal of any Target from the Blocked Target List, Alnylam shall notify Licensee of such removal (but not the identity of the Target which was removed) and Licensee shall have the right to inquire of the Gatekeeper pursuant to, and in compliance with, clause (i) above whether or not a Target is on the Blocked Target List; provided , however , that the [**] limit set forth in clause (i) above on the frequency of inquiries which may be made of the Gatekeeper shall not apply with respect to an inquiry made under this Section 2.4(a)(ii), nor shall an inquiry made under this Section 2.4(a)(ii) be counted towards such [**] limit.

          (iii) Notwithstanding the foregoing, the Parties acknowledge that a Pre-Existing Alliance Party may subsequently request exclusive or co-exclusive rights from Alnylam with respect to a particular Target as described in Section 2.3(a)(ii) and the provisions of Section 2.3(a)(ii) shall control.

     (b)  Gatekeeper . Subject to the provisions of Section 2.7(b), the inquiries and responses made by one Party to the other in connection with Section 2.4(a) shall be made in writing to the attention of a designated employee of Alnylam mutually agreeable to both Parties (the “ Gatekeeper ”) who will be bound by confidentiality obligations to both Parties. Each Party agrees to provide the Gatekeeper with full and complete copies of all records and information (including un-redacted copies of the relevant Third Party agreements) that are necessary for the Gatekeeper to render his or her determination.

      2.5 Additional Fields; Field Option.

     (a)  Additional Fields .

          (i) Licensee shall initially conduct Discovery, Development, Commercialization and Manufacturing activities directed to Targets only with respect to Indications in the Field. After Licensee’s completion of a Phase II Study with respect to any Licensed Product directed to a specific Target in the Field, Licensee may engage in Discovery, Development, and/or Manufacturing activities directed to such Target for any Indication (each, an “ Additional Indication ”) in any Additional Field (if such Additional Field has not been the subject of Licensee’s exercise of a Field Option) without having to pay a Field Option Fee; provided , however , that (A) Licensee shall notify Alnylam of its extension of Discovery, Development and/or Manufacturing activities directed to such Target for such Additional Indication in such Additional Field, and (B) Licensee shall pay Alnylam the

following amounts (which shall be in addition to any event payments which may be owed under Section 5.3 below and except as provided in clause (ii) below) upon achievement of the following events by Licensee, its Affiliates or Licensee Partners with respect to each such Additional Indication:

		Payment for
		Licensed Products
Development Event:		(in [**]):
Initiation of Phase III for each Additional Indication		$	[**]
Filing of an NDA for each Additional Indication		$	[**]
Regulatory Approval for each Additional Indication		$	[**]

          (ii) Notwithstanding the foregoing provisions of clause (i) above, Licensee shall pay Alnylam the following amounts (which shall be in addition to any event payments which may be owed under Section 5.3 below and in lieu of any amounts which may otherwise be owed under clause (i) above) upon achievement of the following events by Licensee, its Affiliates or Licensee Partners solely with respect to a Licensed Product with respect to which Licensee extends its activities for the first time to an Additional Indication in a given Additional Field:

		Payment for
		Licensed Products
Development Event:		(in [**]):
Initiation of Phase III for a Licensed Product for the first Additional Indication in a given Additional Field		$	[**]
Filing of an NDA for a Licensed Product for the first Additional Indication in a given Additional Field		$	[**]
Regulatory Approval for a Licensed Product for the first Additional Indication in a given Additional Field		$	[**]

          (iii) The amounts paid under subsections (i) and (ii) of this Section 2.5(a) for Additional Indications within a given Additional Field shall be fully creditable against Field Option Fees which may be paid by Licensee pursuant to Section 5.6 for such Additional Field. In no event shall the total event payments made under this provision exceed $[**] for a given Additional Field.

          (iv) For the avoidance of doubt, in no event shall Licensee conduct Discovery, Development, Commercialization and Manufacturing activities directed to any Target in any Additional Field other than as permitted in this Section 2.5. In the event that the

Parties are unable to agree on whether or not Licensee’s activities fall within or outside the Primary Field or any Additional Field in a manner prohibited by this Agreement, the Parties shall submit such dispute to a panel (the “ Field Definition Panel ”) consisting of three (3) independent experts in clinical development, with each Party having the right to select a single expert and the two (2) selected experts selecting the third expert by mutual agreement. Such third expert shall serve as the chairperson of the Field Definition Panel. The selection of the experts for the Field Definition Panel shall occur within thirty (30) days following the Parties’ decision to submit such dispute to such a panel, and the Parties shall consult with such Field Definition Panel for a period not to exceed thirty (30) days from the selection of such experts. The Field Definition Panel shall render a decision with respect to such dispute, based on a majority vote, with each expert having one (1) vote, within ten (10) days following the end of such consultation period, which decision shall be binding on the Parties. In the event that the Field Definition Panel determines that Licensee’s Discovery, Development, Commercialization or Manufacturing activities are being conducted in any Additional Field in a manner which is prohibited hereunder, Licensee shall, within ten (10) Business Days after such determination by the Field Definition Panel, cease such proscribed activity.

     (b)  Field Option .

