IL-13 AGREEMENT

Investors Rights Agreement

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IDM PHARMA, INC.

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Title: IL-13 AGREEMENT
Date: 3/31/2006
Industry: BIOTRX

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Exhibit 10.56

EXHIBIT 10.56

***Text Omitted and Filed Separately
Confidential Treatment Requested
Under 17 C.F.R. §§ 200.80(b)(4) and
240.24b-2(b)(1)

IL-13 AGREEMENT

BY AND BETWEEN THE UNDERSIGNED :

IDM Immuno-Designed Molecules, a French société anonyme with a capital of 1 164 736.90 Euros having its principal place of business at 172 rue de Charonne, Paris (75011) and registered at the Paris Register of Trade and Companies under B 382 632 263 represented by Jean-Loup Romet-Lemonne, President, and Bernard Brigonnet, General Director (hereinafter, “IDM”).

AND:

SANOFI-SYNTHELABO, a French société anonyme with a capital of 1 462 883 492 Euros having its principal place of business at 174, avenue de France, 75013 Paris, and registered at the Paris Register of Trade and Companies under B 395 030 844, represented by Jean-Claude Leroy, Senior Vice President Strategy and Business Development and José Ferrer, Director Operations Legal Affairs (hereinafter “SANOFI-SYNTHELABO”);

When used in this IL-13 agreement, capitalized terms have the meaning assigned in Article 1 of this IL-13 agreement.

RECITALS :

Whereas IDM is a biotechnology company incorporated in 1993 that, since inception, has developed a Know-how and expertise in the field of immunotherapy, and particularly in the field of ex vivo cancer treatments in humans.

Whereas SANOFI-SYNTHELABO is a pharmaceutical company that develops, manufactures and/or markets pharmaceutical products in the field of human health on a worldwide basis. In the course of its R&D, it discovered and developed a cytokine known as Interleukin 13 (« IL-13 »), for which it applied for and obtained patents and developed Know-how.

Whereas, on July 13, 1999, SANOFI-SYNTHELABO and IDM entered into an agreement (« the 1999 Agreement ») defining the terms and conditions under which SANOFI-SYNTHELABO granted IDM a non-exclusive license to its IL-13 Intellectual Property rights relative to the IL-13 cytokine, in return for SANOFI-

SYNTHELABO’s taking a stake in the capital of IDM, along with an exclusive marketing option for SANOFI-SYNTHELABO in the event developments carried out by IDM are successful.

Whereas in application of the 1999 Agreement, the Parties executed on July 13, 1999 a contribution agreement (the « Contribution Agreement ») pursuant to which SANOFI-SYNTHELABO contributed to IDM the following assets, valued at [...***...] :

	(a)		full ownership [...*...] of IL-13 (non GMP) equivalent to a minimum of [...*...] biological activity units of IL-13.

	(b)		a non-exclusive right to use the IL-13 Intellectual Property for the purpose of using, implementing, developing, exploiting in all forms and by all means the IL-13 Intellectual Property and, in particular, IL-13 products resulting from that Intellectual Property, exclusively in the field of ex vivo therapy for the purpose of carrying out Phase I and Phase II Studies in one or more Development Programs involving an IL-13 Product and for the marketing of IL-13 Research Kits during Phase I and II Studies.

	(c)		a non-exclusive right to use, under certain conditions, the IL-13 Intellectual Property for the purpose of using, implementing, developing, exploiting in all forms and by all means the IL-13 Intellectual Property and, in particular, IL-13 products resulting from that Intellectual Property exclusively in the field of ex vivo therapy in order to carry out Phase III Studies in one or more Development Programs involving an IL-13 Product.

	(d)		a non-exclusive right to use, under certain conditions, the IL-13 Intellectual Property for the purpose of using, implementing, developing, exploiting in all forms and by all means the IL-13 Intellectual Property and, in particular, IL-13 products resulting from that Intellectual Property exclusively in the field of ex vivo therapy for the marketing of Final IL-13 Products.

Whereas IDM and SANOFI-SYNTHELABO having expressed their desire to strengthen their collaboration in the field of ex vivo cellular therapies for humans executed on July 20, 2001 a memorandum of agreement pursuant to which SANOFI-SYNTHELABO has a priority right, on the terms and conditions defined in this memorandum of agreement, to all IDM Development Programs in the area of ex vivo cellular therapy in humans, whether or not they require IL-13 (hereinafter, « the 2001 Agreement »).

