E XHIBIT 10.24
EXECUTION
[ * ] = C ERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT , MARKED BY BRACKETS , HAS BEEN OMITTED AND FILED SEPARATELY WITH THE S ECURITIES AND E XCHANGE C OMMISSION PURSUANT TO R ULE 24 B -2 OF THE S ECURITIES E XCHANGE A CT OF 1934, AS AMENDED .
FIRST AMENDMENT TO THE PRODUCT
DEVELOPMENT AND
COMMERCIALIZATION AGREEMENT
BETWEEN SMITHKLINE BEECHAM
CORPORATION D/B/A GLAXOSMITHKLINE
AND EXELIXIS, INC. DATED AS OF
OCTOBER 28, 2002
This F IRST A MENDMENT (the “ First Amendment ”) is
entered into as of January 10, 2005 (the “ First Amendment
Effective Date ”), by and between S
MITH K LINE B EECHAM C ORPORATION , a
Pennsylvania corporation, doing business as GlaxoSmithKline
(“ GSK ”), and E XELIXIS , I NC . , a
Delaware corporation (“ EXEL ”). EXEL and GSK
are each referred to herein individually as a “ Party
” or, collectively, as the “ Parties
.”
R ECITALS
W HEREAS , the Parties entered into that certain Product
Development and Commercialization Agreement dated as of October 28,
2002 (the “ Development Agreement ”) under which
EXEL and GSK formed a broad alliance to discover, develop and
commercialize novel therapeutics;
W HEREAS , the Parties now desire to amend certain
provisions of the Development Agreement as set forth below in this
First Amendment; and
W HEREAS , concurrently with the execution of this First
Amendment, the Parties are executing amendments to the Loan and
Security Agreement and Stock Purchase and Stock Issuance Agreement
between the Parties, each dated as of October 28, 2002.
N OW ,
T HEREFORE
, in consideration of the premises
and mutual covenants herein contain, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto agree as
follows:
A GREEMENT
1. A MENDMENT OF THE D EVELOPMENT A GREEMENT
The Parties hereby agree to amend
the terms of the Development Agreement as provided below, effective
as of the First Amendment Effective Date. To the extent that the
Development Agreement is explicitly amended by this First
Amendment, the terms of this First Amendment will control where the
terms of the Development Agreement are contrary to or conflict with
the following provisions. Where the Development Agreement is not
explicitly amended, the terms of the Development Agreement will
remain in full force and effect. Capitalized terms used in this
First Amendment that are not otherwise defined herein shall have
the same meanings as such terms are defined in the Development
Agreement.
1.1 Amendment of Section
1.40 . Section 1.40 is
hereby deleted in its entirety and replaced with the
following:
“1.40 “ Development
Candidate ” shall mean a Development Compound: (i)
selected by EXEL during the [*] which the
Collaboration
Committee confirms meets, or is
otherwise deemed by [*] to have met, the Developability
Criteria for further development through PoC Trials with respect
thereto, in accordance with Section 3.3.2; (ii) for which GSK
exercises its Development Election pursuant to Section 4.3.1(a);
(iii) that becomes a Refused Candidate for which GSK thereafter
exercises its Development Election pursuant to Section 4.3.1(c) or
Section 4.3.1(d); or (iv) for which GSK exercises its Development
Election pursuant to Section 4.3.2.”
1.2 Addition of New
Definitions . The
following new definitions are hereby added to the end of Article 1
to read in their entirety as follows:
“1.147 “Category A
Compound ” shall mean any of XL784, XL647 and
XL999.
1.148 “Category B
Compound ” shall mean any of XL880, XL184, XL820 and
XL844.
1.149 “Independent
Candidate ” shall mean any Category A Compound. Except as
expressly stated in this Agreement, each Independent Candidate
shall [*] .
1.150 “Ineligible
Independent Candidate” shall mean an Independent
Candidate for which GSK does not exercise its Development Election
during the First Option Period and which EXEL does not Control
thereafter.
1.151 “Limited Program
Targets” shall mean the Existing Targets and
Collaboration Targets set forth in Exhibit 7.1.1(b), as may be
amended solely in accordance with Section
7.1.1(d).”