          (i) During the Option Term, if Alnylam intends to grant to any Third Party (other than Listed Counterparties or Pre-Existing Alliance Parties, subject to the terms of the applicable Listed Alnylam Third Party Agreements or Pre-Existing Alliance Agreements, as the case may be) an exclusive license to any Additional Field(s) which is not included in the then-current Field, Alnylam shall notify Licensee thereof (“ Field Extension Opportunity ”). Licensee shall have the right to extend the licenses granted under Section 2.1(a) to include the Additional Field(s) covered by such Field Extension Opportunity by notifying Alnylam in writing of such intent within sixty (60) days after Alnylam’s notice and paying the Field Option Fee for each such Additional Field pursuant to Section 5.6. For the avoidance of doubt, Alnylam and Alnylam Europe AG shall have the right to grant to any Third Party any exclusive licenses under Alnylam’s or Alnylam Europe AG’s rights, as the case may be, in any Licensed Intellectual Property in any Additional Field to which Licensee has not extended its licenses granted under Section 2.1(a) pursuant to Licensee’s exercise of the Field Option under this Section 2.5(b).

          (ii) From time to time during the Option Term, Licensee shall have the right, upon written notice to Alnylam, to request the extension of the license granted under Section 2.1(a) to include one or more Additional Field(s) (“ Field Option ”) in which Licensee has a good faith intention to seek to Discover, Develop, Commercialize and Manufacture RNAi Compounds or RNAi Products, which right shall be subject to any agreement which Alnylam may have entered into with a Third Party with respect to such Additional Field(s) following Licensee’s rejection of, or failure to pay the Field Option Fee for, any Field Extension Opportunity pursuant to clause (i) above. Upon Licensee’s payment of the Field Option Fee for each such Additional Field pursuant to Section 5.6, the licenses granted to Licensee under Section 2.1(a) shall include such Additional Field(s).

      2.6 Designated Target Option. From time to time during the Novartis Exclusivity Term, Licensee shall have the right, upon written notice to Alnylam, to select any

Target in the Field which is not a Blocked Target for submission by Alnylam to Novartis pursuant to the terms of the Novartis Agreement (a “ Submitted Target ”). Alnylam shall promptly provide notice to Novartis of the Submitted Target(s) in accordance with the provisions of the Novartis Agreement, and Licensee shall cooperate with Alnylam in providing any information reasonably requested by Novartis (but not the identity of Licensee or any of Licensee’s RNAi Compounds) in order for Novartis to determine whether or not to pursue Discovery, Development and/or Commercialization activities directed to such Submitted Target. If Novartis notifies Alnylam that it wishes (as such term is used in the Novartis Agreement) to pursue Discovery, Development and/or Commercialization activities directed to such Submitted Target, then Alnylam shall so notify Licensee promptly upon Alnylam’s receipt of such notification, and such Target shall be deemed a Blocked Target for purposes of this Agreement. If Alnylam receives notice from Novartis that Novartis has no interest in pursuing Discovery, Development and/or Commercialization activities directed to such Submitted Target, or if Novartis otherwise waives its right to such Submitted Target under the terms of the Novartis Agreement, then Alnylam shall notify Licensee promptly upon Alnylam’s receipt of such notification or waiver. In such event, such rejected or waived Submitted Target shall be deemed a “Designated Target” for all purposes under this Agreement, Licensee shall be deemed to have exercised its option with respect to such Submitted Target (each, a “Designated Target Option”), and Licensee shall be free, upon [**] pursuant to Section 5.5, to Discover, Develop, Commercialize or Manufacture RNAi Compounds and RNAi Products directed to such Designated Target in accordance with the terms hereof without further risk of such Target becoming a Blocked Target.

      2.7 Special Provisions Relating to Novartis.

     (a)  Compliance with Novartis Agreement . It is the intent of the Parties that this Agreement be construed in a manner which is consistent with and in compliance with the terms of the Novartis Agreement in all respects.

     (b)  Alnylam Change of Control . In the event that, at any time during the [**], an Alnylam Change of Control occurs in which [**] (other than [**] or any controlled [**]) is the acquiring entity (a “[**]”), it shall be a condition precedent to such [**] that:

          (i) Section 2.4(b) of this Agreement shall be amended to provide that the “Gatekeeper” shall not be a designated employee of Alnylam but instead (A) shall be a Third Party who shall have no material relationship (other than as Gatekeeper) with Alnylam, [**], (B) shall be mutually agreeable to both Parties and (C) shall be bound by confidentiality obligations to both Parties, and to the extent that the consent of [**] shall be required for such amendment, such consent shall have been obtained; and

          (ii) [**], to the extent required, shall have agreed [**] that the[**] contained therein ( i.e. , [**] thereof) shall terminate upon such [**] and that [**] as a result of any obligations under the [**] or as a result of any other actions [**] in connection with [**] hereunder after the date of the agreement providing for such [**] or, if there is no [**], after the date of such [**].

Alnylam agrees that the [**] shall include the consent of [**], as applicable, required by clause (i) above and the agreement of [**], as applicable, to the amendment required by clause (ii) above. If, notwithstanding the foregoing, the [**] shall occur without the amendment and consent contemplated by clause (i) above or without the agreement and amendment contemplated by clause (ii) above, then (A) [**] and (B) Alnylam shall pay to Licensee an amount equal to [**]. Each Party agrees that if the [**] shall occur without the amendment and consent contemplated by clause (i) above or without the agreement and amendment contemplated by clause (ii) above, the damages that Licensee and its Affiliates would suffer would be irreparable and difficult to calculate with certainty but in such event the amounts payable by Alnylam pursuant to the immediately preceding sentence shall constitute fair and reasonable amounts and not penalties.

