Exhibit 10.1

 

LICENSE AGREEMENT

 

This License Agreement (“Agreement”) is made effective as of May 2, 2000 (the
“Effective Date”) by and between GENENTECH, INC., a Delaware corporation having
its principal business office at 1 DNA Way, South San Francisco, California
94080 (“GENENTECH”), and IMMUNOGEN, INC., a Massachusetts corporation with its
principal place of business at 333 Providence Highway, Norwood, Massachusetts
02062 (“IMMUNOGEN”). GENENTECH and IMMUNOGEN are each hereafter referred to
individually as a “Party” and together as the “Parties”.

 

WHEREAS, GENENTECH is the owner of or otherwise controls certain rights in
proprietary technology and know-how relating to anti-HER2 antibodies and other
HER-2 binding proteins; and

 

WHEREAS, IMMUNOGEN is the owner of or otherwise controls certain rights in
proprietary technology and know-how relating to or otherwise useful in the
conjugation of maytansine derivatives such as DM1 to binding proteins;

 

WHEREAS, pursuant to an MTA (as defined below), IMMUNOGEN performed certain work
using a biologic materials of GENENTECH to create a conjugated compound, which
work under the MTA is part of what is covered by this Agreement; and

 

WHEREAS, on the terms and conditions set forth herein, GENENTECH desires to
obtain from IMMUNOGEN, and IMMUNOGEN desires to grant to GENENTECH, the rights
set forth herein, including a license under IMMUNOGEN’S technology and/or
intellectual property rights to develop and commercialize one or more Licensed
Products (as defined below).

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Parties hereby agree as follows:

 

1. DEFINITIONS

 

Whenever used in the Agreement with an initial capital letter, the terms defined
in this Section 1 shall have the meanings specified.

 

1.1. “ADVERSE EVENT” shall mean any untoward medical occurrence in a patient or
subject who is administered a Licensed Product, whether or not considered
related to the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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Licensed Product, including, without limitation, any undesirable sign (including
abnormal laboratory findings of clinical concern), symptom or disease temporally
associated with the use of such Licensed Product.

 

1.2. “AFFILIATE” shall mean any corporation, firm, limited liability company,
partnership or other entity which directly or indirectly controls or is
controlled by or is under common control with a Party to this Agreement. For
purposes of this Section 1.2, “control” means ownership, directly or indirectly
through one or more Affiliates, of fifty percent (50%) or more of the shares of
stock entitled to vote for the election of directors, in the case of a
corporation, or fifty percent (50%) or more of the equity interests in the case
of any other type of legal entity, or status as a general partner in the case of
any partnership, or any other arrangement whereby a Party controls or has the
right to control the Board of Directors or equivalent governing body or
management of a corporation or other entity.

 

1.3. “AGREEMENT” shall mean this License Agreement between the Parties, dated as
of the Effective Date, including any exhibits, schedules or other attachments
hereto and incorporated herein, as any of the foregoing may be validly amended
from time to time. In the event of any inconsistency between the terms of this
Agreement and the terms of any exhibits, schedules or other attachments
incorporated herein, the terms of this Agreement shall govern unless the Parties
expressly agree otherwise in writing.

 

1.4. “ALLOCABLE OVERHEAD” shall mean overhead costs incurred by IMMUNOGEN
attributable to IMMUNOGEN’s [*] functions which are allocated to company
departments based on [*] or [*] or another [*] method, and shall include the [*]
as defined hereinbelow. For purposes of any given calculation of “Allocable
Overhead” hereunder, the [*] of the total amount of Allocable Overhead (as
calculated before the inclusion of any such fee). However, “Allocable Overhead”
[*]

 

1.5. “ANTI-HER2 ANTIBODY” shall mean [*].

 

1.6. “BLA” shall mean a biologics license application (as defined in Title 21 of
the United States Code of Federal Regulations, as amended from time to time)
filed with the FDA seeking Regulatory Approval to market and sell any Licensed
Product in the United States for a particular indication within the Field.

 

1.7. “CLINICAL MATERIALS” shall mean (a) supplies of ansamitocin P-3, and/or any
other MAY Compound as manufactured in accordance with all applicable GMPs and
other legal requirements and all applicable Specifications for such MAY Compound
for use in human

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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clinical testing, and (b) supplies of any Licensed Product as manufactured in
accordance with all applicable GMPs and other legal requirements and all
applicable Specifications for such Licensed Product for use in human clinical
testing of any Licensed Product.

 

1.8. “COMBINATION PRODUCT” shall mean any Licensed Product that contains, in
addition to any conjugate of any Anti-HER2 Antibody with any MAY Compound, one
or more other ingredients that has biologic activity as a therapeutic agent when
present alone.

 

1.9. “COMPETING PRODUCT” shall have the meaning set forth in Section 2.1(b).

 

1.10. “CONFIDENTIAL INFORMATION” shall have the meaning set forth in
Section 5.1.

 

1.11. “CONTROL” or “CONTROLLED” shall mean, with respect to any Patent Rights or
Technology (including, without limitation, any MAY Compound, Anti-HER2 Antibody
or other proprietary biologic material covered under this Agreement), the
possession by a Party of the ability to grant a license or sublicense of such
patent rights, know-how or other intellectual property and the rights thereto or
to supply such compounds or materials as provided for in this Agreement without
violating the terms of any arrangement or agreement between such Party and any
Third Party.

 

1.12. “DEVELOPMENT” and “DEVELOP” shall mean, with respect to any Licensed
Product, all activities with respect to such Licensed Product relating to
research and development in connection with seeking, obtaining and/or
maintaining any Regulatory Approval for such Licensed Product in the Field in
the Territory, including without limitation, all pre-clinical research and
development activities, all human clinical studies, all activities relating to
developing the ability to manufacture any Licensed Product or any component
thereof (including, without limitation, process development work), and all other
activities relating to seeking, obtaining and/or maintaining any Regulatory
Approvals from the FDA and/or any Foreign Regulatory Authority.

 

1.13. “DRUG APPROVAL APPLICATION” shall mean any application for Regulatory
Approval (including pricing and reimbursement approvals) required prior to any
commercial sale or use of a Licensed Product in any country or jurisdiction in
the Territory, including, without limitation, (a) any BLA, NDA or MAA filed with
the FDA or any Foreign Regulatory Authority, and (b) any equivalent application
filed with any Foreign Regulatory Authority for Regulatory Approval (including
pricing and reimbursement approvals) required prior to any commercial sale or
use of a Licensed Product in any country or jurisdiction in the Territory.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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1.14. “EFFECTIVE DATE” shall mean the date first written above in the
introductory paragraph to this Agreement.

 

1.15. “EXTENDED INDICATIONS” shall mean any and all human uses for the
indications of [*]. However, “Extended Indications” shall not include any human
therapeutic use for the indication of metastatic breast cancer.

 

1.16. “FDA” shall mean the United States Food and Drug Administration and any
successor agency or authority thereto.

 

1.17. “FIELD” shall mean any and all human uses, including, without limitation,
for the indication of metastatic breast cancer and/or any Extended Indications.

 

1.18. “FIRST COMMERCIAL SALE” shall mean the date of the first commercial sale
(other than for purposes of obtaining Regulatory Approval) of a Licensed Product
by or on behalf of GENENTECH or any Sublicensee.

 

1.19. “FOREIGN REGULATORY AUTHORITIES” shall mean any applicable supranational,
national, federal, state or local regulatory agency, department, bureau or other
governmental entity of any country or jurisdiction in the Territory (other than
the FDA in the United States), having responsibility in such country or
jurisdiction for any Regulatory Approvals of any kind in such country or
jurisdiction, and any successor agency or authority thereto.

 

1.20. “FULLY BURDENED MANUFACTURING COST” shall mean, with respect to any
Preclinical Materials or Clinical Materials produced by IMMUNOGEN for GENENTECH
under this Agreement, the sum of the following components: (a) the costs of
goods produced, as determined by IMMUNOGEN in accordance with generally accepted
accounting principles in the United States, consistently applied, including,
without limitation, direct labor, material and product testing costs of such
Preclinical Materials or Clinical Materials; (b) any Third Party royalty costs
directly allocable to the manufacture or use of such Preclinical Materials or
Clinical Materials; (c) all Allocable Overhead on the cost of goods under clause
(a) above; and (d) any other costs borne by IMMUNOGEN, for the transport,
customs clearance, duty, insurance and/or storage of such Preclinical Materials
or Clinical Materials.

 

1.21. “GENENTECH” shall mean Genentech, Inc., a Delaware corporation, and its
successors and permitted assigns under this Agreement.

 

1.22. “GENENTECH PRODUCT” shall have the meaning set forth in Section 2.1(b).

 

1.23. “GLPS” shall mean all good laboratory practices under Title 21 of the
United States Code of Federal Regulations, as amended from time to time.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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1.24. “GMPS” shall mean all good manufacturing practices under Title 21 of the
United States Code of Federal Regulations, as amended from time to time.

 

1.25. “HER2 PRODUCT” shall have the meaning set forth in Section 2.3(b).

 

1.26. “IMMUNOGEN” shall mean ImmunoGen, Inc., a Massachusetts corporation, and
its successors and permitted assigns under this Agreement.

 

1.27. “IMPROVEMENT” shall mean any enhancement, improvement or modification
created or identified by GENENTECH under this Agreement or by IMMUNOGEN under
this Agreement or otherwise, to the extent covered by or under the Licensed
Patent Rights or the Licensed Technology.

 

1.28. “IND” shall mean an investigational new drug application (as defined in
Title 21 of the United States Code of Federal Regulations, as amended from time
to time) filed or to be filed with the FDA with regard to any Licensed Product.

 

1.29. “IND ACCEPTANCE” shall mean the expiration of thirty (30) days following
receipt by GENENTECH of a notice from the FDA to GENENTECH (or its Sublicensee)
that the FDA has received an IND for a Licensed Product filed by GENENTECH (or
its Sublicensee) for the purpose of obtaining approval or authority to commence
human clinical trials in the United States with such Licensed Product; PROVIDED,
HOWEVER, that if the FDA puts a clinical hold on the IND during such thirty (30)
day period, the term “IND Acceptance” shall mean that date during the term of
this Agreement when GENENTECH (or its Sublicensee) receives written confirmation
from the FDA that the clinical hold has been removed and that GENENTECH (or its
Sublicensee) has the approval or authority to commence human clinical trials of
such Licensed Product under such IND in the United States. Notwithstanding
anything set forth herein, “IND Acceptance” shall not be deemed to have occurred
in any circumstances where GENENTECH (or its Sublicensee) withdraws any IND
filed with the FDA for a Licensed Product at any time prior to the commencement
of human clinical trials with such Licensed Product in the United States.

 

1.30. “INDEMNITEES” and “INDEMNIFYING PARTY” shall have the meanings set forth
in Section 9.

 

1.31. “JOINT PROCESS DEVELOPMENT COMMITTEE” or “JPDC” shall mean the committee
with representatives of each Party established as set forth in Section 3.4.

