DISTRIBUTION AGREEMENT

EXHIBIT 10.49

EXECUTION VERSION

DISTRIBUTION AGREEMENT

between

ANIKA THERAPEUTICS, INC.

and

ARTES MEDICAL, INC.

TABLE OF CONTENTS

DISTRIBUTION AGREEMENT

     THIS DISTRIBUTION AGREEMENT (this “ Agreement ”) is made effective as of July 7, 2008 (the “ Effective Date ”) by and between ANIKA THERAPEUTICS, INC., a Massachusetts corporation having a place of business at 32 Wiggins Avenue, Bedford, Massachusetts 01730 (“ ANIKA ”), and Artes Medical, Inc., having a place of business at 5870 Pacific Center Boulevard, San Diego, California 92121 (“ ARTES ”). ANIKA and ARTES are each referred to by name or as a “ Party ,” or collectively as the “ Parties .”

RECITALS

1. ANIKA invents, develops, manufactures and commercializes therapeutic products and devices. Furthermore, ANIKA has developed a proprietary product intended for use in cosmetic-dermatological procedures, including cosmetic-tissue augmentation.

2. On July 16, 2007, ANIKA received PMA clearance for the cosmetic tissue augmentation product, ELEVESS.

3. ARTES possesses commercialization capabilities in the dermatological and cosmetic fields.

4. ANIKA desires to supply the Product to ARTES and ARTES desires to purchase the Product from ANIKA and to commercialize, distribute and sell it within the Field and in the Territory pursuant to this Agreement. NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I — DEFINITIONS

     When used in this Agreement, each of the following terms shall have the meaning set forth below. The term shall have the same meaning whether the singular or plural form is used.

“ Affiliate ” of a Person means any company or entity which controls, is controlled by or is under common control with such Person, where control, for purposes of this definition, means (i) the possession, directly or indirectly, of the power to direct the management or policies of a Person or to veto any material decision relating to the management or policies of a Person or a majority of the composition of the board of directors (or similar governing body), in each case, whether through the ownership of voting securities, by contract or otherwise, or (ii) the Beneficial Ownership, directly or indirectly, of at least 50% of the voting securities of a Person. “ Beneficial Ownership ” shall be determined in compliance with Rule 13d-3 of the Securities Exchange Act of 1934.

“ Agreement ” shall have the meaning set forth in the preamble.

“ ANIKA Intellectual Property ” means the ANIKA Marks, the ANIKA Patents and any other Intellectual Property Rights of ANIKA that are necessary for the Commercialization of the Product in the Field in the Territory.

“ ANIKA Marks ” means the trade name, trademarks and service marks of ANIKA as set forth in Exhibit A hereto.

“ ANIKA Patents ” means the patents or applications therefor Controlled by ANIKA during the Term that are necessary for the Commercialization of the Product in the Field in the Territory. A list of current ANIKA Patents is recited in Exhibit B , which shall be updated from time to time.

“ ANIKA ” shall have the meaning set forth in the preamble.

“ Annual Minimum Purchase Commitment ” shall mean, for the applicable year, the amount set forth in Section 5.11.

“ Applicable Law ” means, with respect to the Product in the Territory, all national, federal, state, local, governmental, judicial, arbitral and other laws, statutes, codes, treaties, conventions, rules, regulations, judgments, awards, orders, directives and other pronouncements having the effect of law or similar binding effect, governing the activities contemplated by this Agreement.

“ Audit ” shall have the meaning set forth in Section 6.4(b).

“ ARTES Seller(s) ” means ARTES or any authorized Third Party or Affiliate of ARTES appointed by ARTES to engage in the distribution of Product anywhere in the Territory.

“ ARTES ” shall have the meaning set forth in the preamble.

“ Business Day ” means a day on which banking institutions in New York, New York are open for business.

“ cGMP ” means “Good Manufacturing Practices” as such term is generally understood in the medical device industry, as in effect from time to time.

“ Claiming Party ” shall have the meaning set forth in Section 13.5.

“ Clinical Development ” means all activities directly related to human clinical studies, including without limitation the Phase IV clinical study relating to the Product.

“ Commercialization ” shall mean any and all activities (whether conducted before or after Regulatory Approval) directed to the marketing, detailing and promotion of products after Regulatory Approval has been obtained, and shall include pre-launch and post-launch marketing, promoting, detailing, marketing research, distributing, and commercially selling the Product, transporting the Product for commercial sale and regulatory affairs with respect to the foregoing, but shall not include Post Approval Studies or Manufacturing or seeking Regulatory Approval. When used as a verb, “Commercializing” means to engage in Commercialization and “Commercialize” and “Commercialized” shall have a corresponding meanings.