     (c)  No Adverse Amendments . Alnylam agrees not to enter into any amendment or modification to the [**] which would have an adverse impact on Licensee’s rights under this Agreement, without the prior written consent of Licensee. Without limiting the foregoing, the Parties acknowledge and agree that the following amendments/modifications would have an adverse impact on Licensee’s rights under this Agreement: [**]; (iv) any amendment that would require Alnylam to provide to [**] any Confidential Information of Licensee; and (v) any provision that is inconsistent with the obligations of Alnylam to Licensee hereunder.

     (d)  Specific Performance . The Parties hereto agree that irreparable damage would occur if any provision of this Section 2.7 were not performed in accordance with the terms hereof and that Licensee shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof in any federal court located in the State of Delaware or any Delaware state court, in addition to any other remedy to which they are entitled at law or in equity.

      2.8 Certain Intellectual Property Matters

     (a)  Claimed Infringement .

          (i) In the event that a Third Party at any time asserts a claim, or brings an action, suit or proceeding against a Party or any of its Affiliates or, with respect to Licensee, Licensee Partners, claiming infringement of such Third Party’s Patent Rights or unauthorized use or misappropriation of such Third Party’s Know-How, based upon an assertion or claim arising out of any of the activities taken in respect of the Discovery, Development, Commercialization or Manufacture of Licensed Products, where such claim, action, suit or proceeding and/or the defense thereof involves, or is likely to involve, the validity, scope and/or enforceability of the Licensed Intellectual Property (“ Third Party Infringement Claim ”), such Party shall promptly notify the other Party in writing of the claim or the commencement of such action, suit or proceeding, enclosing a copy of the claim and all papers served.

          (ii) Within thirty (30) days after delivery of the notification required to be delivered under clause (i) above, as between Alnylam and Licensee and subject to Alnylam Third Party Obligations, Alnylam shall, upon written notice thereof to Licensee,

assume control of the defense of those aspects of any such Third Party Infringement Claim which involve the validity, scope and/or enforceability of Licensed Intellectual Property (either alone or in combination with any other Patent Rights or Know-How), and Licensee shall, upon written notice thereof to Alnylam, assume control of the defense of any other Third Party Infringement Claim or aspect thereof, as the case may be. Licensee and Alnylam, subject to Alnylam Third Party Obligations, shall keep the other Party advised of the status of such action, suit, proceeding or claim and the defense thereof and shall consider recommendations made by the other Party with respect thereto.

          (iii) The Party controlling the action, suit, proceeding, claim or defense under Section 2.8(a) shall not agree to any settlement of such action, suit, proceeding, claim or defense without the prior written consent of the other Party, which shall not be unreasonably withheld, conditioned or delayed; provided , that Alnylam may settle or compromise any action, suit, proceeding, claim or defense relating to Licensed Intellectual Property without the prior written consent of Licensee.

     (b)  Trademarks . Each Party and its Affiliates shall retain all right, title and interest in and to its and their respective corporate names and logos. Licensee shall not acquire any rights under this Agreement in any trademark, service mark or Internet domain name including the word “Alnylam” or any other trademarks or trade dress of Alnylam or its Affiliates, and Alnylam shall not acquire any rights under this Agreement in any trademark, service mark or Internet domain name including the word “Roche” or any other trademarks or trade dress of Licensee or its Affiliates.

     (c)  Enforcement of Licensed Intellectual Property . Alnylam shall take reasonable measures to protect and, to the extent Alnylam has such a right, to enforce the Licensed Intellectual Property in the Field, consistent with prudent commercial practices in the biotechnology industry.

     (d)  Notice of Changes . Within sixty (60) days after each anniversary of the Effective Date, Alnylam shall provide to Licensee an updated Schedule C that reflects any changes to the list of Licensed Patent Rights set forth on Schedule C which have occurred during the prior year.

      2.9 Obligation to Maintain Listed Alnylam Third Party Agreements. Alnylam shall use commercially reasonable efforts to maintain the Listed Alnylam Third Party Agreements in full force and effect as they relate to the Licensed Patent Rights. If a Listed Alnylam Third Party Agreement provides Alnylam with the opportunity to assume prosecution of any Licensed Patent Right or risk that such right will be abandoned, then Alnylam shall take reasonable measures to prosecute such Licensed Patent Right in the Field, consistent with prudent commercial practices in the biotechnology industry.

ARTICLE III

TECHNOLOGY TRANSFER;

JOINT FUTURE TECHNOLOGY COMMITTEE

      3.1 Technology Transfer.

     (a)  Initial Technology Transfer .

          (i) Within a period of [**] months following the Effective Date (“ Technology Transfer Period ”), Alnylam shall complete the activities assigned to Alnylam as set forth on the technology transfer plan attached hereto as Schedule F (as it may be amended from time to time by mutual agreement of the Parties, the “ Technology Transfer Plan ”), at no additional cost to Licensee (subject to subsection 3.1(d) below), to effect the transfer to Licensee (or its designated Affiliate(s)) of Licensed Intellectual Property that is reasonably necessary for the exercise of Licensee’s rights under the licenses granted pursuant to Section 2.1(a) and for the operation of the facility in Kulmbach, Germany which is being transferred to Licensee pursuant to the terms of the Share Purchase Agreement (“ Kulmbach Facility ”). Alnylam shall make available to Licensee such number of technical personnel as may be set forth in the Technology Transfer Plan to answer any questions or provide instruction as reasonably requested by Licensee concerning the items delivered pursuant to this Section 3.1(a), in connection with Licensee’s Discovery, Development, Commercialization and Manufacture of Licensed Products hereunder and the operation of the Kulmbach Facility.

