LICENSE AGREEMENT

Exhibit 10.1

EXECUTION VERSION

LICENSE AGREEMENT

     This License Agreement (“Agreement”), made this 27th day of May, 2009 (“Effective Date”), between Echo Therapeutics, Inc., a corporation existing under the laws of the State of Delaware, having its principal place of business at 10 Forge Parkway, Franklin, Massachusetts 02038 (“Licensor”), and Ferndale Pharma Group, Inc., a corporation existing under the laws of the State of Michigan, having its principal place of business at 780 West Eight Mile Road, Ferndale, Michigan 48220 (“Licensee”).

RECITALS

     A. Licensor is engaged in the business of research, development, production and commercialization of transdermal medical devices and pharmaceuticals, with emphasis on (i) transdermal continuous glucose monitoring (tCGM) systems for use in clinical settings and by people with diabetes and (ii) transdermal drug delivery technologies;

     B. Licensor has developed and is commercializing the Prelude Technology (as defined below);

     C. Licensor has developed Know-How (as defined below) relating to the Prelude Technology; and

     D. Subject to the terms and conditions of this Agreement, Licensee desires to obtain from Licensor an exclusive license under the Patents (as defined below) and the Know-How in order to develop, have developed, assemble, use, market, have marketed, sell and have sold, and export the Products (as defined below) within the scope of the Field (as defined below) and in the Territory (as defined below);

      NOW, THEREFORE, in consideration of the mutual promises herein contained, it is agreed as follows:

      1. Definitions .

“50% Royalty” has the meaning given in Section 6.2.

“510(k) Clearance” means the 510(k) medical device clearance from the FDA for the Prelude™ SkinPrep System, which states, inter alia , that the labeling is substantially equivalent to that approved by the FDA for the SonoPrep™ System in 510(k) Number K040525.

“Affiliate” means any company, corporation, firm, partnership or other entity that controls, is controlled by or is under common control with the party in question. As used in this definition, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a party, whether through ownership of voting securities, by contract, or otherwise.

“Available Product Opportunity” means a combination of lidocaine and Azone TS™.

“Clearance” means any approvals (including pricing and reimbursement approvals), licenses, registrations or authorizations of any federal, state or local regulatory agency, department, bureau or other governmental entity, necessary for the marketing and commercial sale of the Products in the Field in a regulatory jurisdiction including, but not limited to, a 510(k) Clearance.

“Commercial Sale” means a commercial sale of Product Components to a non-Affiliate third-party within the scope of the Field in the Territory.

“Confidential Information” means, with respect to a party, all information of any kind whatsoever, and all tangible and intangible embodiments thereof of any kind whatsoever, which is disclosed by such party to the other party and is marked, identified or otherwise indicated to be confidential at the time of disclosure to the other party. Notwithstanding the foregoing, Confidential Information of a party shall not include information which the other party can establish by written documentation (a) to have been publicly known prior to disclosure of such information by the disclosing party to the other party, (b) to have become publicly known, without fault on the part of the other party, subsequent to disclosure of such information by the disclosing party to the other party, (c) to have been received by the other party at any time from a source, other than the disclosing party, rightfully having possession of and the right to disclose such information, (d) to have been otherwise known by the other party prior to disclosure of such information by the disclosing party to the other party, or (e) to have been independently developed by employees or agents of the other party without access to or use of such information disclosed by the disclosing party to the other party.

“Contract Year” has the meaning given in Section 6.2.

“Defense Action” means a lawsuit or claim that arises out of Licensee’s practice of the composition or method of preparing the composition as set forth in one or more of the claims of the Patents.

“Device” means a mechanical skin ablation device including embedded software, with charging stand.

“FDA” means the United States Food and Drug Administration.

“Field” means the temporary disruption of the outer layer of the skin prior to the application of topical analgesic/anesthetic cream, for local dermal anesthesia or analgesia prior to a needle insertion or IV procedure.

“Final Patent Refusal” means a final, non-appealable denial or refusal (not subject to re-examination) to issue a patent in a certain country by that country’s patent reviewing body.

“Improvement Plan” has the meaning given in Section 6.2.

“Improvements” means any replacements, improvements or modifications to the Device or Product Components, in each case in the Field.

“Know-How” means trade secret and other know-how rights in all information and data that is not generally known (including, but not limited to, information and data regarding formulae, procedures, protocols, techniques and results of experimentation and testing), which is necessary or useful to use, develop, sell, or seek Clearance for the Prelude Technology for use in the Field.