 

1.32 “LICENSED PATENT RIGHTS” shall mean any and all Patent Rights in the Field
in the Territory which are Controlled by IMMUNOGEN as of the Effective Date
(including

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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IMMUNOGEN’s interest in any such Patent Rights conceived or reduced to practice
or arising from any work under the MTA) or become Controlled by IMMUNOGEN during
the Term, to the extent that any of the foregoing is necessary or useful for the
Development, manufacture, use, import, export or sale of any Licensed Product
(or any component thereof) or any Improvement in the Field in the Territory. The
Licensed Patent Rights as of the Effective Date include, without limitation, the
patents and patent applications set forth in SCHEDULE I attached hereto and
incorporated herein. SCHEDULE I shall be updated by IMMUNOGEN by written notice
to GENENTECH on a semi-annual basis during the term of this Agreement, beginning
six (6) months after the Effective Date, to include any Licensed Patent Rights
that have arisen in the period since the Effective Date or since the last update
to SCHEDULE I. If IMMUNOGEN fails to update SCHEDULE I on a timely basis as
provided herein, IMMUNOGEN shall update SCHEDULE I within thirty (30) days after
any written request from GENENTECH to do so.

 

1.33 “LICENSED PRODUCT” shall mean any product containing any conjugate of any
Anti-HER2 Antibody with any MAY Compound, and shall include, without limitation,
any formulation thereof (including, without limitation, any lyophilized, liquid,
sustained release or aerosolized formulation). “Licensed Product” shall also
include any and all Combination Products (if any) and any HER2 Product.

 

1.34 “LICENSED TECHNOLOGY” shall mean any and all Technology which relates to
the use of any Licensed Product in the Field in the Territory which is
Controlled by IMMUNOGEN as of the Effective Date (including IMMUNOGEN’s interest
in any such Technology conceived or reduced to practice or arising from any work
under the MTA) or becomes Controlled by IMMUNOGEN during the Term, to the extent
that any of the foregoing relates to any Licensed Patent Rights or is necessary
or useful for the Development, manufacture, use, import, export or sale of any
Licensed Product (or any component thereof, including any linker) or any
unpatented Improvement in the Field in the Territory. The Licensed Technology as
of the Effective Date includes, without limitation, the materials, information
and documentation set forth in SCHEDULE II attached hereto and incorporated
herein.

 

1.35 “MAA” shall mean an application filed with the relevant Foreign Regulatory
Authorities in Europe seeking Regulatory Approval to market and sell any
Licensed Product in Europe or any country or territory therein for a particular
indication within the Field.

 

1.36 “MAY COMPOUND” shall mean any and all maytansinoid compounds (including,
without limitation, maytansine, ansamitocin P-3 and DM1), whether produced by a
botanical

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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source, natural fermentation or chemical synthesis, and shall include, without
limitation, all variants, fragments or derivatives of any of the foregoing, in
each case owned or otherwise Controlled by IMMUNOGEN. MAY shall include, without
limitation, that certain maytansine derivative known as “DM1” whose more
specific chemical name is N2’-deacetyl-N2’-(3-mercapto-1-oxopropyl)-maytansine.

 

1.37 “MTA” shall mean that certain Material Transfer Agreement, dated as of
March 29, 1999, between the Parties.

 

1.38 “NDA” shall mean a new drug application (as defined in Title 21 of the
United States Code of Federal Regulations, as amended from time to time) filed
with the FDA seeking Regulatory Approval to market and sell any Licensed Product
in the United States for a particular indication within the Field.

 

1.39 “NET SALES” shall mean, as to each calendar quarter during the Term, the
gross invoiced sales prices charged for all Licensed Products sold by GENENTECH
or its Sublicensees to Third Parties throughout the Territory during such
calendar quarter, less the following amounts incurred or paid by GENENTECH or
its Sublicensees during such calendar quarter with respect to sales of Licensed
Products regardless of the calendar quarter in which such sales were made:

 

(a) trade, cash and quantity discounts or rebates actually allowed or taken,
including discounts or rebates to governmental or managed care organizations;

 

(b) credits or allowances actually given or made for rejection of or return of,
and for uncollectible amounts on, previously sold Licensed Products or for
retroactive price reductions (including Medicare and similar types of rebates);

 

(c) any charges for insurance, freight, and other transportation costs directly
related to the delivery of Licensed Product to the extent included in the gross
invoiced sales price;

 

(d) any tax, tariff, duty or governmental charge levied on the sales, transfer,
transportation or delivery of a Licensed Product (including any tax such as a
value added or similar tax or government charge) borne by the seller thereof,
other than franchise or income tax of any kind whatsoever; and

 

(e) any import or export duties or their equivalent borne by the seller. “Net
Sales” shall not include sales or transfers between GENENTECH and its
Sublicensees, unless the Licensed Product is consumed by the Sublicensee.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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1.40 “PATENT RIGHTS” shall mean the rights and interests in and to any and all
issued patents and pending patent applications (including inventor’s
certificates and utility models) in any country or jurisdiction in the
Territory, including any and all provisionals, non-provisionals, substitutions,
continuations, continuations-in-part, divisionals and other continuing
applications, supplementary protection certificates, renewals, and all letters
patent on any of the foregoing, and any and all reissues, reexaminations,
extensions, confirmations, registrations and patents of addition on any of the
foregoing.

 

1.41 “PHASE II CLINICAL STUDY” shall mean, as to a particular Licensed Product
for a particular indication, a controlled and lawful study in humans of the
safety, dose ranging and efficacy of such Licensed Product for such indication,
which is prospectively designed to generate sufficient data (if successful) to
commence a Phase III Clinical Trial of such Licensed Product for such
indication.

 

1.42 “PHASE III CLINICAL TRIAL” shall mean, as to a particular Licensed Product
for a particular indication, a controlled and lawful study in humans of the
safety and efficacy of such Licensed Product for such indication, which is
prospectively designed to demonstrate statistically whether such Licensed
Product is safe and effective for use in such indication in a manner sufficient
to file a BLA or NDA to obtain Regulatory Approval to market and sell that
Licensed Product in the United States for the indication under investigation in
such study.

 

1.43 “PHASE III EQUIVALENT DECISION” shall mean the date (if any) on which
GENENTECH (or its Sublicensee) decides, based on notification and input from the
FDA, that the data and results generated from the Phase II Clinical Studies of a
Licensed Product for a particular indication are sufficient, without any Phase
III Clinical Trial of such Licensed Product for such indication, to support the
filing of a BLA or NDA to obtain Regulatory Approval to market and sell that
Licensed Product in the United States for the indication under investigation.

 

1.44 “PRECLINICAL MATERIALS” shall mean (a) supplies of ansamitocin P-3, DM1
and/or any other MAY Compound as manufactured in accordance with all applicable
legal requirements and all applicable Specifications for such MAY Compound for
use in preclinical testing, and (b) supplies of any Licensed Product as
manufactured in accordance with all applicable legal requirements and all
applicable Specifications for such Licensed Product for use in preclinical
testing of any Licensed Product.

 

1.45 “REGULATORY APPROVAL” shall mean any and all approvals (including pricing
and reimbursement approvals), product and establishment licenses, registrations
or authorizations of

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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any kind of the FDA or any Foreign Regulatory Authority necessary for the
development, pre-clinical and/or human clinical testing, manufacture, quality
testing, supply, use, storage, importation, export, transport, marketing and
sale of a Licensed Product (or any component thereof) for use in the Field in
any country or other jurisdiction in the Territory. “Regulatory Approval” shall
include, without limitation, any BLA, NDA, MAA or other Drug Approval
Application.

 

1.46 “SPECIFICATIONS” shall mean any specifications agreed upon in writing by
the Parties relating to the manufacturing and supply of any MAY Compound and/or
Licensed Product hereunder.

 

1.47 “SUBLICENSEE” shall have the meaning set forth in Section 2.2, and
“MATERIAL SUBLICENSEE” shall have the meaning set forth in Section 3.3.

 

1.48 “TARGET” shall have the meaning set forth in Section 2.1(b).

 

1.49 “TECHNOLOGY” shall mean and include any and all unpatented proprietary
ideas, inventions, discoveries, Confidential Information, biologic materials,
data, results, formulae, designs, specifications, methods, processes,
formulations, techniques, ideas, know-how, technical information (including,
without limitation, structural and functional information), process information,
pre-clinical information, clinical information, and any and all proprietary
biological, chemical, pharmacological, toxicological, pre-clinical, clinical,
assay, control and manufacturing data and materials.

 

1.50 “TERM” shall mean the period commencing on the Effective Date and
continuing until the expiration or termination of this Agreement in accordance
with the terms hereof (including Section 7).

 

1.51 “TERRITORY” shall mean all countries and jurisdictions of the world.

 

1.52 “THIRD PARTY” shall mean any entity other than GENENTECH, IMMUNOGEN and
their respective Affiliates.

 

1.53 “THIRD PARTY PAYMENTS” shall have the meaning set forth in Section 4.2.2.

 

1.54 “VALID CLAIM” shall mean a claim in an issued, unexpired patent within the
Licensed Patent Rights that (i) has not been finally cancelled, withdrawn,
abandoned or rejected by any administrative agency or other body of competent
jurisdiction, and (ii) has not been revoked, held invalid, or declared
unpatentable or unenforceable in a decision of a court or other body of
competent jurisdiction that is unappealable or unappealed within the time
allowed for

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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appeal, and (iii) has not been rendered unenforceable through disclaimer or
otherwise, and (iv) is not lost through an interference proceeding.

 

2. GRANT OF RIGHTS

 

2.1. LICENSE GRANTS.

 

(a) LICENSE TO GENENTECH. IMMUNOGEN hereby grants to GENENTECH an exclusive
(even as to IMMUNOGEN) royalty-bearing license within the Territory, including
the right to grant sublicenses as described in Section 2.2 below, under the
Licensed Patent Rights and Licensed Technology and IMMUNOGEN’s interest in any
Improvements, to Develop, have Developed, make, have made, use, have used, sell,
have sold, offer for sale, import, have imported, export and have exported
Licensed Products in the Field in the Territory, subject to the other terms and
conditions of this Agreement. IMMUNOGEN and GENENTECH hereby acknowledge and
agree that this Agreement constitutes the worldwide exclusive license relating
to Licensed Products as to which IMMUNOGEN afforded GENENTECH an exclusive
option under the MTA.

 

(b) LICENSE TO IMMUNOGEN. [*]

 

2.2  SUBLICENSES. GENENTECH shall have the right freely to grant sublicenses to
all or any portion of its rights under the license rights granted pursuant to
Section 2.1(a) hereof to any Affiliate or Third Party (in any case, a
“SUBLICENSEE”); PROVIDED, HOWEVER, that GENENTECH shall remain obligated to
ensure payment of milestone and royalty obligations as set forth in Section 4.