          (ii) During the Technology Transfer Period, Licensee shall conduct, and shall cause Licensee’s applicable Affiliate(s) to conduct, the activities assigned to Licensee (and/or its Affiliates) as set forth on the Technology Transfer Plan, at no additional cost to Alnylam, to effect the transfer to Alnylam (or its designated Affiliate(s)) of Know-How which is reasonably necessary to enable Alnylam (or its Affiliate(s)) to transfer the performance of the activities conducted at the Kulmbach Facility prior to the Effective Date to an alternate facility in Cambridge, MA, U.S.A, designated by Alnylam.

     (b)  Technology Transfer to Alnylam After Technology Transfer Period . Without limiting Licensee’s obligations under Section 3.1(a), following the end of the Technology Transfer Period, Licensee shall conduct, and shall cause Licensee’s applicable Affiliates to conduct, the activities assigned to Licensee and/or its Affiliates as set forth in the Technology Transfer Plan, at no additional cost to Alnylam, to effect the transfer to Alnylam (or its designated Affiliate(s)) of Know-How associated with, or arising from, the Discovery, Development, Commercialization and/or Manufacturing activities performed by Licensee (and/or its Affiliate(s)) and its or its Affiliates’ employees and subcontractors at the Kulmbach Facility on behalf of Alnylam and/or its Affiliates before and/or during the Transition Period (as defined in the Share Purchase Agreement). Licensee shall make available to Alnylam such number of technical personnel as may be set forth in the Technology Transfer Plan to answer any questions or provide instruction as reasonably requested by Alnylam concerning the items delivered pursuant to this Section 3.1(b).

     (c)  Management of Transition Activities . Each Party shall designate personnel to the Joint Transition Team (as defined in the Share Purchase Agreement) who shall be responsible for coordinating the technology transfer activities under the Technology Transfer Plan. Each Party shall cooperate with the other Party in such other Party’s conduct of technology transfer activities under the Technology Transfer Plan.

     (d)  Additional Services . If Licensee desires that Alnylam continue to provide technology transfer services with respect to Licensed Intellectual Property (i) beyond the scope of the Technology Transfer Plan, or (ii) following the end of the Technology Transfer Period, Alnylam shall, at its discretion and upon mutual agreement of the Parties on the terms of such services (including, as necessary, an amended Technology Transfer Plan), continue to provide such services on terms to be agreed upon by the Parties.

      3.2 Joint Future Technology Committee. Within thirty (30) days after the Effective Date, the Parties shall establish a “ Joint Future Technology Committee ”, comprised of at least one (1) representative from each of Licensee and Alnylam, to exchange information and facilitate discussions concerning any Future Technology Patent Rights which may arise during the Option Term. Unless otherwise agreed by the Parties, the Joint Future Technology Committee shall remain in effect during the Option Term and shall meet on a bi-annual basis, in a manner and at a location mutually agreed by the Parties (including via telephone). During the Option Term, either Party may notify the other Party of its interest in obtaining a license under such other Party’s rights to any Future Technology Patent Rights. Upon such notification and subject to any rights of Third Parties to such Future Technology Patent Rights, the Parties shall negotiate in good faith for a period not to exceed one hundred twenty (120) days the terms of any license to such Future Technology Patent Rights, provided that neither Party shall be obligated to grant any licenses to the other Party. For the avoidance of doubt, the Joint Future Technology Committee shall have no decision-making authority with respect to the acquisition or grant of any licenses under any Future Technology Patent Rights.

ARTICLE IV

DISCOVERY COLLABORATION

      4.1 Discovery Collaboration. Within [**] months following the Effective Date during the Option Term (“ Initial Discovery Collaboration Opportunity Period ”), Licensee shall propose to Alnylam at least [**] Targets which are not Blocked Targets with respect to which Licensee has an interest in entering into a Discovery Collaboration with Alnylam (“ Discovery Collaboration Opportunity ”), and shall provide to Alnylam any available information concerning such Targets which Licensee reasonably believes may be material to Alnylam in its evaluation of such Discovery Collaboration Opportunity and the rationale for pursuing an RNAi Compound directed to such Target. If Alnylam has an interest in pursuing any such Discovery Collaboration Opportunity with Licensee with respect to one or more of the proposed Targets (each, a “ Collaboration Target ”), then Alnylam shall so respond within thirty (30) days of Licensee’s notice. If any such Collaboration Target is not already a Designated Target at the time of Licensee’s proposal of the Discovery Collaboration Opportunity directed to such Collaboration Target, then Licensee shall submit such

Collaboration Target(s) to Novartis during the Novartis Exclusivity Term in accordance with Section 2.6 hereof. In the event that Novartis rejects or waives such Collaboration Target and such Collaboration Target becomes a Designated Target hereunder, [**], and the Parties shall negotiate in good faith, for a period not to exceed six (6) months, the terms of a Discovery Collaboration Opportunity directed to such Designated Target in accordance with Section 4.2. If the Parties are unable to negotiate the terms of a Discovery Collaboration Opportunity within such six (6) month period, the Parties shall refer the matter(s) under negotiation to the Chief Executive Officer of Alnylam and the Global Head of Pharma Research of Licensee, for discussion and resolution within a thirty (30) day period. Licensee shall have no obligation to pursue more than [**]; provided, that, the Parties shall enter into at least [**] directed to at least [**] within the Option Term.