“ Commercially Reasonable Efforts ” means, with respect to the Commercialization of each Product, efforts and resources commonly used in the pharmaceutical industry by a company of the approximate size of the Party called upon to make such Commercially Reasonable Efforts for a product of similar commercial potential at a similar stage in its lifecycle, taking into consideration its safety and efficacy, its cost to develop, the competitiveness of alternative products, its proprietary position, its profitability, and all other relevant factors. Commercially Reasonable Efforts shall be determined on a market-by-market basis for each Product without regard to the particular circumstances (other than size) of a Party, including any other product opportunities of such Party.

“ Confidential Information ” shall have the meaning set forth in Section 7.1.

“ Control ” or “ Controlling ” means, with respect to ANIKA, owned by or possesses the right to grant a license or sublicense without violating the terms of any agreement of ANIKA with any Third Party.

“ Date of First Sale ” means the date on which an ARTES Seller first sells a Product to a Third Party in an arms-length commercial transaction in conjunction with a commercial launch of such Product pursuant to a launch plan reviewed by the Steering Committee.

“ Develop ” or “ Development ” means all activities related to developing a product for Clinical Development, and if no Clinical Development is required, obtaining Regulatory Approval, including but not limited to generating any Information in this respect, chemical and analytical development, pre-clinical testing, toxicology, formulation, manufacturing process development, quality assurance and quality control, pharmacokinetics and the development of any assays requested by health authorities; provided that Develop or Development shall not include Clinical Development.

“ Dollars ” or “ $ ” means lawful money of the United States in immediately available funds.

“ Effective Date ” shall have the meaning set forth in the preamble.

“ Facility ” means ANIKA’s manufacturing facility located at 236 West Cummings Park, Woburn, MA 01801, or any other manufacturing facility certified under Applicable Law for the manufacture of Product and selected by ANIKA from time to time.

“ FDA ” means the United States Food and Drug Administration or any successor agency.

“ Field ” means injectable products for use solely in cosmetic dermatology procedures in humans, including but not limited to the correction of soft tissue contour deficiencies such as wrinkles, folds, and scars, and the enlargement and/or smoothing of the appearance of lips.

“ HA Product ” means a product for use in the Field, one principal component of which is HA.

“ HA ” means a hyaluronic acid from any source whether as an acid, a pharmaceutically acceptable salt, or a mixture thereof, in any solid or solution phase form thereof or cross-linked or chemically modified hyaluronic acid derivatives such as, without limitation, cross-linked biscarbodiimide hyaluronic acid derivatives.

“ Initial Term ” shall have the meaning set forth in Section 12.1(a).

“ Intellectual Property Rights ” means, collectively, all rights in, to and under patents, trade secret rights, copyrights, mask works, trademarks, service marks, trade dress and similar rights of any type under the laws of any governmental authority, including without limitation, all applications and registrations relating to the foregoing.

“ Joint Patent Holder ” means                 ^***                 or                            any related Person.

“ Joint Patents ” means the patents jointly owned by ANIKA and the Joint Patent Holder identified in Exhibit B .

“ Net Sales ” means, for sales of Product in the Territory, the gross amount invoiced by ARTES Sellers to customers, less (i) discounts, including cash discounts, unit discounts, rebates paid and retroactive price reductions or allowances actually allowed or granted from the billed amount, and (ii) credits or allowances actually granted upon claims, rejections or returns of such sales of Product, including recalls (provided such recalls are in accordance with Section Article V and except to the extent ANIKA has otherwise paid for such recall such that ARTES receives full payment for the recalled Product and does not have to refund any portion thereof). For purposes of calculating “ Net Sales ,” (a) amounts invoiced are for product sales only and exclude non-product line items such as taxes and shipping charges; (b) a Product shall be considered “sold” upon the invoicing of such Product by ARTES Sellers to Third Parties; and (c) Samples are to be excluded from both the Dollars and Unit count.

“ Packaging Requirements ” means the labeling and packaging specifications attached hereto as Exhibit F for the Product, as modified by Section 5.14 and as amended from time to time by mutual agreement of the Parties.

“ Party ” or “ Parties ” shall have the meaning set forth in the preamble.

“ Patent Costs ” means the reasonable fees and expenses paid to outside legal counsel and other Third Parties and preparation, filing, prosecution and maintenance expenses incurred in connection with the establishment and maintenance of the ANIKA Patents.

“ Patent Rights ” means (i) valid and enforceable patents, including any extension, registration, confirmation, reissue, continuation, divisional, continuation-in-part, re-examination or renewal thereof, and (ii) pending applications for letters patents, in any jurisdiction within the Territory.

“ Per Unit Price ” means the amounts set forth in Exhibit C .

“ Person ” shall mean any natural person, corporation, firm, limited liability company, limited liability partnership, business trust, joint venture, association, organization, company, partnership or other business entity, or any government or any agency or political subdivision thereof.