 

2.3  IMMUNOGEN RETAINED RIGHTS AND COVENANTS; GENENTECH TECHNOLOGY OR PATENT
RIGHTS.

 

(a) RETAINED RIGHTS. Subject to the other terms of this Agreement, including,
without limitation, Section 2.3 (b) hereof, IMMUNOGEN retains the right to use
the Licensed Technology and practice the Licensed Patent Rights and to use
IMMUNOGEN’s interest in all Improvements (i) to perform its work under Sections
3.3, 3.4, 3.5 and 3.6 hereof relating to the Joint Process Development Committee
and to manufacture and supply of Preclinical Materials and Clinical Materials
for GENENTECH (and its Sublicensees), (ii) to develop, have developed, make,
have made, use, have used, sell have sold, offer for sale, import, have
imported, export and have exported any product that is not a Licensed Product,
subject to Section 2.3(b) below,

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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and (iii) to otherwise exploit such Improvements for any and all uses outside of
the Field, subject to Section 2.3(b) below.

 

(b) COVENANTS. [*]

 

(c) NO RIGHTS TO GENENTECH TECHNOLOGY OR PATENT RIGHTS. Nothing in this
Section 2.3 or any other provision of this Agreement shall be construed as a
grant to IMMUNOGEN of any license or other rights with respect to any Technology
(including, without limitation, any Confidential Information) or Patent Rights
owned or Controlled (in whole or in part) by GENENTECH.

 

3. DEVELOPMENT AND COMMERCIALIZATION OF LICENSED PRODUCTS.

 

3.1  DEVELOPMENT AND COMMERCIALIZATION.

 

(a) RESPONSIBILITY. On and after the Effective Date, GENENTECH shall have full
control and authority over all Development and commercialization of Licensed
Products in the Field in the Territory, including, without limitation, (i) all
pre-clinical Development activities (including any pharmaceutical development
work on formulations or process development relating to any Licensed Product),
(ii) all activities related to human clinical trials (including any phase I
studies, any Phase II Clinical Studies or any Phase III Clinical Trials),
(iii) all activities relating to manufacture and supply of all Anti-HER2
Antibodies, all MAY Compounds (including ansamitocin P-3 and DM1) and all
Licensed Products, solely to the extent such activities relate to the
development and commercialization of Licensed Products (including all required
process development and scale up work with respect thereto), (iv) all marketing,
promotion, sales, distribution, import and export activities relating to any
Licensed Product (including any post-marketing trials or databases and
post-marketing safety surveillance), and (v) all activities relating to any
regulatory filings, registrations, applications and Regulatory Approvals
relating to any of the foregoing (including any INDs or foreign equivalents, any
manufacturing facility validation and/or licensure, any Drug Approval
Applications and any other Regulatory Approvals). Except as described in the
next sentence, GENENTECH shall own all data, results and all other information
arising from any such activities under this Agreement, including, without
limitation, all regulatory filings, registrations, applications and Regulatory
Approvals relating to Licensed Products (including any INDs or foreign
equivalents, any Drug Approval Applications and any other Regulatory Approvals),
and all of the foregoing

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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information, documentation and materials shall be considered Confidential
Information and Technology solely owned by GENENTECH. IMMUNOGEN shall own all
data, results and all other information arising from IMMUNOGEN’s activities
relating to the manufacture and supply of MAY Compounds (including ansamitocin
P-3 and DM1) to GENENTECH, and all of the foregoing information, documentation
and materials shall be considered Confidential Information and Technology solely
owned by IMMUNOGEN. All activities relating to Development and commercialization
under this Agreement shall be undertaken at GENENTECH’s sole cost and expense,
except as otherwise expressly provided in this Agreement.

 

(b) DUE DILIGENCE. GENENTECH will exercise its commercially reasonable efforts
and diligence in Developing and commercializing Licensed Products in accordance
with its business, legal, medical and scientific judgment, and in undertaking
investigations and actions required to obtain appropriate Regulatory Approvals
necessary to market Licensed Products in the Field in the Territory, such
reasonable efforts and diligence to be in accordance with the efforts and
resources GENENTECH would use for a compound owned by it or to which it has
rights, which is of similar market potential at a similar stage in development
as the applicable Licensed Product, taking into account the competitiveness of
the marketplace, the proprietary position of the Licensed Product, the relative
potential safety and efficacy of the Licensed Product, the regulatory
requirements involved in its Development, commercialization and Regulatory
Approval, the cost of goods and availability of capacity to manufacture and
supply the Licensed Product at commercial scale, the profitability of the
applicable Licensed Product, and other relevant factors including, without
limitation, technical, legal, scientific or medical factors. In the event that
GENENTECH fails to use due diligence as required hereunder, then on a Licensed
Product-by-Licensed Product and country-by-country basis as to the Licensed
Product in the country in which GENENTECH has failed to use due diligence as
required hereunder, IMMUNOGEN’s exclusive remedy shall be, in its sole
discretion (i) to terminate the licenses granted under Section 2.1 this
Agreement for breach under Section 7.2(a) below (including the notice and cure
provisions therein) or (ii) to convert the licenses granted under Section 2.1 of
this Agreement from exclusive licenses to non-exclusive licenses, in either case
only as such licenses apply to such Licensed Product in such country, which
termination or conversion, as the case may be, shall be effective upon
expiration of the cure period specified in 7.2(a) below provided that such
failure remains uncured upon such expiration.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

12

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3.2  UPDATES AND REPORTS; EXCHANGES OF ADVERSE EVENT INFORMATION.

 

(a) UPDATES AND REPORTS. GENENTECH shall keep IMMUNOGEN informed of the progress
of GENENTECH’s efforts to Develop and commercialize Licensed Products in the
Field in the Territory as provided in this Section 3.2(a). GENENTECH (or its
Sublicensee) shall provide IMMUNOGEN with brief written reports as provided
herein no less frequently than on each anniversary of the Effective Date during
the Term (commencing with the first anniversary of the Effective Date). Such
reports shall summarize GENENTECH’s material efforts to Develop and
commercialize all Licensed Products hereunder, identify the Drug Approval
Applications with respect to any Licensed Product that GENENTECH and its
Sublicensees have filed, sought or obtained in the prior twelve (12)-month
period, and any they reasonably expect to make, seek or attempt to obtain in the
following twelve (12)-month period. In addition, GENENTECH (or its Sublicensee)
shall provide IMMUNOGEN with prompt written notice of the occurrence of any
event giving rise to an obligation to make a milestone payment to IMMUNOGEN
under Section 4.1, and shall provide IMMUNOGEN with prompt written notice of the
occurrence of the First Commercial Sale of any particular Licensed Product. All
such reports and notices shall be sent to the attention of IMMUNOGEN’s
designated representative, who shall be its Chief Executive Officer unless
IMMUNOGEN otherwise notifies GENENTECH.

 

(b) ADVERSE EVENTS. In addition to such reports, GENENTECH agrees to provide
IMMUNOGEN with Adverse Event information and product complaint information
relating to Licensed Products (but not relating to any other products of
GENENTECH, including but not limited to Herceptin(R) (trastuzumab)) as compiled
and prepared by GENENTECH in the normal course of business in connection with
the Development, commercialization or sale of any Licensed Product, within time
frames consistent with reporting obligations under applicable laws and
regulations. IMMUNOGEN agrees to provide GENENTECH with Adverse Event and
product complaint information relating to any product containing any
MAY Compound that is compiled and prepared by IMMUNOGEN or any Third Party in
the normal course of business in connection with the development,
commercialization or sale of any such product, within time frames consistent
with reporting obligations under applicable laws and regulations; PROVIDED,
however, that the foregoing shall not require IMMUNOGEN to violate any
agreements with or confidentiality obligations owed to any Third Party.
GENENTECH shall provide its Adverse Event and product complaint information
hereunder to IMMUNOGEN’s designated

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

13

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representative, who shall be its Chief Regulatory Officer unless IMMUNOGEN
otherwise notifies GENENTECH. IMMUNOGEN shall provide its Adverse Event and
product complaint information hereunder to GENENTECH’s designated
representative, who shall be the head of its Drug Safety group in GENENTECH’S
Medical Affairs Department unless GENENTECH otherwise notifies IMMUNOGEN.

 

(c) CONFIDENTIAL INFORMATION. All reports, updates, Adverse Event, product
complaint and other information provided by one Party to the other Party under
this Agreement (including under this Section 3), shall be considered
Confidential Information of the disclosing Party, subject to the terms of
Section 5.

 

3.3  REASONABLE ASSISTANCE BY IMMUNOGEN. In connection with the exclusive grant
of rights to GENENTECH under Section 2.1 above, and subject to the other terms
of this Agreement, IMMUNOGEN shall provide GENENTECH (and any Sublicensee of
GENENTECH with respect to all of GENENTECH’s license rights hereunder to make or
have made all Licensed Products or any particular Licensed Product(s) throughout
the Territory or in a particular geographic region of the Territory, and/or all
of GENENTECH’s license rights hereunder to Develop or commercialize all Licensed
Products or any particular Licensed Product(s) throughout the Territory or in a
particular geographic region of the Territory (in any case, a “MATERIAL
SUBLICENSEE”) such information and materials comprising the Licensed Technology
and/or Licensed Patent Rights as GENENTECH (or its Material Sublicensee) may
reasonably request. Without limiting the generality of the foregoing, IMMUNOGEN
shall provide all of such technical assistance within IMMUNOGEN’s area of
expertise (or its subcontractors) concerning the Development and
commercialization of Licensed Products as may be reasonably requested by
GENENTECH (or its Material Sublicensee) from time to time during the Term,
provided that such technical assistance and expertise is within the scope of the
Licensed Technology and/or Licensed Patent Rights covered under this Agreement.
Such technical assistance and expertise shall include, but not be limited to,
visits by IMMUNOGEN personnel to GENENTECH and visits by GENENTECH to IMMUNOGEN
(or its subcontractors), at GENENTECH’s expense, at such times and for such
periods of time as may be reasonably acceptable to the Parties. Without limiting
the generality of the foregoing, within thirty (30) days after the Effective
Date IMMUNOGEN shall deliver to GENENTECH the materials, documentation and other
information set forth on SCHEDULE II.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

14

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3.4  JOINT PROCESS DEVELOPMENT COMMITTEE.

 

(a) MANDATE AND ESTABLISHMENT OF COMMITTEE. Promptly after the Effective Date,
the Parties shall form a “JOINT PROCESS DEVELOPMENT COMMITTEE” or “JPDC” whose
mandate shall be to serve as a forum for coordination and communication between
the Parties with respect to Development of manufacturing processes applicable to
any MAY Compound or Licensed Product covered by this Agreement (including,
without limitation, all process science and process development work,
formulation work, and quality control/ assurance work hereunder), to assist
GENENTECH in its exercise of its rights to make or have made Licensed Products
under this Agreement. Within thirty (30) days after the Effective Date, the
Parties shall each nominate an equal number of representatives (which shall be
no less than two (2) each) for membership on the JPDC. Each Party may change its
representative(s) as it deems appropriate by notice to the other Party. The
input of the IMMUNOGEN representatives on the JPDC shall be fully considered by
the JPDC; PROVIDED, HOWEVER, that all decisions of the JPDC shall be subject to
final approval by GENENTECH.