      4.2 Minimum Terms. The terms of any Discovery Collaboration negotiated between the Parties pursuant to Section 4.1 shall include, at a minimum, the following: (a) each Party shall be responsible for the costs of its own employees who perform work under the Discovery Collaboration, (b) Licensee shall pay to Alnylam event payments and royalties with respect to Licensed Collaboration Product(s) which shall be in addition to those which would have been payable by Licensee with respect to such Licensed Collaboration Product(s) had Licensee independently Discovered, Developed, Commercialized and/or Manufactured such Licensed Collaboration Product(s) as Licensed Product(s) outside of any Discovery Collaboration, which shall be commensurate with Alnylam’s contributions to the Discovery Collaboration (taking into account, at a minimum, the Patent Rights referred to in subsection (c) below which shall be licensed to Licensee in connection with such Discovery Collaboration in addition to the Licensed Patent Rights); (c) the grant of licenses under each Party’s rights to Patent Rights and Know-How developed by such Party, its Affiliates and/sublicensees, either individually or jointly with each other, during and in the performance of the Discovery Collaboration; (d) the rights and obligations of each Party with respect to prosecution, maintenance and enforcement of the intellectual property rights set forth in the immediately preceding clause (c); and (e) termination rights. Upon finalization of the terms of any Discovery Collaboration pursuant to this Section 4.2, the Parties shall (x) develop a research plan in accordance with which each Party shall perform activities specified under such Discovery Collaboration, and (y) establish a joint steering committee made up of an equal number of representatives from each Party to oversee, review and coordinate the activities of the Parties under such Discovery Collaboration. Notwithstanding the foregoing, if there is an Alnylam Change of Control, then Licensee shall have the right not to (i) begin, or continue, to propose Discovery Collaboration Opportunities pursuant to Section 4.1, (ii) begin, or continue to engage in, any negotiations with Alnylam with respect to any such Discovery Collaboration Opportunity, or (iii) continue with any ongoing Discovery Collaboration.

ARTICLE V

FINANCIAL PROVISIONS

      5.1 Equity Investment. As of the Execution Date, the Parties have entered into the Common Stock Purchase Agreement pursuant to which Licensee has agreed to purchase shares of Alnylam’s Common Stock (as defined in the Common Stock Purchase

Agreement) for a total consideration of Forty-Two Million Four Hundred Sixty-Two Thousand Five Hundred dollars ($42,462,500).

      5.2 License Grant Consideration. In consideration of the rights granted to Licensee under this Agreement as of the Effective Date, Licensee shall pay, or cause to be paid, to Alnylam Two Hundred Seventy-Three Million Five Hundred Five Thousand Five Hundred dollars ($273,505,500) within ten (10) Business Days following the Effective Date.

      5.3 Event Payments.

     (a)  Development Events . In connection with the Discovery and Development of Licensed Products that are Covered by a Valid Claim of Licensed Patent Rights, or the Manufacture of which Licensed Products is Covered by a Valid Claim of a Licensed Patent Right, and directed against a given Target hereunder, Licensee shall pay, or cause to be paid, to Alnylam the following payments upon the achievement of the events set forth below:

		Payment for
		Licensed Products
Development Event:		(in [**]):
Initiation of GLP Toxicology Studies		$	[**]
Initiation of the first Phase I Study		$	[**]
Initiation of the first Phase II Study		$	[**]
Initiation of the first Phase III Study for the first Indication		$	[**]
Initiation of first Phase III Study for a second Indication		$	[**]
First filing of an NDA in the U.S. for the first Indication		$	[**]
First filing of an NDA in the EU for the first Indication		$	[**]
First filing of an NDA in Japan for the first Indication		$	[**]
First filing of an NDA in the U.S. or EU for a second Indication		$	[**]
Regulatory Approval in the U.S. for the first Indication		$	[**]
Regulatory Approval in the EU for the first Indication		$	[**]
Regulatory Approval in Japan for the first Indication		$	[**]
Regulatory Approval in the U.S. or EU for a second Indication		$	[**]

     (b)  Sales Events . With respect to each Target, Licensee shall pay, or cause to be paid, to Alnylam the following payments based on Net Sales of Licensed Products that are Covered by a Valid Claim of Licensed Patent Rights, or the Manufacture of which Licensed Products is Covered by a Valid Claim of a Licensed Patent Right, upon the achievement of the events set forth below:

		Payment for
		Licensed Products
Sales Event:		(in [**]):
Aggregate worldwide Annual Net Sales of all Licensed Product(s) directed to such Target reach or exceed $[**] (≥$[**])		$[**]
Aggregate worldwide Annual Net Sales of all Licensed Product(s) directed to such Target reach or exceed $[**] (≥$[**])		$[**]

     (c)  Achievement of Events . Licensee shall notify Alnylam within thirty (30) days following achievement or occurrence of an event under Section 2.5(a) and this Section 5.3, and Alnylam shall deliver to Licensee an invoice for such event. Each event payment under Section 2.5(a) and this Section 5.3 shall be deemed earned as of the achievement or occurrence of the related event and shall be paid by Licensee within sixty (60) days following such achievement or occurrence.

     (d)  Event Payments Payable Only Once . Each event payment under this Section 5.3 shall be payable only once in relation to each Target. By way of example, in the event that Licensee elects not to proceed with the Development or Commercialization of a Licensed Product directed to a Target for which one or more of the foregoing event payments have been paid, Licensee shall not be required to make any event payments previously paid under this Section 5.3 with respect to any back-up Licensed Product(s) directed at such Target. In addition, if, with respect to the Development of a Licensed Product, Licensee satisfies an event under this Section 5.3, Licensee shall pay to Alnylam all earlier event payments under this Section 5.3 that have not otherwise been paid with respect to such Target (regardless of whether such earlier events have been satisfied).