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“ PMA ” means a premarket approval application filed with the FDA as defined in 21 CFR Part 814 or any successor provision.

“ Price Per Sample ” means the amount set forth in Exhibit C .

“ Product ” means a product in finished packaged form containing HA combined with Lidocaine, conforming to the Specifications, conforming to the Packaging Requirements, and for indications for use as specified in the PMA No. 050033 approval letter and all approved PMA supplements as of the Effective Date.

“ Product Development ” means the combination of activities defined as Development and Clinical Development.

“ Regulatory Approval Application ” means an application for Regulatory Approval required before first commercial sale or use of a Product as a drug or a medical device in any jurisdiction.

“ Regulatory Approval ” means, with respect to a Product in the Territory, all unrestricted approvals, clearances, registrations and permits required under Applicable Law for first use or sale of such product, whether a medical device and/or drug.

“ Regulatory Approval Fees ” means any regulatory agency filing and processing fees, Regulatory Approval Application drafting expenses, and expenses associated with translation of any such Regulatory Approval Application.

“ Samples ” means samples of the Product that are not for re-sale by ARTES and are labeled as such and provided by ANIKA to ARTES

“ SKU ” means each unique packaging configuration for a Product.

“ Specifications ” means the specifications attached hereto as Exhibit D for the Product, as amended from time to time by mutual agreement by the Parties.

“ Steering Committee ” shall have the meaning set forth in Section 14.1 of this Agreement.

“ Term ” shall have the meaning set forth in Section 12.1(b).

“ Territory ” means the fifty states and District of Columbia comprising United States of America, and Puerto Rico, but excluding any other of its territories.

“ Third Party(ies) ” means any entity other than ANIKA, ARTES, or any Affiliates of ANIKA or ARTES.

“ Unit ” means each syringe containing Product.

“ United States ” means the United States of America.

ARTICLE II — PRODUCT DEVELOPMENT

     2.1. Continued Development of the Product .

     (a) The Parties agree to negotiate in good faith a product development and clinical development strategy agreement, including line extensions and funding contributions, by                 ^***                 .

     2.2. Ownership, Filing of Regulatory Approval Applications and Obtaining Regulatory Approvals .

     (a) ANIKA (i) shall be responsible for and shall use commercially reasonable efforts in filing Regulatory Approval Applications and obtaining and maintaining Regulatory Approvals for the Product in the Territory, (ii) shall own all Regulatory Approval Applications and Regulatory Approvals, and (iii) shall inform ARTES of any action taken in connection therewith. ANIKA shall bear all reasonable Regulatory Approval Fees associated with Regulatory Approval Applications and with Regulatory Approvals for the Product in the Territory.

     (b) All Regulatory Approvals for the Product will be issued under ANIKA’s name and ANIKA will own all relevant documents associated with such Regulatory Approvals and corresponding Regulatory Approval Application materials. ANIKA shall provide ARTES with access to an electronic copy of all Regulatory Approvals and Regulatory Approval Applications for the Product.

     (c) ANIKA shall be responsible for all communications with any governmental authority or agency concerning the Product, and Artes shall not initiate in any communications with any governmental authority or agency concerning the Product unless requested to do so by ANIKA.

ARTICLE III — COMMERCIALIZATION

     3.1. ARTES’ Commercialization Obligations For the Product . ARTES shall be responsible for and shall use Commercially Reasonable Efforts to conduct the Commercialization of the Product under this Agreement. ARTES’ failure to use Commercially Reasonable Efforts to conduct the Commercialization of the Product under this Agreement shall be considered a material breach of the Agreement.

     3.2. Commercial Launch of the Product . ARTES shall cause the commercial launch to occur as soon as practicable after            *** .

     3.3. Right to Accompany . Subject to ARTES’ approval, which approval shall not be unreasonably withheld, ANIKA, at its expense and upon reasonable notice to ARTES, shall have the right to accompany ARTES or ARTES’ Sellers to any conventions, any Product-specific sales training meetings, any significant physical meetings with any regulatory authorities or any governmental or reimbursement agency or carrier, or any non-routine

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meetings with key clinicians where the Parties reasonably believe that ANIKA’s presence will add value to the development of the business. ARTES will endeavor to give ANIKA reasonable advanced notice of any such conventions, meetings or sessions described in this Section 3.3.

     3.4. ARTES Sellers .

     (a) ARTES shall not be entitled to appoint or engage any Third Party ARTES Seller to market, sell or distribute any Product, without the prior written consent of ANIKA, which consent shall not be unreasonably withheld. In no event shall any permitted ARTES Seller be appointed as an agent of ANIKA, and ARTES shall not otherwise designate or appoint any party to serve as its agent in connection with the marketing, sale or distribution of the Product in the Territory.

