MICRO-NEEDLE LICENSE, JOINT DEVELOPMENT, AND MANUFACTURING ASSISTANCE AGREEMENT

Parties . This Agreement is entered into as of October 29, 2004 between Debiotech S.A., a Swiss company having a place of business at 28 Avenue de Sevelin, CH-1004 Lausanne, Switzerland, and Animas Corporation, a Delaware corporation having a place of business at 200 Lawrence Drive, West Chester, PA 19380, USA.

Development Funding and License . Debiotech is prepared to undertake the development of one amongst more families of needles based upon Debiotech’s Micro Electro-Mechanical Systems technology and related know-how, the specifications of which have not been developed yet. Animas desires to have exclusive rights to make, use sell and/or import any and all families of such needles and to obtain exclusive license rights to all of Debiotech Intellectual Property useful for such purpose for all uses relating to the administration of insulin .

Confidentiality Agreement. Debiotech and Animas entered into a confidential disclosure agreement dated July 6, 2004. Upon execution of this Agreement, the Confidentiality Agreement shall be terminated and replaced with the terms of this Agreement.

Term Sheet. Debiotech and Animas signed on August 31, 2004 a Term Sheet containing most of the material terms upon which they intended to agree and providing a basis for this Agreement. Upon execution of this Agreement, the Term Sheet shall be terminated and replaced with the terms of this Agreement.

Parallel Agreement. Debiotech and Animas enter into a parallel License, Joint Development and Manufacturing Assistance Agreement in connection with an externally worn micro-pump for the delivery of insulin.

Due-Diligence Prior to Agreement Signed . Prior to signature of this Agreement, Animas has conducted a due diligence review of Debiotech’s relevant technology and related manufacturing, Debiotech having provided all information requested by Animas, as well as a further due diligence relating to such relevant technology, including the intellectual property.

Consideration . In consideration of the mutual promises and obligations contained herein the parties agree as set forth in this Agreement.

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1.   

Definitions

1.1   

Affiliate: any corporation, partnership, limited liability company or other enterprise or organization that directly or indirectly through one or more intermediaries controls, is controlled by, or is under common control with a party, where “control” means beneficial ownership of at least fifty percent (50%) of the then outstanding voting shares or equity interests in the party in question or the power to direct or otherwise cause the direction of the management and policy of the party in question (for the avoidance of doubt, Existing Shareholders listed under Exhibit D shall not be considered Affiliates given their current ownership of Animas).

1.2   

Agreement: this MICRO-NEEDLE LICENSE, JOINT DEVELOPMENT, AND MANUFACTURING ASSITANCE AGREEMENT and all attached exhibits, together with any future amendments entered into in accordance with Section 16.13 of this Agreement.

1.3   

Agreement Date: the date on which this Agreement is entered into by the Parties.

1.4   

Animas: Animas Corporation, a Delaware corporation having a place of business at 200 Lawrence Drive, West Chester, PA 19380, USA.

1.5   

Animas Group: Animas and its Affiliates.

1.6   

Change of Control: a change of control of Animas Group shall be deemed to have occurred at such time as any third party, other than an Existing Shareholder listed under Exhibit D, acquires more than 50% of the voting stock of Animas or Animas merges with a third party except where Animas is the surviving entity. A Change of Control will be deemed to have occurred if this Agreement is assigned directly or indirectly to a third party, excluding an Animas Affiliate, including without limitation the sale of substantially all of the assets of Animas in accordance with Section 16.6 of this Agreement.

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1.7   

Commercial Launch: the date at which the first Debiotech Micro-Needle Product is sold to an end-user in any country, directly or indirectly, by a Licensee.

1.8   

Debiotech: Debiotech S.A., a Swiss company having a place of business at 28 Avenue de Sevelin, CH-1004 Lausanne, Switzerland (together with successors and assigns, and those Affiliates who (i) own Debiotech Intellectual Property, or (ii) have license rights therein in the Field, or (iii) employ any personnel having been involved as an employee of Debiotech (including successors and assigns) or an Affiliate in the development of Micro-Needles utilizing MEMS technology).