      5.4 Royalties.

     (a)  Royalty Rate . Subject to subsections (b)-(g) of this Section 5.4, during each relevant Royalty Term, Licensee shall pay, or cause to be paid, to Alnylam the following royalties on Annual Net Sales of each Licensed Product:

		Royalty Rate
Annual Net Sales of a Licensed Product (on a		Applicable to Such
Target-by-Target basis) during the applicable		Annual Net Sales
calendar year:		of Such Licensed Product:
Less than or equal to $[**]:			[**]	%
Greater than $[**], but less than or equal to $[**]:			[**]	%
Greater than $[**], but less than or equal to $[**]:			[**]	%
Greater than $[**], but less than or equal to $[**]			[**]	%
Greater than $[**], but less than or equal to $[**]:			[**]	%
Greater than $[**], but less than or equal to $[**]			[**]	%
Greater than $[**]:			[**]	%

By way of example, if Annual Net Sales of a Licensed Product are [**] dollars and no deductions were to apply under Sections 5.4(b)-(g), then the royalty payable by Licensee to Alnylam would be as follows:

$[**] million at [**]%		=  $[**] million
$[**] million at [**]%		=  $[**] million
$[**] million at [**]%		=  $[**] million
$[**] million at [**]%		=  $[**] million
$[**] million at [**]%		=  $[**] million
$[**] million at [**]%		=  $[**] million
$[**] million at [**]%		=  $[**] million
Total Royalty Due		=  $[**] million

For the avoidance of doubt, Licensee’s obligation to pay royalties under this Section 5.4 is imposed only once with respect to the same unit of Licensed Product, including by reason of such Licensed Product being Covered by more than one Valid Claim of Licensed Patent Rights.

     (b)  Expiration of Patent Coverage . If no Valid Claim of Licensed Patent Rights Covers a Licensed Product in a given country, and the Manufacture of such Licensed Product is not Covered by a Valid Claim of Licensed Patent Rights in the country of manufacture, then the royalty rate applicable to such Licensed Product in such country shall be reduced to [**] percent ([**]%) of the rate set forth in Section 5.4(a) above for any

remaining portion of the Royalty Term which applies to such Licensed Product in such country.

     (c)  Royalty Stacking . Licensee shall be entitled to deduct, from the royalty payments payable by Licensee under Section 5.4(a) for a reporting period, [**] percent ([**]%) of Required Third Party Payments paid by Licensee with respect to Licensed Products during the applicable reporting period; provided that in no event shall a deduction under this subsection (c) reduce any royalty payment payable by Licensee under Section 5.4(a) by more than [**] percent ([**]%).

     (d)  Payments in Respect of Alnylam In-Licenses . In addition to any royalty set forth in Section 5.4(a) during the Royalty Term, Licensee shall reimburse Alnylam for [**] percent ([**]%) of all royalty payments payable (each such payment, a “ Listed Alnylam Third Party Payment ,” collectively, the “ Listed Alnylam Third Party Payments ”) to Third Parties pursuant to Listed Alnylam Third Party Agreements in respect of Net Sales of Licensed Products; provided that in no event shall the royalty payments payable by Licensee hereunder in respect of such Listed Alnylam Third Party Payments in any reporting period exceed in the aggregate [**] percent ([**]%) of Net Sales of Licensed Products for such reporting period. The Parties shall cooperate to coordinate such reimbursements by Licensee in a manner that ensures all amounts payable by Licensee hereunder pursuant to Listed Alnylam Third Party Agreements are paid in a timely manner and otherwise in compliance with such Listed Alnylam Third Party Agreements. Licensee shall have the right to have an independent public accountant reasonably acceptable to Alnylam audit Alnylam’s books and records solely for purposes of verifying such Listed Alnylam Third Party Payments, which right shall be exercisable [**] per year solely with respect to records covering up to the [**] calendar years prior to audit notification, upon reasonable advance notice and during Alnylam’s business hours, subject to the confidentiality provisions of Article VI hereof. Audit results and findings shall be shared by Licensee and Alnylam. If the audit reveals an overpayment by Licensee under this Section 5.4(d), the amount of such overpayment shall be credited towards any future reimbursement amounts payable by Licensee under this Section 5.4(d), subject to Section 5.4(e). If the audit reveals an underpayment by Licensee, Licensee shall make up such underpayment within thirty (30) days. The failure of Licensee to request verification of any Listed Alnylam Third Party Payments hereunder within the [**] calendar year period set forth above shall be deemed acceptance of the calculation of such Listed Alnylam Third Party Payments.

     (e)  Deductions . Notwithstanding anything in this Agreement to the contrary, in no event shall total deductions under Sections 5.4(b) and 5.4(c) reduce any quarterly royalty payment by Licensee in respect of Net Sales of a given Licensed Product to less than [**]. Alnylam shall have the burden of demonstrating the amount of royalty payments payable to Third Parties pursuant to Listed Alnylam Third Party Agreements. Any deductions allowable under Sections 5.4(b) and 5.4(c) which cannot be used against any quarterly royalty payment due to the foregoing limitation may be carried forward and used against future quarterly royalty payments, subject to the limitation set forth above.