 

(b) CHAIR OF COMMITTEE; MEETINGS. The chair of the JPDC shall be one of the
GENENTECH representatives on the JPDC, as designated by GENENTECH; PROVIDED,
HOWEVER, that during the first twelve (12) months after the Effective Date, the
JPDC shall be co-chaired by a GENENTECH representative on the JPDC (as
designated by GENENTECH) and an IMMUNOGEN representative on the JPDC (as
designated by IMMUNOGEN). All decisions of the JPDC shall be subject to the
approval of the GENENTECH chair (including during the period when there is a
co-chair from IMMUNOGEN). The JPDC shall meet on a semi-annual basis or other
schedule agreed upon by the Parties, unless at least thirty (30) days in advance
of any meeting the chair (or co-chairs during the first twelve (12) months) of
the JPDC determine that there is no need for a meeting. In such instance, the
next JPDC meeting shall also be scheduled as agreed upon by the Parties. The
location of meetings of the JPDC shall alternate between IMMUNOGEN’s offices in
Massachusetts and GENENTECH’s offices in California, unless otherwise agreed by
the Parties. As agreed upon by the Parties, JPDC meetings may be face-to-face or
may be conducted through teleconferences and/or videoconferences. In addition to
its JPDC representatives, each Party shall be entitled to have other employees
attend such meetings to present and participate, though not in a decision-making
capacity. Each Party shall bear all costs and expenses, including travel and
lodging expense, that may be incurred by its JPDC representatives or other of
its attendees at JPDC meetings, as a result of such meetings hereunder. Minutes
of each JPDC meeting will be transcribed and issued to members of the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

15

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JPDC by the chair (or the GENENTECH co-chair), as the case may be, within thirty
(30) days after each meeting, and such minutes shall be reviewed and modified as
mutually required to obtain approval of such minutes promptly thereafter.

 

3.5  SUPPLY OF PRECLINICAL MATERIALS. During the Term of this
Agreement, IMMUNOGEN shall supply to GENENTECH (or its Material Sublicensee)
with such quantities of Preclinical Materials as may be reasonably requested by
GENENTECH (or its Material Sublicensee) in order to conduct all pre-clinical
Development activities relating to Licensed Products. GENENTECH (or its Material
Sublicensee) shall order all amounts of Preclinical Materials, and IMMUNOGEN
shall deliver all such ordered amounts, in accordance with advance ordering
timeframes and delivery timeframes to be agreed upon by the Parties through the
JPDC. IMMUNOGEN shall use its commercially reasonable efforts to deliver such
amounts of Preclinical Materials ordered in accordance with the foregoing
(including such agreed upon timeframes) in a timely manner. In connection with
any ordering of Preclinical Materials by GENENTECH (or its Material
Sublicensee), IMMUNOGEN shall provide GENENTECH (or its Material Sublicensee)
promptly with IMMUNOGEN’s good faith estimate of the Fully Burdened
Manufacturing Cost for manufacture and supply of such Preclinical Materials.
IMMUNOGEN’s price to supply Preclinical Materials to GENENTECH (or its Material
Sublicensee) shall equal [*] of IMMUNOGEN’s Fully Burdened Manufacturing Cost
for such Preclinical Materials as approved by GENENTECH (or its Material
Sublicensee). Nothing herein shall preclude GENENTECH from making its own
arrangements for manufacture and supply of Preclinical Materials on its own or
with Third Parties, in exercise of its license rights under Section 2.1.
GENENTECH hereby agrees that (a) it shall not use the Preclinical Materials in
any human subject, (b) it shall use the Preclinical Materials in compliance with
all applicable federal, state and local laws and regulations, and (c) it (as a
matter of contract between itself and IMMUNOGEN) shall assume all liability for
damages that may arise from the use, storage and disposal of any Preclinical
Materials to the extent provided pursuant to Section 9 below. GENENTECH shall be
entitled to transfer Preclinical Materials to any Third Party under terms
obligating such Third Party not to transfer or use such Preclinical Materials
except in compliance with the foregoing clauses (a) and (b) of this Section 3.5.

 

3.6  SUPPLY OF CLINICAL MATERIALS. During the Term of this Agreement, IMMUNOGEN
shall supply to GENENTECH (or its Material

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

16

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Sublicensee) with such quantities of Clinical Materials as may be reasonably
requested by GENENTECH (or its Material Sublicensee) in order to conduct all
human clinical trials of Licensed Products through Phase II Clinical Studies.
GENENTECH (or its Material Sublicensee) shall order all amounts of Clinical
Materials, and IMMUNOGEN shall deliver all such ordered amounts, in accordance
with forecasting parameters, advance ordering timeframes and delivery timeframes
to be agreed upon by the Parties through the JPDC. IMMUNOGEN shall use its
commercially reasonable efforts to deliver such amounts of Clinical Materials
ordered in accordance with the foregoing (including such agreed upon timeframes)
in a timely manner. In connection with any ordering of Clinical Materials by
GENENTECH (or its Material Sublicensee), IMMUNOGEN shall provide GENENTECH (or
its Material Sublicensee) promptly with IMMUNOGEN’s good faith estimate of the
Fully Burdened Manufacturing Cost for manufacture and supply of such Clinical
Materials. IMMUNOGEN’s price to supply Clinical Materials to GENENTECH (or its
Material Sublicensee) shall equal [*] of IMMUNOGEN’S Fully Burdened
Manufacturing Cost for such Clinical Materials as approved by GENENTECH (or its
Material Sublicensee). Nothing herein shall preclude GENENTECH from making its
own arrangements for manufacture and supply of Clinical Materials on its own or
with Third Parties, in exercise of its license rights under Section 2.1.
GENENTECH hereby agrees that (a) it shall use the Clinical Materials in
compliance with all applicable federal, state and local laws, and (b) it (as a
matter of contract between itself and IMMUNOGEN) shall assume all liability for
damages that may arise from the use, storage and disposal of such Clinical
Materials to the extent provided pursuant to Section 9 below. GENENTECH shall be
entitled to transfer Clinical Materials to any Third Party under terms
obligating such Third Party not to transfer or use such Clinical Materials
except in compliance with the foregoing clause (a) of this Section 3.6.

 

3.7  PURCHASE OF EQUIPMENT. If, during the Term of this Agreement, IMMUNOGEN
determines in good faith that it is necessary or advisable to purchase equipment
or instruments in order to perform any of its obligations to manufacture
Preclinical Materials and Clinical Materials under Sections 3.5 or 3.6 of this
Agreement, then IMMUNOGEN shall provide the JPDC with written notice of such
determination, along with the estimated price for such purchase and quality
parameters for the equipment or instruments, for the JPDC’s approval of such
price and features. Promptly after the consummation of such purchase, assuming
that the JPDC has provided its approval hereunder, IMMUNOGEN shall provide
GENENTECH with a copy of the invoice or invoices reflecting such purchase, and
GENENTECH shall reimburse IMMUNOGEN for the purchase of all such approved
equipment hereunder within thirty (30) days of its receipt

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

17

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of such invoice from IMMUNOGEN; PROVIDED, HOWEVER, that no costs reimbursed by
GENENTECH hereunder (or depreciation of such purchased equipment or instruments)
shall be includible or included within the calculation of any Fully Burdened
Manufacturing Costs under this Agreement.

 

4. PAYMENTS AND ROYALTIES

 

4.1  MILESTONE PAYMENTS FOR LICENSED PRODUCTS.

 

4.1.1 MILESTONES. In consideration of the grant of the license by IMMUNOGEN
hereunder, and subject to the other terms of this Agreement, GENENTECH will make
the following nonrefundable, noncreditable (except as expressly provided in
Section 4.1.2 below) payments to IMMUNOGEN within thirty (30) days after the
first achievement of each of the milestones set forth below:

 

Milestone

 

Milestone Payment

 

 

 

Effective Date

 

$

2 Million

 

 

 

IND Acceptance for a Licensed Product

 

$

2 Million

 

 

 

Commencement of Phase II

 

 

Clinical Trials in United States for a Licensed Product

 

$

3 Million

 

 

 

Earlier of Commencement of Phase III

 

 

Clinical Trials in United States for a Licensed Product

 

 

or Phase III Equivalent Decision for a Licensed Product

 

$

5 Million

 

[*]

 

It is hereby acknowledged and agreed that any milestone payment shall be made
only once, with respect to the first achievement of the relevant milestone for
the first Licensed Product, regardless of how many times such milestones are
achieved by Licensed Products and regardless of how many times a particular
Licensed Product achieves such milestones. GENENTECH shall notify IMMUNOGEN of
the achievement of milestones hereunder as provided in Section 3.2(a) above.

 

4.1.2 [*]

 

4.2  PAYMENT OF ROYALTIES; ROYALTY RATES; ACCOUNTING FOR ROYALTIES AND RECORDS.

 

4.2.1 ROYALTY PAYMENTS. In consideration of the grant of the license by
IMMUNOGEN hereunder, and subject to the other terms of this Agreement (including
the remainder of this Section 4), commencing on the first date of First
Commercial Sale of Licensed Products in such country or jurisdiction in the
Territory, GENENTECH shall pay to IMMUNOGEN the following royalties based on
total Net Sales of all Licensed Products sold by GENENTECH and/or its
Sublicensees, on an incremental basis in each calendar year during the Term, at
the following rates [*]:

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

18

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FOR NET SALES OF A LICENSED PRODUCT [*] IN ANY CALENDAR YEAR

DURING THE TERM:

 

ROYALTY RATE (% OF NET SALES)

 

 

 

[*]

 

 

 

 

 

FOR NET SALES OF A LICENSED PRODUCT

[*] IN ANY CALENDAR YEAR

 

 

DURING THE TERM:

 

ROYALTY RATE (% OF NET SALES)

 

 

 

[*]

 

 

 

 

 

[*].

 

 

 

4.2.2 [*]. Subject to the other terms of this Agreement, on a country-by-country
basis, the [*] as provided in this Section 4.2.2:

 

(a) [*].

 

(b) [*]. If GENENTECH is [*].

 

(c) [*]. If GENENTECH determines [*].

 

(d) [*]. The [*] in Section 4.2.2(c) above is [*] under Section 4.2.2(b) above,
but each is [*] set forth in this Section 4.2.2(d) as follows. No [*] under this
Section 4.2.2, [*] IMMUNOGEN thereunder,[*].

 

4.2.3 [*]. In consideration of the grant of the license by IMMUNOGEN hereunder,
and subject to the other terms of this Agreement (including the other terms of
this Section 4):

 

(a) [*]. Notwithstanding anything set forth in Section 4.2.1 above, [*] set
forth therein shall apply, [*] Subject to the other terms of this Agreement
(except for Section 4.2.2 above, which shall not apply), on a [*] Section 4.2.1
[*] of this Section 4.2.3(a), GENENTECH [*].

 

(b) [*]. Notwithstanding anything set forth in Section 4.2.1 above, the [*] set
forth in Section 4.2.1 above [*]. Subject to the other terms of this Agreement
(except for Section 4.2.2, which shall not apply), on a [*] under Section 4.2.1
[*] this Section 4.2.3(b), [*]; PROVIDED, HOWEVER, [*] this
Section 4.2.3(b) [*].