     (b) ARTES shall cause any and all permitted ARTES Sellers to agree in writing to be bound by the terms and conditions of this Agreement. Such written agreement shall provide that ANIKA shall be a third-party beneficiary thereunder.

     (c) ARTES shall remain jointly and severally liable under this Agreement for the actions and omissions of each permitted ARTES Seller, and ARTES shall be solely responsible for any commitment or liabilities to any of its permitted ARTES Sellers.

ARTICLE IV — INTELLECTUAL PROPERTY LICENSE GRANTS

     4.1. License . ANIKA hereby grants to ARTES, for the Term, an exclusive, non-transferable (except as permitted by Section 16.5) and paid-up license under the ANIKA Intellectual Property, solely to purchase the Product from ANIKA and promote, sell, offer to sell, and distribute the Product in the Field in the Territory and for no other purpose. ARTES shall have the right to sublicense such license, and the license granted in Section 4.2, to any permitted ARTES Sellers as provided in Section 3.4.

     4.2. Use of Marks . Subject to the terms and conditions hereof, solely in connection with marketing and sale of the Product by ARTES, ARTES shall have the right to use the ANIKA Marks. ARTES shall not promote, market, brand or sell the Product using any other trademark, logo or trade name other than the ANIKA Marks; provided, however, ARTES shall have the right to affix its company name to the packaging of the Product in a manner to be agreed by the Parties. ANIKA grants to ARTES a non-exclusive, non-transferable license to use the ANIKA Marks for such purpose. ARTES shall use the ANIKA Marks only in connection with the marketing and sale of the Product, and not in connection with any other products or services of any Person. ARTES may not modify any of the ANIKA Marks or combine them with any other marks of any Person. All proposed brochures, advertisements, displays, packaging, and other materials in which any ANIKA Mark is to be used shall be submitted to ANIKA for its approval (which approval shall not be unreasonably withheld, delayed or conditioned) at least five (5) Business Days in advance of production or any use or distribution thereof. ARTES shall not use or distribute any such materials without ANIKA ‘s written approval, and such approval shall be deemed granted if ANIKA does not deliver an objection in writing to ARTES concerning any such furnished material within five (5) Business Days of ANIKA’s actual receipt of such furnished material. Any such use of approved

materials shall be only in accordance with the samples or designs provided to ANIKA in connection with such approval. ARTES shall not file any application for registration in any jurisdiction with respect to any ANIKA Mark, or any mark or name confusingly similar thereto. Except to the extent authorized in writing by ANIKA, or as provided in Section 12.3(a), upon termination of this Agreement for any reason, ARTES shall immediately cease all use of the ANIKA Marks and deliver to ANIKA all such materials in ARTES’ control or possession that bear any ANIKA Marks, including any and all sales literature, or, at ANIKA’s election, destroy all such materials and deliver to ANIKA a certificate signed by an executive officer certifying to such destruction. Upon termination of the trademark license granted herein, all goodwill accruing from ARTES’ use of the ANIKA Marks shall inure to the benefit of ANIKA. ARTES shall have no interest in the ANIKA Marks except its rights provided in this Agreement. Notwithstanding any approval by ANIKA of brochures, advertisements, displays, packaging, or other materials as set forth in this Section 4.2, ARTES remains solely liable for any claims or information contained in such brochures, advertisements, displays, packaging, or other materials, to the extent that such claims and such information are not supported by the Product label and package insert claims and information as authorized by the FDA approval letter.

     4.3. Reservation of Rights . Except as expressly set forth herein, ANIKA reserves all right, title and interest in the ANIKA Intellectual Property, and ARTES shall not acquire, or be deemed to have acquired, any right, title or interest whatsoever as a result of this Agreement in the ANIKA Intellectual Property or the Intellectual Property Rights of any of its Affiliates.

ARTICLE V — MANUFACTURE AND SUPPLY

     5.1. Supply of Product . Subject to the provisions of this Agreement, during the Term, ANIKA and its Affiliates shall manufacture and supply ARTES in the Territory on an exclusive basis with those quantities of the Product as ordered by ARTES pursuant to and in accordance with the terms of this Agreement, and ARTES and its Affiliates shall purchase exclusively from ANIKA (which includes permitted sublicensees of ANIKA pursuant to Section 5.2) 100% of ARTES’ requirements for the Product to be sold subject to the ordering procedures set forth in this Article V. During the Term, ARTES will not distribute and ANIKA will not supply another temporary filler in the Territory nor enable (via license or technology transfer or otherwise) any Person to supply another temporary filler in the Territory, regardless of material composition, that competes with the Product. ANIKA’s associated responsibilities shall include:

     (a) identifying, ordering, procuring, reception, control and storage of raw materials and work-in process inventory;

     (b) manufacturing, packaging, filling, sealing, printing, labeling, packing and storage of the Product until delivery pursuant to Section 5.15;

     (c) control and testing of the finished Product to the extent required by Applicable Law or pursuant to the terms of this Agreement;

     (d) decision to release batches of the Product for delivery;

     (e) delivery of the Product in accordance with Section 5.15;

     (f) storage of batch records and retention samples to the extent required by Applicable Law or pursuant to the terms of this Agreement; and

     (g) file maintenance to the extent required by Applicable Law or pursuant to the terms of this Agreement.

