COLLABORATIVE RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

Research and Development Agreement

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PHARMION CORP

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Title: COLLABORATIVE RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT
Governing Law: New York Date: 5/10/2006
Industry: BIOTRX Sector: HEALTH

exv10w37

[***] = 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.

Exhibit 10.37

COLLABORATIVE RESEARCH, DEVELOPMENT AND
COMMERCIALIZATION AGREEMENT

This COLLABORATIVE RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (the “Agreement”), effective as of January 30, 2006 (the “Effective Date”) is made by and between Pharmion Corporation, a corporation organized under the laws of the State of Delaware, USA, with a place of business at 2525-28^th Street, Suite 200, Boulder, Colorado, 803301, USA (“Pharmion Corporation”) and Pharmion GmbH, a wholly-owned subsidiary of Pharmion Corporation registered in Switzerland having its principle place of business at Aeschenvorstadt 71, 4051 Basel, Switzerland (“Pharmion GmbH” and, collectively with Pharmion Corporation, “Pharmion”) on the one hand and MethylGene Inc., a corporation organized under the laws of Quebec, Canada, with its principal place of business at 7220 Frederick-Banting, Suite 200, Montreal, Québec H4S 2A1, Canada (“MG”). Each of Pharmion and MG shall be referred to as a “Party” and, together, as the “Parties.”

BACKGROUND

A. MG has developed certain proprietary technology related to small molecule HDAC Inhibitors (as defined below), which may be useful for developing pharmaceutical products for the treatment and prophylaxis of cancer in humans.

B. Pharmion possesses pharmaceutical development and commercialization capabilities.

C. MG has identified certain novel, proprietary HDAC Inhibitors, including the Compound designated as MGCD0103, which MG is pursuing as potential development candidates for cancer.

D. MG and Pharmion desire to collaborate to pursue potential commercial development in the cancer field of one or more HDAC Inhibitors, discovered by MG prior to the Effective Date, and discover and potentially commercialize additional HDAC Inhibitors as potential development compounds for cancer, all on the terms and conditions set forth herein.

E. In addition, MG desires to grant to Pharmion, and Pharmion desires to obtain, a license from MG of HDAC Inhibitors for use in the Territory (as defined below) in the Field (as defined below), on the terms and conditions set forth herein.

NOW THEREFORE, for and in consideration of the covenants, conditions, and undertakings hereinafter set forth, it is agreed by and between the Parties as follows:

ARTICLE 1
DEFINITIONS

1.1 “Actions” shall have the meaning set forth in Section 17.5.

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1.2 “Additional Clinical Candidate(s)” shall mean a Selected Compound with respect to which IND enabling studies have been completed pursuant to the Collaboration, other than the Initial Clinical Candidate.

1.3 “Additional Partner” shall mean each Third Party who is granted by MG, directly or indirectly, a right to market or commercialize Compounds and/or Products outside the Territory, other than a Non-Cancer Partner or an Opt-out Non-Cancer Partner. It is understood that, for purposes of this definition, “a right to market or commercialize” shall include an option to acquire such rights. As of the Effective Date, the sole Additional Partner is Taiho.

1.4 “Affiliate” shall mean, in the case of a subject entity, another entity which controls, is controlled by or is under common control with the subject entity. For purposes of this definition only, “control” shall mean beneficial ownership (direct or indirect) of at least fifty percent (50%) of the shares of the subject entity entitled to vote in the election of directors (or, in the case of an entity that is not a corporation, in the election of the corresponding managing authority).

1.5 “Agreement” shall have the meaning set forth in the Preamble.

1.6 “Audited Party” and “Auditing Party” shall have the meanings set forth in Section 12.5.1.

1.7 “Cancer Compound” shall have the meaning set forth in Section 11.7.1.

1.8 “Cancer HDAC Research” shall mean Research conducted by or under authority of MG that is not conducted as part of Non-Cancer HDAC Research.

1.9 “Cancer Royalty” shall have the meaning set forth in Section 11.7.1.

1.10 “Change of Control” shall mean with respect to a Party, (a) a merger, consolidation, share exchange or other similar transaction involving such Party and any Third Party which results in the holders of the outstanding voting securities of such Party immediately prior to such merger, consolidation, share exchange or other similar transaction ceasing to hold more than fifty percent (50%) of the combined voting power of the surviving, purchasing or continuing entity immediately after such merger, consolidation, share exchange or other similar transaction, (b) any transaction or series of related transactions in which any “person”, as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), together with any of such person’s “affiliates” or “associates”, as such terms are used in the Exchange Act, becomes the beneficial owner of fifty percent (50%) or more of the combined voting power of the outstanding securities of a Party, or (c) the sale or other transfer to a Third Party of all or substantially all of a Party’s assets.

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1.11 “Clinical Studies” shall mean the Preclinical Studies, as well as those certain clinical trials of a Compound and/or Product in the Territory in the Field, as set forth in the Development Plans established in accordance with Article 4 below.

1.12 “Collaboration” shall mean the Research, the Development and the Commercialization conducted pursuant to this Agreement.

1.13 “Collaboration Term” shall have the meaning set forth in Section 20.1.

1.14 “Commercialization Costs” shall mean, with respect to a Product Co-Promoted in North America, the variable costs and fixed costs properly incurred by each Party with respect to work performed by the Parties and their subcontractors in connection with the conduct of the applicable Commercialization Plan for such Product, and in accordance with the budget contained therein, including (a) the Fully Absorbed Cost of Goods for batches of such Product sold, (b) marketing, distribution and sales expenses attributable to a Product, including costs incurred in connection with commercial launch, market research, post-approval marketing studies, advertising, producing Product Promotional Materials, sponsoring seminars and symposia (including continuing medical education sponsored by the Marketing Party), sales training meetings and seminars specific to the Product, reimbursement and other patient support services, distribution costs, product liability insurance, transportation expenses including insurance (but only to the extent not charged to customers), inventory losses (except to the extent caused by the gross negligence or willful misconduct of a Party), allocated based upon the proportion of such expenses directly attributable to such Product or the activities of the Parties in connection with the conduct of the Commercialization Plan, (c) to the extent not included in the Fully Absorbed Cost of Goods of a Product, license fees, milestone payments and other amounts required to be paid to Third Parties in consideration for rights required to conduct activities under the applicable Commercialization Plan as agreed to pursuant to this Agreement, allocated based on the proportion of such costs directly attributable to such Product, (d) costs associated with Prosecution and enforcement of Licensed Patents in North America pursuant to Sections 17.4 and 17.6 covering any Co-Promoted Products and defense of Third Party intellectual property claims in North America pursuant to Section 17.5 incurred after the Marketing Approval of such Product, and (e) post-Marketing Approval regulatory expenses directly related to the Product, including costs to maintain such Marketing Approval (including user fees paid after Marketing Approval), medical and safety activities, adverse event reporting, market withdrawals, field adjustments or recalls. For purposes of this paragraph and to the extent agreed upon by the JSC and included in the applicable Commercialization Plan, “variable costs” shall be deemed to be the cost of labor (calculated on a full-time equivalent basis) and other material resources directly consumed in the execution of the applicable Commercialization Plan and “fixed costs” shall be deemed to be the fixed costs directly related to the execution of the applicable Commercialization Plan, allocated based upon the proportion of such costs directly attributable to support of the applicable Commercialization Plan or by such other method of cost allocation as may be approved by the JSC. A Party’s internal costs associated with efforts of sales representatives shall be allocated to Commercialization Costs based on reasonable metrics established by the JSC prior to obtaining Marketing Approval of a Product. Except as otherwise provided in this Agreement, all cost determinations made hereunder shall be made in accordance with GAAP.

