Exhibit 10.1

CONSULTING AGREEMENT

AGREEMENT, dated as of October 1, 1995, between EUGENE CORDES, Ph.D.
(“Consultant”) and VERTEX PHARMACEUTICALS INCORPORATED (“Vertex”), a
Massachusetts corporation.

WHEREAS, Vertex desires to retain the services of Consultant as a member of
Vertex’s Scientific Advisory Board and in a consulting capacity with respect to
certain activities as described in this Agreement, and Consultant is willing to
so act; and

WHEREAS, Consultant is an employee and member of the staff of the University of
Michigan (the “Institution”);

NOW, THEREFORE, Consultant and Vertex agree as follows:

1.         Description of Services.   Vertex hereby retains Consultant as a
consultant to Vertex and Consultant hereby agrees to use his or her best efforts
to perform services for Vertex as follows. Consultant shall serve as a member of
Vertex’s Scientific Advisory Board, and shall perform an estimated five (5) days
of consultation per year with Vertex’s scientists or management or as otherwise
designated by Vertex, in the form of formal meetings of the Scientific Advisory
Board and a reasonable amount of informal consultation over the telephone or
otherwise. Consultant may from time to time be unavailable to attend Advisory
Board meetings or perform other consulting duties, due to other prior
obligations including but not limited to teaching and other academic and
research duties and attending scientific conferences, and such unavailability
shall not be considered a breach of this Agreement.

2.     Term and Expiration.   This Agreement shall become effective as of the
date first set forth above, and shall remain in effect for one (1) year, and
shall continue in effect thereafter until terminated by either party upon not
less than thirty (30) days prior written notice. Notwithstanding the foregoing,
Vertex may terminate this Agreement forthwith by notice in writing to the
Consultant in the event of default by the Consultant hereunder, or if Vertex
determines that any employment agreement or other arrangement referred to in
Section 9 might create a conflict of interest. Any termination of this Agreement
shall be without prejudice to any obligation by either party which shall have
accrued and then be owing. The obligations of the Consultant under Section 6, 7,
and 8 of this Agreement shall survive the expiration or any termination of this
Agreement.

3.         Compensation.   For all services provided hereunder, Vertex will pay
Consultant an annual fee of $20,000 plus $1,000 for each full day of meetings or
consultation sessions that Consultant actually attends at the request of Vertex
hereunder. Payments will be made quarterly in advance, in equal quarterly
installments of $5,000 each, paid within 30 days after the beginning of each
calendar quarter and commencing with the calendar quarter beginning on or after
the effective date, plus per diem payments due for consulting time actually
spent in the previous quarter as determined by Vertex. The initial payment will
include a payment pro rata to reflect the period, if any, from the effective
date of this agreement to the beginning of the first full calendar quarter in
which this Agreement is effective. In addition, upon the approval of Vertex’s
Board of Directors, Vertex shall grant to the Consultant a non-qualified stock
option for the purchase of 20,000 shares of Vertex’s Common Stock at an exercise
price equal to the fair market value per share of Vertex’s Common Stock on the
date of grant of such option. Such option shall have a term of ten (10) years
and shall vest over a period of five (5) years from the date hereof, so long as
the Consultant continues to serve as a member of the Scientific Advisory Board.

4.     Expenses.   Vertex will reimburse Consultant for any actual expenses
incurred by Consultant while rendering services under this Agreement so long as
the expenses are reasonable and necessary. Such expenses shall include
reasonable and necessary travel, lodging and meals in connection with services

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performed under this Agreement. Requests for reimbursement shall be in a form
reasonably acceptable to Vertex.

5.     Institutional Agreements.   Prior to entering into this Agreement with
Vertex, Consultant was employed, and continues to be employed, by the
Institution. Vertex recognizes that in connection with Consultant’s employment
by the Institution, Consultant’s primary responsibility is to the Institution.
In connection with such employment, Consultant may have entered into agreements
relating to ownership of patent rights and other matters with the Institution
(“Institutional Agreements”). Vertex hereby acknowledges the existence of the
Institutional Agreements and agrees to take no actions which would result in
Consultant’s violating the Institutional Agreements. If any provision of this
Agreement is in conflict with any provisions of the Institutional Agreements,
then the provisions of the Institutional Agreements shall govern and the
conflicting provisions of this Agreement shall be void.