     5.2. Permitted Sublicensees . Notwithstanding any provision in this Agreement, ANIKA shall be permitted to sublicense or outsource to Affiliates or Third Parties the manufacturing and supply of the Product; provided , however , that ANIKA shall be responsible for the compliance by such sublicensees or outsourced parties with all applicable terms of this Agreement and bear all the related costs that ANIKA is obligated to bear under this Agreement. ANIKA shall consult with ARTES with respect to the selection by ANIKA of any such Third Party sublicensees or outsourced parties.

     5.3. Compliance with Applicable Law . ANIKA shall comply in all material respects with all Applicable Laws relating to the manufacture and supply of the Product being provided hereunder, including, without limitation, those enforced by the United States Food and Drug Administration (including compliance with cGMP), it being understood by the Parties that, upon delivery of the Product to the Shipping Point in accordance with Section 5.15, responsibility for compliance thereafter with all Applicable Laws with respect to such delivered Units of the Product shall shift to ARTES, and thereafter ARTES shall comply in all material respects with all Applicable Laws relating to the storage and distribution of the Product.

     5.4. ANIKA Marketing Support; Samples . ANIKA agrees to assist ARTES’ Commercialization effort by providing Samples as set forth on Exhibit C. ARTES agrees that the Samples shall be used solely for marketing purposes in accordance with Applicable Law, and ARTES shall not sell, or offer for sale, or otherwise permit its Affiliates or distributors to sell or offer for sale, the Samples.

     5.5. Pricing . ARTES shall pay ANIKA for the Product in accordance with the prices set forth in Exhibit C hereto.

     5.6. Payment Terms .

     (a) The Per Unit Price payments shall become due and payable by ARTES no later than thirty (30) days after ARTES has received an invoice for any Product (which invoice shall not be sent by Anika prior to shipment of the applicable Product). ARTES agrees that receipt of an invoice by facsimile transmission shall be treated as receipt of an original invoice for purposes of this Agreement. ARTES shall make the Per Unit Price payments hereunder to ANIKA within the above referenced thirty (30) day period in accordance with written wire instructions delivered to ARTES by ANIKA from time to time.

     (b) ARTES shall be responsible for all such payments and late payments that are due to ANIKA pursuant to the terms of this Agreement. Any past due amounts for any overdue payment to either Party pursuant to any provision of this Agreement will be subject to a late fee of one percent (1%) per month, or the highest rate allowed by law, whichever is less, with such

interest accrual commencing on the thirtieth (30th) day after the applicable due date. All costs of enforcing or collecting payment hereunder, including attorneys’ fees and expenses and court costs, shall be paid by the non-prevailing Party. Breach for non-payment commences on the thirtieth (30th) day following the due date assuming the invoice is materially accurate; provided, however, that ARTES shall promptly notify ANIKA of any material inaccuracies in any ANIKA invoice received by ARTES.

     5.7. Concurrent with the execution of this Agreement, ARTES shall provide ANIKA with its initial written forecast of ARTES’ anticipated requirements for such Product by SKU for each of the first twelve (12) months following such execution (such initial forecast and all future forecasts herein referred to as a “ Forecast ” or the “ Forecasts ”); provided , however , that such initial Forecast shall provide for delivery on an expedited basis of up to                  ^***                 Units of such Product per month in the first two (2) months of such Forecast. From and after the delivery of the initial Forecast, no later than fifteen (15) days prior to the commencement of each calendar month during the Term, ARTES shall provide ANIKA with a revised Forecast by SKU covering each of the following twelve (12) months, accompanied by firm purchase orders for the first three months of the Forecast. With respect to all Forecasts issued to ANIKA by ARTES pursuant to the terms hereof, the quantities forecasted for the first and second months (the second and third months of the previous month’s Forecast) shall equal the amounts provided in the previous forecast, and the new third month shall now also become binding on the Parties on a rolling basis (i.e., such “third” month’s commitment means a commitment to place, in such month, Purchase Orders for delivery of Product at least 60 days thereafter) and constitute a firm commitment for Product, regardless of receipt by ANIKA of ARTES’ actual Purchase Orders, it being understood and agreed that should ANIKA fail to deliver the committed quantity in a given month, that ARTES shall have the right to reduce a subsequent month’s commitment by the amount ANIKA failed to deliver.