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1.15 “Commercialization Plan” shall mean, with respect to a Product, the comprehensive plan and budget for such Product, as more fully described in Section 5.4 and approved by the JSC in accordance Sections 3.1 and 5.4.2.

1.16 “Commercialization Program” shall mean, with respect to a Product, the program for the Commercialization of such Product, as more fully described in Section 5.4 and the applicable Commercialization Plan.

1.17 “Commercialization” shall mean any and all activities directed to marketing, promoting, distributing, offering for sale and selling a Product, importing a Product for sale and manufacturing a Product for sale.

1.18 “Commercially Reasonable and Diligent Efforts” shall mean the carrying out of obligations in a diligent and sustained manner using efforts reasonably necessary or appropriate to actively develop a product in an expeditious manner, taking into consideration the countries in question and the market potential for such product. “Market potential” for a product shall be fairly determined in good faith and without limitation may be based upon the market size, labeled indication, price, competition, patent rights, product liability issues and general marketing parameters. Without limiting the foregoing, Commercially Reasonable and Diligent Efforts requires that the applicable party: (a) promptly assign responsibility for such obligations to specific employee(s) who are held accountable for progress and monitor such progress on an on-going basis, (b) set and consistently seek to achieve specific meaningful objectives for carrying out such obligations, and (c) consistently make and implement decisions and allocate the full complement of resources necessary or appropriate to advance progress with respect to such objectives in accordance with the foregoing, in each case in a manner similar to other high priority drug development programs.

1.19 “Complaint” shall mean any oral or written communication of dissatisfaction regarding the identity, quality, durability, reliability or performance of a Product. Examples include, but are not limited to appearance, low fills, foreign materials, foreign product, defective packaging or defective labeling.

1.20 “Compounds” shall mean all HDAC Inhibitors identified, synthesized, discovered or acquired (collectively, “Discovered”) by or under authority of MG or its Affiliates: (a) prior to the Effective Date, or (b) during the Research Term, or (c) any time during the term of this Agreement after the Research Term, if Discovered in connection with Cancer HDAC Research, or (d) any time during the term of this Agreement prior to [***] after completion of the last Cancer HDAC Research, if Discovered pursuant to Non-Cancer HDAC Research; provided that in each case such HDAC Inhibitors are used or useful in the Field. With respect to each Compound, such Compound shall include all salts, esters, hydrates, solvates, polymorphs, free base, isomers, prodrugs, metabolites, conjugated forms and/or liposomal or other formulations thereof, and other compositions consisting of such Compound non-covalently bounded with other moieties. In the event that MG or its Affiliate has entered or enters into an agreement with a Third Party (including an Additional Partner or Non-Cancer Partner) in connection with Research or prior to the end of the time periods, each as described in clauses (a) through (d) above, Compounds shall

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include HDAC Inhibitors Discovered by or under authority of such Third Party during the term of its right to conduct Research granted by MG, but shall exclude those compounds that were identified or being developed by such Third Party, as an inhibitor that directly inhibits the activity of HDAC enzymes or that has therapeutic effect through the inhibition of HDAC enzymes, prior to the time an agreement was first entered into with MG or its Affiliate. For clarity, it is understood that as used herein, the term “Discovered” shall be deemed to include HDAC Inhibitors covered by a patent application filed during the particular period, it being understood that the set of HDAC Inhibitors covered by a patent or patent application shall not be deemed a single Compound for purposes of defining Selected Compounds and Non-Cancer Selected Compounds below, solely because they are covered by such patent application.

1.21 “Compound Disclosure Date” shall mean ninety (90) days after the Compound Registration Date with respect to any Compound.

1.22 “Compound Registration Date” shall mean, with respect to all Compounds, the date such Compound is Registered in the MG Compound Registry, which shall be no later than thirty (30) days after the date such Compound is first synthesized or acquired by or on behalf of MG or its Affiliates, a Non-Cancer Partner or its Affiliates, any Additional Partner or its Affiliates or Pharmion or its Affiliates, as the case may be.

1.23 “Confidential Information” shall have the meaning set forth in Section 16.1.

1.24 “Contracted Research Work” shall mean the research work conducted by or under authority of MG which is funded, in whole or in part, by Pharmion under this Agreement, including without limitation all Research conducted under the Research Plan.

1.25 “Controlling Party” shall have the meaning set forth in Section 17.5.

1.26 “Co-Promote” or “Co-Promoted” or “Co-Promoting” or “Co-Promotion” shall mean to promote jointly a Product in North America through Pharmion and MG and their respective sales forces under both Parties’ trade names (in accordance with Section 5.5.2), unless otherwise agreed.

1.27 “Cost of Goods” shall mean, with respect to units of a Compound or Product to be supplied to a Party hereunder: (a) those costs of the supplying party associated with the manufacture of such units that would normally be included as inventoriable costs of such units in accordance with GAAP, and would include raw materials (including normal scrap) and actual direct labor costs and a proper allocation of overhead, subject to Section 11.3 below (i.e., with respect to Third Party royalties), and would exclude excess capacity, unusable raw materials, cost of capital and other costs not normally included as inventoriable costs as set forth above; or (b) if the units are purchased from a Third Party that is not an Affiliate, the purchase price thereof. Notwithstanding the foregoing, royalties paid by the manufacturing party with respect to patent rights for generic manufacturing processes used in such manufacture, but that are not primarily used for nor primarily related to Compounds, Products and/or HDAC, shall not be treated as a Third Party royalties subject to Section 11.3 below, for purposes of Section 1.27(a).

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1.28 “Data” shall mean, collectively, Research Data, Preclinical and Clinical Data and Manufacturing Data.

1.29 “Detail” shall mean an interactive face-to-face contact of a sales representative, who is fully equipped with, and knowledgeable of, applicable Product Promotional Materials and Product labeling, with a physician or other medical professional licensed to prescribe drugs or other healthcare professional that has a significant impact or influence on prescribing decisions, in which relevant characteristics of the Product are described by the sales representative in a fair and balanced manner consistent with the requirements of this Agreement and applicable laws and regulations, and in a manner that is customary in the industry for the purpose of promoting a prescription pharmaceutical product. Details shall be accounted for in accordance with the Marketing Party’s internal methodology for recording such activity as approved by the JSC.

1.30 “Development” shall mean the Preclinical Development and the clinical development of each Compound selected by the JSC for Clinical Studies; such activities shall include, among others, test method development and stability testing, toxicology, formulation, process development, including process automation, manufacturing scale-up, development-stage manufacturing and QC/QA.

