CONFIDENTIAL PROVISIONS MARKED EXHIBIT 10.28 (CONFIDENTIAL) PATENT LICENSE AGREEMENT

Exhibit 10.28

[        ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

CONFIDENTIAL PROVISIONS MARKED

EXHIBIT 10.28 (CONFIDENTIAL)

PATENT LICENSE AGREEMENT

between

PROTEIN DESIGN LABS, INC.

and

MEDIMMUNE, INC.

This Agreement (“Agreement”), effective as of July 17, 1997 (“Effective Date”), is made by and between PROTEIN DESIGN LABS, INC., a Delaware corporation having offices at 2375 Garcia Avenue, Mountain View, CA 94043, USA (hereinafter “PDL”) and MEDIMMUNE, INC., a Delaware corporation, having offices at 35 West Watkins Mill Road, Gaithersburg, MD 20878 (hereinafter “MEDIMMUNE”).

RECITALS

A.    MEDIMMUNE desires to license certain patents owned or controlled by PDL related to a humanized antibody directed against RSV (as defined below), which antibody has involved significant development efforts undertaken by MEDIMMUNE (including without limitation the antibody known as “MEDI-493”); and

B.    PDL is willing to license to MEDIMMUNE such rights under the terms and conditions of this Agreement.

AGREEMENT

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

All references to Exhibits, Articles and Sections shall be references to Exhibits, Articles and Sections of this Agreement. In addition, except as otherwise expressly provided herein, the following terms in this Agreement shall have the following meanings:

1.01    “Affiliate” means, with respect to a party hereto, any corporate or other entity which, directly or indirectly, controls, is controlled by, or is under common control with such party where “control” means the ownership of not less than 50% of the voting shares of a corporation, or decision-making authority as to an unincorporated entity.

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1.02    “Combination Product(s)” shall mean any product containing both a pharmaceutically active agent or ingredient which constitutes a Licensed Product and one or more other pharmaceutically active agents or ingredients which do not constitute Licensed Products.

1.03    “Field” means the field of human prophylaxis and therapy.

1.04    “Licensed Product(s)” shall mean an Antibody for which MEDIMMUNE has undertaken significant development efforts (e.g., conducted or sponsored a human clinical trial), which product is an Antibody that binds to RSV (including without limitation, the MEDI-493 product of MEDIMMUNE or MEDIMMUNE’s sublicensees and any modifications or improvements) whose development, importation, manufacture, use or sale would, but for a license under this Agreement, infringe a Valid Claim. “Antibody” as used in the preceding sentence shall include, without limitation, monospecific and bispecific antibodies; less than full-length antibody forms such as Fv, Fab, and F(ab’)(2); single-chain antibodies; and antibody conjugates bound to a toxin, label or other moiety.

1.05    “Net Sales” shall mean the aggregate gross revenues, whether in cash or in kind, derived by or payable from or on account of the sale of Licensed Products, less an allowance of Five Percent (5%) to cover factors such as (a) credits or allowances, if any, actually granted on account of price adjustments, recalls, rejection or return of items previously sold, (b) excise and sales taxes, duties or other taxes imposed on and paid with respect to such sales (excluding income or franchise taxes of any kind) and (c) outer packing, freight and freight insurance costs. If MEDIMMUNE or any of its Affiliates or sublicensees receive non-cash consideration for any Licensed Product sold or otherwise transferred to an independent third party not an Affiliate of the seller or transferor, the fair market value of such non-cash consideration on the date of such transfer as known to MEDIMMUNE, or as reasonably estimated by MEDIMMUNE if unknown, shall be included in the definition of Net Sales.

1.06    “PDL Patent Rights” means the patents (as well as any foreign counterparts or patent applications thereto) identified on Exhibit A , including any addition, continuation, continuation-in-part or division thereof or any substitute application therefor; any patent issued with respect to such patent application, any reissue, extension or patent term extension of any such patent, and any confirmation patent or registration patent or patent of addition based on any such patent.