 

4.2.4 [*]. In determining [*] of any [*] under this Agreement, [*] shall first
[*] in accordance with the definition of “Net Sales” above, [*].

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

19

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4.3  ONE ROYALTY. Only one royalty, calculated at the highest applicable royalty
rate under this Section 4, shall be payable to IMMUNOGEN hereunder for each sale
of a Licensed Product.

 

4.4  ROYALTY TERM. GENENTECH shall pay royalties with respect to each Licensed
Product on a country-by-country and Licensed Product-by-Licensed Product basis
until [*], import and have imported such Licensed Product in such country.

 

4.5  PAYMENT TERMS.

 

(a) PAYMENT OF MILESTONES; PAYMENT OF ROYALTIES; ROYALTY REPORTS. Subject to the
other terms of this Agreement (including Section 4.1 above), GENENTECH shall
make any milestone payments owed to IMMUNOGEN hereunder in United States
Dollars, using the wire transfer provisions of this Section 4.4. Subject to the
other terms of this Agreement (including Sections 4.2, 4.3 and 4.4 above),
GENENTECH shall make any royalty payments owed to IMMUNOGEN in United States
Dollars, [*] following the end of each calendar quarter for which such royalties
are deemed to occur (as provided in the next sentence), using the wire transfer
provisions of this Section 4.5. For purposes of determining when a sale of any
Licensed Product occurs under this Agreement, the sale shall be deemed to occur
on the earlier of (i) the date the Licensed Product is shipped or (ii) the date
of the invoice to the purchaser of the Licensed Product. Each royalty payment
shall be accompanied by a report for each country in the Territory in which
sales of Licensed Products occurred in the calendar quarter covered by such
statement, specifying: the gross sales (if available) and Net Sales in each
country’s currency; the applicable royalty rate under this Agreement; the
royalties payable in each country’s currency, including an accounting of
deductions taken in the calculation of Net Sales; the applicable exchange rate
to convert from each country’s currency to United States Dollars under this
Section 4.5; and the royalties payable in United States Dollars.

 

(b) FOREIGN CURRENCY EXCHANGE. All royalties shall be payable in full in the
United States in United States Dollars, regardless of the countries in which
sales are made. For the purpose of computing Net Sales for Licensed Products
sold in any currency other than United States Dollars, the quarterly royalty
payment will be calculated as follows:

 

(A/B) x C = United States Dollars royalty payment on foreign current sales,
where

 

A = foreign current “Net Sales” (as defined above) per quarter;

 

B = foreign exchange conversion rate, expressed in local currency per United
States Dollar (using as the applicable foreign exchange rate the average of the
rate

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

20

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published in the western edition of the Wall Street Journal, or any other
mutually agreed upon source, for the last business day of the calendar quarter);
and

 

C = the royalty rate applicable to such Net Sales under this Agreement.

 

(c) TAX WITHHOLDING; RESTRICTIONS ON PAYMENT. All payments hereunder shall be
made free and clear of any taxes, duties, levies, fees or charges, except for
withholding taxes (to the extent applicable). GENENTECH shall make any
applicable withholding payments due on behalf of IMMUNOGEN and shall promptly
provide IMMUNOGEN with written documentation of any such payment sufficient to
satisfy the requirements of the United States Internal Revenue Service relating
to an application by IMMUNOGEN for a foreign tax credit for such payment. If by
law, regulations or fiscal policy of a particular country in the Territory,
remittance of royalties in United States Dollars is restricted or forbidden,
written notice thereof shall promptly be given to IMMUNOGEN, and payment of the
royalty shall be made by the deposit thereof in local currency to the credit of
IMMUNOGEN in a recognized banking institution designated by IMMUNOGEN by written
notice to GENENTECH. When in any country in the Territory the law or regulations
prohibit both the transmittal and the deposit of royalties on sales in such
country, royalty payments shall be suspended for as long a such prohibition is
in effect and as soon as such prohibition ceases to be in effect, all royalties
that GENENTECH would have been under an obligation to transmit or deposit but
for the prohibition shall forthwith be deposited or transmitted, to the extent
allowable.

 

(d) WIRE TRANSFERS. All payments hereunder shall be made to IMMUNOGEN by bank
wire transfer in immediately available funds to the account designated by
IMMUNOGEN by written notice to GENENTECH from time to time.

 

4.6  OVERDUE ROYALTIES. Subject to the other terms of this Agreement, royalties
not paid within the time period set forth in this Section 4 shall bear interest
at a rate of one percent (1%) from the due date until paid in full.

 

4.7  RECORDS RETENTION; REVIEW.

 

(a) ROYALTIES. Commencing as of the date of First Commercial Sale of the first
Licensed Product, GENENTECH and its Sublicensees shall keep for at least [*]
from the end of the calendar year to which they pertain complete and accurate
records of sales by GENENTECH or its Sublicensees, as the case may be, of each
Licensed Product, in sufficient detail to allow the accuracy of the royalties to
be confirmed.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

21

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(b) FULLY BURDENED MANUFACTURING COSTS. Commencing as of the Effective
Date, IMMUNOGEN shall keep for at least [*] following the end of the calendar
year to which they pertain complete and accurate records of all of IMMUNOGEN’s
Fully Burdened Manufacturing Costs for Preclinical Materials and Clinical
Materials supplied to GENENTECH (or its Sublicensee) hereunder, in sufficient
detail to allow the accuracy of the Fully Burdened Manufacturing Costs to be
confirmed.

 

(c) REVIEW. Subject to the other terms of this Section 4.7(c), at the request of
either Party, upon at least ten (10) business days’ prior written notice from
the requesting Party, and at the expense of the requesting Party (except as
otherwise provided herein), the other Party shall permit an independent
certified public accountant reasonably selected by the requesting Party and
reasonably acceptable to the other Party to inspect (during regular business
hours) the relevant records required to be maintained by the other Party under
this Section 4.7. At IMMUNOGEN’s request (which shall not be made more
frequently than once per year during the Term), the accountant shall be entitled
to review the then-preceding three (3) years of GENENTECH’s records under this
Section 4.7 for purposes of verifying GENENTECH’s royalty calculations. At
GENENTECH’s request (which shall not be made more frequently than once per year
during the Term), the accountant shall be entitled to review the then-preceding
[*] of IMMUNOGEN’s records under this Section 4.7 for purposes of verifying
IMMUNOGEN’s Fully Burdened Manufacturing Cost calculations. In every case the
accountant must have previously entered into a confidentiality agreement with
both Parties substantially similar to the provisions of Section 4 and limiting
the disclosure and use of such information by such accountant to authorized
representatives of the Parties and the purposes germane to this Section 4.7.
Results of any such review shall be made available to both Parties and shall be
binding on both Parties. Each Party agrees to treat the results of any such
accountant’s review of the other Party’s records under this Section 4.7 as
Confidential Information of the other Party subject to the terms of Section 5.
If any review reveals a deficiency in the calculation of royalties resulting
from any underpayment by GENENTECH, GENENTECH shall promptly pay IMMUNOGEN the
amount remaining to be paid (plus interest thereon at the rate provided in
Section 4.6 above), and if such underpayment is by [*] or more, GENENTECH shall
pay all costs and expenses of the review. If any review reveals a deficiency in
the calculation of Fully Burdened Manufacturing Costs resulting from any
overpayment by GENENTECH, IMMUNOGEN shall promptly refund GENENTECH the amount
of any such overpayment (plus interest thereon at the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

22

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rate provided in Section 4.6 above), and if such overpayment is by [*] or
more, IMMUNOGEN shall pay all costs and expenses of the review.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

23

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5. TREATMENT OF CONFIDENTIAL INFORMATION

 

5.1  CONFIDENTIAL INFORMATION. During the Term, in the course of performance of
this Agreement, each Party may disclose to the other Party proprietary technical
and business information of the disclosing Party, including techniques, data,
inventions, practices, methods, knowledge, know-how, test data and results
(including from pre-clinical and/or human clinical testing), analytical and
quality control data, cost, sales, manufacturing, patent data and any other
information disclosed hereunder. Such information of the disclosing Party
hereunder, if so identified in writing by the disclosing Party to the receiving
Party either pursuant to this Section 5.1 or otherwise upon disclosure to the
receiving Party, shall be considered “Confidential Information” of the
disclosing Party. Each Party agrees that it will take the same commercially
reasonable steps to protect the confidentiality of other Party’s Confidential
Information as it takes to protect its own proprietary and confidential
information. For a period of ten (10) years after the receipt of any such
Confidential Information from the disclosing Party hereunder, subject to the
terms of this Section 5, the receiving Party shall keep confidential and not
disclose (by publication or otherwise) such Confidential Information of the
other Party, and shall not use, publish or otherwise disclose Confidential
Information of the other Party for any purpose other than those contemplated by
this Agreement (including as reasonably necessary to exercise any rights or
perform any obligations under this Agreement). Notwithstanding the foregoing, it
is understood and agreed that the receiving Party’s obligations of
confidentiality and non-use herein shall not apply to the extent that it can be
established by competent written records that any such information:

 

(a) is, at the time of disclosure by the disclosing Party hereunder, or
thereafter becomes, a part of the public domain or publicly known or available,
other than through any act or omission of the receiving Party in breach of its
obligations under this Section 5; or

 

(b) was known to the receiving Party at the time of disclosure to it by the
disclosing Party; or

 

(c) is, at the time of disclosure by the disclosing Party hereunder, or
thereafter becomes, known to the receiving Party from a source that had a lawful
right to disclose such information to others; or

 

(d) was independently developed by the receiving Party without use or reference
to any Confidential Information of the disclosing Party.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

24

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5.2  PERMITTED DISCLOSURES; PUBLICATIONS.

 

(a) PERMITTED DISCLOSURES. Each Party shall be entitled to disclose Confidential
Information of the other Party to employees of the receiving Party, provided
that such employees are already bound by obligations of confidentiality to their
employer, and also to Affiliates, consultants, agents and Third Parties for any
purpose provided for in this Agreement, provided that any such Affiliate,
consultant, agent or other Third Party has first agreed in writing to
confidentiality restrictions and obligations at least as protective as this
Section 5, in each case for any purpose contemplated by this Agreement
(including as reasonably necessary to exercise any rights or perform any
obligations under this Agreement).

 

(b) REVIEW OF PUBLICATIONS. Each Party shall consult with the other Party prior
to the submission of any manuscript for publication if the publication will
contain any Confidential Information of the other Party, unless the applicable
laws and regulations prohibit such consultation. Such consultation shall include
providing a copy of the proposed manuscript to the other Party at least thirty
(30) days prior to the proposed date of submission to a publisher, incorporating
appropriate changes proposed by the other Party regarding its Confidential
Information into the manuscript submission and deleting all Confidential
Information of the other Party as it may request; PROVIDED, however, that the
other Party’s review hereunder shall be deemed completed at the end of such
thirty (30)-day period.