1.31 “Development Costs” with respect to a Product shall mean the variable costs and fixed costs incurred after the Effective Date by a Party pursuant to the conduct of activities covered by this Agreement and in accordance with the relevant approved Development Plan (including the budget contained therein), for the development of such Product, including (a) direct, out-of-pocket external costs, including clinical grants, clinical laboratory fees, formulation costs and the cost of studies conducted and services provided by contract research organizations for clinical development and IND enabling studies and individuals, consultants, toxicology contractors, and manufacturers necessary or useful for the purpose of obtaining Marketing Approvals for such Product, (b) costs incurred in connection with process development and pre-clinical and clinical Product supply as set forth in the relevant approved Development Plan for such Product, including the efforts of Pharmion and MG to develop and document process methods and procedures for the manufacture of such Product, manufacturing process improvements, scale-up, manufacturing site qualification, supply chain management and storage and the Fully Absorbed Cost of Goods for batches of such Product manufactured and supplied for use in Clinical Studies, (c) costs for preparing, submitting, reviewing or developing data or information for the purpose of submissions to any Regulatory Authority, including submission of applications to obtain Marketing Approvals for such Product (including user fees paid prior to Marketing Approval), (d) to the extent not otherwise included in Fully Absorbed Cost of Goods of a Product, license fees and other amounts paid to a Third Party pursuant to a Third Party agreement in consideration for rights necessary to conduct activities under the Development Plans as approved by the JSC and (e) costs associated with Prosecution and enforcement of Licensed Patents in North America pursuant to Sections 17.4 and 17.6 and defense of Third Party intellectual property claims in North America pursuant to Sections 17.5 to the extent not included in Commercialization Costs. For purposes of this definition and to the extent agreed upon by the JSC and included in the applicable Development Plan, “variable costs” means the cost of labor (calculated on a full-time equivalent basis) and other material resources directly

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consumed in the conduct of and in accordance with the Development Plans; and “fixed costs” means the fixed costs directly related to the conduct of activities under the Development Plans, allocated based upon the proportion of such costs directly attributable to the support or performance of activities under the Development Plans or by such other method of cost allocation as may be approved by the JSC. Except as otherwise provided in this Agreement, all cost determinations made hereunder shall be made in accordance with GAAP.

1.32 “Development Plans” shall mean the plans and budgets for Development, as described in Article 4.

1.33 “Distributor” shall mean a Third Party in one or more countries in the Territory that (a) purchases a Product in finished form or in bulk form (to be packaged or labeled by such Third Party in accordance with applicable law) from Pharmion, its Sublicensees or their Affiliates for such country(ies) for a price which in no event is less than seventy-five percent (75%) of the average selling price of such Product in countries that are member states of the European Union within the Territory, (b) assumes responsibility from Pharmion for all or a portion of the Commercialization of such Product in such country(ies) and (c) sells such Product in such country(ies). The countries in which Pharmion has engaged a Distributor as of the Effective Date are identified in Exhibit 1.33.

1.34 “DMF” shall mean the Drug Master File filed with the FDA or such corresponding files in other countries or regulatory jurisdictions of the Territory, in each case, with respect to a Product for use within the Field.

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

1.36 “EMEA” shall mean the European Medicines Agency and any successor agency thereto.

1.37 “Enforcement Action” shall have the meaning set forth in Section 17.6.

1.38 “Exempt Patent Licensees” shall have the meaning set forth in Section 8.3.3(a).

1.39 “FDA” shall mean the U.S. Food and Drug Administration, or any successor agency.

1.40 “Field” shall mean the therapeutic or prophylactic treatment of cancer in humans (including neoplasia and other pre-cancerous conditions, including myelodysplasia syndrome) using a Compound or Product.

1.41 “Full Time Equivalent” or “FTE” shall mean one (1) full-time research scientist, or in the case of less than a full-time dedicated research scientist, a full-time, equivalent person year of activities under the Research Plan. The term “research scientists” means personnel of MG assigned to conduct research, scientific and/or technical activities under the Research Plan and having qualifications reasonably approved by the JSC.

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1.42 “Fully Absorbed Cost of Goods” with respect to units of a Product shall mean (a) the variable costs and fixed costs incurred by a Party associated with the manufacture (inclusive of finishing processes including filling, packaging, labeling and/or other preparation) quality assurance, quality control and other testing, storage and shipping of batches of such units of such Product or (b) if such units or components of a Product are not manufactured by the Parties, the amounts paid to the vendor plus costs associated with acquisition from such vendor plus the other variable costs and fixed costs incurred by a Party associated with any finishing processes conducted by such Party, including filling, packaging, labeling and QA/QC testing. For purposes of this definition, “variable costs” means the cost of labor (calculated on a full-time equivalent basis), raw materials, scrap, obsolescence, supplies and other resources directly consumed in the manufacture, quality assurance, quality control and other testing, storage and shipping of batches of such Product, and “fixed costs” means the cost of facilities, utilities, insurance (including any product liability insurance or accrual for self-insurance), facility and equipment depreciation and other fixed costs directly related to the manufacture, quality assurance, quality control and other testing, storage and shipping of batches of such Product, as well as amounts paid to Third Parties under a Third Party agreement (subject to Section 11.3 below), as a result of the manufacture, use or sale of such units of Products. Fixed costs shall be allocated to such units of Product based upon the proportion of such costs directly attributable to support of the manufacturing, quality assurance, quality control and other testing, storage and shipping processes for such Product. If a facility is used to manufacture Products and has the capacity to manufacture products for other programs of either Pharmion or MG, fixed costs shall be allocated in proportion to the actual use of such facility for the manufacture of Products and the capacity to manufacture products for such other programs. For the avoidance of doubt, no idle capacity of a manufacturing facility, or a proportionate use thereof, shall be included in Fully Absorbed Cost of Goods except, in the case of a facility dedicated solely to the manufacture of Products, it shall be included to the extent the JSC determines in good faith that such facility is appropriately sized. Fully Absorbed Cost of Goods shall exclude all costs otherwise reimbursed pursuant to this Agreement. All cost determinations made hereunder shall be made in accordance with GAAP. Notwithstanding the foregoing, royalties paid by the manufacturing party with respect to patent rights for generic manufacturing processes used in such manufacture, but that are not primarily used for nor primarily related to Compounds, Products and/or HDAC, shall not be treated as a Third Party royalties subject to Section 11.3 below, for purposes of Section 1.42(a).

1.43 The “FTE Rate” for Research conducted by MG hereunder shall be Two Hundred and Fifty Thousand Dollars (US $250,000) per FTE (consisting of at least a total of eighteen hundred (1,800) hours per calendar year, or such other number as may be agreed by the JSC) for work directly related to the Research or any other activities contemplated under the Research Plan. No additional payment shall be made with respect to any person who works more than eighteen hundred (1,800) hours per calendar year and any person who devotes less than eighteen hundred (1,800) hours per calendar year shall be treated as an FTE on a pro-rata basis based upon the actual number of hours worked divided by eighteen hundred (1,800). Each Party acknowledges that the foregoing FTE rate has been set to include all salary, employee benefits, materials and other expenses, including support staff and overhead for or associated with an FTE.