1.07    “Territory” means the world.

1.08    “Valid Claim” means any claim in any issued patent included in the PDL Patent Rights which has not been disclaimed or held unenforceable or invalid by a governmental agency or court of competent jurisdiction by a decision beyond right of review.

1.09    “Europe” means one or more the following countries: U.K., France, Germany, Italy and Spain.

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2.01    License Grant.   Subject to the terms and conditions of this Agreement, PDL hereby grants and MEDIMMUNE hereby accepts a nonexclusive license under the PDL Patent Rights limited to the Field and Territory, including the right to grant sublicenses (subject to Section 2.02), to make, import, have made, use or sell Licensed Products.

2.02    Limitation on Sublicenses; Notification of Grant of Sublicense.   MEDIMMUNE shall have the right to grant sublicenses of its rights under Section 2.01 only in connection with the assignment or license by it of a Licensed Product to a third party and only with respect to that Licensed Product. The right to grant sublicenses under Section 2.01 shall be on terms and conditions which are subject to and subordinate to the terms of this Agreement. Promptly following execution of any sublicense hereunder, but in any event not less than ten (10) days thereafter, MEDIMMUNE shall notify PDL of the identity of the sublicensee and the scope of the sublicense.

2.03    Notification of Other Potential Licensee.   PDL shall use commercially reasonable efforts to notify MEDIMMUNE in the event that a third party proposes to obtain a license under the PDL Patent Rights in the Field. MEDIMMUNE shall have a period of ten (10) business days from notification to propose terms for an amendment to this Agreement for an exclusive license in the Field and Territory. PDL agrees to reasonably consider any proposal to enter into an amendment to this Agreement for an exclusive license proposed by MEDIMMUNE, but neither party shall have any obligation to enter into such amendment.

2.04     [            ]

3.01    Payments.   In consideration for the license granted by PDL under Article 2 of this Agreement MEDIMMUNE shall pay the amounts set forth in this Section 3.01.

(a)    Initial Payment.   Unless this Agreement is terminated as provided in Section 7.02(a), not later than September 1, 1997 MEDIMMUNE shall pay to PDL a nonrefundable signing and licensing fee in the sum of [            ].

(b)    Milestone Payments.

i.    Filing of Biologics License Application(s).   Within thirty (30) days following the submission of a biologics license application (or foreign counterpart thereto) to regulatory authorities with respect to a Licensed Product in any country in the Territory, MEDIMMUNE shall pay to PDL a one time nonrefundable sum of [            ].

ii.    Approval to Market in the U.S.   Within thirty (30) days following the initial approval to market a Licensed Product in the U.S., MEDIMMUNE shall pay to PDL the nonrefundable sum of [            ].

iii.    Approval to Market in Europe.   Within thirty (30) days following the initial approval to market a Licensed Product in any country in Europe, MEDIMMUNE shall pay to PDL the nonrefundable sum of [            ].

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iv.     First Sale in the U.S.   Within thirty (30) days following the initial sale of a Licensed Product that, but for the licenses granted to MEDIMMUNE under this Agreement would infringe a Valid Claim in the U.S., MEDIMMUNE shall pay to PDL the nonrefundable sum of [            ].

v.    First Sale in Europe.   Within thirty (30) days following the initial sale of a Licensed Product that, but for the licenses granted to MEDIMMUNE under this Agreement would infringe a Valid Claim in any country in Europe, MEDIMMUNE shall pay to PDL the nonrefundable sum of [            ].

Each milestone set forth in this Section 3.01 shall be deemed achieved and the corresponding milestone payment due upon the achievement of the milestone, whether by MEDIMMUNE, its Affiliates or sublicensees. Any payment made by MEDIMMUNE for the achievement of any milestone herein shall be paid by MEDIMMUNE only once.

3.02    Annual Maintenance Fee.   In further consideration of the license granted under Article 2, not later than June 30, 2000 and not later than May 31 each year thereafter, MEDIMMUNE shall pay PDL a nonrefundable annual maintenance fee in the amount of [            ].