The Parties further wished to revise certain provisions of the 1999 Agreement and agreed, in Article 8 of the 2001 Agreement, on general principles that are to apply to the amendment to the 1999 Agreement.


		*		Confidential Treatment Requested under 17 C.F.R. §§ 200.80(b)(4) and
				240.24b-2(b)(1)

In view of the complexity created by the coexistence of these two agreements, the 1999 Agreement and the 2001 Agreement, the Parties hereby agree to amend the 1999 Agreement and to make more explicit certain provisions of this Agreement.

This IL-13 Agreement constitutes the amendment to the 1999 Agreement specified in Article VIII of the 2001 Agreement.

NOW, THEREFORE, THE PARTIES MUTUALLY AGREE AS FOLLOWS:

ARTICLE 1 — DEFINITIONS

1.1.		ABSA shall mean 7.283 class B shares with attached B-share subscription warrants issued by IDM to SANOFI-SYNTHELABO and fully paid up through the Contribution, at the Extraordinary Shareholders’ Meeting of IDM held on January 7, 2000.

1.2.		1999 Agreement shall mean the memorandum of agreement executed by the Parties on July 13, 1999.

1.3.		IL-13 Agreement shall mean this Agreement, including all its Attachments.

1.4.		2001 Agreement shall mean the memorandum of agreement executed by the Parties on July 20, 2001.

1.5.		Affiliate shall mean any entity controlled by a Party, controlling that Party or under the same control as that Party, in each case either directly or indirectly. For the needs of this definition, “control” means the holding (directly or indirectly through an Affiliate) of more than 50% of the capital or voting rights of a company. The status of an Affiliate is determined as of the date on which this definition needs to be used.

1.6.		MA (AMM) or Marketing Approval shall mean the official approval to market a Final IL-13 Product granted by the relevant health authority in each country in the Territory or each group of countries in the Territory.

1.7.		Reference MA shall mean any MA granted :

	–		for the territory of the United States of America ; or

	–		for the territory of Japan ; or

	–		for the territories of at least three of the following five countries : France, Germany, the United Kingdom, Italy, or Spain ; or

–

issued by the European Drug Agency (EMEA) for the marketing of any of the Final IL-13 Products on the territory of countries that recognize the competence of that agency.

1.8.		Contributions shall mean contributions in kind entailing full title and ownership (as recalled in the recitals of this agreement) made by SANOFI -SYNTHELABO under the 1999 Agreement, and more specifically, the Contributions Agreement.

1.9.		Amendment to the IL-13 License Agreement shall mean the amendment to the IL-13 License Agreement to be executed by the Parties, on terms and conditions specified in Article 6.3.2, and a model of which is set forth in Attachment 6.3.2.

1.10.		IL-13 Patents shall mean patent applications and patents belonging to SANOFI-SYNTHELABO, a descriptive list of which is given in Attachment 1.10, including all divisions, continuations in part and extensions of said patents, certificates of addition, certificates of utility and supplementary certificates of protection.

1.11.		BSA 1 warrants shall mean 7,283 B-share subscription warrants attached to the ABSA granting the right to subscribe 161,860 (or 8,093 multiplied by 20 following the 20 split approved by the Extraordinary Shareholders’ Meeting held on June 21, 2001) new IDM B-shares by exercise of Option 1 for a total price of [...***...].

1.12.		BSA 2 warrants shall mean 7,283 B-share subscription warrants attached to the ABSA granting the right to subscribe 242,800 (or 12,140 multiplied by 20 following the 20 split approved by the Extraordinary Shareholders’ Meeting held on June 21, 2001) new IDM B-shares by exercise exercise of Option 2 for a total price of [...***...].

1.13.		Change of Control of IDM shall mean the transfer of shares and/or other financial instruments in any form whatsoever, which effect is to cause a Third Party who was not an IDM shareholder on the effective date of the 1999 Agreement, to hold directly or indirectly more than 50% of the capital and/or voting rights of IDM. Attachment 1.13 contains a list of IDM shareholders as of the effective date of the 1999 Agreement.