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1.44 “GAAP” shall mean United States generally accepted accounting principles, consistently applied.

1.45 “Generic Competition” shall have the meaning set forth in Section 11.5.1.

1.46 “Global Development Committee” shall have the meaning set forth in Section 3.2.

1.47 “HDAC” shall mean histone deacetylase and shall include without limitation any one of a family of enzymes that remove acetyl groups from amino groups of lysine residues at the N-terminus of a histone, including but not limited to HDAC1, HDAC2, HDAC3, HDAC4, HDAC5, HDAC6, HDAC7, HDAC8, HDAC9, HDAC10, HDAC11, SIRT1, SIRT2, SIRT3, SIRT4, SIRT5, SIRT6, SIRT7, and any histone deacetylase as described or referenced in MG’s patent application WO2003024448A2, or the articles Nature Reviews, Drug Discovery, 1, 287-299 (2002) or J. Biol. Chem., 277, 25748-55 (2002).

1.48 “HDAC Assay” shall mean the evaluation in vitro of a compound’s dose dependent inhibition of at least one (1) isolated, partially purified, recombinant human HDAC enzyme from any HDAC Class I or HDAC Class II enzyme families.

1.49 “HDAC Inhibitors” means Small Molecules that directly inhibit HDAC enzymatic activity or which have therapeutic effect through the inhibition of HDAC enzymes. The Parties hereby agree that such inhibition must be with an IC50 value less than or equal to [***] towards at least one of the tested HDAC isotypes using the HDAC Assay.

1.50 “Indemnitor” or “Indemnitee” shall have the meaning set forth in Section 19.5.

1.51 “Initial Clinical Candidate” shall mean the Compound designated internally at MG as MGCD0103 (as further identified in a side letter between the Parties exchanged on the Effective Date), or any other Compound as selected by the JSC to replace MGCD0103 as a clinical candidate.

1.52 “Initial Clinical Candidate Milestone Events” shall have the meaning set forth in Section 10.1.1.

1.53 “Insolvency Event” shall have the meaning set forth in Section 20.2.2.

1.54 “IND” shall mean an Investigational New Drug application, as defined in the U.S. Federal Food, Drug and Cosmetic Act and the regulations promulgated thereunder, or comparable filing in a foreign jurisdiction, in each case, with respect to a Product for use within the Field.

1.55 “JAMS” shall have the meaning set forth in Section 21.1.

1.56 “Joint Intellectual Property” shall have the meaning set forth in Section 17.2.

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1.57 “Joint Steering Committee” or “JSC” shall have the meaning set forth in Section 3.1.

1.58 “Licensed Technology” shall mean the Licensed Patents and Licensed Technical Information.

1.59 “Licensed Patents” shall mean all patents and all reissues, renewals, re-examinations, and extensions thereof, and patent applications therefor, and any divisions, continuations, in whole or in part, thereof, which claim or otherwise cover the composition, manufacture, sale or use of a Compound(s) or a Product(s), that are owned or acquired by MG or its Affiliates, or that cover inventions made by or under authority of MG or its Affiliates, prior to or during the term of this Agreement, including those patents and applications listed on Exhibit 1.59. It is understood and agreed that for purposes of this Agreement, “acquired” when applied to patents, information, data, materials or other intellectual property shall include such items that are in-licensed, of or within the scope of the relevant licenses, rights or obligations herein, including, without limitation, the Taiho Blocking Patents (as that term is defined in the Taiho Agreement), Non-Cancer Partner Blocking Patents and any similar blocking patents licensed to MG pursuant to an agreement with an Additional Partner.

1.60 “Licensed Technical Information” shall mean all material confidential information and tangible materials related to the development, manufacture, sale or use of a Compound or a Product, including, but not limited to: pharmaceutical, chemical, biological and biochemical compositions; and technical data and information; available descriptions, if any, of assays, methods and processes; the results of tests, including without limitation screening results, SAR data, optimization data, in vitro and in vivo data; preclinical, clinical and research, manufacturing processes and procedures; analytical and quality control data; and plans, specifications and/or other documents containing said information and data; in each case which are owned or acquired by MG prior to the Effective Date or discovered, developed or acquired by or under authority of MG or its Affiliates during the term of this Agreement. Notwithstanding the foregoing, Licensed Technical Information shall not include confidential information or tangible materials generated by a Non-Cancer Partner or MG in collaboration with a Non-Cancer Partner (in each case, other than those items set forth in part 1.121B of Exhibit 1.121), unless such confidential information or tangible materials is permitted by the Non-Cancer Partner to be provided to an Additional Partner and is not specific to indications outside the Field. As used in this Section 1.60 and in Sections 1.64, 1.108 and 1.121 below, information, data or materials shall be deemed generated by MG “in collaboration” with a Non-Cancer Partner only if such information, data or materials is generated in the course of Research directly solely to indications outside the Field that: (a) is conducted pursuant to an agreement with such Non-Cancer Partner in compliance with this Agreement; (b) is funded initially at least [***] percent ([***]%) by such Non-Cancer Partner and continues to be funded in whole or in part by such Non-Cancer Partner over the entire course of such Research; and (c) is not conducted by MG personnel who are involved in Research that is not directed solely to indications outside the Field.

1.61 “Litigation Agreement” shall have the meaning set forth in Section 17.6.

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1.62 “MAA” shall mean a marketing authorization application filed with the EMEA pursuant to the centralized approval procedure or with the applicable Regulatory Authority of a country of the Territory in Europe with respect to the mutual recognition or any other national approval procedure.

1.63 “Major Country” shall mean the United States of America, Canada, Australia, France, Germany, Italy, Spain and the United Kingdom.

1.64 “Manufacturing Data” shall mean all material information and data relating to or used in connection with the manufacturing of Compounds and/or Products by MG, Pharmion, Additional Partners, their Affiliates, or others working under authority of such entities, including without limitation, such information and data as generated or used during process development, stability studies, formulation development, scale-up of manufacturing, production of preclinical and clinical product batches, validation studies, development of quality assurance/quality control testing, and related regulatory affairs; and all information and data contained in the DMF or in the CMC section of an IND or NDA (or their counterparts in other countries) with respect to Compounds and/or Products. Without limiting the foregoing, Manufacturing Data shall include information and data described in Exhibit 1.64. Notwithstanding the foregoing, to the extent MG, Pharmion, Additional Partners or their Affiliates do not have rights to such know-how, the term “Manufacturing Data” shall exclude any proprietary manufacturing know-how described in a DMF that was disclosed by a contract manufacturer of MG, Pharmion, Additional Partners or their Affiliates directly to the Regulatory Authority (and not to MG, Pharmion, Additional Partners or their Affiliates), which know-how had been independently developed by such contract manufacturer outside of its relationship with MG, Pharmion, Additional Partners or their Affiliates; provided that in the case of a contract manufacturer of MG, MG ensures that, upon the request of Pharmion, such contract manufacturer shall file with Regulatory Authorities in the Territory a similar DMF containing such know-how in support of Pharmion’s regulatory filings. In addition, notwithstanding the foregoing, Manufacturing Data shall not include information or data generated by a Non-Cancer Partner or MG in collaboration with a Non-Cancer Partner, unless the same is provided to an Additional Partner and is not specific to indications outside the Field.