     5.8. Subject to the binding commitment incurred pursuant to each Forecast pursuant to Section 5.7, ARTES shall place specific binding orders for the Product by the issuance of separate purchase orders (the “ Purchase Orders ”) to ANIKA, provided that all Purchase Orders must be submitted at least sixty (60) days in advance of the requested shipping date, which Purchase Orders may be in written or electronic form or by any other means agreed to by the Parties and shall be binding on ANIKA to the extent that such purchase orders do not exceed 100% by SKU by month of the applicable Forecast with respect to the first, second and third months of such Forecast, 120% by SKU by month of such Forecast with respect to the fourth month, and 150% by SKU by month of such Forecast with respect to the fifth and sixth months. If ARTES requests a quantity of Product that exceeds the binding portion of a given Forecast, the Parties agree in good faith to negotiate additional quantities and associated delivery dates. The Purchase Orders shall designate the desired SKU’s and quantities of Product (subject to the requirements of this Section 5.8), delivery dates, and destinations. The minimum Purchase Order quantity by SKU shall be                 ***                 Units. ARTES shall issue written Purchase Orders for Products to ANIKA at least sixty (60) days prior to the requested delivery dates.

     5.9. In the event that ARTES shall fail to place sufficient Purchase Orders to satisfy the binding monthly order commitment incurred pursuant to any Forecast, such Purchase

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Orders shall be deemed to have been submitted by ARTES on the last day of the applicable month, and ANIKA shall deliver such Units of Product to ARTES sixty (60) days thereafter in accordance with such deemed Purchase Order.

     5.10. To the extent of any conflict or inconsistency between this Agreement and any Purchase Order, purchase order release, confirmation, acceptance or any similar document, the terms of this Agreement shall govern.

     5.11. Annual Minimum Purchase Commitment .

     (a) In order to maintain this Agreement, ARTES needs to take or purchase, at a minimum, the following quantities of Product for the applicable year (the “Annual Minimum Purchase Commitment”):

     (b) It is agreed that if ARTES has placed a Purchase Order calling for delivery of Units before year-end, and ANIKA has accepted such Purchase Order, but ANIKA fails to ship such Units by year-end, ARTES shall be deemed to have “purchased” such Units before year-end for the purpose of determining compliance with the Annual Minimum Purchase Commitment; but ARTES nonetheless shall not be required to actually pay for such Units until after they are actually delivered.

     (c) For any calendar year in which ARTES has not met the Annual Minimum Purchase Commitment, ARTES will have the right to pay ANIKA the balance due by multiplying the purchase shortfall in Units, times the Per Unit Price per Exhibit C , such amount being due on or before December 31 of the year in which the shortfall occurs. Such a payment shall be deemed to be as good as an actual purchase of such Units for the purpose of determining compliance with the Annual Minimum Purchase Commitment.

     (d) Upon                 ***                 days’ written notice to ARTES, ANIKA shall have the right to terminate all of ARTES’ rights and obligations under this Agreement if ARTES fails to meet its calendar year Annual Minimum Purchase Commitment.

     5.12. Specifications . ANIKA agrees that it shall manufacture the Products in accordance with the Specifications and with the Packaging Requirements.

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     5.13. Records .

     (a) ANIKA shall keep complete, accurate and detailed original records pertaining to the manufacture, including quality control, of the Product. ARTES shall keep, and will use its reasonable efforts to the extent required by Applicable Law to cause other ARTES Sellers to keep, complete, accurate and detailed original records pertaining to the use, storage, sale, distribution and other disposition of the Product, including for each lot number of Product, the quantity shipped and where the lot was shipped, so that, among other things, in the event of a recall, ARTES will be able to contact all physicians and/or end users of Product. Each party shall keep its respective records for at least five (5) years or for such longer period if and as required by Applicable Law from the date of delivery or receipt, as applicable, of each batch of Product to which said records pertain. For validation batches, each Party shall keep the documents throughout the commercial life of the relevant Products.

     (b) Subject to any more specific express limitations set forth elsewhere in this Agreement, each Party shall make available such records (including making copies thereof) to the other Party for such lawful purpose as such other Party may reasonably request in writing as reasonably necessary for complying with such Party’s obligations or exercising such Party’s rights under this Agreement during the Term, or as would otherwise be necessary for complying with Applicable Law.

     5.14. Packaging . ARTES agrees to use ANIKA’s existing labeling and packaging (modified as per Section 4.2) in the Territory as attached hereto as Exhibit F .