 

(c) OTHER PERMITTED DISCLOSURES. Notwithstanding the foregoing, Confidential
Information of either Party may be disclosed by the other Party to the extent
such disclosure is reasonably necessary for filing or prosecuting patent
applications or maintaining patents, prosecuting or defending litigation,
enforcing rights and/or obligations under this Agreement, complying with
applicable laws, regulations or court order or conducting pre-clinical or human
clinical testing of Licensed Products, provided that if a Party is required by
applicable law, regulation or court order to make such disclosure of the other
Party’s Confidential Information, it will give reasonable advance notice of the
need for such disclosure and will use its commercially reasonable efforts to
secure confidential treatment (if available) of such other Party’s Confidential
Information required to be disclosed.

 

5.3  USE OF NAMES; PRESS RELEASES.

 

(a) USE OF NAMES. A Party may not use the name of the other Party (or any
trademarks or tradenames of the other Party) in any press release or any other
publicity or advertising without the prior written consent of the other Party.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

25

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(b) PRESS RELEASES. Except as provided in Sections 5.1 and 5.2 above, a Party
may not issue a press release or otherwise publicize or disclose any information
related to this Agreement or the terms or conditions hereof, without the prior
written consent of the other Party. The Parties shall mutually agree on the text
of any press release announcing the execution of this Agreement and on any
confidential treatment request(s) to be filed with the Securities and Exchange
Commission with respect to this Agreement. Once any written text is approved for
disclosure by both Parties as provided herein, either Party may make subsequent
or repeated public disclosures of the contents thereof without the further
approval of the other Party. Nothing in the foregoing, however, shall prohibit a
Party from making such disclosures regarding this Agreement or the terms thereof
to the extent deemed necessary under applicable federal or state securities laws
or any rule or regulation of any nationally recognized securities exchange,
subject to the terms of Section 5.2 above regarding disclosures required to
comply with applicable laws, regulations or court order.

 

5.4  INTEGRATION; SURVIVAL. As to the subject matter of this Agreement, this
Section 5 supersedes any confidential disclosure agreements between the Parties,
including, without limitation, the confidentiality provisions of the MTA, of
that certain Confidentiality Agreement effective November 5, 1996, and of that
certain Confidentiality Agreement effective April 8, 1998. Any confidential
information of a Party under any such agreement shall be treated as Confidential
Information of such Party hereunder, subject to the terms of this Section 4
(including, without limitation, the data and results from the work under the
MTA, which are considered GENENTECH’s Confidential Information as provided under
the MTA and under this Agreement). Section 4 shall survive termination or
expiration of this Agreement.

 

6. PROVISIONS CONCERNING THE FILING, PROSECUTION AND MAINTENANCE OF PATENT
RIGHTS

 

6.1  OWNERSHIP OF INTELLECTUAL PROPERTY.

 

(a) SOLE INVENTIONS. IMMUNOGEN shall own all inventions (whether or not
patentable) made during the course of and pursuant to activities carried out
under this Agreement (or under the MTA) solely by employees of or agents or
others obligated to assign inventions to IMMUNOGEN. GENENTECH shall own all
inventions (whether or not patentable) made during the course of and pursuant to
activities carried out under this Agreement (or under the MTA) solely by
employees of or agents or others obligated to assign inventions to GENENTECH.
The

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

26

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Party solely owning any inventions hereunder shall be the sole owner of any
inventorship certificate(s), patent application(s) and patent(s) thereon. All
determinations of inventive contribution shall be as determined by United States
laws of inventorship. Subject to the terms of Section 6.2 below relating to
IMMUNOGEN sole inventions, the Party solely owning an invention hereunder will
be solely responsible, at its own cost and expense and in its sole discretion,
for the filing, prosecution and maintenance of any inventorship certificate(s),
patent application(s) and patent(s) thereon.

 

(b) JOINT INVENTIONS. Inventions made during the course of and pursuant to
activities carried out under this Agreement (or under the MTA) jointly by
employees of or agents of or others obligated to assign inventions to IMMUNOGEN
and GENENTECH shall be jointly owned by IMMUNOGEN and GENENTECH. All
determinations of inventive contribution shall be as determined by United States
laws of inventorship. The Parties shall also jointly own any inventorship
certificate(s), patent application(s) and patent(s) on any joint inventions
hereunder. The terms of Section 6.2 below relating to joint inventions shall
apply to any inventorship certificate(s), patent application(s) and
patent(s) thereon.

 

(c) DISCLOSURE. As regards any IMMUNOGEN sole or joint invention hereunder or
any GENENTECH joint inventions hereunder, each Party shall provide to the other
Party any invention disclosure made during the course of performance of this
Agreement and relating to activities carried out hereunder within thirty (30)
days after such Party receives such disclosure from its employees, agents or
others obligated to assign inventions to such Party.

 

6.2  PATENT FILING, PROSECUTION AND MAINTENANCE.

 

(a) SOLE IMMUNOGEN INVENTIONS. Subject to the other terms of this
Section 6.2(a) and Section 6.2(b), IMMUNOGEN shall have the right to prepare,
file, prosecute, obtain and maintain, at its sole cost and expense, all Licensed
Patent Rights. IMMUNOGEN agrees that with respect to such Licensed Patent Rights
licensed exclusively to GENENTECH hereunder, (i) any such preparation, filing,
prosecution and maintenance shall be conducted with commercially reasonable
diligence by IMMUNOGEN, using patent counsel selected by IMMUNOGEN and
reasonably acceptable to GENENTECH. In any case IMMUNOGEN (i) will provide
GENENTECH with a copy of any proposed patent application covering any such
Licensed Patent Rights for review and comment reasonably in advance of filing
(which shall under no circumstances be in excess of thirty (30) days), and
(ii) will keep GENENTECH reasonably informed of the status of such filing,
prosecution and maintenance, including, without limitation,

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

27

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(A) by providing GENENTECH with copies of all communications received from or
filed in patent office(s) with respect to such filing, and (B) by providing
GENENTECH, a reasonable time prior to taking or failing to take any action that
would affect the scope or validity of any such of any such filing (including the
substantially narrowing, cancellation or abandonment of any claim(s) without
retaining the right to pursue such subject matter in a separate application, or
the failure to file or perfect the filing of any claim(s) in any country), with
prior written notice of such proposed action or inaction so that GENENTECH has a
reasonable opportunity to review and comment. [*] If IMMUNOGEN fails to
undertake the filing(s) of any patent application with respect to any invention
under such Licensed Patent Rights within ninety (90) days after receipt of
written notice from GENENTECH that GENENTECH believes filing of such an
application by IMMUNOGEN is appropriate, GENENTECH may undertake such
filing(s) at its own expense, in which case IMMUNOGEN will assign all of its
rights to such invention to GENENTECH and any subsequently issued patent thereon
will be owned solely by GENENTECH.

 

(b) JOINT INVENTIONS. As regards any joint invention by the Parties hereunder,
the Party from whom the majority of the data underlying any such joint invention
arose (the “controlling Party”) will have the first right, but not the
obligation, to undertake filing(s), prosecution and maintenance of inventorship
certificate(s), patent application(s) and patent(s) thereon. In connection with
any such filing(s), the filing Party will use patent counsel mutually acceptable
to each Party (in its reasonable determination) and the Parties will, prior to
filing of the patent application, agree on mutually acceptable sharing of the
costs and expenses of such filing(s), prosecution and maintenance. In any case
the filing Party (i) will provide the non-controlling Party with a copy of any
such proposed patent application for review and comment reasonably in advance of
filing, and (ii) will keep the non-controlling Party reasonably informed of the
status of such filing, prosecution and maintenance, including, without
limitation, (A) by providing the non-controlling Party with copies of all
communications received from or filed in patent office(s) with respect to such
filing, and (B) by providing the non-controlling Party, a reasonable time prior
to taking or failing to take any action that would affect the scope or validity
of any such filing (including the substantially narrowing, cancellation or
abandonment of any claim(s) without retaining the right to pursue such subject
matter in a separate application, or the failure to file or perfect the filing
of any claim(s) in any country), with prior written notice of such proposed
action or inaction so that the non-controlling Party has a reasonable
opportunity to

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

28

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review and comment. If the Party from whom the majority of the data underlying
any such joint invention fails to undertake the filing(s) of any such patent
application with respect to any such invention within ninety (90) days after
receipt of written notice from the other Party that the other Party believes
filing(s) of such an application by such Party is appropriate, such other Party
may undertake such filing(s) at its own expense, in which case the non-filing
Party will assign all of its rights to such joint invention to the filing Party
and any subsequently issued patent thereon will be owned solely by the filing
Party. Either Party may assign its rights hereunder to any jointly owned
invention, inventorship certificate, patent application or patent to the other
Party, who will then have the right, in its discretion, to assume the filing,
prosecution and/or maintenance thereof as the sole owner thereof and at its sole
cost and expense.

 

6.3 NOTICE OF INFRINGEMENT. If, during the Term of this Agreement, either Party
learns of any actual, alleged or threatened infringement by a Third Party of any
Licensed Patent Rights under this Agreement, such Party shall promptly notify
the other Party and shall provide such other Party with available evidence of
such infringement.

 

6.4  INFRINGEMENT OF PATENT RIGHTS.

 

(a) SOLE IMMUNOGEN INVENTIONS. IMMUNOGEN shall have the first right (but not the
obligation), at its own expense, to bring suit (or take other appropriate legal
action) against any actual, alleged or threatened infringement of the Licensed
Patent Rights solely owned by IMMUNOGEN under this Agreement, with legal counsel
of its own choice. GENENTECH shall have the right, at its own expense, to be
represented in any such action by IMMUNOGEN by counsel of GENENTECH’s own
choice; PROVIDED, HOWEVER, that under no circumstances shall the foregoing
affect the right of IMMUNOGEN to control the suit as described in the first
sentence of this Section 6.4(a). If IMMUNOGEN does not file any action or
proceeding against such infringement within one hundred twenty (120) days after
the later of (i) IMMUNOGEN’s notice to GENENTECH under Section 6.3 above,
(ii) GENENTECH’s notice to IMMUNOGEN under Section 6.3 above, or (iii) a written
request from GENENTECH to take action with respect to such infringement, then
GENENTECH shall have the right (but not the obligation), at its own expense, to
bring suit (or take other appropriate legal action) against such actual, alleged
or threatened infringement, with legal counsel of its own choice. IMMUNOGEN
shall have the right, at its own expense, to be represented in any such action
by GENENTECH by counsel of IMMUNOGEN’s own choice. Any damages, monetary awards
or other amounts recovered, whether by judgment or settlement, pursuant to any
suit, proceeding or

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

29

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other legal action taken under this Section 6.4(a), shall first be applied to
reimburse the costs and expenses (including attorneys’ fees) of the Party
bringing such suit or proceeding or taking such other legal action, then to the
costs and expenses (including attorneys’ fees), if any, of the other Party. Any
amounts remaining shall be allocated as follows: (A) if GENENTECH is the Party
bringing such suit or proceeding or taking such other legal action, [*] to
GENENTECH and [*] to IMMUNOGEN, (B) if IMMUNOGEN is the Party bringing such suit
or proceeding or taking such other legal action, [*] to IMMUNOGEN and (C) if the
suit is brought jointly, [*] to each Party. If a Party brings any such action or
proceeding hereunder, the other Party agrees to be joined as party plaintiff if
necessary to prosecute such action or proceeding, and to give the Party bringing
such action or proceeding reasonable assistance and authority to file and
prosecute the suit; PROVIDED, HOWEVER, that neither Party shall be required to
transfer any right, title or interest in or to any property to the other Party
or any Third Party to confer standing on a Party hereunder.