1.3 Amendment of Section
3.2.4(a)(iv)(2). Section
3.2.4(a)(iv)(2) is hereby deleted in its entirety and replaced with
the following:
“(2) if GSK has selected, or
been deemed to have selected, the Limited Program Option, then for
[*] and for [*] , use [*] to conduct the
Development Program with respect to: (i) each of the Category A
Compounds and Category B Compounds and, to the extent appropriate
for any of the Category A Compounds or Category B Compounds
[*] , as determined by EXEL and discussed by the
Collaboration Committee; (ii) the lead optimization stage chemistry
programs for [*] ; and (iii) the programs for [*] ,
all as selected pursuant to Section 3.5.1(a), including but not
limited to [*] . Such efforts shall include but not be
limited to using [*] to: (A) [*] each of the Category
A Compounds and Category B Compounds, or, if [*] , possibly
[*] ; (B) [*] on Development Compounds identified
from the lead optimization stage chemistry programs for [*]
and [*] on certain of the Development Compounds resulting
from such programs; (C) [*] against [*] ; (D)
[*] with respect to [*] , and [*] on certain
of such Development Compounds resulting from such programs; and (E)
[*] The Parties acknowledge and agree that, as part of
EXEL’s [*] to perform the foregoing, it is anticipated
that EXEL will prioritize these projects based on their apparent
potential for successful development, will allocate available
resources among such
[ * ] = C ERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT , MARKED BY BRACKETS , HAS BEEN OMITTED AND FILED SEPARATELY WITH THE S ECURITIES AND E XCHANGE C OMMISSION PURSUANT TO R ULE 24 B -2 OF THE S ECURITIES E XCHANGE A CT OF 1934, AS AMENDED .
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projects based on such
prioritization, and will, over the course of the Development Term
and Extension Period, if any, progressively concentrate its efforts
on those projects that appear the most promising;
or”
1.4 Amendment of Section
3.5.1. Section 3.5.1 is
hereby deleted in its entirety and replaced with the
following:
“3.5.1 Election Period
. During Contract Year Two, EXEL provided to GSK a written list of
all Collaboration Targets and the Development Compounds identified
(including all Development Candidates approved by the Collaboration
Committee), along with a data package containing, to the extent
then available and with respect to each such Development Compound
(including all Development Candidates), certain of the following
information: (A) any previously undisclosed [*] for each
such Development Compound; (B) a [*] of each such
Development Compound against the [*] ; (C) a [*] of
each such Development Compound against [*] ; (D) information
regarding [*] for such Development Compound; (E) the
identification of and all relevant information concerning the
[*] with respect to any Development Candidate, including but
not limited to [*] , if any are identified by such time,
with respect to such Development Compound; and (vi) [*] that
EXEL [*] (the “ Data Package ”). The
Parties acknowledge that the Data Package that EXEL provided to GSK
contained the information requested by GSK, and that GSK has
elected, as of the First Amendment Effective Date, to make its
decision whether to choose either to:
(a) limit the Development Program by
selecting, for further development by EXEL under the Development
Program, up to: (i) seven (7) Category A Compounds and Category B
Compounds [*] ; (ii) three (3) chemistry programs at the
lead optimization stage; and (iii) two (2) designated Limited
Program Targets, together with all Development Compounds that meet,
or are discovered to so meet, the Activity Threshold against such
Limited Program Targets during [*] (the “ Limited
Program Option ”); or
(b) have EXEL continue to engage in
ongoing target and compound identification as being conducted by
EXEL as described in Sections 3.2, 3.3 and elsewhere in this
Agreement as part of the Development Program (the “
Expanded Program Option ”).
By executing this First Amendment:
(i) GSK is hereby selecting the Limited Program Option; (ii) GSK
reserves the right to request from EXEL Information that was not
previously provided to GSK as part of the Data Package and that
pertains to Development Compounds that are part of the Development
Program (as modified by GSK’s selection of the Limited
Program Option); and (iii) the Parties acknowledge that EXEL has
met all of its diligence obligations as of the First Amendment
Effective Date and the minimum performance requirements described
in Sections 3.2.4(a)(i)-(ii).”