     5.15. Shipment .

     (a) ANIKA shall deliver the Product to the Shipping Point by such mode of transportation as ARTES shall direct and pursuant to the validated transportation specifications to ensure Product quality (including packaging and temperature). At the time of such delivery, (i) each Product with an            ***            shelf life shall have at a minimum            ***            of shelf life remaining, and (ii) each Product with a shorter than                  ***                 shelf life shall have at a minimum            ***            of such shelf life remaining. All charges for packing, handling, hauling, storage, bar coding and transportation to the Shipping Point are included in the Per Unit Price unless otherwise agreed to by the Parties in writing.

     (b) The risk of loss and damage with respect to the Product shall remain with ANIKA through production until the Product is picked-up by ARTES’ carrier at ANIKA’s Facility (the “Shipping Point”). Shipping terms will be Ex Works (EXW) per INCOTERMS 2000. ANIKA will pack all Product ordered hereunder in a manner suitable for shipment and sufficient to enable the Product to withstand the normal effects of shipping, including handling during loading and unloading. ARTES shall be responsible for designating the carrier(s) and negotiating terms for shipment of Product (and ANIKA agrees to cooperate therewith by providing to ARTES ANIKA’s insights and recommendations), and ARTES shall be responsible for payment of all transportation charges, shipping insurance, handling, storage, taxes, custom duties and fees and all other charges incident to the storage and movement of the Products (including Samples) in

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commerce subsequent to delivery by ANIKA to the Shipping Point. Except as provided in Section 5.9, ANIKA agrees not to direct the shipment of any Product to ARTES or any other location other than as directed by ARTES. In the event any of said charges are paid by ANIKA, with the approval of ARTES, ANIKA shall invoice ARTES therefor, and ARTES shall remit said amount(s) to ANIKA not later than thirty (30) days after the date of invoice. ANIKA agrees to provide reasonable assistance to ARTES’ operations people in their development and validation of their shipment protocol.

     (c) Certificates of Analysis. At the time of delivery, ANIKA shall provide ARTES with a certificate of analysis for each batch of the Product delivered confirming that each batch of Product complies with the applicable Specifications, and containing a statement of conformance confirming that each batch of Product complies with the cGMP.

     5.16. Inspection by ARTES . During the Term, ARTES retains the right to perform independent quality assurance audits of the Facility where the Products are manufactured and of the procedures and capabilities relating to the manufacture of the Product. Such audits shall include, without limitation, inspection of manufacturing, laboratory and storage facilities, any materials stored for ARTES, all equipment and machinery and all records relating to such manufacturing. Such audits shall not unreasonably disrupt the normal operations of ANIKA. Such audits shall be conducted during normal business hours upon at least twenty (20) Business Days prior written notice and shall be limited to not more than one (1) visit per year, except in the event of a Recall of the Product not caused by ARTES or governmental action involving the Product, in which case ARTES shall have the right to one (1) additional audit visit per such Recall or governmental action. Observations and conclusions of such audits will be issued by ARTES and discussed with ANIKA, and the Parties may agree upon what, if any, corrective actions will be implemented by ANIKA in response to such observations and conclusions. ANIKA shall implement any such agreed-to corrective actions as soon as practicable at its expense. The cost of all such audits shall be borne by ARTES.

     5.17. Inspection by ANIKA . ANIKA shall have the right to visit ARTES’ or ARTES’ Sellers’ facilities where the Product is stored or delivered from time to time during the Term to perform a quality audit of ARTES’ records concerning storage and physical distribution (including shipping and handling) of the Product (but not to include any information pertaining to customers, except the minimum amount of information pertaining to customers which is necessary with respect to addressing storage/physical distribution quality issues that are disclosed during the course of the audit). Such audits shall include, without limitation, inspection of distribution and storage facilities, all equipment and machinery and all records relating to such storage and physical distribution (but not to include any information pertaining to customers, except the minimum amount of information pertaining to customers necessary with respect to addressing storage/physical distribution quality issues that are disclosed during the course of the audit). Such audits shall not unreasonably disrupt the normal operations of ARTES. Such audits shall be conducted during normal business hours upon at least twenty (20) Business Days prior written notice and shall be limited to not more than one (1) visit per year, except in the event of a Recall of the Product not caused by ANIKA or governmental action involving the Product, in which case ANIKA shall have the right to one (1) additional audit visit per such Recall. Observations and conclusions of such audits will be issued by ANIKA and discussed with ARTES, and the Parties may agree upon what, if any, corrective actions will

be implemented by ARTES in response to such observations and conclusions. ARTES shall implement any such agreed-to corrective actions as soon as practicable at its expense. The cost of all such audits shall be borne by ANIKA.