1.65 “Marketing Approval” shall mean all approvals, registrations or authorizations of any governmental entity that are necessary for the manufacturing, use, storage, import, transport and sale of a Compound or Product in a regulatory jurisdiction. For countries where governmental approval is required for pricing or reimbursement for the Product to be reimbursed by national health insurance, Marketing Approval shall not be deemed to occur until such pricing or reimbursement approval is obtained; provided, that Marketing Approval shall be deemed to have occurred in such country where government approval of pricing has not been obtained if, at any time, the party undertakes a full commercial launch of such Product in the country without obtaining pricing approval.

1.66 “Marketing Party” shall mean the Party designated under this Agreement as having specific responsibilities for marketing, sales and distribution of a Product within a particular country, as set forth in Section 5.4.

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1.67 “Material Non-Performance” shall have the meaning set forth in Section 20.2.2.

1.68 “MG” shall have the meaning set forth in the Preamble.

1.69 “MG Blocking Patents” shall have the meaning set forth in Section 5.3.7(a).

1.70 “MG Compound Registry” shall mean the comprehensive registry of Compounds maintained by or on behalf of MG, which comprehensive registry includes (i) all Compounds, (ii) the chemical structure of each Compound, (iii) a unique identifying number for each Compound, (iv) the Compound Registration Date for such Compound, (v) the potency of each Compound, as determined by MG, and (vi) such other information and Data as MG may determine to include in the MG Compound Registry from time to time, in each case in a format suitable to reasonably enable Pharmion to access and use Compounds as contemplated by this Agreement.

1.71 “MG Indemnitees” shall have the meaning set forth in Section 19.2.

1.72 “[***]Programs” shall mean an [***] research and development program directed solely to the discovery and/or characterization of HDAC Inhibitors having therapeutic utility in particular disease areas outside the Field and with respect to which [***] is devoting [***] resources or causing resources to be devoted but excluding Non-Cancer Partners.

1.73 “MG Opt-out Right” shall have the meaning set forth in Section 8.6.

1.74 “[***] Reserve Compounds” shall mean a list of up to [***] individual Compounds designated by [***] as potential development candidates which [***] desires to reserve in the Territory in the fields of [***] Programs in accordance with Section 5.3.3(b) below. The [***] Reserve Compounds as of the Effective Date are identified on Exhibit 18.2.4.

1.75 “[***] Selected Compounds” shall mean (i) those individual Compounds selected by [***] under Section 5.3.3(d), (ii) those Compounds that are [***] Selected Compounds in accordance with Section 5.3.3(c) below, and (iii) [***] Reserve Compounds selected in accordance with Section 5.3.3(b) below, in each case subject to Section 5.3.4. With respect to each such Compound, the [***] Selected Compound shall also include the prodrugs, metabolites, salts, esters, hydrates, solvates, free base, polymorphs, isomers thereof, conjugated forms and/or liposomal or other formulations thereof and other compositions consisting of such Compound non-covalently bonded with other moieties, which together shall be deemed a single [***] Selected Compound (and a single [***] Reserve Compound) for purposes of Sections 5.3.3(b)(iii), 5.3.3(c) and 5.3.3(d) below.

1.76 “Milestone Events” shall have the meaning set forth in Section 10.1.2.

1.77 “NDA” shall mean a New Drug Application pursuant to Section 505 of the United States Federal Food, Drug and Cosmetic Act (21 U.S.C. Section 355) and the regulations promulgated thereunder related to a Product submitted to the FDA or any successor application

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or procedure or any foreign counterpart of a U.S. New Drug Application for approval to market (such as a MAA for EMEA), including, where applicable, applications for pricing and reimbursement approval, and all supplements and amendments thereto.

1.78 “Net Profits and Losses” shall mean, as to any period for which there is a determination thereof, Net Revenues less Commercialization Costs; provided that in no event shall any amounts deducted from gross sales for the purpose of calculating the Net Sales component of Net Revenues also be counted toward the amount of Commercialization Costs. To the extent Net Revenues exceeds Commercialization Costs for the relevant period, such amount of difference shall be deemed “Net Profits,” and to the extent Commercialization Costs exceeds Net Revenues for the relevant period, such amount of difference shall be deemed “Net Losses.”

1.79 “Net Revenues” shall mean the sum of (a) Net Sales received with respect to a Product sold in North America plus, if any, (b) the fair market value of any consideration other than the proceeds of Net Sales (whether in cash, payment in kind, exchange or other form) actually received by a Party or its Affiliates from Third Parties with respect to transactions involving the research, development or commercialization of a Product or exploitation of Licensed Technology in North America, to the extent such consideration is fairly and reasonably attributable to such Product, or Licensed Technology.

1.80 “Net Sales” shall mean the gross invoice price for Product sold by either of the Parties, or both, their Sublicensees or their Affiliates to a Distributor or a non-Affiliate Third Party customer less the reasonable and customary accrual-basis deductions from such gross amounts for: (i) normal and customary trade, cash and other discounts, allowances and credits actually allowed and taken directly with respect to sales of Product; (ii) credits or allowances actually granted for damaged goods, returns or rejections of Product; (iii) sales taxes or similar taxes (including duties or other governmental charges levied on, absorbed or otherwise imposed directly on the sales of Product, including, without limitation, value added taxes or other governmental charges otherwise measured by the billing amount) which are included in billing amount, and excluding any taxes imposed on or measured by the net income or profits of the selling party; (iv) charge back payments and rebates granted to trade customers, including, but not limited to, wholesalers and government or private insurers; (v) packaging, handling fees, freight, insurance and the like, and (vi) actual uncollectible accounts. For purposes of determined Net Sales in order to calculate the Non-Cancer Royalties owed to Non-Cancer Partners pursuant to Section 11.7.2, amounts deducted under subsection (v) shall not exceed [***]% of Net Sales and amounts deducted under subsection (vi) shall not exceed [***]% of Net Sales. Such amounts shall be determined from the books and records of a Party, its Affiliates and their Sublicensees maintained in accordance with GAAP consistently applied, and such amounts shall be calculated using the same accounting principles used for other products of the Party. Sales between or among a Party, its Affiliates and Sublicensees shall be excluded from the computation of Net Sales if such Affiliates or Sublicensees are not end-users, but Net Sales shall include the subsequent final sales to non-Affiliate Third Parties by any such Affiliates or Sublicensees. Where (a) Product is sold by a Party, its Affiliates or Sublicensees other than in an arms-length sale or as one of a number of items without a separate invoiced price; or (b) consideration for Product shall include any non-cash element, the Net Sales applicable to any such transaction

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shall be deemed to be the Party’s average Net Sales for the applicable quantity of the Product at that time; provided, however, Net Sales shall not include Product sold or used for development of the Product hereunder (including for clinical trials) or as samples (provided the cost of such samples does not exceed [***]% of Net Sales). For purposes of determined Net Sales in order to calculate the Non-Cancer Royalties owed to Non-Cancer Partners pursuant to Section 11.7.2, amounts deducted in respect of the preceding sentence shall not exceed [***]% of Net Sales.