 

(b) INFRINGEMENT OF JOINT INVENTIONS. As to the any actual, alleged or
threatened infringement of any Patent Rights jointly owned by IMMUNOGEN and
GENENTECH under this Agreement, including actions against any alleged infringer,
the Parties hereto will consult with each other in good faith regarding the best
manner in which to proceed. The Parties agree as a basic principle that in the
case of such actions against infringers, the expenses incurred and damages
awarded shall be for the account of the Party or Parties who take such actions
to the extent of their financial participation therein.

 

6.5  THIRD PARTY PATENTS. If any Third Party claims that a patent it owns or
controls claims any aspect of a Licensed Product or its manufacture, use or
sale, the Party with notice of such claim shall notify the other Party promptly,
and the Parties shall as soon as practicable thereafter discuss in good faith
regarding the best response.

 

6.6  TRADEMARKS. All Licensed Products shall be sold under one (1) or more
trademarks and tradenames selected and owned by GENENTECH (or its Sublicensee)
in the Territory. GENENTECH (or its Sublicensee) shall control the preparation,
prosecution and maintenance of applications related to all such trademarks and
tradenames in the Territory, at its sole cost and expense and at its sole
discretion. IMMUNOGEN shall notify GENENTECH promptly upon learning of any
actual, alleged or threatened infringement of a trademark or tradename
applicable to a Licensed Product in the Territory, or of any unfair trade
practices, trade dress imitation, passing off of counterfeit goods, or like
offenses in the Territory. All of the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

30

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costs, expenses and legal fees in bringing, maintaining and prosecuting any
action to maintain, protect or defend any owned by GENENTECH (or its
Sublicensee) hereunder, and any damages or other recovery, shall be GENENTECH’s
(or its Sublicensee’s) sole responsibility, and taken in its sole discretion.

 

6.7  INTEGRATION. This Section 6 supersedes any agreement between the Parties as
to the subject matter hereof, including, without limitation, the provisions of
MTA relating to inventions, patent applications and patents. Section 6 shall
survive termination or expiration of this Agreement.

 

7. TERM AND TERMINATION

 

7.1  TERM; EXPIRATION. The term of this Agreement (“TERM”) shall expire upon the
expiration of the final royalty payment obligation under Section 4.4 above. Upon
such expiration of the Term of this Agreement, GENENTECH shall have a fully
paid-up, irrevocable, freely transferable and sublicensable license in the
Territory under the Licensed Patent Rights and Licensed Technology, to Develop,
have Developed, make, have made, use, have used, sell, have sold, offer for
sale, import and have imported any and all Licensed Products in the Territory.

 

7.2. TERMINATION. Subject to the other terms of this Agreement:

 

(a) BREACH. A Party may terminate this Agreement and the licenses granted
herein, effective upon written notice to the other Party, upon any breach by the
other Party of any material obligation or condition of this Agreement, which
material breach remains uncured [*] after the non-breaching Party gives a first
written notice to the other Party describing such breach in reasonable detail;
PROVIDED, HOWEVER, that in the event of a payment breach by GENENTECH under this
Agreement, the applicable cure period shall be [*] but the other terms of this
Section 7.2(a) shall apply to termination in connection with any such payment
breach. Notwithstanding anything set forth herein, if the asserted material
breach is cured or shown to be non-existent within the applicable cure period,
the first notice of breach hereunder shall be deemed automatically withdrawn and
of no effect.

 

(b) BANKRUPTCY. A Party may terminate this Agreement, effective on written
notice to the other Party, in the event the other Party shall have become
insolvent or bankrupt, or shall have made an assignment for the benefit of its
creditors, or there shall have been appointed a trustee or receiver of the other
Party or for all or a substantial part of its property, or any case or

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

31

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proceeding shall have been commenced or other action taken by or against the
other Party in bankruptcy or seeking reorganization, liquidation, dissolution,
winding-up, arrangement, composition or readjustment of its debts or any other
relief under any bankruptcy, insolvency, reorganization or other similar act or
law of any jurisdiction now or hereafter in effect, or there shall have been
issued a warrant of attachment, execution, distraint or similar process against
any substantial part of the property of the other Party, and any such foregoing
events shall have continued for sixty (60) days undismissed, unbonded and
undischarged. Furthermore, all rights and licenses granted under this Agreement
are, and shall be deemed to be, for purposes of Section 365(n) of the United
States Bankruptcy Code, licenses of rights to “intellectual property” as defined
under Section 101(56) of the United States Bankruptcy Code. The Parties agree
that in the event of the commencement of a bankruptcy proceeding by or against
one Party hereunder under the United States Bankruptcy Code, the other Party
shall be entitled to complete access to any such intellectual property, and all
embodiments of such intellectual property, pertaining to the rights granted in
the licenses hereunder of the Party by or against whom a bankruptcy proceeding
has been commenced, subject, however, to payment of the milestone amounts and
royalties set forth in this Agreement through the effective date of any
termination hereunder.

 

(c) UNILATERAL TERMINATION BY GENENTECH. GENENTECH, in its sole discretion, at
any time may terminate this Agreement, and the rights and obligations hereunder,
or may remove any Licensed Product and the licenses related thereto from
operation of this Agreement, in any case effective [*] after written notice
thereof to IMMUNOGEN. In the event of any termination under this
Section 7.2(c) only as to a Licensed Product, the consequences set forth in
Section 7.3 below relating to termination of the Agreement under this
Section 7.2(c) shall apply only with respect to such terminated Licensed
Product, and this Agreement and the rights and obligations hereunder shall
continue in full force and effect as to any and all other Licensed Products.

 

7.3  EFFECTS OF TERMINATION. Upon any termination of this Agreement by IMMUNOGEN
under Section 7.2(a) or by GENENTECH under Section 7.2(c), as of the effective
date of such termination, all relevant licenses and sublicenses granted by
IMMUNOGEN to GENENTECH hereunder shall terminate automatically. Notwithstanding
the foregoing, (a) no such termination of this Agreement shall be construed as a
termination of any valid sublicense of any Sublicensee hereunder, and thereafter
each such Sublicensee shall be considered a direct licensee of IMMUNOGEN,
PROVIDED that (i) such Sublicensee is then in full

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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compliance with all terms and conditions of its sublicense, (ii) all accrued
payments obligations to IMMUNOGEN have been paid, and (iii) such sublicensee
agrees at least [*] prior to the effective date of such termination to assume
all obligations of GENENTECH under this Agreement, and (b) Genentech and its
Sublicensees shall have the right, for [*] or such longer time period (if any)
on which the Parties mutually agree in writing, to sell or otherwise dispose of
all Licensed Products then on hand, with royalties to be paid to IMMUNOGEN on
all Net Sales of such Licensed Products as provided for in this Agreement.
Nothing set forth in this Section 7 or any other provision of this Agreement
shall entitle IMMUNOGEN to any ownership interest in, or to any license under or
other rights with respect to (including any rights to use or request any
transfer to IMMUNOGEN or any Third Party), any Confidential Information of
Genentech or any Technology or Patent Rights solely owned by GENENTECH under
this Agreement.

 

7.4  EFFECTS OF TERMINATION FOR IMMUNOGEN BREACH. Upon any termination of this
Agreement by GENENTECH under Section 7.2(a), as of the effective date of such
termination, GENENTECH thereafter automatically shall have a fully sublicensable
and transferable, fully paid up (subject to the remainder of this Section 7.4),
exclusive license in the Territory under the Licensed Patent Rights and Licensed
Technology, to Develop, have Developed, make, have made, use, have used, sell,
have sold, offer for sale, import and have imported any and all Licensed
Products in the Territory, PROVIDED that GENENTECH shall pay, for the remainder
of the royalty term under Section 4.4 above, in lieu of any payments including
milestones or royalties it would otherwise owe to IMMUNOGEN under this
Agreement, a royalty equal to [*] with respect to the Licensed Product under
Sections 4.2.1, 4.2.2, 4.2.3 and 4.2.4 of this Agreement.

 

7.5  REMEDIES. Except as otherwise expressly set forth in this Agreement, the
termination provisions of this Section 7 are in addition to any other relief and
remedies available to either Party at law.

 

7.6 SURVIVING PROVISIONS. Notwithstanding any provision herein to the contrary,
the rights and obligations of the Parties set forth in Sections 4.7, 5, 6, 7.3,
7.4, 7.5, 8, 9, 10 and this Section 7.6, as well as any rights or obligations
otherwise accrued hereunder (including any accrued payment obligations), shall
survive the expiration or termination of the Term of this Agreement. Without
limiting the generality of the foregoing, GENENTECH shall have no obligation to
make any milestone or royalty payment to IMMUNOGEN that has not accrued

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

33

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prior to the effective date of any termination of this Agreement, but shall
remain liable for all such payment obligations accruing prior to the effective
date of such termination.

 

8. REPRESENTATIONS AND WARRANTIES

 

8.1  IMMUNOGEN REPRESENTATIONS. IMMUNOGEN represents and warrants to GENENTECH
that: (a) the execution and delivery of this Agreement and the performance of
the transactions contemplated hereby have been duly authorized by all
appropriate IMMUNOGEN corporate action; (b) this Agreement is a legal and valid
obligation binding upon IMMUNOGEN and enforceable in accordance with its terms,
and the execution, delivery and performance of this Agreement by the Parties
does not conflict with any agreement, instrument or understanding to which
IMMUNOGEN is a party or by which it is bound; (c) IMMUNOGEN has the full right
and legal capacity to grant the licenses and rights to GENENTECH pursuant to
Section 2 above without violating the rights of any Third Party; and (d) to
IMMUNOGEN’s knowledge, no Patent Rights within the Licensed Patent Rights are
invalid or unenforceable or would infringe Patent Rights of Third Parties, and
as of the Effective Date no patents within the Licensed Patent Rights are
expired.

 

8.2  GENENTECH REPRESENTATIONS. GENENTECH represents and warrants to IMMUNOGEN
that: (a) the execution and delivery of this Agreement and the performance of
the transactions contemplated hereby have been duly authorized by all
appropriate GENENTECH corporate action; and (b) this Agreement is a legal and
valid obligation binding upon GENENTECH and enforceable in accordance with its
terms, and the execution, delivery and performance of this Agreement by the
Parties does not conflict with any agreement, instrument or understanding to
which GENENTECH is a party or by which it is bound.

 

8.3  NO WARRANTIES.

 

(a)  Nothing in this Agreement is or shall be construed as:

 

(i)  a warranty or representation by IMMUNOGEN as to the validity or scope of
any patent application or patent within the Licensed Patent Rights;

 

(ii) a warranty or representation that anything made, used, sold or otherwise
disposed of under any license granted in this Agreement is or will be free from
infringement of patents, copyrights, and other rights of third parties.