     (f)  Loss of Listed Alnylam Third Party Agreements . If Alnylam ceases to be a licensee of Licensed Patent Rights (as such, “ Terminated Patent Rights ”) under any

Listed Alnylam Third Party Agreement (other than as a result of any action or omission by Licensee) and Licensee directly licenses such Terminated Patent Rights from that Third Party, then Licensee may deduct the full amount of any [**] paid to such Third Party for such license(s) that is attributable to Licensed Products Covered by such Terminated Patent Rights from any royalties otherwise payable to Alnylam hereunder; provided, that prior to Licensee entering into any such license of such Terminated Patent Rights from such Third Party, Licensee shall notify Alnylam of its intent to do so and shall provide to Alnylam an opportunity to explain its rationale for ceasing to license such Terminated Patent Rights and Licensee shall consider in good faith such rationale. If Licensee does not agree with Alnylam’s rationale, then, at Licensee’s request, Alnylam shall use commercially reasonable efforts to reinstate the license for such Terminated Patent Rights within a sixty (60) day period; provided, however, that Alnylam shall not be required to continue to undertake such efforts if the Third Party requires payments which are incremental to what would otherwise be owed to such Third Party had such Terminated Patent Rights not been terminated, or the imposition of additional terms and conditions. If Alnylam is unable to reinstate the license, then Licensee may obtain a direct license for such Terminated Patent Rights from such Third Party; provided, that in no event shall total deductions under this Section 5.4(f) reduce any quarterly royalty payment by Licensee in respect of Net Sales of a given Licensed Product to less than [**].

     (g)  Duration of Royalty Payments; First Commercial Sale . The royalties payable under Section 5.4(a) shall be paid on a country-by-country basis on each Licensed Product commencing upon the occurrence of the First Commercial Sale of such Licensed Product until the expiration of the applicable Royalty Term for such Licensed Product. Licensee shall notify Alnylam of the occurrence of First Commercial Sale of each Licensed Product within fifteen (15) days of its occurrence.

      5.5 [**]. If Licensee exercises the [**] with respect to a Target pursuant to Section 2.6, and such Target is deemed a [**] hereunder, then Licensee shall pay Alnylam a fee (the [**]) of (a) [**] Dollars ($[**]) for each of the first [**] Targets to be [**] pursuant to Licensee’s exercise of the [**] in any calendar year, (b) following the [**] of the [**] Target as a [**] hereunder in any calendar year, [**] Dollars ($[**]) for each of the next [**] Targets [**] pursuant to Licensee’s exercise of the [**] hereunder; (c) following the [**] of the [**] Target as a [**] hereunder in any calendar year, [**] Dollars ($[**]) for each of the next [**] Targets [**] pursuant to Licensee’s exercise of the [**] hereunder; and (d) following the [**] of the [**] Target as a [**] hereunder in any calendar year, [**] Dollars ($[**]) for each Target [**] pursuant to Licensee’s exercise of the [**] hereunder. Licensee shall pay such [**] within thirty (30) days following receipt of Alnylam’s invoice with respect to the [**] hereunder.

      5.6 Field Option Fee. If Licensee exercises the Field Option with respect to any Additional Field pursuant to Section 2.5, Licensee shall pay Alnylam a fee (the “ Field Option Fee ”) of [**] Dollars ($[**]) for each such Additional Field. Licensee shall pay such Field Option Fee within thirty (30) days following receipt of Alnylam’s invoice therefor.

      5.7 Most Favored Licensee. During the Option Term, in the event that Alnylam grants to a Third Party (other than Listed Counterparties or Pre-Existing Alliance

Parties) rights including a non-exclusive, worldwide license under the Licensed Intellectual Property to Discover, Develop, Manufacture and Commercialize Licensed Products, at a royalty rate (taking into account any obligations to make payments to Third Parties) that is more favorable to such Third Party than the royalty rate (taking into account any obligations to make payments to Third Parties) set forth in Section 5.4 of this Agreement with respect to such license grant, then the royalty rate (taking into account any obligations to make payments to Third Parties) under this Agreement shall be reduced or adjusted to such more favorable Third Party royalty rate on a prospective basis from the effective date of Alnylam’s agreement with such Third Party with respect to such rights. Notwithstanding the foregoing, if (a) the Third Party has paid cash or other consideration, or there are other elements of the overall transaction with such Third Party, that justifies a royalty rate below the rate set forth in Section 5.4 of this Agreement, or (b) the license has been granted as part of a joint venture or similar collaborative agreement, then such royalty rate reduction shall not apply. For the avoidance of doubt, such more favorable royalty rate shall have no retroactive effect and shall not apply to any royalties which have been paid by Licensee or which have otherwise accrued under this Agreement prior to the date of such reduction or adjustment.

      5.8 Payment of Royalty. Licensee shall calculate royalties on Net Sales quarterly as of March 31, June 30, September 30 and December 31 (each being the last day of an “ Accounting Period ”) and shall pay royalties on Net Sales within the sixty (60) days after the end of each Accounting Period in which such Net Sales occur. Royalties on Net Sales shall be paid by Licensee in U.S. Dollars.

      5.9 Currency Computation. Whenever calculating royalties requires conversion from any currency, Licensee shall make such conversion as follows: When calculating the Adjusted Gross Sales for countries other than the United States of America, Licensee shall convert the amount of such sales in currencies other than Swiss Francs into Swiss Francs using for internal foreign currency translation Licensee’s then current standard practices actually used on a consistent basis in preparing its audited financial statements. Upon converting the amount of Adjusted Gross Sales into Swiss Francs, Licensee shall convert into US Dollars (or other currency), using the daily rate (Reuters) at the last working day for the applicable period.