3.03    Royalties to PDL; Credits Against Royalties.

(a)     In further consideration of the rights and licenses granted under Article 2, MEDIMMUNE shall pay to PDL a royalty of [            ] of the Net Sales of all Licensed Products sold by MEDIMMUNE or its Affiliates or sublicensees to non-Affiliated third parties in each country in the Territory until the last date on which there is a Valid Claim that, but for the licenses granted to MEDIMMUNE under this Agreement, would be infringed by the making, importing, using, having made or sale of that Licensed Product in such country in the Territory or by the manufacture of Licensed Product in the country of manufacture.

(b)     [            ]

3.04    Sales Among Affiliates .    Sales between and among MEDIMMUNE, its sublicensees and its Affiliates of Licensed Products which are subsequently resold or to be resold by such sublicensees or Affiliates shall not be subject to royalty, but in such cases royalties shall accrue and be calculated on any subsequent sale of such Licensed Products to a non-affiliated third party.

3.05    Combination Products .    Net Sales in a particular country in the Territory, in the case of Combination Products for which the pharmaceutically active agent or ingredient constituting a Licensed Product and each of the other pharmaceutically active agents or ingredients not constituting Licensed Products have established market prices in that country in the Territory when sold separately, shall be determined by multiplying the Net Sales for each such Combination Product by a fraction, the numerator of which shall be the established market price for the Licensed Product(s) contained in the Combination Product and the denominator of which shall be the sum of the established market prices for the Licensed Product(s) plus the established market prices for the other pharmaceutically active agents or ingredients contained in the Combination Product. When such separate market prices are not established in that country

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in the Territory, then the parties shall negotiate in good faith to determine a fair and equitable method of calculating Net Sales in that country for the Combination Product in question.

3.06    Withholding.

(a)    Payments.   MEDIMMUNE shall pay all amounts payable to PDL under Section 3.01 and Section 3.02 from a U.S. bank account. Any deductions for any taxes or other withholding that may be applicable to the payments to PDL under Sections 3.01 and 3.02 shall be promptly paid by MEDIMMUNE to the appropriate governmental authority and MEDIMMUNE shall provide proof of payment to PDL.

(b)    Royalty Payments.   MEDIMMUNE may withhold from royalties due to PDL amounts for payment of any withholding tax that MEDIMMUNE has paid to any taxing authority with respect to royalties due on account of the sale or manufacture of Licensed Products in the Territory. MEDIMMUNE agrees to reasonably cooperate with PDL in obtaining a foreign tax credit in the U.S. with respect to royalties due to PDL on the sale or manufacture of Licensed Products.

3.07    Currency Conversion.   All amounts payable to PDL under this Agreement shall be payable in U.S. Dollars by wire transfer to-a bank account designated by PDL. In the case of royalties on Net Sales, all amounts payable shall first be calculated in the currency of sale and then converted into U.S. Dollars using the average of the daily exchange rates for such currency quoted by Citibank, N.A. for each of the last fifteen (15) banking days of each calendar quarter.

3.08    Royalty Reports.

(a)    Current Reports.   MEDIMMUNE agrees to make written reports and royalty payments to PDL within forty-five (45) days after the close of each calendar quarter during the term of this Agreement, beginning with the calendar quarter in which the date of first commercial sale occurs. These reports shall show for the calendar quarter in question Net Sales by MEDIMMUNE, its Affiliates and sublicensees of the Licensed Products in the Territory on a country-by-country basis, details of the quantities of Licensed Products sold in each country and the country of manufacture if different, and the royalty due to PDL thereon pursuant to Article 2. Concurrently with the making of each such report, MEDIMMUNE shall make any payment due to PDL of royalties for the period covered by such report.

(b)    Termination Report.   For each Licensed Product, MEDIMMUNE also agrees to make a written report to PDL within ninety (90)&n