[ * ] = C ERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT , MARKED BY BRACKETS , HAS BEEN OMITTED AND FILED SEPARATELY WITH THE S ECURITIES AND E XCHANGE C OMMISSION PURSUANT TO R ULE 24 B -2 OF THE S ECURITIES E XCHANGE A CT OF 1934, AS AMENDED .
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1.5 Amendment of Section
3.5.2. Section 3.5.2 is
hereby deleted in its entirety and replaced with the
following:
“3.5.2 Selection of the
Limited Program Option . GSK has decided that the Limited
Program Option, which it is selecting as part of its entry into
this First Amendment, shall consist of: (A) the Category A
Compounds, the Category B Compounds [*] ; (B) lead
optimization stage chemistry programs for [*] and all
related Development Compounds; and (C) early stage programs for
[*] , together with all Development Compounds that meet, or
are discovered to so meet, the Activity Threshold against
[*] , during [*] . In addition to the other effects
of such selection set forth elsewhere in this Agreement,
GSK’s selection of the Limited Program Option shall have the
following effects:
(a) subject to EXEL’s
obligations pursuant to Section 7.1.1, all rights to those targets
and compounds that were part of the Development Program prior to
GSK’s selection of the Limited Program Option but were not
selected by GSK for inclusion in the Limited Program Option (as set
forth in the rest of this Section 3.5.2) shall revert to EXEL and
no longer be deemed Existing Targets, Collaboration Targets or
Development Compounds, and GSK shall have no further rights or
obligations with respect thereto. EXEL shall be free to use such
reverted targets and develop and commercialize such reverted
Development Compounds, at its sole expense and in its sole
discretion, subject to the terms and conditions of the Agreement,
including without limitation Section 7.1.1.
Notwithstanding anything to the
contrary, following the selection of the Limited Program
Option:
(i) the term “Development
Compound” as used in this Agreement shall, as of the First
Amendment Effective Date, be deemed to include only: (1) (x) the
Category A Compounds, Category B Compounds [*] and (y) all
compounds that, during the [*] are shown to meet the
Activity Threshold against [*] and that are [*] ; and
(2) those Collaboration Compounds that, during the Development Term
or Extension Period, if any, are shown to meet the Activity
Threshold against [*] . For purposes of this subsection,
[*] means the [*] . For clarity, “Development
Compounds” include “Included
Compounds”;
(ii) the term “Collaboration
Target” as used in this Agreement shall, as of the First
Amendment Effective Date, be deemed to include only [*]
;
(iii) the term “Existing
Target” as used in this Agreement shall, as of the First
Amendment Effective Date, be deemed to include only [*] ;
and
(iv) the term “Included
Compound” as used in this Agreement shall, as of the First
Amendment Effective Date, mean, with respect to each Development
Candidate or Development Compound, as applicable, each Development
Compound (except for any other Development Candidate and the
Back-Up Compounds and Follow-Up Compounds to such Development
Candidate) that is [*] . For purposes of this subsection,
[*] means the [*] ;
[ * ] = C ERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT , MARKED BY BRACKETS , HAS BEEN OMITTED AND FILED SEPARATELY WITH THE S ECURITIES AND E XCHANGE C OMMISSION PURSUANT TO R ULE 24 B -2 OF THE S ECURITIES E XCHANGE A CT OF 1934, AS AMENDED .