1.9   

Debiotech Intellectual Property: all patents, copyrights, trade secrets, know-how and other intellectual property related to or useful for a Micro-Needle based on MEMS technology owned by, developed by or licensed to Debiotech, now or until such time as the license granted pursuant to this Agreement is terminated in accordance with Section 15 of this Agreement or becomes a fully paid-up license in accordance with Section 2.2 of this Agreement (including, without limitation, the intellectual property described more specifically in Exhibit A). Debiotech Intellectual Property includes, without limitation, all ideas, methods, concepts, design features, diagrams, schematics, flowcharts, specifications, code (source and object) and any other intellectual property necessary or useful for Animas to fully exercise its rights and perform its obligations under this Agreement or otherwise commercialize Debiotech Micro-Needle Products in the Field. Notwithstanding the foregoing, Debiotech Intellectual Property shall include intellectual property developed jointly by Debiotech and a third party unless Debiotech is prohibited by contractual agreement with such third party to license such intellectual property to another party.

1.10   

Debiotech Micro-Needle Products: one or more families of micro-needle products, using MEMS Micro-Needle (the specifications of such Debiotech Micro-Needle Products shall be mutually agreed by the parties).

1.11   

Debiotech Micro-Needle: one specific Debiotech Micro-Needle Product to be developed by Debiotech and Animas under the Development Program pursuant to this Agreement, in accordance with the Micro-Needle Specifications.

1.12   

Development Program: the development program described more fully in Article 5 of this Agreement pursuant to which Debiotech is to use commercially reasonable

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efforts to develop fully functional prototypes of the Debiotech Micro-Needle which meet the Micro-Needle Specifications.

1.13   

Distributors: Third parties (outside Animas Group) that distribute Debiotech Micro-Needle Products sold to them by a Licensee.

1.14   

FDA Approval: 510(k) clearance or such other approvals as may be necessary from the Food and Drug Administration (FDA) for sale in the United States of the Debiotech Micro-Needle.

1.15   

FDA Submission: filing for FDA Approval.

1.16   

Field: All uses relating to the external administration of insulin, alone or in combination with other medications, and/or sensing of glucose.

1.17   

Interface: interface of the MEMS Micro-Needle with the rest of Debiotech Micro-Needle (tubing, connector, patch, etc.), to be developed by Animas under the Development Program.

1.18   

Knowledge: “to the best knowledge of Debiotech” shall mean to the actual or implied knowledge, as of the Agreement Date, of the officers, directors, owners and management of Debiotech; provided that, “implied knowledge” shall mean only the knowledge readily obtainable from all information available in the books, records and files of Debiotech.

1.19   

License: the exclusive license granted to Animas pursuant to Section 2.1 of this Agreement.

1.20   

Licensed Patents: all patents, patent applications and patent rights included in Debiotech Intellectual Property, as well as patents, patent applications and patent rights resulting from joint inventions under Section 13.1 of this Agreement. A comprehensive list of such Licensed Patents, as of the Agreement Date, is described in Exhibit A.

1.21   

Licensees: Animas, Affiliates of Animas and Sub-licensees.

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1.22   

Major Countries: France, Germany, United Kingdom and United States.

1.23   

Manufacturing Program: The manufacturing program as defined in Section 7.3 of this Agreement.

1.24   

MEMS: Micro Electromechanical Systems using fabrication techniques similar to those utilized in the micro-electronics industry.

1.25   

MEMS Micro-Needle: A Micro-Needle based on MEMS technology based upon Debiotech Intellectual Property.

1.26   

MEMS Micro-Needle Business: the business of Debiotech relating specifically to the design, development and production of micro-needle devices consisting of an array of micro-needles not exceeding ****** in depth utilizing MEMS technology and all licensing, consulting and investment activities and operations relating thereto, whether in the Field or outside the Field.

1.27   

Micro-Needle: any micro-needle device consisting of an array of micro-needles not exceeding ****** in depth.

1.28   

Micro-Needle Specifications: the specifications of Debiotech Micro-Needle, including specifications of MEMS Micro-Needle, to be developed pursuant to this Agreement between the parties.