1.81 “Non-Cancer Compound” shall have the meaning set forth in Section 11.7.2.

1.82 “Non-Cancer HDAC Research” shall mean Research conducted by or under authority of MG that is directed only to applications outside the Field and for which MG shall not grant a Third Party rights to commercialize resulting compounds for applications in the Field.

1.83 “Non-Cancer Partner” shall mean a non-Affiliate Third Party who (i) is or will be granted by MG, directly or indirectly, a right to develop, market and/or commercialize Compounds and/or Products outside the Field, (ii) is not and will not be granted by MG, directly or indirectly, any rights with respect to Compounds or Products in the Field anywhere in the world, and (iii) who is not an Opt-out Non-Cancer Partner. A Non-Cancer Partner and all of its Affiliates shall be deemed a single Non-Cancer Partner.

1.84 “Non-Cancer Partner Agreement” shall mean any written agreement or arrangement between MG or its Affiliates and a Non-Cancer Partner that governs a Non-Cancer Research Program or the manufacture or commercialization of HDAC Inhibitors and resulting products for the treatment or prevention of diseases outside of the Field.

1.85 “Non-Cancer Partner Blocking Patents” shall mean all patents owned and controlled by a Non-Cancer Partner which are necessarily infringed by the composition, manufacture, sale, use or importation of Compounds.

1.86 “Non-Cancer Research Program” shall mean activities directed to the research, discovery, characterization, optimization, in vitro testing, in vivo evaluation, preclinical and/or clinical development of HDAC Inhibitors other than for the treatment or prevention of diseases within the Field, which activities are conducted by or on behalf of a Non-Cancer Partner or its Affiliates pursuant to any written agreement or arrangement with MG or its Affiliates.

1.87 “Non-Cancer Reserve Compounds” shall mean a list of up to ten (10) individual Compounds designated by a Non-Cancer Partner as potential development candidates which such Non-Cancer Partner desires to reserve in the Territory outside the Field in accordance with Section 5.3.2(b) below. The Non-Cancer Reserve Compounds as of the Effective Date are identified on Exhibit 18.2.4.

1.88 “Non-Cancer Royalty” shall have the meaning set forth in Section 11.7.2.

1.89 “Non-Cancer Selected Compounds” shall mean (i) those individual Compounds selected by Non-Cancer Partners under Section 5.3.2(d), (ii) those Compounds that are Non-Cancer Selected Compound in accordance with Section 5.3.2(c) below, and (iii) Non-Cancer

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Reserve Compounds selected in accordance with Section 5.3.2(b) below, in each case subject to Section 5.3.4 and provided that MG has obtained all rights and covenants as set forth in Section 8.3.1(b) from the respective Non-Cancer Partner. With respect to each such Compound, the Non-Cancer Selected Compound shall also include the prodrugs, metabolites, salts, esters, hydrates, solvates, free base, polymorphs, isomers thereof, conjugated forms and/or liposomal or other formulations thereof and other compositions consisting of such Compound non-covalently bonded with other moieties, which together shall be deemed a single Non-Cancer Selected Compound (and a single Non-Cancer Reserve Compound) for purposes of Sections 5.3.2(b)(iii), 5.3.2(c) and 5.3.2(d) below.

1.90 “North America” shall mean the United States of America and Canada.

1.91 “North American Development Costs” shall mean the Development Costs incurred in connection with development activities designed to support or obtain Marketing Approval for a Product and/or Compound anywhere in North America. For clarity, “North American Development Costs” shall not include Development Costs incurred in connection with development activities designed solely to support or obtain Marketing Approval for a Product and/or Compound outside North America.

1.92 “Opt-out Non-Cancer Partner” shall have the meaning set forth in Section 8.3.4(a).

1.93 “Opt-out Non-Cancer Partner Blocking Patents” shall have the meaning set forth in Section 8.3.4(d)(ii).

1.94 “Opt-out Non-Cancer Reserve HDAC Inhibitor” shall mean a list of up to [ *** ] individual compounds designated by a Opt-out Non-Cancer Partner as potential development candidates which such Opt-out Non-Cancer Partner desires to reserve in the Territory outside the Field in accordance with Section 5.3.7(b) below. It is understood that an Opt-out Non-Cancer Partner and all of its Affiliates shall be deemed a single Opt-out Non-Cancer Partner (for example, for purposes of Section 5.3.7(b)(iii)). The Opt-out Non-Cancer Reserved HDAC Inhibitors as of the Effective Date are identified on Exhibit 18.2.4.

1.95 “Opt-out Non-Cancer Selected HDAC Inhibitor” shall mean (i) those compounds that are Opt-out Non-Cancer Selected HDAC Inhibitors in accordance with Section 5.3.7(c) below, and (ii) Opt-out Non-Cancer Reserve HDAC Inhibitors selected in accordance with Section 5.3.7(b) below, in each case subject to Section 5.3.4 and provided that MG has obtained all rights and covenants as set forth in Section 8.3.4 from the respective Opt-out Non-Cancer Partner. With respect to each such compound, the Opt-out Non-Cancer Selected HDAC Inhibitor shall also include the prodrugs, metabolites, salts, esters, hydrates, solvates, free base, polymorphs, isomers thereof, conjugated forms and/or liposomal or other formulations thereof and other compositions consisting of such compound non-covalently bonded with other moieties, which together shall be deemed a single Opt-out Non-Cancer Selected HDAC Inhibitor (and a single Opt-out Non-Cancer Reserve HDAC Inhibitor) for purposes of Sections 5.3.7(b)(iii) and 5.3.7(c) below.

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1.96 “Patent Counsel” shall mean a Third Party patent attorney retained by MG and reasonably acceptable to Pharmion.

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

1.98 “Pharmion” shall have the meaning set forth in the Preamble.

1.99 “Pharmion Blocking Patents” shall have the meaning set forth in Section 8.5.

1.100 “Pharmion Indemnitees” shall have the meaning set forth in Section 19.3.

1.101 “Pharmion Patent Rights” shall have the meaning set forth in Section 17.1.

1.102 “Pharmion Research Funds” shall have the meaning set forth in Section 9.1.

1.103 “Pharmion Reserve Compounds” shall mean a list of up to [ *** ] individual Compounds designated by Pharmion as potential development candidates which Pharmion desires to reserve in the Territory for the Field in accordance with Section 5.3.1(a).

1.104 “Phase I” shall mean human clinical trials, the principal purpose of which is preliminary determination of safety in healthy individuals or patients (for example, as described in 21 C.F.R. §312.21(a), or similar clinical study in a country other than the United States).