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(b) GSK shall have the right to make
a Development Election to acquire up to two (2) Development
Candidates as Licensed Products during the Development Term and up
to one (1) additional Development Candidate as a Licensed Product
during the Extension Period, if any, and the Pipeline Option Period
for a maximum total of no more than three (3) Development
Candidates as Licensed Products under this Agreement, all in
accordance with Article 4;
(c) the DOP shall be revised by EXEL
to include the information described in Section 3.3.1 relevant
under the Limited Program Option with respect to EXEL’s
activities during the Development Term and Extension Period, if
any, including, without limitation, development of the Category A
Compounds and Category B Compounds (and, as appropriate, any
[*] ), optimization of Development Compounds and [*]
with respect to [*] , screening compounds against [*]
and identification and optimization of Development Compounds
[*] with respect to [*] . Such revised DOP shall be
submitted to the Collaboration Committee for review and comment at
a meeting to be held as soon as practicable after [*]
;
(d) the Collaboration
Committee’s responsibilities under Section 2.2.5 shall be
deemed revised as follows:
(i) under subsection (a), to
‘review the overall progress of EXEL’s efforts to
develop Development Compounds and Development Candidates’;
and
(ii) subsections (b) and (c) shall
have no further force and effect, as EXEL will no longer be engaged
in target Identification activities under this
Agreement;
(e) Section 2.5.2 shall have no
further force and effect;
(f) GSK shall make such Research and
Development Payments and incentive and extension period option
payments as are specified herein with respect to the Limited
Program Option;
(g) EXEL’s obligations under
Section 3.7 shall be deemed to be revised to refer solely to: (i)
the Category A Compounds and Category B Compounds, and [*] ;
and (ii) the Development Compounds that [*] to meet the
Activity Threshold against [*] ; provided, however ,
that EXEL shall not be required pursuant to Section 3.7 to provide
GSK with Independent Candidate-related development information that
is not in EXEL’s possession;
(h) Section 7.4.2 shall have no
further force and effect;
(i) Section 7.4.3 shall have no
further force and effect; and
(k) With respect to human molecular
targets other than those included within the Limited Program
Targets, EXEL shall, subject to the terms and conditions of this
Agreement, be free to identify human molecular targets having
applicability in the Field and to use those human
[ * ] = C ERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT , MARKED BY BRACKETS , HAS BEEN OMITTED AND FILED SEPARATELY WITH THE S ECURITIES AND E XCHANGE C OMMISSION PURSUANT TO R ULE 24 B -2 OF THE S ECURITIES E XCHANGE A CT OF 1934, AS AMENDED .
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molecular targets in any way,
including without limit the discovery and development of small
molecule compounds, antibodies or protein-based products, without
obligation or payment to GSK. Section 7.1.1 shall govern
EXEL’s rights and restrictions with respect to human
molecular targets included within the Limited Program
Targets.”
1.6 Amendment of Section
3.3.4. Section 3.3.4 is
hereby deleted in its entirety and replaced with the
following:
“3.3.4. Developability
Criteria, Target Product Profiles and PoC Trial Design .
Notwithstanding anything contained herein to the contrary, all
Developability Criteria, Target Product Profiles and designs for
PoC Trials [*] for any Development Compound (that are not
Independent Candidates) or Development Candidate (that are not
Independent Candidates) shall: (A) be consistent with [*]
the Development Compound or Development Candidate in question; (B)
be [*] for the same indication, or if no such information
exists, [*] for a related indication based on such
therapeutic area: and (C) require [*] . In the event that
[*] cannot agree on such Developability Criteria, Target
Product Profiles and/or the design of a PoC Trial within [*]
after meeting and attempting to reach agreement on same, such
dispute shall be submitted promptly to [*] , who shall have
a period of [*] to resolve such dispute; provided,
however , that, notwithstanding anything contained in this
Agreement to the contrary, [*] shall have final
decision-making authority with respect to such disputes. In
addition, any disputes regarding whether or not a Development
Compound (that is not an Independent Candidate) or Development
Candidate (that is not an Independent Candidate), as applicable,
[*] (including without limitation whether any [*]
have resulted in a Development Compound [*] ) shall be
subject to resolution in accordance with [*]
”
1.7 Addition of New Section
3.5.3. A new Section
3.5.3 is hereby added to read in its entirety as
follows:
“3.5.3. Continued
Development of Independent Candidates . The Parties acknowledge
and agree that EXEL may continue the clinical development of each
Independent Candidate by itself, through an EXEL Affiliate or a
Third Party, or any combination of the foregoing, in EXEL’s
sole discretion and as set forth in this Section 3.5.3. Such
continued development may be conducted using EXEL’s own
funds, the funds of an EXEL Affiliate or a Third Party, or any
combination of the foregoing, but in no event shall EXEL use for
the development of such Independent Candidates: (a) any funds
provided to it by GSK [*] ; or (b) [*] unless
[*] otherwise agree in writing; provided, however ,
any inability to reach agreement shall [*] . Notwithstanding
anything to the contrary, the [*] for each Independent
Candidate shall not be subject to [*] ; provided,
however , that EXEL shall use [*] to provide GSK with
the right, at GSK’s sole discretion, to [*] for each
Independent Candidate and to [*] thereon, which [*]
EXEL shall [*] . In the event that a Third Party continues
the clinical development of an Independent Candidate, EXEL shall
use [*] to provide GSK with the right to: (i) have
[*] of such Third Party; (ii) have [*] ; and (iii)
discuss [*] for the applicable Ineligible Independent
Candidate. EXEL shall, subject to any confidentiality obligations
with Third Parties, provide GSK with information on [*] .