1.29   

Net Revenue: gross revenue of Animas Group on a consolidated basis (excluding all revenue from Sub-licensees) from the sale of Debiotech Micro-Needle Products to distributors and end-users minus contractual allowances and discounts, as calculated in accordance with US Generally Accepted Accounting Principles, as such principles are in effect at that time, and as recognized in accordance with Animas’ standard accounting practices in effect for the relevant period, consistently applied ( “GAAP”).

1.30   

Quarterly Royalties Statement: a statement prepared by Animas at the end of each calendar quarter in accordance with Section 4.6 of this Agreement, setting forth the Net Revenue relating to Debiotech Micro-Needle Products subject to a royalty in that quarter. The Quarterly Royalty Statement shall set forth (i) the number of Debiotech Micro-Needle Products placed or sold to end-users, by product and by country, and

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the Net Revenue, by product and by country, associated with such Debiotech Micro-Needle Products, (ii) the number of Debiotech Micro-Needle Products placed or sold to distributors, by product and by country, and the Net Revenue, by product and by country, associated with such Debiotech Micro-Needle Products, (iii) the number of Debiotech Micro-Needle Products placed or sold by Sub-licensees, by product and by country, and Net Payments received by Animas from Sub-licensees associated with such Debiotech Micro-Needle Products, and (iv) the royalties payable by Animas with respect to such Net Revenue for that quarter and the Sublicense Fees payable by Animas with respect to such Net Payments from Sub-licensees for that quarter, if any.

1.31   

Pump Agreement: a parallel agreement entered into between Debiotech and Animas in connection with an externally worn micro-pump product of Debiotech, entitled License, Joint Development and Manufacturing Assistance Agreement and all attached exhibits, together with any future amendments entered into in accordance with such parallel agreement.

1.32   

Royalties Term: the period during which at least one Licensed Patent is Valid in at least one Major Country.

1.33   

Steering Group: a six person committee, composed of three senior employees of each party, but not their CEOs, which shall review in accordance with Section 5.5 of this Agreement all the developmental, logistical and technical aspects of the Development Program.

1.34   

Sub-licensees: third party (outside Animas Group) sub-licensees appointed by Animas in accordance with Section 2.3 of this Agreement and distributing Debiotech Micro-Needle Products which have not been sold to them by Animas Group or a Sub-licensee (so that such Debiotech Micro-Needle Products have not yet been taken into account for determining royalties due to Debiotech). Sub-licensees do no include (i) parties that manufacture Debiotech Micro-Needle Products, or components therein, on behalf of Animas, but do not distribute such Debiotech Micro-Needle Products or components therein, or (ii) Distributors. However, the same person might be a Distributor in connection with certain Debiotech Micro-Needle Products (bought from Animas Group or a Sub-licensee) and a Sub-licensee in connection with certain other Debiotech Micro-Needle Products (not bought from Animas Group or a Sub-licensee).

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1.35   

Valid: qualifier for a patent in a determined country, meaning that such patent in such country is valid, not expired and has not been declared unenforceable by a competent body of such country (such as a United States Federal District Court) for any defect related to the patent (such as a failure from patentee to make relevant disclosures) and affecting its validity lato sensu , but not making the patent technically invalid. Whether the validity of the patent is challenged and infringers can effectively be prevented is irrelevant to determine whether any patent is Valid.

1.36   

Year: a calendar year, from January 1 to December 31.

2.   

License to Animas.

2.1   

Exclusive License . Debiotech hereby grants to Animas an exclusive, even as to Debiotech, worldwide license, with the right to sublicense in accordance with Section 2.3 of this Agreement, under all Debiotech Intellectual Property, excluding intellectual property jointly developed by Debiotech and a third party, and a non-exclusive sub-license under Debiotech Intellectual Property jointly developed by Debiotech and a third party to make, have made, use, sell, offer for sale, or import Debiotech Micro-Needle Products in the Field.

2.2   

Duration . The License shall be perpetual (subject to Article 15 of this Agreement). After the Royalties Term, the License shall become a fully paid-up, royalty free, irrevocable, non exclusive worldwide license.