      5.10 Reporting. With each payment Licensee shall provide in writing for the relevant Accounting Period the following information split by U.S., each of the Major Market Countries, and rest of world (a) Adjusted Gross Sales; (b) Net Sales; (c) the total royalties payable for the applicable period; and (d) any other information necessary for Alnylam to comply with its reporting and payment obligations to Third Parties under Alnylam Third Party Obligations, subject to Alnylam’s obligations under Section 2.3(b)(i).

      5.11 Withholding Taxes. Any tax required to be withheld by Licensee under the laws of any country for the account of Alnylam shall be promptly paid by Licensee for and on behalf of Alnylam to the appropriate governmental authority, and Licensee shall furnish Alnylam with proof of payment of such tax. Any such tax actually paid on Alnylam’s behalf shall be deducted from royalty payments due to Alnylam hereunder. Licensee shall assist Alnylam in minimizing the withholding taxes applicable to any payment made by Licensee and in claiming tax refunds at Alnylam’s request.

      5.12 Financial Records. Licensee shall keep, and shall require its Affiliates and Licensee Partners to keep, for [**] years, full, true and accurate books of account containing all particulars that may be necessary for the purpose of calculating all amounts payable under this Agreement or to verify compliance with this Agreement. Such books of accounts shall be kept at their principal place of business.

      5.13 Audits by Alnylam. At the expense of Alnylam, Alnylam has the right to engage an independent public accountant reasonably acceptable to Licensee to perform, on behalf of Alnylam, an audit of such books and records of Licensee and its Affiliates and Licensee Partners, that are deemed necessary by Alnylam’s independent public accountant to verify amounts paid or payable under this Agreement for the period or periods requested by Alnylam and the correctness of any report or payments made under this Agreement. Upon timely request and at least thirty (30) Business Days’ prior written notice from Alnylam, such audit shall be conducted in the countries specifically requested by Alnylam, during regular business hours in such a manner as to not unnecessarily interfere with Licensee’s (or its Affiliates’ or Licensee Partners’, as the case may be) normal business activities, and shall be limited to results in the [**] calendar years prior to audit notification. Such audit shall not be performed more frequently than [**] per calendar year nor more frequently than [**]with respect to records covering any specific period of time. All information, data documents and abstracts herein referred to shall be used only for the purpose of verifying royalty statements and other amounts payable under this Agreement, or compliance with this Agreement, shall be treated as Confidential Information of Licensee subject to the obligations of this Agreement and need neither be retained more than [**] year after completion of an audit hereof, if an audit has been requested; nor more than [**] years from the end of the calendar year to which each shall pertain; nor more than [**] year after the date of termination of this Agreement. Audit results and findings shall be shared by Licensee and Alnylam. If the audit reveals an overpayment, Alnylam shall reimburse Licensee for the amount of the overpayment within thirty (30) days. If the audit reveals an underpayment, Licensee shall make up such underpayment within thirty (30) days with interest as set forth in Section 5.14 below. In addition, if the underpayment is equal to or greater than five percent (5%) of the amount that was otherwise due, Licensee shall pay all of the costs of such audit. The failure of Alnylam to request verification of any royalty calculation within the period during which corresponding records must be maintained shall be deemed acceptance of the royalty reporting.

      5.14 Late Payments. Licensee shall pay interest to Alnylam on the aggregate amount of any payments that are not paid on or before the date such payments are due under this Agreement at a rate per annum equal to the lesser of the one month London Interbank Offering Rate of interest plus one percent (1%), as reported by The Wall Street Journal for the applicable period, or the highest rate permitted by applicable law, calculated on the number of days such payment is delinquent.

ARTICLE VI

CONFIDENTIAL INFORMATION

      6.1 Confidential Information. All Confidential Information disclosed by a Party to the other Party in connection with the activities contemplated by this Agreement shall not be used by the receiving Party except in connection with the activities and licenses contemplated by this Agreement, shall be maintained in confidence by the receiving Party, and shall not otherwise be disclosed by the receiving Party to any other Person, without the prior written consent of the disclosing Party, except to the extent that the Confidential Information (as determined by competent documentation):

     (a) was known or used by the receiving Party or its Affiliates prior to its date of disclosure to the receiving Party; or

     (b) either before or after the date of the disclosure to the receiving Party or its Affiliates, is lawfully disclosed to the receiving Party or its Affiliates by sources other than the disclosing Party who are rightfully in possession of the Confidential Information and not subject to an obligation of confidentiality or non-use owed to the disclosing Party; or

     (c) either before or after the date of the disclosure to the receiving Party or its Affiliates, becomes published or generally known to the public other than through the wrongful act or default of the receiving Party or its Affiliates or its or its Affiliates’ representatives; or

     (d) is independently developed by the receiving Party or its Affiliates without reference to or reliance upon the Confidential Information.

     Notwithstanding anything set forth herein to the contrary, this Article VI shall not prohibit the receiving Party from disclosing Confidential Information of the disclosing Party to defend or prosecute litigation; provided that , to the extent practicable, the receiving Party provides prior written notice of such disclosure to the disclosing Party and assists the disclosing Party in its reasonable and lawful efforts to avoid or minimize the degree of such disclosure. Notwithstanding the foregoing provisions of this Section 6.1, either Party may only disclose the terms of this Agreement if such Party reasonably determines, based on advice from its counsel, that it is required to make such disclosure by applica