LICENSE AGREEMENT

Exhibit 10.6

LICENSE AGREEMENT

        Agreement ("AGREEMENT"), effective as of November 22, 1996 ("Effective Date") by and between Biomira, Inc., a corporation incorporated pursuant to the Canadian Business Corporations Act, with its principal place of business at Edmonton Research Park, 2011 - 94 Street, Edmonton, Alberta, T6N 1H1, Canada, (hereinafter referred to as "Biomira") and the DANA-FARBER CANCER INSTITUTE, INC., a Massachusetts non-profit corporation, with its principal place of business at 44 Binney Street, Boston, Massachusetts, 02115 (hereinafter referred to as "DFCI").

WITNESSETH:

        WHEREAS, DFCI is the legal and beneficial owner of certain rights in technology as later defined herein, subject only to a royalty-free, nonexclusive license heretofore granted to the United States Government; and

        WHEREAS, DFCI desires to have such rights utilized to promote the public interest by granting a license hereunder;

        WHEREAS, Biomira has represented to DFCI that Biomira is experienced in the development of therapeutic products, based on technologies similar to the technology which is the subject of this AGREEMENT, and has the financial capacity and the strategic commitment to facilitate the transfer of such technology for the public interest; and

        WHEREAS, Biomira desires to obtain from DFCI and DFCI has agreed to grant to Biomira a license to said rights upon the terms and conditions hereinafter set forth;

        NOW THEREFORE, in consideration of the mutual covenants herein contained and intending to be legally bound hereby, the parties hereto agree as follows:

ARTICLE I—Definitions

1.1

"Patent Rights" shall mean US Patents [+] as set forth in Appendix A.

1.2

"Invention" shall mean the inventions claimed or described in Patent Rights.

1.3

"Peptide" shall mean any peptide, polypeptide or protein or glycosylated forms thereof, or any chemically modified or conjugated derivative thereof, which may be made by solid phase or solution phase synthesis techniques, by in vitro recombinant expression techniques, or through the use of gene expression systems.

1.4

"Licensed Product" shall mean any product which incorporates or consists of a Peptide that includes a portion of an amino acid sequence described in Patent Rights, wherein said Peptide is formulated with or without adjuvant for direct administration to a patient or for ex vivo exposure to cells obtained from a patient where such cells will be re-administered to the patient following such exposure. Such Peptide may, for example, be formulated in solution or conjugated to a carrier molecule, or incorporated into or in an inert delivery vehicle such as liposomes. Licensed Products do not include Invention(s) described in Patent Rights, or products based on or incorporating such Invention(s), which comprise nucleic acids prepared or otherwise formulated for gene therapy or administration as vaccines, in vivo or ex vivo .

1.5

"Field of Use" shall mean in vivo , ex vivo , or in vitro prophylactic or therapeutic uses of Licensed Product in the treatment or prevention of cancer in humans.

1.6

"Territory" shall mean the United States of America and its territories and possessions.

1.7

"Milestone Payments" shall mean one-time payments made or payable by Biomira to DFCI pursuant to Section 4.4 herein.

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1.8

"End User" shall mean any organization or individual that provides or administers a Licensed Product to a patient, including but not limited to hospitals, pharmacies and physicians.

1.9

"Net Sales Revenue" shall mean the gross revenue derived by Biomira, its Affiliates or its Sublicensee(s) from the sale, use or disposition of Licensed Products to End Users in the Territory, less the following items but only insofar as they actually pertain to the sale, use or disposition of such Licensed Products by Biomira, its Affiliates or its Sublicensee(s) and are included in such gross revenue:

(a)

transportation charges or allowances;

(b)

trade, quantity, cash or other discounts allowed;

(c)

credits or allowances made or given on account of rejects, returns or retroactive price reductions;

(d)

Any tax or governmental charge including without limitation sales and excise taxes;

        All as determined in accordance with Canadian generally accepted accounting principles applied on a consistent basis.

1.10

"Sublicensee" shall mean any corporation, partnership or business organization, other than an End User or an Affiliate, to whom Biomira transfers any rights or privileges granted hereunder to enable said party to make and/or sell Licensed Products.