     5.18. Product Acceptance and Rejection .

     (a) In the event that ARTES reasonably believes that any portion of the Product delivered to ARTES by ANIKA fails to conform with any Specification, ARTES may reject all or a portion of the same by giving written notice to ANIKA within thirty (30) days of ARTES’ receipt of the Product from the carrier and may not so reject after thirty (30) days from ARTES’ receipt of the Product from the carrier. Such notice shall evidence ARTES’ claims of nonconformity of the Product with an analysis of the allegedly nonconforming Product that shall have been prepared by ARTES or its agent. Such report shall be accompanied with a copy of the records pertaining to such testing and a sample of the Product from the batch analyzed. If the non-conformity is due to damage to the Product caused subsequent to ANIKA’s delivery to a common carrier at ANIKA’s Shipping Point, ANIKA shall have no liability to ARTES with respect thereto.

     (b) If, after its own analysis of a sample stored by ANIKA from such lot of the Product (which such sample ANIKA is required to retain) (the “Retained Sample”), ANIKA confirms such nonconformity, ANIKA shall, at ARTES’ election (which election shall be communicated in writing to ANIKA no later than ten (10) Business Days after ARTES’ rejection of such Product pursuant to Section 5.18(a)), either replace the nonconforming Product with a conforming Product (including reimbursement of freight and disposition costs) as soon as reasonably practicable at ANIKA’s expense or refund to ARTES the entire Per Unit Price therefor; provided, however, that, if ARTES elects the refund with respect to Product delivered in the fourth calendar quarter of any year (but not during the first three calendar quarters of any year), then ARTES’ required minimum purchases for the applicable year shall be reduced Unit for Unit. For clarity, such reduction shall not apply to Product delivered during the first three calendar quarters of any year. Except as set forth in Article IX , the foregoing, and the rights under Article XII, shall be ARTES’s sole and exclusive remedy with respect to such nonconformity, unless this Agreement is terminated pursuant to Section 12.2(a) as a result of a breach by ANIKA, in which case ARTES shall be entitled to all available remedies in respect of any breach of this Agreement. The nonconforming Product shall either be returned to ANIKA, at ANIKA’s request, or destroyed by ARTES, in each case at ANIKA’s expense.

     (c) If, after ANIKA’s own analysis, ANIKA does not confirm such non-conformance to the Specifications or whether the Retained Sample of the Product has such a defect, Anika may deliver its Retained Sample to an independent Third-Party laboratory, mutually and reasonably acceptable to both Parties, for analytical testing to confirm the Product’s conformance to the Specifications or the presence or absence of defects. All costs associated with such Third-Party testing shall be at ARTES’ expense unless the tested Product is deemed by such Third-Party to be materially defective or not in compliance with the Specifications, in which case all such costs, including reimbursement of freight and disposition costs, shall be paid by ANIKA, and the remedy provisions of Section 5.18(b) shall also apply.

     (d) Except as provided in Section 5.18(a), no inspection or testing of or payment for Product by ARTES or any Third-Party agent of ARTES shall constitute acceptance by ARTES thereof, nor shall any such inspection or testing be in lieu or substitution of any obligation of ANIKA for testing, inspection and quality control as provided in the Specifications or under Applicable Law. In the event that any such shipment or batch thereof is ultimately agreed or found to meet the Specifications, ARTES shall retain such shipment or batch, and all the terms and conditions of this Agreement and the License Agreement shall continue to apply to such Product.

     5.19. Reportable Events . ANIKA shall be responsible for notifying all applicable regulatory authorities of reportable events (including without limitation complaints) involving the Product for which ANIKA receives written notification, as required by Applicable Law. ARTES shall notify ANIKA of potentially reportable events promptly but in no event later than twenty-four (24) hours after it receives notice of such event. In addition, all such notices shall be consistent with the requirements of Applicable Law in the applicable jurisdictions.

     5.20. Product Complaints . The Parties have determined that ARTES will be the primary Party to receive complaints, interface with the customer, and perform initial investigations of complaints. For medical complaints, the Parties will rely on ARTES’ Vice President of Regulatory and Quality for the initial investigation, and ARTES’ Vice President of Regulatory and Quality and ANIKA will decide on the severity of the event and the reporting consequences. In the event of a disagreement, ANIKA reserves the right to perform its own investigation. As owner of all regulatory filings for the Product, ANIKA shall be responsible for all contact and correspondence with regulatory authorities. Each Party shall promptly (but in no event later than twenty-four (24) hours after it receives a complaint) communicate to the other Party by facsimile, telephone or email (and confirm any such telephone communication as instructed at the time) any complaint received in respect of the Product in the configuration supplied by the other Party. To the extent known by the notifying Party, each notification of a complaint shall contain, but not be limited to, the lot number, dosage size, expiration date, indication for actual use, description of circumstances involved in the failure of the Unit(s) in question, and any other pertinent information available at that time to the Party that receives such complaint. Notwithstanding any other provision of this Agreement, ARTES shall promptly prov