“Joint Inventions” means inventions, discoveries, know-how, trade secrets, and other information, that are made jointly by the parties in the course of the performance of this Agreement.

“Joint Patents” means any and all patents claiming Joint Inventions.

“Net Sales” means the gross amounts or cash equivalents actually received by Licensee or its Affiliates, subsidiaries, Sublicensees or assigns during the term of this Agreement less amounts directly attributable to: (i) rebates actually paid or taken (including government rebates such as Medicaid chargebacks or rebates), administrative fees in lieu of rebates paid to managed care and similar institutions, chargebacks and retroactive price adjustments; (ii) refunds, credits or allowances actually granted upon claims, rejections or returns of such sales of Product Components, including recalls, regardless of the party requesting the claim, rejection, or return; (iii) separately itemized freight, postage, packaging, shipping, and insurance charges actually incurred by Licensee for delivery of such Product Components; (iv) taxes (but not income taxes on sales), duties, or other governmental charges levied on or measured by the invoiced amount for the Product Components, and actually paid by Licensee; and (v) normal and customary trade, quantity and cash discounts and allowances actually allowed.

“Option” has the meaning given in Section 2.4.

“Option Period” has the meaning given in Section 2.4.

“Patents” means the patents and patent applications identified on attached Schedule A, including (i) all patent applications which are renewals, divisions, continuations, continuations-in-part, substitutions, or additions of the patents listed on Schedule A, (ii) all foreign counterparts of the patents listed on Schedule A, and (iii) all patents, including reissues, re-examinations and extensions which may issue on any of the preceding.

“Prelude Technology” means a proprietary technology known as the Prelude™ SkinPrep System that is capable of, among other things, temporarily disrupting the outer layer of the skin for the purpose of administering a topical anesthetic or analgesic and accelerating the time to onset for topical anesthetic or analgesic drugs including, but not limited to, lidocaine.

“Product Components” means, collectively, an abrasive tip, a reference electrode ring, Benzalkonium Chloride for skin preparation, and topical 4% lidocaine cream.

“Products” means the Device and the products and formulations based on the Prelude Technology described on attached Schedule B that are comprised of the Product Components and assembled in a kit.

“Qualifying Third Party” means a corporate partner or a licensee that receives commercialization rights to the Product for use in the Field in the Territory under a sublicense.

“Recipient” means the party receiving Confidential Information.

“Sublicense Consideration” means payments made by a Sublicensee to Licensee or its Affiliates in consideration for a sublicense agreement to use the Patents, such as up-front license fees, maintenance fees, milestone fees, and minimum unearned royalties; but excluding all earned running royalties (since earned running royalties on Licensee’s Net Sales are payable to Licensor pursuant to Section 6.2).

“Sublicensee” means any party, other than an Affiliate, that obtains certain rights under this Agreement by entering into an agreement or arrangement with Licensee, or receives a license grant from Licensee under the Patents.

“Sublicensee Breach” means a breach by a Sublicensee of the payment obligations affecting Licensor or any other material terms and conditions of a sublicense that would constitute a breach of the terms and conditions of this Agreement if such acts were performed by Licensee.

“Territory” means the United States and its territories and possessions, Canada, Mexico and the United Kingdom.

“Total Claim Amount” means all amounts expended by Licensor and/or Licensee in connection with any third party claim of infringement or misappropriation in a Defense Action, including, but not limited to, attorney fees and legal costs, and/or a royalty or other amount that must be paid to a third party as a result of a final claim or judgment or settlement.

“Trademarks” means the trademarks set forth on the attached Schedule C.

      2. Grant of License; Sublicenses; Licensee’s Right of First Refusal; Improvements; Licensor’s Supply and Sale of Certain Goods to Licensee .

     2.1 Subject to the terms and conditions of this Agreement, Licensor grants to Licensee the exclusive right and license under the Patents, and the Know-How to develop, have developed, assemble, use, market, have marketed, sell and have sold, and export the Products, within the scope of the Field in the Territory.