2.3   

Sublicense . The License shall include the right for Animas to sublicense the licensed rights; provided that Animas obtains Debiotech’s written consent which consent shall not be unreasonably withheld or delayed. Animas’ sub-licensees shall conform to the applicable material terms of this Agreement and Animas shall remain directly liable to Debiotech with regard to any breach of the terms of this Agreement by Animas’ sub-licensees remaining uncured after a 90 day period following a default notice; provided that, Animas shall no longer be considered in breach of this Section 2.3 in the event Animas terminates the sublicense agreement within a reasonable period after the breach.

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2.4   

Limitation to the Field . Licensees shall not make, use, sell, offer for sale, or import Debiotech Micro-Needle Products outside the Field.

2.5   

Further Documents . Debiotech hereby agrees to execute, or cause its employees, partners, licensors, agents, or consultants to execute all documents and shall take all actions necessary or desirable to effect, confirm and perfect the rights granted to Animas pursuant to the License, including without limitation, assignment to Debiotech of inventions past, present and future from its employees and consultants.

2.6   

Promotion . Animas shall use reasonable commercial efforts to commercialize the Debiotech Micro-Needle Products, independent of the economic attractiveness of other competing Animas products.

2.7   

Sales, Marketing and Distribution . All sales, marketing, and distribution activities for Debiotech Micro-Needle Products shall be the responsibility of Animas. Animas shall give Debiotech periodic updates on the progress of Animas marketing activities.

3.   

License Fees.

3.1   

Initial License Fee. Animas shall not pay to Debiotech any initial license fee in connection with this Agreement.

3.2   

License Fee . Animas shall pay to Debiotech a license fee of up to Two Million Five Hundred Thousand Dollars ($2,500,000), payable within 30 days after the following milestones are reached : (a) $500,000 upon sale of 500,000 ^th Debiotech Micro-Needle Product ; (b) $2.0 million upon sale of 2,000,000th Debiotech Micro-Needle Product. Above payments are payable only once. Quantity thresholds are determined in aggregate for all Debiotech Micro-Needle Products.

3.3   

Sublicense Fees . Except to the extent a Sub-licensee Royalty Rate is applicable, Animas shall pay to Debiotech ****** of any Net Payments Animas receives from Sub-licensees and Distributors (“Base Sub-licensee Rate”). Net Payments equal the gross cash (including royalties) received by Animas Group from Sub-licensees pursuant to any sub-license agreement between Animas Group and such Sub-licensee

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relating to Debiotech Intellectual Property and the gross cash received by Animas Group from Distributors pursuant to any agreement between Animas Group and such Distributor relating to Debiotech Intellectual Property but excluding any cash received by Animas Group from sales of Debiotech Micro-Needle Products to such Distributors (provided that, to the extent Debiotech can demonstrate that a substantial portion of the sales price of Debiotech Micro-Needle Products sold by Animas Group to Distributors includes what should be characterized as a sublicense fee or royalties due to Animas Group, Debiotech may require that such part of the sales price be included in the Net Payments instead of in the Net Revenue), minus applicable import, export and excise duties and sales tax (including VAT), and minus any taxes withheld from the gross cash (excluding any taxes that were withheld after the gross cash payable to Animas Group was increased to provide that after the withholding of the taxes Animas Group was to receive the same amount of payment it would have received but for the withholding) to the extent not recoverable by Animas Group within two years of the receipt of the gross cash. In the event the total aggregate number of Debiotech Micro-Needle Products sold by all Sub-licensees and sold by Animas Group to Distributors for resale outside the USA in a Year exceeds ****** of all Debiotech Micro-Needle Products sold by Animas Group (including those to Distributors) and its Sub-licensees in such Year, Animas shall pay to Debiotech a Sub License Fee equal to the greater of (i) a royalty equal to ****** of net revenues of Debiotech Micro-Needle Products sold by all Sub-licensees (“Sub-licensee Royalty Rate”), or (ii) Base Sub-licensee Rate.

3.4   

Currency. All payments under this Agreement shall be made in US Dollars, and all references in this Agreement to “Dollars” shall mean “US Dollars”. Payments to be made to Debiotech shall be made by bank transfer to Debiotech’s bank account.