1.11

"Affiliate" shall mean any corporation or other business entity which assumes the rights and obligations of Biomira hereunder and which is controlled by, controlling, or under common control with Biomira. For this purpose "control" means direct or indirect beneficial ownership of at least fifty percent (50%) interest in the income or stock of such corporation or other business.

1.12

"ICRT" shall mean Imperial Cancer Research Technology, Ltd.

1.13

"ICRT Patent Rights" shall mean patent application U.S.S.N. 08/456,919.

ARTICLE II—Grant

2.1

DFCI hereby grants to Biomira, subject to all the terms and conditions of this AGREEMENT, including a nonexclusive license heretofore granted to the United States Government as described in section 2.2 herein, the exclusive right and license, with the right to sublicense as provided for in section 2.6 herein, to make, have made, use, lease and sell the Licensed Products in the Territory for the Field of Use for the term of this AGREEMENT unless this grant is sooner terminated according to the terms hereof.

2.2

Biomira hereby acknowledges that DFCI has heretofore granted the United States government a non-exclusive, non-transferable, irrevocable, paid-up license pursuant to 37 CFR 401 (Part 401 of Chapter IV of Title 37, Code of Federal Regulations), to practice Patent Rights, or have Patent Rights practiced, for or on behalf of the United States throughout the world.

2.3

Notwithstanding the provisions of Section 2.1., DFCI shall retain the right within the Field of Use, to make, use and practice the Invention for its own non-commercial research purposes, and to convey to other organizations at no charge other than shipping fees the Invention for use in non-commercial research. DFCI agrees that any such transfer by DFCI to another organization of materials embodying the Invention for use in non-commercial research shall be made under the terms of a written agreement, specifying, inter alia , that the materials shall be used solely by the named investigator and those conducting their research activities under his or her direct supervision, and will not be used for testing in human subjects. Upon becoming aware of any material breach of such written agreement by another organization, DFCI shall cooperate with

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Biomira and take reasonable measures to enforce the provisions of said agreement on said organization. This Section does not affect DFCI's rights to use and/or convey the Invention outside the licensed Field of Use.

2.4

To comply with United States Government regulations for the licensing of federally funded inventions, Biomira agrees that Licensed Products leased or sold in the United States shall be manufactured substantially in the United States. Notwithstanding the foregoing, in the event that Biomira provides compelling evidence to DFCI that such manufacture in the United States would impose an extraordinary and/or commercially unreasonable burden on Biomira, DFCI shall agree to seek a waiver from the United States Government with respect to the requirement that Licensed Products for lease or sale in the United States be manufactured substantially in the United States. Biomira hereby acknowledges that DFCI cannot guarantee that such a waiver can be obtained. Biomira shall bear all reasonable costs associated with the seeking of such a waiver by DFCI. If a waiver is sought, Biomira shall also provide DFCI with evidence required to seek such a waiver. Biomira shall bear primary responsibility for preparing the paperwork necessary to obtain such waiver.

2.5

Biomira agrees to comply with any and all applicable local, state, national, federal and/or international laws and regulations pertaining to the development, testing, manufacture, promotion and sale of Licensed Products.

2.6

(a)    Biomira shall have the right, subject to the terms of this Section, to enter into sublicensing agreements with any entity, whether or not an Affiliate, for the rights, privileges and licenses granted hereunder at royalty rates not less than those delineated in Section 4.5 hereof. DFCI shall be informed by written notice of the identity of any prospective Sublicensee and shall have the right to approve of said Sublicensee, which approval shall not be unreasonably withheld. If DFCI does not object in writing within thirty (30) days of said written notice, approval shall be presumed conclusively to have been given.

(b)

Biomira agrees that any sublicenses granted by it shall provide that the obligations to DFCI contained in Sections 2.1 through 2.5, 3.1, 5.1, 5.2, 10.1, 10.2, 13 and 14 of this AGREEMENT shall be binding upon the Sublicensee. Biomira further agrees to include in each sublicense agreement a provision requiring the Sublicensee to assume Biomira's obligations under Article VIII of this AGREEMENT in the event that the Sublicensee becomes a direct licensee of DFCI pursuant to Section 7.7 hereunder, and to attach to each sublicense agreement copies of those Sections of this AGREEMENT which DFCI, acting reasonably, deems should be so attached, including as a minimum those Sections expressly identified in this Section 2.6(b).