1.105 “Phase II” shall mean a study of a Product in human patients designed to determine initial efficacy and dose range finding that satisfies the requirements of 21 C.F.R. § 312.21(b), or similar clinical study in a country other than the United States.

1.106 “Phase III” shall mean a study of a Product in human patients designed to determine efficacy and safety of a Product for the purpose of preparing and submitting applications for Marketing Approval to the competent Regulatory Authority in a country of the world, and that satisfies the requirements of 21 C.F.R. § 312.21(c), or similar clinical study in a country other than the United States.

1.107 “Phase IV” shall mean a study of a Product in human patients conducted in a particular jurisdiction after the Product has received Marketing Approval and has been Commercialized in that jurisdiction, the principal purpose of which is to continue testing the Product to collect information about its safety or efficacy in broader or various populations, long-term safety and side effects associated with long-term use, and its use in additional indications other than for which Marketing Approval was previously granted.

1.108 “Preclinical and Clinical Data” shall mean all filings and supporting documents submitted or to be submitted to a Regulatory Authority in a Major Country, relating to the Compound(s) or Product(s), and all data contained therein, including, without limitation, any INDs, NDAs and their counterparts in other countries, investigator’s brochures, correspondence to and from such Regulatory Authorities, minutes from teleconferences with Regulatory Authorities, registrations and licenses, regulatory drug lists, advertising and promotion

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documents shared with Regulatory Authorities, adverse event files and complaint files. In addition, Preclinical and Clinical Data shall include all investigator reports (both preliminary and final), statistical analysis, expert opinions and reports, safety and other electronic databases and all other material documentation and information related to Preclinical Development or clinical development of a Compound or a Product. Without limiting the foregoing, Preclinical and Clinical Data shall include all items described in Exhibit 1.108 that are generated from the Contracted Research Work. Notwithstanding the foregoing, Preclinical and Clinical Data shall not include filings, supporting documents, data, reports, analysis, databases or other documentation or information generated by a Non-Cancer Partner or MG in collaboration with a Non-Cancer Partner, unless the same is permitted by the Non-Cancer Partner to be provided to an Additional Partner and is not specific to indications outside the Field.

1.109 “Preclinical Development” shall mean those preclinical studies with respect to the Compounds and/or Products that are specifically required for an IND, including without limitation ADME and GLP toxicology studies, pharmacology or studies required for the CMC section of an IND or an NDA. It is understood that “preclinical” testing will continue after the filing of an IND in support of the clinical development of a Compound or Product, including ongoing toxicology, metabolic, PK and other non-clinical testing of such Compound or Product, and that “Preclinical Development” as used herein shall include such ongoing non-clinical testing.

1.110 “Preclinical Studies” shall mean those certain Preclinical Development studies in the Field, set forth in the Development Plans established in accordance with Article 4 below.

1.111 “Product(s)” shall mean product(s), in any formulation, containing a Compound(s) as an active ingredient(s).

1.112 “Product Promotional Materials” shall mean all sales representative training materials and all written, printed, graphic, electronic, audio or video matter related to the marketing or promotion of a Product, including, but not limited to, journal advertisements, sales visual aids, direct mail, direct-to-consumer advertising, Internet postings, broadcast advertisements, and sales reminder aids (e.g., scratch pads, pens and other such items) intended for use or used by or for a Party in connection with such marketing or promotion.

1.113 “Programs” shall mean, collectively, Research conducted pursuant to the Research Plan and Development conducted pursuant to the Development Plan.

1.114 “Prosecution” shall mean the preparing, filing, prosecuting and maintenance of patent applications and patents and re-examinations, reissues and requests for patent term extensions therefor, together with the conduct of any interference, opposition or other similar proceeding pertaining to patent applications or patents.

1.115 “Register” or “Registration” shall mean entering a compound into the MG Compound Registry together with (i) a unique identifying number for such compound, (ii) the chemical structure of such compound, and (iii) the Compound Registration Date for such compound, in each case in a format suitable to reasonably enable Pharmion to access and use

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Compounds, their chemical structures and any related Data included in the MG Compound Registry, as contemplated by this Agreement.

1.116 “Registrational Trial” shall mean one or more controlled, multi-center clinical trials in human patients, whether a Phase II trial or a Phase III trial, that is designed in consultation with the JSC to obtain sufficient efficacy and safety data to support Marketing Approval and labeling of the Product by the competent Regulatory Authority in any country of the Territory.

1.117 “Regulatory Authority” shall mean any national (e.g., the FDA), supra-national (e.g., the European Commission, the Council of the European Union, or the EMEA), or other governmental entity in any jurisdiction of the world involved in the granting of Marketing Approval for pharmaceutical products.

1.118 “Rejection” or “Rejected” shall have the meaning set forth in Section 5.3.4(c).

1.119 “Reporting Period” shall have the meaning set forth in Section 9.6(a).

1.120 “Research” shall mean activities directed to the research, discovery, characterization, optimization, in vitro testing and/or in vivo evaluation of HDAC Inhibitors, conducted by or under authority of MG.

1.121 “Research Data” shall mean all material screening results, SAR data, optimization information, in vitro and in vivo data, compositions, samples and other information generated in the course of research conducted by or under authority of MG or Pharmion with respect to Compounds and/or Products, including without limitation all information and data described in part 1.121A of Exhibit 1.121. In case of data that is generated by an entity with rights with respect to Compounds and/or Products both in and outside of the Field, Research Data shall mean the foregoing, but only to the extent it is not specific to non-cancer indications. With respect to such data generated by Non-Cancer Partners or MG in collaboration with a Non-Cancer Partner, Research Data shall mean only the items set forth in part 1.121B of Exhibit 1.121, unless such data is provided to an Additional Partner and is not specific to indications outside Field.

1.122 “Research Plan” shall mean the plan and budget for Research, as described in Article 4 below.

1.123 “Research Term” shall mean the period beginning forty five (45) days following the Effective Date and, unless earlier terminated in accordance with Article 20, terminating one (1) year thereafter, unless extended by the Parties in writing upon mutual agreement.

1.124 “Resolution” shall have the meaning set forth in Section 20.2.2(a).

1.125 “Royalty Term” shall mean, with respect to a particular Product in a country (on a Product-by-Product and country-by-country basis), the period commencing on the Effective Date and continuing until the later of (a) expiration or abandonment of the last Valid Claim within the

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Licensed Patents covering such Product in the particular country, or (b) [ *** ] years after the first commercial sale in such country of the first Product.

1.126 “Selected Compounds” shall mean the Initial Clinical Candidate and (i) those other individual Compounds selected as a Selected Compound by the JSC under Section 5.2, (ii) those Compounds that are Selected Compounds under Section 5.3.1(b), (iii) Compounds for which an Additional Partner or Third Party has rights to develop, market or commercialize as described in Section 5.3.5, and (iv) all Pharmion Reserve Compounds in compliance with Section 5.3.1(a) below. With respect to each such Compound, the Selected Compound shall include prodrugs, metabolites, salts, esters, hydrates, solvates, free base, polymorphs, isomers thereof, conjugated forms and/or liposomal or other formulations thereof and other compositions consisting of such Compound non-covalently bonded with other moieties, which together shall be deemed a single Selected Compound (and a single Pharmion Reserve Compound) for purposes of Sections 5.2, 5.3.1(a)(ii) and 5.3.1(b) below.