     2.2 Licensee may use the Trademarks solely as necessary to use, offer for sale, sell, lease and/or export the Products in accordance with the terms and conditions of this Agreement. Licensee acknowledges that all use of the Trademarks pursuant to this Agreement must be in accordance with Licensor’s policies and must meet Licensor’s

quality standards. Licensee understands and agrees that its use of the Trademarks does not create any right, title or interest in or to the use of the Trademarks and that all such use and goodwill associated with the Trademarks will inure to the benefit of Licensor. Except as expressly permitted by Licensor in writing, Licensee shall not adopt nor attempt to register any trademark, trade name or service mark which is confusingly similar to the Trademarks. In addition to the Trademarks, Licensee, in Licensee’s sole discretion, may use other trademarks to use, offer for sale, sell, lease and/or export the Products in accordance with the terms and conditions of this Agreement. Licensee shall be responsible for developing and registering trademarks for the Products, and shall own all such trademarks. Licensee shall not be obligated to use the Trademarks, but may do so in its sole discretion and otherwise in accordance with the terms and conditions of this Agreement.

     2.3 Licensee shall have the unconditional right to sublicense any right granted to Licensee under this Agreement, subject to the following conditions:

     2.3.1 In each such sublicense, the Sublicensee will be permitted to grant further sublicenses, and so forth for further sub-tier sublicenses, but only on the condition that any such sublicense will be subject to the terms and conditions of the license granted to Licensee under this Agreement, including payments to Licensor of royalties and other fees set forth in Section 6 based upon consideration paid by any further Sublicensee for any such further sublicense.

     2.3.2 Licensee will forward to Licensor, within thirty (30) days following its execution, a fully executed, complete and accurate copy of each sublicense granted under this Agreement. Licensor’s receipt of such sublicense will not constitute a waiver of any of Licensor’s rights or Licensee’s obligations under this Agreement. Each such sublicense agreement shall be treated as the Confidential Information of Licensee.

     2.3.3 Each sublicense will contain a right of termination by Licensee in the event of a Sublicensee Breach. In the event of a Sublicensee Breach, and if after a reasonable opportunity to cure as provided in any such Sublicensee’s sublicense, such Sublicensee fails to cure such Sublicensee Breach, then Licensee will terminate the sublicense unless Licensor agrees in writing that such sublicense need not be terminated. Such Sublicensee Breach and termination of a Sublicensee’s sublicense will not affect the term of Licensee’s license hereunder or the sublicense of any non-breaching Sublicensee.

     2.3.4 Upon termination of this Agreement for any reason, all sublicenses will be assigned to Licensor, and Licensor will have no greater duties or lesser rights under such sublicenses than Licensor has under the Agreement.

Licensee shall have the sole discretion to determine the financial and other terms on which any sublicenses shall be granted under this Agreement; however, no such sublicense agreement shall alter any obligation owed by Licensee to Licensor under this Agreement.

     2.4 For a period of twelve (12) months following Licensee’s receipt of notification that the 510(k) Clearance has been granted (the “Option Period”), Licensor grants to Licensee the right of first refusal (“Option”) to obtain an exclusive license to develop, have developed, assemble, use, market, have marketed, sell and have sold, and import and export all products that fall within the definition of Available Product Opportunity. Whether to exercise such Option is solely at the discretion of Licensee, but if Licensee does exercise the Option, Licensee must exercise the Option within the Option Period by payment of a [ ^** ] Option fee. The Option fee shall be paid at the time of Licensee’s exercise of the Option and shall be fully creditable against any subsequent license fee due for such technology. Upon payment of such Option fee, the same rights granted in Sections 2.1 through 2.3 of this Agreement shall be extended automatically to cover the use of the Available Product Opportunity.

     2.5 Any Improvements to the Patents or Know-How made by or for Licensor during the term of this Agreement shall be made available to Licensee and be deemed included within the scope of the licensed rights under this Agreement without any additional consideration on the part of Licensee.

     2.6 Promptly following the Effective Date, Licensor shall disclose to Licensee all Know-How and assist Licensee in the use of all such Know-How to enable Licensee to perform its obligations under this Agreement. In addition, Licensor shall make available to Licensee during the term of this Agreement, at Licensor’s expense, upon reasonable notice and during normal business hours, the reasonable assistance of Licensor’s employees who are knowledgeable about the Know-How in order to facilitate Licensee’s efforts to develop and commercialize the Products in accordance with the terms and conditions of this Agreement.

     2.7 In consideration for the sums paid pursuant to this Agreement, Licensor shall not, during the term of this Agreement, conduct, fund, license or participate in, directly or indirectly through one or more third parties, the development, distribution or commercialization in any country in the Territory, of any product that can reasonably be interpreted to compete with the Products within the scope of the Field in the Territory. Notwithstanding the foregoing, the restrictions in this Section 2.7 shall not apply to any product relating to Licensor’s Symphony or AzoneTS-based technologies, as identified on attached Schedule D.