4.   

Royalties.

4.1   

Base Royalties . Animas agrees to pay Debiotech a royalty equal to a percentage of Net Revenue of Debiotech Micro-Needle Products sold or placed to end-users by Animas Group. The royalty rate shall be in accordance with Exhibit B.

4.2   

Allocation of Net Revenues. For the purposes of royalty calculations, any product sold in same sterile pack as Debiotech Micro-Needle Product will be included as part

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of Debiotech Micro-Needle Product. Also any tubing used for the delivery of insulin or measurement of glucose along with Debiotech Micro-Needle Product will also be included as part of Debiotech Micro-Needle Product.

4.3   

Pump Agreement Royalties . To the extent royalties payable under the Pump Agreement relate to the same product sold hereunder, such amounts shall be deducted from any royalty amounts due under this Agreement.

4.4   

Net Revenue Adjustment. In the event that less than ****** of Debiotech Micro-Needle Products placed or sold by Animas Group in any given Year are placed or sold through its direct sales force, the parties shall negotiate in good faith an appropriate correction factor of the Net Revenue for that Year, which correction factor shall increase royalty payments payable to Debiotech to compensate, in part, for the reduced average selling prices of Debiotech Micro-Needle Products, and hence royalties to Debiotech, as a result of the lower percentage of direct sales. The parties in such negotiation shall consider a correction factor to provide for what the average selling price of Debiotech Micro-Needle Products would have been had Animas Group sold at least ****** of Debiotech Micro-Needle Products through its direct sales force; provided that the gross margin percentage of Debiotech Micro-Needle Products, in aggregate, sold by Animas Group after the increased royalties does not fall below customary gross margin percentages for manufacturers in the med-tech industry providing similar levels of customer service, have similar mix of direct versus indirect sales, and perform similar levels of R&D activities. Following any Change of Control, the correction factor shall apply without regard to its impact on gross margin. If the parties are unable to agree on a correction, either party may require that the matter be determined by binding baseball arbitration pursuant to Section 16.2 of this Agreement.

4.5   

Royalties reduction . During the Royalties Term, if none of the Licensed Patents covering any Debiotech Micro-Needle Product is Valid in any Major Country, the royalty rate set forth in Exhibit H shall be reduced to ****** of above rate in those countries in which Debiotech Micro-Needle Products are sold, but Licensed Patents are not Valid, provided that such reduction in royalty rates shall only occur if (i) there is another competing Micro-Needle product utilizing MEMS technology being sold in such country and, (ii) the Debiotech Micro-Needle Products sold in such country are not manufactured in a country where a Licensed Patent covering any Debiotech

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Micro-Needle Product is Valid.

4.6   

Quarterly Calculation and Payment of Royalties . Royalties shall be due and payable with respect to the Net Revenue made in each calendar quarter on the date which is forty-five (45) days following the end of such calendar quarter (each such payment date, a “ Payment Date ”). On or before each Payment Date on which royalties are due, Animas shall prepare and deliver to Debiotech a Quarterly Royalties Statement.

4.7   

Records and Audits . Licensees shall maintain detailed books and records containing information sufficient to verify the completeness and accuracy of the information presented in each Royalty Statement for a period of at least five years after the period to which such Royalty Statement relates.

Debiotech shall have the right, not more than once each Year, on reasonable advance notice to Animas, during usual business hours, to cause the examination of relevant records of Licensees for the period since the last period covered by any previous examination (including records which are more than five years old, if then available) and ending with the calendar quarter covered by the most recent Payment Date for the sole purpose of verifying the completeness and accuracy of the Quarterly Royalty Statements, including any specific calculation relevant under this Agreement (such as with regard to Sections 3.3 and 4.4 of this Agreement). At Debiotech’s election, any such examination shall be conducted by Animas’ auditors, if allowed by law and agreeable to such auditors, or by independent public accountants selected by Debiotech and reasonably acceptable to Animas.