6.     Intellectual Property.   The Consultant hereby agrees that any and all
data, results, information, inventions, improvements, ideas, trademarks,
formulae, processes, experimental protocols, techniques, know-how and
innovations, whether patentable or not, which the Consultant may create, invent,
discover, originate, make or conceive during the course of or in connection with
his or her consultancy to Vertex hereunder, whether or not reduced to writing or
practice, either solely or jointly with others, which result from (a) tasks
assigned to Consultant by Vertex or otherwise performed by Consultant pursuant
to this Agreement, (b) tasks funded by Vertex, or (c) use of materials or
premises owned, leased or contracted for by Vertex (all the foregoing
collectively hereinafter called “Intellectual Property”) shall be the sole and
exclusive property of Vertex and the Consultant hereby assigns the same to
Vertex. The Consultant shall promptly and fully disclose all such Intellectual
Property to Vertex. The Consultant further agrees at any time, upon the request
and at the expense of Vertex, for the benefit of Vertex or Vertex’s nominees, to
execute any and all applications, assignments, instruments and papers, including
patent applications, which Vertex shall deem necessary or desirable to protect
or perfect its entire right, title and interest in and to any of the
Intellectual Property, to testify in any proceeding in the Patent Office or in
the courts, and generally to do everything lawfully possible to aid Vertex, its
successors, assigns and nominees to obtain, enjoy and enforce proper patent or
other protection for the Intellectual Property.

7.         Confidential Information.   The Consultant shall hold all of Vertex’s
Confidential Information in confidence and shall not disclose any Confidential
Information to any third party. The Consultant shall use the same level of care
to prevent any unauthorized use or disclosure of such Confidential Information
as the Consultant exercises in protecting the Consultant’s own information of
similar nature. The Consultant shall not use Vertex’s Confidential Information
for any purpose except as may be necessary in the ordinary course of performing
Consultant’s duties hereunder, without the prior written consent of Vertex. For
purposes hereof, Vertex’s “Confidential Information” shall mean (a) all
Intellectual Property, as defined above, and (b) all confidential and
proprietary data, trade secrets, business plans, and other information of a
confidential or proprietary nature, belonging to Vertex or third parties with
whom it may have business dealings, disclosed or otherwise made available to the
Consultant by Vertex; provided, however, that Confidential Information shall not
include information the Consultant receives from Vertex which the Consultant
establishes by competent proof: (i) is in the public domain at the time of
disclosure; (ii) after disclosure, becomes part of the public domain by
publication or otherwise, except by breach of this Agreement; (iii) was in the
Consultant’s possession at the time of disclosure by Vertex; or (iv) which the
Consultant shall receive from a third party who has the right to disclose it to
the Consultant.

8.         Technical Records.   All documents, data, records, apparatus,
equipment and other physical property, whether or not pertaining to Intellectual
Property or Confidential Information, furnished to Consultant by Vertex or
produced by Consultant or others in connection with Consultant’s retention
hereunder shall be and remain the sole property of Vertex and shall be returned
promptly to Vertex as and when requested by Vertex. In any event, Consultant
shall return and deliver all such property, including any copies thereof, upon
termination of his or her retention as a consultant hereunder for any reason.

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9.     Covenant with Respect to Competition.   During the term of this
Agreement, Consultant agrees to inform Vertex promptly in writing of any
activity by the Consultant to own, directly or indirectly, manage, operate,
join, control, finance, consult to, advise or participate in the ownership,
management, operation, control or financing of, or be connected as an officer,
director, employee, partner, principal, agent, representative, consultant or
otherwise with, or allow his name to be used in any advertisement of, or solicit
or attempt to solicit business on behalf of, any person, business or enterprise
which is engaged in protein structure-based rational drug design in actual or
potential direct competition with Vertex or its affiliates.