(c)

With respect to sublicenses granted under this Section, Biomira shall pay to DFCI [+] of all fees and lump sum payments, including but not limited to technology access fees and license issue fees, but excluding research support, received by Biomira. Said payments by Biomira to DFCI shall be in addition to Milestone Payments made pursuant to Section 4.4. Biomira's obligation to make payments under this section 2.6(c) shall cease if there is an Adverse Expedited Review Judgment (as hereinafter defined, in Section 4.3).

(d)

Biomira, on behalf of itself and/or its Affiliates and/or any other sublicensee(s), shall be responsible for making all payments to DFCI of royalties on Net Sales due to DFCI pursuant to Article IV.

(e)

Biomira agrees to forward promptly to DFCI a copy of any and all fully executed sublicense agreements, and further agrees to forward to DFCI annually a copy of such reports received by Biomira from its Sublicensees during the preceding twelve (12) month period under the sublicenses as shall be pertinent to a royalty accounting under said sublicense agreements.

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• (f)

  Biomira hereby agrees that every sublicensing agreement to which it shall be a part and which shall relate to the rights, privileges and license granted hereunder shall contain a statement setting forth the date upon which Biomira's exclusive rights, privileges and license hereunder shall terminate.

ARTICLE III—Due Diligence

3.1

Biomira agrees to use its reasonable efforts to bring one or more Licensed Products to the marketplace in a timely manner. Biomira shall use its reasonable efforts to achieve the following milestones by the dates indicated:

[+]

• The dates set forth above for the achievement of the specified milestones shall be adjusted appropriately at the reasonable request of Biomira, subject to the prior written consent of DFCI, which consent DFCI shall not unreasonably withhold.

3.2

Any disagreement between DFCI and Biomira concerning Biomira's compliance with its diligence obligations under Section 3.1 which cannot be resolved by good-faith negotiations between the parties shall be referred to arbitration pursuant to Article XII.

ARTICLE IV—Payments

4.1

In partial consideration for the license granted hereunder, Biomira agrees to pay DFCI within thirty (30) days of the Effective Date a license issuance royalty of [+] such issuance royalty being in part to offset DFCI's legal and administrative expenses arising from establishing a proprietary position in the Invention and facilitating the transfer of the Invention to the commercial marketplace.

4.2

Commencing on the second anniversary of the Effective Date, Biomira shall pay DFCI a license maintenance fee of [+] on each anniversary of the Effective Date. Biomira's obligation to pay such license maintenance fee shall cease on the date of first commercial sale of Licensed Products. The cumulative total of such fees paid prior to such date may be credited against royalties due pursuant to Section 4.5, provided that the amount credited in any one year shall not exceed [+] of the total royalties otherwise due in said year.

4.3

In partial consideration for the license granted hereunder, Biomira also agrees to make Milestone Payments and pay royalties to DFCI as set forth in Sections 4.4 and 4.5. In stipulating the amounts of such Milestone Payments and royalties, the parties recognize that a priority contest (an "Interference") could arise between Patent Rights and ICRT Patent Rights, and agree that in such event the amounts of such Milestone Payments and royalties should be determined in part by the process by which such Interference is resolved and by the outcome of such resolution. The parties agree that it may be desirable to try to resolve such Interference in an expeditious manner and that there are numerous means for accomplishing that goal. In order to encourage such expedition, the parties agree that in the event that an agreement is reached to use an expedited review process, and that after such process, a judgment is entered against all claims of the Patent Rights that cover the manufacture, use and/or sale of any Licensed Product (such a judgment under such circumstances hereinafter being referred to as an "Adverse Expedited Review Judgment", and any other outcome of an expedited review process being referred to as "Favorable Expedited Review Outcome"), that DFCI shall still be entitled to receive Milestone Payments and royalties, but in reduced amounts, as set forth in Sections 4.4 and 4.5.