As a condition to such examination, Animas may require such independent public accountants to execute a confidentiality agreement in form and substance reasonably satisfactory to Animas pursuant to which such independent public accountants will agree to retain in confidence all information learned by them in the course of such examination, except that any discrepancy in any information included in a Quarterly Royalty Statement, or being a relevant information under this Agreement, may be disclosed to Debiotech.

Debiotech shall pay the costs of conducting such audit unless the final results of an audit reveal an underpayment by Animas of five percent (5%) or more during the

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audited period, in which case Animas shall pay the costs of conducting such audit.

4.8   

Duration . Royalties are to be paid on the sale of all Debiotech Micro-Needle Products sold by Licensees throughout the world during the Royalties Term. Following the Royalties Term, the provisions of Section 2.2 of this Agreement shall apply.

5.   

The Development Program and MEMS Micro-Needle.

5.1   

Responsibilities of Debiotech . Debiotech shall use reasonable commercial efforts to complete the Development Program, pursuant to which Debiotech shall be responsible for development of MEMS Micro-Needle and process to manufacture MEMS Micro-Needle , both in accordance with Micro-Needle Specifications, and provide to Animas fully functional prototypes of the MEMS Micro-Needle, which meet the Micro-Needle Specifications, are sufficient for FDA Submission, and are in a form which in fact permits redesign for manufacturing and scaling up for large scale industrial manufacturing.

To the extent that such prototypes of the MEMS Micro-Needle fail to meet the requirements set forth above, Debiotech shall, at its sole expense, use reasonable commercial efforts to continue development work to satisfy such requirements; provided that, Debiotech shall not be required to continue development if Animas has commenced marketing of the Debiotech Micro-Needle.

5.2   

Responsibilities of Animas . Animas shall use reasonable commercial efforts to complete the Development Program, pursuant to which Animas shall be responsible for development of Debiotech Micro-Needle in accordance with Micro-Needle Specifications to be developed.

Animas shall be responsible for establishing the large scale manufacturing and Debiotech shall propose appropriate materials to be used to manufacture the Debiotech Micro-Needle and shall assist by supplying engineering support necessary to facilitate production of the Debiotech Micro-Needle in large scale by Animas or suppliers designated by Animas.

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5.3   

Development Expenses . Each party shall be responsible for bearing its own costs of the Development Program. Debiotech shall be solely responsible for all expenditures of any nature required to complete the development of the MEMS Micro-Needle in a form which in fact permits scaling up for large scale industrial manufacturing and which satisfies the requirements set forth in Section 5.1 above. Animas shall be solely responsible for all expenditures of any nature required to complete the development of the Debiotech Micro-Needle in a form which in fact permits scaling up for large scale industrial manufacturing and which satisfies the requirements set forth in Section 5.2 above. Animas shall be responsible for the costs of any tooling and equipment for manufacturing of the Debiotech Micro-Needle as well as for the cost of all required redesign for manufacturing.

However, if (a) development costs incurred by Debiotech solely to satisfy Interface requirements in aggregate exceed ******, or (b) Debiotech Micro-Needle Products (other than Debiotech Micro-Needle) require modification of MEMS Micro-Needle, Animas shall reimburse Debiotech at rates as provided for in Exhibit C plus out-of-pocket expenses.

Animas agrees to spend not less than ****** to develop Debiotech Micro-Needle prior to January 2007 unless both parties agree, in good faith, that the Debiotech Micro-Needle is not feasible as a commercial product.

5.4   

Reports. Debiotech shall keep Animas fully informed with regard to the progress of the development of the MEMS Micro-Needle.

Not later than fifteen (15) days prior to the meetings with CEOs contemplated by Section 5.5, Debiotech shall submit to Animas a written report including all information regarding progress on the Development Program, disclosing any inventions or other improvements in technology, whether or not patentable, discovered or created in the course of the Development Program. The reports will also include a confirmation from Debiotech that Debiotech believes that the Development Program can be completed consistent with the schedule contemplated, or Debiotech shall submit to Animas a revised schedule setting forth the revised estimated time to complete the Development Program.