1.14.		IL-13 Net Sales shall mean net sales before taxes made by IDM and/or by any authorized IDM licensee (except SANOFI-SYNTHELABO) in connection with the Final IL-13 Products and/or the IL-13 Research Kits after deduction of discounts, reductions and rebates granted to Third Parties, the cost of Final IL-13 Products or IL-13 Research Kits returned, commissions paid, miscellaneous taxes paid on the sale of Final IL-13 Products or IL-13 Research Kits, market access costs and custom duties


		*		Confidential Treatment Requested under 17 C.F.R. §§ 200.80(b)(4) and
				240.24b-2(b)(1)

		as well as transport and insurance costs relative to these sales, except Final IL-13 Products or IL-13 Research Kits used by IDM or by any IDM sublicensee for internal purposes — training, development, studies, research — within the context of its (their) activities.

1.15.		Executive Committee shall mean the executive committee referred to in Article 4.1(a) of the 2001 Agreement.

1.16.		IL-13 License Agreement shall mean the license contact that is to be executed by the Parties on the terms and conditions specified in Article 6.2.2, a model of which is given in Annex 6.2.2.

1.17.		Not applicable

1.18.		Effective Date shall mean the date the 2001 Agreement takes effect.

1.19.		Implementation Date shall mean January 7, 2000.

1.20.		Phase I Study (Studies) shall mean, within the context of a given IL-13 Development Program, all tolerance studies of an IL-13 Product as well as any pharmacodynamic study relative to said IL-13 Product conducted by IDM in treated patients.

1.21.		Phase II Study (Studies) shall mean, within the context of a given IL-13 Development Program, all studies conducted by IDM to demonstrate clinical activity of the IL-13 Product in treated patients.

1.22.		Phase III Study (Studies) shall mean, within the context of a given IL-13 Development Program, all studies conducted by IDM to confirm the efficacy and evaluate the long-term tolerance of an IL-13 Product in order to obtain Marketing Approval for the Final IL-13 Product in the Countries of the Territory.

1.23.		Exercise of Option 1 shall mean the occurrence of one of the events referred to in Article 6.2.2.

1.24.		Exercise of Option 2 shall mean the obtaining of a Reference MA.

1.25.		IL-13 shall mean the protein with human cytokinic activity, cloned and discovered by SANOFI-SYNTHELABO as more precisely described in Annex 1.25.

1.26.		IL-13 Research Kits shall mean the IL-13 Product or Products, in any form whatsoever, (i) developed in whole or in part by IDM and/or any authorized IDM sublicensee within the scope of this IL-13 Agreement, and which manufacture and/or marketing and/or utilization is covered by one or more

		IL-13 Patents and (ii) marketed for one or more of the following uses (a) for research purposes only without therapeutic use, and/or (b) for clinical trial purposes and without therapeutic use except as it results naturally from such clinical trials.

1.27.		Development Offer shall mean the offer that IDM must make to SANOFI-SYNTHELABO in application of Article III of the 2001 Agreement in order to allow the latter to exercise, or not, its Development Option right.

1.28.		Development Option shall mean the irrevocable option enjoyed by SANOFI-SYNTHELABO pursuant to Article III of the 2001 Agreement granting it, if it exercises the option with regard to a given Development Program, exclusive rights to benefit from the exploitation of the results of the corresponding Development Program, in return for its financing of the costs and expenses relative to said Development Program.

1.29.		Exclusive License Option shall mean the irrevocable option enjoyed by SANOFI-SYNTHELABO pursuant to Article VI of the 2001 Agreement.

1.30		IDM Shareholders’ Agreement shall mean the shareholders’ agreement among IDM’s shareholders dated December 29, 1996 and amended on August 31, 1998, October 29, 1998, January 7, 2000 and October 6, 2000, and, if applicable, any subsequent additional amendment.

1.31.		Parties shall mean SANOFI-SYNTHELABO and IDM collectively (each of the Parties being individually designated as a “Party”).

1.32.		Improvements shall mean any improvements and upgrades made to the IL-13 Intellectual Property, whether or not they are covered by patents or certificates of utility or any other intellectual property title.

1.33.		IL-13 Product shall mean any Product, as defined in Article 1.18 of the 2001 Agreement, that includes a dendritic cell obtained using IL-13.