1.127 “Senior Representatives” shall have the meaning set forth in Section 20.2.2(a).

1.128 “Share of Net Profits and Losses” shall have the meaning set forth in Section 9.7.1.

1.129 “Small Molecule” shall mean a compound with a molecular weight no greater than 1,500 daltons.

1.130 “Subject Infringements” shall have the meaning set forth in Section 17.6.

1.131 “Sublicensee” shall mean, when permitted under this Agreement, a non-Affiliate Third Party other than a Distributor to whom Pharmion has granted (i) a sublicense to sell and offer for sale a Product made in accordance with this Agreement, provided that such Third Party has primary responsibility for the marketing and promotion of such Product in its distribution territory and has the right to record sales of such Product for its account or (ii) the right to make and sell a Product, with respect to Products made and sold by such Third Party, within the scope of the license hereunder. In addition, for purposes of this Agreement, Pharmion and MG shall not be deemed Sublicensees of the other, nor shall either Party be deemed to be acting “under authority” of the other Party.

1.132 “Taiho” shall mean Taiho Pharmaceutical Co., Ltd. and its successors and permitted assigns.

1.133 “Taiho Agreement” shall mean the Collaboration and License Agreement dated as of October 16, 2003 between MG and Taiho, as amended on December 15, 2004.

1.134 “Taiho Initiated Studies” shall mean those clinical studies initiated under the Taiho Agreement prior to the Effective Date, as identified in Exhibit 1.134.

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1.135 “Taiho Territory” shall mean the territory set forth in the Taiho Agreement (i.e. Japan, South Korea (or both South Korea and North Korea if united), Taiwan and the People’s Republic of China).

1.136 “Target Claims” shall have the meaning set forth in Section 8.3.3(b).

1.137 “Territory” shall mean the United States of America, Canada, member states of the European Union as of the Effective Date (i.e. Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, the Netherlands, the United Kingdom), Norway, Switzerland, Bulgaria, Romania, Singapore, Malaysia, Philippines, Indonesia, South Africa, countries of the Middle East (i.e. Bahrain, Cyprus, Dubai, Egypt, Turkey, Iran (Persia), Iraq, Israel, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Syria, the United Arab Emirates, Yemen, the West Bank and the Gaza Strip), Australia, New Zealand and Thailand and specifically excludes the Taiho Territory.

1.138 “Third Party” shall mean any individual, limited liability company, corporation, partnership, trust, unincorporated organization, association or other entity, but excluding MG or Pharmion and their respective Affiliates.

1.139 “Third Party IP” shall have the meaning set forth in Section 11.3.1.

1.140 “Valid Claim” shall mean (a) a claim of an issued and unexpired patent, which has not been held unenforceable, unpatentable or invalid by an unappealed or unappealable decision of a court or other governmental agency of competent jurisdiction, and which has not been admitted to be invalid or unenforceable through reissue, disclaimer or otherwise, or (b) a claim in a pending patent application being prosecuted in good faith that has not been abandoned or finally rejected and which has been pending for less than seven (7) years after the earliest priority date to which it is entitled. In the event subsequent to such seven (7) year period, such pending claim is issued as a claim of an issued and un-expired patent included within (a) above, such claim shall be reinstated thereafter as a “Valid Claim” in accordance with clause (a) above.

1.141 “Vidaza” shall mean Pharmion’s proprietary pharmaceutical product known generically as azacitidine, and commercialized by Pharmion in the United States under the trademark “VIDAZA^®” as of the Effective Date.

1.142 “Withholding Party” shall have the meaning set forth in Section 9.7.2(d).

1.143 “$” or “US$” shall mean U.S. Dollars.

ARTICLE 2
COLLABORATION

2.1 Scope of Collaboration. Subject to the terms and conditions of this Agreement, the Parties shall collaborate: (a) to develop and commercialize the Initial Clinical Candidate in the Field in the Territory, (b) to conduct Research to identify, characterize and discover other

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Compounds useful in the Field, and (c) to develop and commercialize Compounds in the Field in the Territory.

2.2 Conduct of the Collaboration. Subject to the terms and conditions of this Agreement, each Party shall use Commercially Reasonable and Diligent Efforts to conduct Research in accordance with the Research Plan, the Clinical Studies in accordance with the Development Plans and the Commercialization under the Commercialization Plans, in each case under the supervision of the JSC.

2.3 MG Co-Promotion Right. Provided that MG has not exercised its MG Opt-out Right in respect of the Development of a Compound and/or Product, MG shall have the right (but not the obligation) to elect to Co-Promote such Compound and/or Product in North America with Pharmion under the terms of this Collaboration in lieu of receiving royalties from Pharmion in respect of North America under Section 11.2. Within thirty (30) days of the approval of the Commercialization Plan specified in Section 5.4.2, MG shall notify Pharmion in writing (i) of its decision, in its sole discretion, to elect to Co-Promote in North America in accordance with the terms of Section 5.5, and (ii) of its Co-Promotion Level as per Section 5.5.1. In the event MG fails to elect, or elects not, to Co-Promote a Compound and/or Product in accordance with the foregoing, the license set forth in Section 8.1.1 shall be, in respect of such Compound and/or Product, an exclusive right and license (even as to MG) under the Licensed Technology in favour of Pharmion in North America in the Field, with the right to grant and authorize sublicenses. In the event MG elects to Co-Promote in accordance with the foregoing, MG’s Co-Promotion shall nevertheless remain subject to MG’s Op-out Right as per the terms of Section 8.6.

2.4 Participation. Subject to the MG Opt-out Right set forth in Section 8.6 below and notwithstanding anything herein to the contrary, the Parties shall jointly conduct and each play a significant role in the conduct of the Development of each Product in the Field in the Territory as described in the Development Plans. Provided that MG has elected to exercise its right to Co-Promote under Section 2.3, Pharmion shall conduct the Commercialization of each Product in the Field in the Territory other than North America, and the Parties shall jointly conduct and each play a significant role in the Commercialization of each Product in the Field in North America as described in the Commercialization Plans.

2.5 Restrictive Covenants.

2.5.1 Exclusive Relationship in the Territory. During the term of the Collaboration, neither Pharmion or its Affiliates nor MG or its Affiliates, shall, directly or indirectly, on its own or in collaboration with a Third Party, conduct research or development regarding, or engage in the manufacture, marketing, sale or distribution of, or otherwise exploit, any compound that directly inhibits the activity of HDAC enzymes or has therapeutic effect through the inhibition of HDAC enzymes (or a product containing the same) for use within the Field in the Territory, or grant any Third Parties the rights to do any of the foregoing, other than as part of the Collaboration or to an Additional Partner.

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