If reasonably necessary in addition to the above, and to the extent it would not be

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unreasonably burdensome on Debiotech, upon request from Animas, Debiotech shall allow Animas’ representatives and, where Animas shows a reasonable business purpose, third party guests (subject to appropriate confidentiality agreements with Debiotech), to visit the development facilities where the Development Program is conducted, to attend presentations by Debiotech representatives of the current state of the Development Program and to receive additional written reports addressing specific issues.

All contents of this Section 5.4 and of Section 5.5 below shall be reviewed and modified by the parties as necessary to adequately reflect the actual needs associated with the Development Program and the associated process.

5.5   

Program Management . Each party shall appoint three senior employees, but not their CEOs, to form the Steering Group, which shall review all the developmental, logistical and technical aspects of the Development Program. In addition, major financial issues shall be discussed when they arise. To the extent possible the Steering Group should be the same as the steering group under the Pump Agreement.

At least two members of the Steering Group from each side shall meet in person at least once every two months. Each party may invite additional participants from its own party to attend. Minutes of the meetings shall be prepared by Debiotech, indicating in particular the steps believed to be satisfactorily performed by the parties and the next steps to be performed. Minutes shall be reviewed and approved or rejected and amended at the next meeting of the Steering Group. Minutes of the Steering Group shall not constitute amendments of this Agreement or the Micro-Needle Specifications even if signed by representatives of the parties or the CEOs of each Party.

The Steering Group shall be charged with managing the Development Program with a view to completing development of the Debiotech Micro-Needle as rapidly as possible. In addition, the Steering Group shall insure that such development be completed in accordance with the Micro-Needle Specifications and that the manufacturing cost of the Debiotech Micro-Needle be consistent with the levels set forth in the Micro-Needle Specifications. The Steering Group shall make recommendations to either Party regarding design and engineering issues and shall

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make recommendations to Animas regarding the most appropriate supplier(s) to manufacture the Debiotech Micro-Needle or any part thereof. Debiotech employees shall be primarily responsible for issues relating to design, engineering and intellectual property with regard to the MEMS Micro-Needle. Animas employees shall be primarily responsible for issues relating to design, engineering and intellectual property with regard to other parts of the Debiotech Micro-Needle as well as manufacturing and selection of suppliers. Animas shall also be responsible for facilitating any incorporation of Animas’ technology, if any, in the Debiotech Micro-Needle.

Either Party’s members on the Steering Group may recommend modifications to the Micro-Needle Specifications and the Development Program by submitting a written request to the other Party’s members on the Steering Group detailing the nature of the modification, the reason for the modification and the anticipated costs associated with implementing the modification. Any modification must be approved in writing by each CEO. Each Party agrees not to unreasonably withhold their approval to a modification suggested by the other Party so long as the consenting Party cannot demonstrate with written documentation that the modification (i) adversely affect the marketability and desirability of the Debiotech Micro-Needle, (ii) materially affects the cost of the development effort, or (iii) materially affects the timing of the availability on the market of the Debiotech Micro-Needle.

Each Party’s members on the Steering Group shall keep their respective CEOs informed as necessary. The Steering Group shall meet in person with the CEOs as a group of eight at least once every 4 months. The Steering Group shall attempt to resolve issues without the involvement of the CEOs; provided, that, in the event the parties cannot agree, the issue shall be put before the CEOs who shall use commercially reasonable efforts to resolve the issue.

Meetings of the Steering Group (other than those to attended by the CEOs) shall be held at the location where the most active development work is being conducted, which the parties anticipate will be in Lausanne Switzerland through the early and middle stages of the Development Program, and may be the site of anticipated manufacturing facilities later in the Development Program. Meetings of the Steering Group attended by the CEOs shall alternate between locations designated by the CEO of Animas and the CEO of Debiotech.

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5.6   

Obligations to develop Product . Debiotech agrees that it will devote the resources as reasonably necessary to ensure development of the MEMS Micro-Needle by the deadline to be mutually agreed by the parties.

Animas agrees that it will devote the resources as reasonably necessary to ensure development of the Debiotech Micro-Needle in time for Debiotech to complete the Development Program by the deadline to be mutually agreed by the parties.