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4.4

(a)    Biomira agrees to make the following one-time Milestone Payments to DFCI, on the dates indicated hereafter, in connection with the first occurrence of the milestone events specified hereafter with respect to, and only with respect to, whichever Licensed Product being developed by Biomira or a Sublicensee is the first to reach such milestones: [+] subject however to the provisions of Section 4.4 (b), (c), and (d).

(b)

If by the time Approval is granted an Interference has arisen, been resolved, and resulted in an Adverse Expedited Review Judgment, then the amount which Biomira shall pay to DFCI upon Approval shall be reduced to [+] said amount being hereinafter referred to as the "Minimum Approval Milestone Payment".

(c)

If at the time Approval is granted, proceedings are in progress to resolve an Interference, then the amount which Biomira shall pay to DFCI shall be the Minimum Approval Milestone Payment. If subsequent resolution of the Interference results in an Adverse Expedited Review Judgment, no further Milestone Payments shall be due from Biomira to DFCI. If said resolution results in a Favorable Expedited Review Outcome, then Biomira shall pay DFCI an additional [+] subject however to the provisions of Section 4.4 (d).

(d)

If the grant of Approval requires Biomira to make a milestone payment to any third party, including but not limited to ICRT and the total amount which would be due from Biomira to DFCI in connection with said Approval, after giving consideration to the provisions of Sections 4.4(c) and 4.4(d), is larger than the Minimum Approval Milestone Payment, then said total amount which Biomira shall pay to DFCI shall be reduced by [+] of the amount owed and actually paid to such third party, provided, however, that in no event shall the amount payable by Biomira to DFCI after such reduction be less than [+].

4.5

(a)    In partial consideration of the license to the Patent Rights granted hereunder by DFCI to Biomira, and subject to the provisions of Sections 4.5(b) and 4.5(c), Biomira shall pay to DFCI during the term of this AGREEMENT royalties amounting to [+] of Net Sales. Such obligation shall commence on the date of first commercial sale of a Licensed Product by Biomira, an Affiliate, or a Sublicensee.

(b)

With respect to Licensed Products upon which Biomira is required to pay royalties to a third party, including but not limited to ICRT, and subject to the provisions of Section 4.5(c), the royalties payable by Biomira to DFCI on Net Sales of such Licensed Products shall be reduced by [+] of the royalties owed and actually paid to such third party, provided, however, that in no event shall the royalties payable by Biomira to DFCI with respect to such Licensed Products be less than [+] of Net Sales of such Licensed Products.

(c)

In the event that an Interference arises and its resolution results in an Adverse Expedited Review Judgment, DFCI shall still be paid a royalty of [+] of Net Sales. This royalty shall be paid for the same length of time the royalty would be due and payable under the last to expire patent of the Patent Rights, as if judgment had not been entered against that patent. If under these circumstances Biomira is required to pay royalties to any third party other than ICRT in order to make, use or sell Licensed Products, the royalties payable by Biomira to DFCI on Net Sales of such Licensed Products shall be reducible by [+] of the royalties owed and actually paid to such third party, but in no event shall the

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• 
  

  royalties payable by Biomira to DFCI be less than [+] of Net Sales of such Licensed Products after such off-set.
  
  

4.6

Payment of royalties specified in Section 4 5 shall be made by Biomira to DFCI within forty-five (45) days after March 31, June 30, September 30 and December 31 each year during the term of this AGREEMENT covering the quantity of Licensed Products sold by Biomira during the preceding calendar quarter. The last such payment shall be made within forty-five (45) days after termination of this AGREEMENT.

4.7

All payments to be made under this ARTICLE shall be paid in United States dollars in Boston, Massachusetts, or at such other place and in such other way reasonably acceptable to Biomira as DFCI may reasonably designate, without deduction of exchange, collection or other charges.

4.8

Only a single royalty shall be paid with respect to any Licensed Product under Section 4.5(a), 4.5(b) or 4.5(c), irrespective of the number of claims of Patent Rights utilized.

4.9

In the event that any payment due hereunder is not made when due, the payment shall accrue interest beginning on the first day following the due date as herein specified, calculated at the annual rate of the sum of [+] plus (b), the prime interest rate quoted by the Bank of Boston on the date said payment is due, the interest being compounded on the last day of each calendar quarter, provided that in no event shall said annual rate exceed the maximu