10.      No Conflict.   Consultant represents that his or her performance of the
terms of this Agreement and that his or her retention as a consultant by Vertex
does not and will not breach any agreement to keep in confidence any proprietary
information acquired by Consultant in confidence or in trust prior to his or her
retention by Vertex. Consultant has not entered into, and agrees he will not
enter into, any agreement, either written or oral, in conflict herewith.
Consultant understands as part of the consideration for the offer to retain him
or her as a consultant, and of his or her retention as a consultant by Vertex,
that the Consultant has not brought and will not bring with him or her to Vertex
or use in the performance of the Consultant’s responsibilities at Vertex any
equipment, supplies, facility or trade secret information of any current or
former employer which are not generally available to the public, unless the
Consultant has obtained written authorization for their possession and use.
Consultant also understands that, in his or her retention as a consultant to
Vertex, he or she is not to breach any obligation of confidentiality that he or
she has to others, and the Consultant agrees to fulfill all such obligations
during the Consultant’s retention by Vertex.

In addition, Consultant agrees and attests as follows:

10.1   Except as disclosed in writing to Vertex, Consultant does not own
directly or indirectly 5% or more of the stock or other equity securities of any
entity which is a present or prospective competitor, customer or supplier of
Vertex;

10.2   Except as disclosed in writing to Vertex, Consultant knows of no legal
proceedings pending or threatened against Consultant, and no reasonable basis
for any such proceedings, and no court or administrative order, which (a) would
conflict with Consultant’s obligations hereunder or question the validity of
this Agreement; (b) might result in any material adverse change in the business
or prospects of Vertex; or (c) might be based upon either Consultant’s past
employment relationships as they may relate to this Agreement.

10.3   Except as disclosed in writing to Vertex, Consultant knows of no fact
concerning the Consultant (either professionally and personally) which would
affect the business or prospects of Vertex in a material adverse way.

11.   Independent Contractor.   Nothing contained in this Agreement shall be
deemed to constitute the Consultant an employee of Vertex, it being the intent
of both the Consultant and Vertex to establish an independent contractor
relationship, nor shall the Consultant have authority to bind Vertex in any
manner whatsoever by reason of this Agreement.

12.   Notices.   Any notice given under this Agreement shall be deemed delivered
when delivered by hand or by registered or certified mail or air courier
addressed to the parties at their respective addresses set forth below or at
such other address as either party may provide to the other in writing from time
to time:

Vertex:

 

Vertex Pharmaceuticals Incorporated

 

 

40 Allston Street

 

 

Cambridge, MA 02139-4211

 

 

Attention: Chief Scientific Officer

 

 

 

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Consultant:

 

Dr. Eugene Cordes

 

 

867 Lesley Rd.

 

 

Villanova, PA 19085

 

13.   Assignment.   The rights and obligations of the parties hereunder shall
inure to the benefit of, and shall be binding upon their respective successors
and assigns, provided, however, that the Consultant may not assign this
Agreement without the prior written consent of Vertex.

14.   Specific Performance.   Consultant acknowledges that Vertex will have no
adequate remedy at law if Consultant violates the terms of Sections 6, 7 or 8
hereof. In such event, Vertex shall have the right, in addition to any other
rights it may have, to obtain in any court of competent jurisdiction, injunctive
or other relief to restrain any breach or threatened breach of this Agreement.

15.   General.   This Agreement embodies the entire agreement between the
parties and supersedes any prior or contemporaneous understandings with respect
to the subject matter hereof. Neither this Agreement nor any term, covenant,
condition or other provision hereof may be changed, waived, discharged or
terminated except by an instrument in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought.

16.   Governing Law.   This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first written above.

CONSULTANT

VERTEX PHARMACEUTICALS INCORPORATED

/s/ EUGENE CORDES

 

By:

/s/ VICKI L. SATO, PH.D.

 

Eugene Cordes

 

Vicki L. Sato, Ph.D.

 

 

Senior Vice President, Research & Development
Chief Scientific Officer

 

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