5.7   

Failure to complete Development Program . Because of the uncertainties associated with the development work, neither party warrants that it will successfully complete the Development Program.

5.8   

Choice of Suppliers under Development Program . Debiotech and Animas must jointly agree on choice of suppliers for any part or process of the Development Program if Non-recurring Engineering Expense (NRE) or tooling charge exceeds $20,000.

6.   

Regulatory Responsibility.

6.1   

Regulatory Filings . Animas shall use commercially reasonable efforts to file regulatory approvals, including to the Food and Drug Administration, pending completion of test results and other documentation required for such submission.

6.2   

Documentation for regulatory submission . In connection with preparation by Animas of the FDA Submission and during the review by FDA of the FDA Submission, Debiotech shall: a) furnish all test results and documentation on MEMS Micro-Needle required by FDA and, b) remain available for responding to questions by FDA relating to such FDA Submission.

6.3   

Clinical Studies . Animas shall be responsible for oversight of clinical studies, if any, necessary to obtain FDA Approval, and shall be responsible for the cost of any such studies. Protocol of clinical studies must be approved by Debiotech in advance.

6.4   

Material for Clinical Studies . Notwithstanding the provisions of Section 7.1 of this

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Agreement, Debiotech shall furnish MEMS Micro-Needle & Interface, in accordance with Micro-Needle Specifications, needed for clinical studies as required in Section 6.3 of this Agreement. The cost of all such deliverables shall be borne solely by Debiotech, provided that, Animas shall be responsible for any investments necessary for manufacturing and redesign for manufacturing, to the extent required.

6.5   

Regulatory Obligations . Animas and Debiotech shall cooperate in the preparation of, and shall execute, as part of the Development Program, a Quality Agreement in order to meet the requirements of ISO13485, European MDD and FDA QSR (21 CFR 820) requirements for medical devices, to the extent applicable.

7.   

Manufacturing Program of MEMS Micro-Needle.

7.1   

Manufacturing Responsibility . Animas shall be responsible for all aspects of manufacturing of Debiotech Micro-Needle Products, and shall bear all corresponding costs, except to the extent specifically stated otherwise.

7.2   

Choice of Initial Manufacturer . Debiotech shall recommend not less than three candidates of initial manufacturer for the MEMS Micro-Needle. Animas may choose between one of three candidates to be the initial manufacturer. If for whatever reason, Animas finds the three candidates unacceptable, Animas may recommend other candidates, whose endorsement by Debiotech may not be unreasonably withheld.

7.3   

Debiotech Assistance. Debiotech, at its own cost, shall provide (i) all documentation of all processes, materials, testing, and assembly instructions necessary for the initial manufacturer to manufacture the MEMS Micro-Needle in small-scale manufacturing and further enter into a redesign for manufacturing for large-scale production, (ii) any training required of personnel of the initial manufacturer to manufacture the MEMS Micro-Needle, (iii) any additional technical support including for re-design/ revalidation of processes necessary for large-scale manufacturing ((i) to (iii) constituting the Manufacturing Program), and (iv) continued technical support including for re-design/ revalidation of processes, until the initial manufacturer has delivered to Animas 500,000 MEMS Micro-Needles to be placed on the market.

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- Material has been omitted and filed separately with the Commission.

7.4   

Cost. The cost of all required manufacturing tools and equipments as well as for the redesign for manufacturing shall be borne by Animas.

7.5   

Support after Manufacturing Program. Debiotech shall provide employees as reasonably requested by Animas from time to time to support manufacturing and technical issues, as they may arise of MEMS Micro-Needle after completion of Manufacturing Program. Animas shall reimburse Debiotech at rates as provided for in Exhibit C, plus out-of-pocket expenses.

7.6   

Access to MEMS Micro-Needle Manufacturer. Subject to the terms and conditions of this Section 7.6 and Section 12.1 of this Agreement, Debiotech shall have the right to buy directly from the manufacturer (the “MEMS Manufacturer”) the MEMS Micro-Needle for use outside the Field.

To the extent Debiotech requires MEMS Manufacturer to use substantially the same tooling and equipment which is either (a) used by and has been specifically paid for by Animas, or (b) is ow