1.34.		Final IL-13 Product shall mean any Final Product, as defined in Article 1.19 of the 2001 Agreement, that pertains to an IL-13 Product.

1.35.		Development Program shall mean, for a given Product in a specified therapeutic indication, all pre-clinical studies and clinical studies carried out or to be carried out by IDM and necessary for the preparation of MA applications in the Territory. IL-13 Development Program shall mean any Development Program pursuant to this definition that pertains to an IL-13 Product. For information, Annex 1.35 contains a list of the IL-13 Development Programs currently in progress. The term SANOFI-SYNTHELABO IL-13 Development Program shall mean an IL-13 Development Program as to which SANOFI-SYNTHELABO has exercised

		its Development Option right per Article III of the 2001 Agreement and that has not been interrupted in accordance with the provisions of the 2001 Agreement.

1.36.		IL-13 Intellectual Property shall mean, collectively, the IL-13 Patents, the IL-13 Know-How, as well as any intellectual property right that SANOFI-SYNTHELABO might have, either before or after the date of signature of the 1999 Agreement, and/or that is freely available to it and that is necessary (i) for the marketing of the IL-13 Research Kits or (ii) for the implementation of the IL-13 Development Programs and (iii) the marketing of the Final IL-13 Products.

1.37.		IL-13 Know-How shall mean all knowledge, experience and experimentation, information and expert reports relative to IL-13 and to the inventions claimed in the IL-13 Patents, that SANOFI-SYNTHELABO developed, as well as those to which it had access, provided they were freely available to it and provided they existed in any physically transmissible form on the execution date of the 1999 Agreement .

1.38.		Territory shall mean the entire world.

1.39.		Third Party shall mean any individual or any legal entity except the Parties and their Affiliates.

ARTICLE 2 — PURPOSE

The purpose of this IL-13 Agreement is:

	(a)		to amend the conditions under which IDM will be supplied with IL-13;

	(b)		to specify the terms of the IL-13 Intellectual Property license granted by SANOFI-SYNTHELABO to IDM for (i) marketing IL-13 Research Kits, (ii) implementation of IL-13 Development Programs and (iii) marketing Final IL-13 Products.

This IL-13 Agreement cancels and replaces, as of the Effective Date, the provisions of the 1999 Agreement with the exception of the Contributions Contract.

ARTICLE 3 — IL-13 SUPPLY

Further to the decision made by SANOFI-SYNTHELABO to stop supplying IL-13 to IDM, SANOFI-SYNTHELABO hereby grants IDM, which accepts it, a free non-exclusive license to the IL-13 Intellectual Property and Improvements, to the

extent they are necessary for the manufacturing of IL-13, in order to enable IDM to manufacture, for its own exclusive use, the required amounts of IL-13 to carry out IL-13 Development Programs and marketing of Final IL-13 Products.

This license includes the right for IDM to sub-license the IL-13 Intellectual Property and Improvements, to the extent the latter are necessary for the manufacturing of IL-13, to one (or more) Third Parties, provided that (i) the Third Party or Parties are pre-approved by SANOFI-SYNTHELABO, which may not refuse its consent without a serious reason, and (ii) IDM concludes with the Third Party or Parties a license contract which terms and conditions are consistent with the provisions of this Article 3.

ARTICLE 4 — NON-EXCLUSIVE NATURE OF GRANTED RIGHTS

IDM declares that it knows and accepts the fact that the rights granted by SANOFI-SYNTHELABO to IDM to the IL-13 Intellectual Property under this IL-13 Agreement are not exclusive.

ARTICLE 5 — CANCELLATION OF THE EXCLUSIVE MARKETING OPTION

The exclusive marketing option right enjoyed by SANOFI-SYNTHELABO under Article 8.2.2. of the 1999 Agreement is hereby cancelled.

ARTICLE 6 —IL-13 LICENSE

6.1.		Marketing of IL-13 Research Kits

		IDM may market IL-13 Research Kits during the life of this IL-13 Agreement, of the IL-13 License Agreement and of the Amendment to the IL-13 License Agreement. In this case, IDM shall pay SANOFI-SYNTHELABO a royalty equal to [...***...] of Net Sales made by IDM under such marketing.