GSK shall also have the right to exercise its Development Election
for Independent Candidates as set forth in Section
4.3.1(a).”
[ * ] = C ERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT , MARKED BY BRACKETS , HAS BEEN OMITTED AND FILED SEPARATELY WITH THE S ECURITIES AND E XCHANGE C OMMISSION PURSUANT TO R ULE 24 B -2 OF THE S ECURITIES E XCHANGE A CT OF 1934, AS AMENDED .
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1.8 Amendment of Section
3.8.1(c). Section
3.8.1(c) is hereby deleted in its entirety and replaced with the
following:
“(c) under the Limited Program
Option:
[*]
1.9 Amendment of Section
4.3.1(b). Section
4.3.1(b) is hereby deleted in its entirety and replaced with the
following:
“(b) R EFUSED C ANDIDATES . If GSK does not exercise within the First
Option Period its Development Election with respect to a particular
Development Candidate that is not an Ineligible Independent
Candidate (each, a “ Refused Candidate ”), then
the Development Election shall expire with respect to that Refused
Candidate, and EXEL will thereafter be free to develop and
commercialize the Refused Candidate, subject to the terms and
conditions of Sections 4.3.1(c), 4.3.1(d) and 4.4 (as applicable).
Upon the expiration of a Development Election with respect to a
Refused Candidate or an Ineligible Independent Candidate, GSK shall
be deemed to [*] , and hereby does [*] under all
[*] that was (1) [*] solely in connection with
[*] , and (2) in existence as of [*] with respect to
such Refused Candidate or Ineligible Independent Candidate and its
related Included Compounds, [*] such Refused Candidate or
Ineligible Independent Candidate, or Included Compounds related
thereto (such [*] but only as to such Refused Candidate,
Ineligible Independent Candidate or Included Compounds, or, if GSK
cannot [*] thereunder, it shall [*]
.”
1.10 Amendment of Section
4.3.1(c). Section
4.3.1(c) is hereby deleted in its entirety and replaced with the
following:
“(c) S ECOND O PTION F OR
A R EFUSED C ANDIDATE [*] . Following expiration of GSK’s
Development Election with respect to a particular Development
Candidate [*] within the First Option Period, and until the
first to occur of: (1) commencement of [*] ; or (2) the
[*] with respect to such Refused Candidate, in compliance
with its obligations pursuant to this Section 4.3.1(c) and Section
4.4:
(i) EXEL shall not disclose
[*] to [*] without [*] , together with notice
of EXEL’s [*] , not less than [*] prior to any
such disclosure; and
(ii) If EXEL, in its sole
discretion, [*] , or otherwise [*] regarding, such
Refused Candidate, regardless of whether EXEL has otherwise
disclosed to GSK [*] as provided in Section 4.3.1(c)(i),
prior to commencement of [*] for such Refused Candidate,
EXEL shall: (A) promptly notify GSK of [*] ; and (B) include
with its notice [*] including, but not limited to,
[*] with respect to such Refused Candidate (the “
Subsequent Product Report ”). During the [*]
period immediately following deliv