     2.8 Licensee shall notify Licensor of the occurrence of the first Commercial Sale no later than ten (10) days after such sale.

     2.9 Exclusively for the purposes of this Agreement, Licensor shall supply all of Licensee’s requirements of the Devices, the abrasive tips and the reference electrode rings pursuant to the terms and conditions of a Supply Agreement to be negotiated in good faith and executed by the parties subsequent to the Effective Date of this

Agreement. Licensee, at Licensee’s cost and expense, shall supply and/or have supplied the Benzalkonium Chloride for skin preparation and the topical 4% lidocaine cream.

      3. Representations and Warranties .

Licensor represents and warrants to Licensee that:

     3.1 Licensor is the exclusive owner or licensee of all rights to the Patents, the Trademarks and the Know-How, has the right to grant this exclusive license to Licensee, and has not granted to any other person, firm or corporation any right, license, shop right, or privilege to the Patents, the Trademarks or the Know-How within the scope of the Field in the Territory.

     3.2 Other than the Patents, Licensor has not (i) filed, or caused to be filed, any pending patent applications based on or claiming the Prelude Technology for use in the Field, or (ii) obtained in its name or caused to be obtained in the name of others any letters patent based on or claiming the Prelude Technology for use in the Field.

     3.3 By execution of this Agreement, Licensor does not violate any other agreements, rights or obligations existing between Licensor and any other person, firm, corporation or other entity.

     3.4 To Licensor’s knowledge, there are no existing or threatened actions, suits or claims pending against Licensor with respect to Licensor’s right to enter into and perform its obligations under this Agreement.

     3.5 Licensor is not aware of any third party intellectual property rights that are infringed by the Patents, the Trademarks or by the Prelude Technology.

     3.6 Licensor has not granted any rights that currently exist under the Patents, the Trademarks and/or the Know-How within the scope of the Field in the Territory other than the rights granted in this Agreement.

     3.7 Licensor has disclosed to Licensee all the information in Licensor’s possession or control concerning side effects, injury, toxicity or sensitivity reaction and incidents associated with the use of the Prelude Technology in the Field, whether or not obtained from any clinical or non-clinical studies.

     3.8 This Agreement is a legal and valid obligation binding upon Licensor and enforceable in accordance with its terms.

Licensee represents and warrants to Licensor that:

     3.9 Licensee shall use commercially reasonable and diligent efforts to commercialize the Products in the Territory. Without limiting the generality of the foregoing, Licensee shall use commercially reasonable and diligent efforts to (i) obtain

necessary Clearances for the Products in the Territory, and (ii) manufacture, market and sell the Products to meet market needs in the Territory.

      4. The Patents and Inventions .

     4.1 Subject to the terms and conditions of this Agreement, all right, title and interest, in and to the Patents vests solely in Licensor. Licensor shall have the obligation to file, prosecute and maintain all Patents in the Territory at its sole expense during the term of this Agreement. Licensor shall pay all expenses in connection with its filing, prosecution and maintenance of the Patents in the Territory.

     4.2 Subject only to the rights expressly granted to the other party hereunder, each party retains its entire right, title and interest in and to any inventions, discoveries, know-how, trade secrets, and other information made or developed solely by such party and/or its consultants in the course of the performance of this Agreement (“Sole Inventions”), and shall have the right, but not the obligation, at its own expense, to file, prosecute and maintain any patents claiming its Sole Inventions in all countries of the world.

     4.3 Both parties shall jointly own any and all Joint Inventions, provided, however, that Licensor shall be granted an exclusive fully-paid, royalty free license to any and all Joint Inventions that are based on, related to or in any way incorporate the Patents and/or the Prelude Technology. Licensor and Licensee shall designate one of them to be responsible for filing, prosecuting and maintaining any and all Joint Patents. All costs and expenses of filing, prosecuting, maintaining, defending and enforcing such Joint Patents will be borne equally by both Licensor and Licensee. The party designated to perform patenting activities shall seek the comments of the other party and shall keep the other informed of the progress of such prosecution by providing quarterly status reports and copies of all correspondence between their patent counsel and the patent offices of the countries where such applications were filed. Such other party shall reasonably assist the party designated in the prosecution of Joint Patents, including, without limitation, by executing any necessary powers of attorney. Each party shall provide the other party with quarterly written updates on its commercialization efforts under any Joint Patents.