		It is specified that [...*...] of the above referenced royalty is in consideration of the license granted to the IL-13 Patents and [...*...] is in consideration of the license granted for the IL-13 Knowhow, this royalty being only due during the life of this IL-13 Agreement.

		The payment by IDM of the amounts due under this Article 6.1 shall be made twice a year, on the last working day of the months of February and August of each year, by bank transfer to the account specified by SANOFI-SYNTHELABO. Each payment shall include a statement of IL-13


		*		Confidential Treatment Requested under 17 C.F.R. §§ 200.80(b)(4) and
				240.24b-2(b)(1)

		Research Kits sales made during the corresponding six calendar months that makes it possible to identify the amounts payable.

		IDM shall have a special accounting procedure, with the corresponding substantiating documents, covering all elements necessary for calculating the amounts owed to SANOFI-SYNTHELABO pursuant to the above provisions. SANOFI-SYNTHELABO may cause IDM’s books to be verified, at its simple request made with sufficient advance notice, by an independent expert jointly chosen by the Parties and, absent an agreement within fifteen (15) days of the date on which SANOFI-SYNTHELABO has requested the audit, by the Presiding Judge of the Lower Court of Paris on the petition of the first acting Party. The expert shall use its best efforts to notify his findings within a period of thirty (30) days after referral. The findings of this expert shall be final and without recourse. The expert’s fees and costs will be covered by SANOFI-SYNTHELABO except if the total amount owed to SANOFI-SYNTHELABO is more than five per cent (5%) greater than the amount reported by IDM, in which case these costs and fees shall be covered by IDM.

6.2.		Implementation of IL-13 Development Programs — Exercise of BSA 1 warrants

6.2.1.		Phase I and II studies

		Except for SANOFI-SYNTHELABO IL-13 Development Programs that are governed by the 2001 Agreement, IDM agrees to implement and pursue the Phase I and II Studies of the IL-13 Development Programs at its sole expense. IDM will use its best efforts to complete the Phase I and II Studies at the earliest possible time compatible with applicable legal and regulatory requirements.

		IDM will provide SANOFI-SYNTHELABO with a summary report of the results of the Phase II Studies carried out on one or more IL-13 Products within six (6) months following completion of these Phase II Studies.

6.2.2.		Exercise of the BSA 1 warrants

		The occurrence of one of the following events shall be deemed to be equivalent to Exercise of Option 1 as specified in the provisions for the exercise of BSA 1s described in Annex 7:

		Events:

(a)

The Executive Committee decides to undertake a Phase III Study on an IL-13 Product in application of Article 5.4.a) (ii) of the 2001 Agreement. In that event, Option 1 shall be deemed to have been

			exercised on the date of signature of the joint report setting forth the decision of the Executive Committee to start a Phase III Study; or
	(b)		IDM decides to undertake a Phase III Study on an IL-13 Product that is not covered by a SANOFI-SYNTHELABO IL-13 Development Program. In that event, IDM shall notify SANOFI-SYNTHELABO of its decision to start Phase III Studies by registered mail with return receipt sent within six (6) months of the completion of the Phase II Studies carried out on such IL-13 Product. Option 1 shall be deemed to have been exercised on the date of the first presentation to SANOFI-SYNTHELABO of such registered mail with return receipt.

		Within thirty (30) days from the occurrence of one of the above events, the Parties agree to enter into an IL-13 License Agreement pursuant to the model contained in Annex 6.2.2., defining (i) the terms and conditions under which IDM may use and exploit the IL-13 Intellectual Property to carry out Phase III Studies on IL-13 Products and (ii) the terms and conditions of the payment for the IL-13 Intellectual Property license thus granted by SANOFI-SYNTHELABO. The IL-13 License Agreement shall take effect as of the Exercise date of Option 1. On the date of execution of the IL-13 License Agreement, SANOFI-SYNTHELABO shall submit to IDM an invoice for the amount specified in Article 4.1.1. of the IL-13 License Agreement, plus any applicable amount of value-added tax, as well as a simplified subscription form requesting exercise of the BSA 1 warrants

		Within thirty (30) days of the signing of the IL-13 License Agreement, IDM shall cause its Board of Directors to draw up a statement of account, to be certified by its auditors, and the Board of Directors shall acknowledge issuance of the shares resulting from the exercise of the BSA 1 warrants.

6.2.3.		Phase III Studies