 

(b)  Except as expressly set forth in this Agreement, NEITHER PARTY MAKES

 

ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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EXPRESS OR IMPLIED. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, THAT ANY LICENSED PRODUCT
WILL BE SUCCESSFULLY DEVELOPED OR MARKETED, OR THAT THE DEVELOPMENT,
MANUFACTURE, SALE, IMPORTATION OR USE OF THE LICENSED PRODUCT(S) WILL NOT
INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER RIGHTS, OR ANY OTHER EXPRESS
OR IMPLIED WARRANTIES.

 

8.4  SURVIVAL. Section 8 shall survive termination or expiration of this
Agreement.

 

9. INDEMNIFICATION; LIABILITY

 

9.1  INDEMNIFICATION.

 

(a) GENENTECH INDEMNITY. Subject to Section 9.1(b) below and the remainder of
this Section 9, GENENTECH shall indemnify, defend and hold harmless IMMUNOGEN,
its Affiliates and their respective directors, officers, employees, and agents
and their respective successors, heirs and assigns (the “Indemnitees”), from and
against any liability, damage, loss or expense (including reasonable attorneys’
fees and expenses of litigation) incurred by or imposed upon such Indemnitees,
or any of them, in connection with any Third Party claims, suits, actions,
demands or judgments, including, without limitation, personal injury and product
liability matters (but excluding any patent, trademark or tradename infringement
matters, which are governed by Section 6 above), that arise out of or relate to
(i) any actions or omissions of GENENTECH or any Sublicensee in the development,
testing, production, manufacture, supply, promotion, import, sale or use by any
person of any Licensed Product (or any component thereof) manufactured or sold
by GENENTECH or any Sublicensee under this Agreement, (ii) any material breach
of this Agreement by GENENTECH, or (iii) negligence or willful misconduct on the
part of GENENTECH, in any such case under this Section 9.1(a) except to the
extent of IMMUNOGEN’s responsibility therefor under Section 9.1(b) below.

 

(b) IMMUNOGEN INDEMNITY. Subject to Section 9.1(a) above and the remainder of
this Section 9, IMMUNOGEN shall indemnify, defend and hold harmless GENENTECH,
its Affiliates and their respective directors, officers, employees, and agents,
and their respective successors, heirs and assigns (also the “INDEMNITEES”),
from and against any liability, damage, loss or expense (including reasonable
attorneys’ fees and expenses of litigation) incurred by or imposed upon such
Indemnitees, or any of them, in connection with any

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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Third Party claims, suits, actions, demands or judgments, including, without
limitation, personal injury and product liability matters (but excluding any
patent, trademark or tradename infringement matters, which are governed by
Section 6 above), that arise out of or relate to (i) any actions or omissions of
IMMUNOGEN or subcontractor of IMMUNOGEN in the development, testing, production,
manufacture or supply of any Licensed Product (or any component thereof)
manufactured and supplied by IMMUNOGEN or any subcontractor of IMMUNOGEN under
this Agreement, (ii) any material breach of this Agreement by IMMUNOGEN, or
(iii) negligence or willful misconduct on the part of IMMUNOGEN, in any such
case under this Section 9.1(b) except to the extent of GENENTECH’s
responsibility therefor under Section 9.1(a) above.

 

9.2  INDEMNIFICATION PROCEDURES. In the event that any Indemnitee is seeking
indemnification under Section 9.1 above from a Party (the “INDEMNIFYING PARTY”),
the other Party shall notify the Indemnifying Party of such claim with respect
to such Indemnitee as soon as reasonably practicable after the Indemnitee
receives notice of the claim, and the Party (on behalf of itself and such
Indemnitee) shall permit the Indemnifying Party to assume direction and control
of the defense of the claim (including the right to settle the claim solely for
monetary consideration) and shall cooperate as requested (at the expense of the
Indemnifying Party) in the defense of the claim.

 

9.3  [*]

 

9.4  SURVIVAL. Section 9 shall survive termination or expiration of this
Agreement.

 

10. MISCELLANEOUS

 

10.1 ENTIRE AGREEMENT; AMENDMENTS. This is the entire Agreement between the
Parties with respect to the subject matter herein, and supersedes any prior
agreements, understandings, negotiations or correspondence between the Parties
respecting the subject matter hereof, whether written or verbal (including,
without limitation, the MTA, that certain Confidentiality Agreement effective
November 5, 1996, and that certain Confidentiality Agreement effective April 8,
1998). No modification or other amendment of this Agreement shall be effective
unless in writing and signed by a fully authorized representative of each Party.

 

10.2 WAIVER. The terms or conditions of this Agreement may be waived only by a
written instrument executed by a duly authorized representative of the Party
waiving compliance. The failure of either Party at any time or times to require
performance of any provision hereof

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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shall in no manner affect its rights at a later time to enforce the same. No
waiver by either Party of any condition or term shall be deemed as a continuing
waiver of such condition or term or of another condition or term.

 

10.3 GOVERNING LAW. This Agreement will be construed, interpreted and applied in
accordance with the laws of the State of California applicable to contracts
entered into and to be performed entirely within the State of California.

 

10.4 NOTICES. Any notices, requests, deliveries, approvals or consents required
or permitted to be given under this Agreement to GENENTECH or IMMUNOGEN shall be
in writing and shall be personally delivered or sent by telecopy (with machine
confirmation of transmission) or by overnight courier providing evidence of
receipt or certified mail, return receipt requested, postage prepaid, in each
case to the respective address specified below (or to such address as may be
specified in writing to the other Party hereto):

 

If to IMMUNOGEN:

ImmunoGen, Inc.

 

333 Providence Highway

 

Norwood, MA 02062

 

Attn:     Chief Executive Officer

 

Fax: (781) 255-9679

 

 

with a copy to

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

 

One Financial Center

 

Boston, MA 02111

 

Attn: Jeffrey M. Wiesen, Esq.

 

(617) 542-2241

 

 

If to GENENTECH:

Genentech, Inc.

 

1 DNA Way 94080

 

South San Francisco, CA 94080

 

Attn: Corporate Secretary

 

Fax: (650) 952-9881

 

Such notices shall be deemed to have been sufficiently given on: (a) the date
sent if delivered in person or transmitted by telecopy, (b) the next business
day after dispatch in the case of overnight courier or (c) five (5) business
days after deposit in the U.S. mail in the case of certified mail.

 

10.5 NO IMPLIED LICENSES. Except as expressly set forth elsewhere in this
Agreement, neither Party grants to the other Party any right or license to any
of its intellectual property.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

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10.6 HEADINGS. Section and subsection headings are inserted for convenience of
reference only and do not form part of this Agreement.

 

10.7 ASSIGNMENT. This Agreement may not be assigned by either Party without the
consent of the other, except that each Party may, without such consent, assign
this Agreement and the rights, obligations and interests of such Party, in whole
or in part, to any of its Affiliates, to any purchaser of all or substantially
all of its assets in the line of business to which this Agreement pertains or to
any successor corporation resulting from any merger or consolidation of such
Party with or into such corporations.

 

10.8 FORCE MAJEURE. Neither Party shall be liable for failure of or delay in
performing obligations set forth in this Agreement, and neither shall be deemed
in breach of its obligations, if such failure or delay is due to natural
disasters or any causes beyond the reasonable control of such Party. In event of
such force majeure, the Party affected thereby shall use reasonable efforts to
cure or overcome the same and resume performance of its obligations hereunder.

 

10.9 CONSTRUCTION. The Parties hereto acknowledge and agree that: (a) each Party
and its counsel reviewed and negotiated the terms and provisions of this
Agreement and have contributed to its revision; (b) the rule of construction to
the effect that any ambiguities are resolved against the drafting Party shall
not be employed in the interpretation of this Agreement; and (c) the terms and
provisions of this Agreement shall be construed fairly as to each Party hereto
and not in a favor of or against any Party, regardless of which Party was
generally responsible for the preparation of this Agreement.

 

10.10 SEVERABILITY. If any provision(s) of this Agreement are or become invalid,
are ruled illegal by any court of competent jurisdiction or are deemed
unenforceable under then current applicable law from time to time in effect
during the term hereof, it is the intention of the Parties that the remainder of
this Agreement shall not be affected thereby provided that a Party’s rights
under this Agreement are not materially affected. The Parties hereto covenant
and agree to renegotiate any such term, covenant or application thereof in good
faith in order to provide a reasonably acceptable alternative to the term,
covenant or condition of this Agreement or the application thereof that is
invalid, illegal or unenforceable, it being the intent of the Parties that the
basic purposes of this Agreement are to be effectuated.

 

10.11 STATUS. Nothing in this Agreement is intended or shall be deemed to
constitute a partner, agency, employer-employee, or joint venture relationship
between the Parties.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

38

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10.12 DISPUTE RESOLUTION. The Parties recognize that a bona fide dispute as to
certain matters may from time to time arise during the term of this Agreement
relating to either Party’s rights and/or obligations hereunder or otherwise
relating to the validity, enforceability or performance of this Agreement,
including disputes relating to alleged breach or termination of this Agreement
but excluding any determination of the validity of the Parties’ patents
(hereinafter, a “Dispute”). In the event of the occurrence of any such Dispute,
the Parties pledge to attempt to resolve it amicably. Accordingly, if any
Dispute should arise, either Party may, by written notice to the other Party,
have such dispute referred to their respective senior officers designated below
(and to any designated officer of a GENENTECH Sublicensee, if such Dispute
involves such Sublicensee), for attempted resolution by good faith negotiations
commencing promptly after such notice is received; PROVIDED, HOWEVER, that if
the subject matter of such Dispute is within the purview of the Joint Process
Development Committee, the Parties’ representatives on the JPDC shall first
attempt to resolve such Dispute before referring it to the Parties’ senior
officers hereunder. Said designated senior officials of the Parties are as
follows:

 

For GENENTECH:  Designated officer with settlement authority; and

 

For IMMUNOGEN:  Chief Executive Officer.

 

In the event the designated senior officials are not able to resolve such
Dispute, the Parties may seek to mediate their Dispute, on terms and with a
mediator mutually agreeable to the Parties, or may seek to arbitrate their
Dispute, on mutually agreed upon terms and conditions, but neither Party shall
be required or obligated to mediate or arbitrate and the dispute resolution
provisions of this Section 10.12 are in addition to any other relief and
remedies available to either Party at law or in equity.

 

10.13 FURTHER ASSURANCES. Each Party agrees to execute, acknowledge and deliver
such further instruments, and to do all other such acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.

 

10.14 COUNTERPARTS. This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

39

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representative in two (2) originals.

 

GENENTECH, INC.

IMMUNOGEN, INC.

 

 

By:

 

By:

 

Title:

 

Title:

 

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

40

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SCHEDULE I

 

LICENSED PATENT RIGHTS

 

[*]

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

41

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SCHEDULE II

 

CERTAIN LICENSED TECHNOLOGY

 

[*]

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the Securities and Exchange Commission pursuant to
the Registrant’s application requesting confidential treatment pursuant to
Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 

4

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