Exhibit 10.2

 

EXTENSION OF CONFIDENTIAL TREATMENT REQUESTED:  Certain identified information,
marked by [***], has been excluded from the exhibit because it is both (i) not
material and (ii) would likely cause competitive harm to the Company, if
publicly disclosed.  An extension of confidential treatment for such information
has been requested.  An unredacted version of this document has been filed
separately with the Securities and Exchange Commission (the “Commission”).

 

 

LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

by and between

Incyte Corporation

Experimental Station, Route 141 & Henry Clay Road

Wilmington, Delaware

 

and

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

 

 

 

 

TABLE OF CONTENTS

 

 

 

 

 

ARTICLE I Definitions

    

1

 

 

 

ARTICLE II Licenses

 

13

 

 

 

 

2.1

Rights Granted by Incyte to Lilly

 

13

2.2

Sublicense Rights

 

13

2.3

Section 365(n) of The Bankruptcy Code

 

14

2.4

Field Expansion

 

14

2.5

Retained Rights

 

15

2.6

Non-Compete

 

15

 

 

 

 

ARTICLE III Governance

 

17

 

 

 

 

3.1

Joint Development Committee.

 

17

3.2

Subcommittees

 

18

3.3

Committee Meetings

 

18

3.4

Authority

 

18

3.5

Decisions.

 

19

3.6

Committee Membership.

 

19

3.7

Future Adjustments in Governance

 

19

 

 

 

 

ARTICLE IV Development; Regulatory Matters; Supply

 

20

 

 

 

 

4.1

Initial Transfer

 

20

4.2

Conduct of Development Activities

 

20

4.3

Development Reports

 

23

4.4

Licensed Product Co-Development Option

 

23

4.5

Regulatory Matters Related to Licensed Products

 

25

4.6

Manufacture and Supply

 

26

 

 

 

 

ARTICLE V Commercialization

 

26

 

 

 

 

5.1

Commercialization Diligence

 

26

5.2

Marketing Responsibilities For Licensed Products

 

28

5.3

Trademarks.

 

28

5.4

Co-Promotion.

 

28

 

 

 

 

ARTICLE VI Intellectual Property Ownership, Protection and Related Matters

 

30

 

 

 

 

6.1

Inventorship; Ownership

 

30

6.2

Prosecution and Maintenance of Patent Rights

 

30

6.3

Third Party Infringement

 

32

6.4

Patent Marking

 

33

 

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ARTICLE VII Financial Provisions

 

33

 

 

 

 

7.1

License Fee

 

33

7.2

Milestone Payments

 

33

7.3

Royalties

 

37

7.4

Royalty Reports; Payments

 

39

7.5

Financial Records

 

40

7.6

Audits

 

40

7.7

Tax Matters

 

40

7.8

Currency Exchange

 

40

7.9

Late Payments

 

41

 

 

 

 

ARTICLE VIII Term and Termination

 

41

 

 

 

 

8.1

Agreement Term

 

41

8.2

Termination.

 

41

8.3

Effects Of Termination.

 

42

 

 

 

 

ARTICLE IX Indemnification; Limitation of Liability

 

45

 

 

 

 

9.1

By Lilly

 

45

9.2

By Incyte

 

45

9.3

Limitation of Liability

 

46

 

 

 

 

ARTICLE X Representations and Warranties and Covenants

 

46

 

 

 

 

10.1

Representation Of Authority; Consents

 

46

10.2

No Conflict

 

47

10.3

Additional Incyte Representations and Warranties

 

47

10.4

Disclaimer of Warranty

 

48

10.5

Standstill

 

48

 

 

 

 

ARTICLE XI Confidentiality

 

50

 

 

 

 

11.1

Confidential Information

 

50

11.2

Permitted Disclosure

 

50

11.3

Publicity; Attribution; Terms of this Agreement; Non-Use of Names.

 

51

11.4

Publications

 

52

11.5

Term

 

53

11.6

Return of Confidential Information

 

53

 

 

 

 

ARTICLE XII Dispute Resolution

 

54

 

 

 

 

12.1

Dispute Resolution Process

 

54

12.2

Injunctive Relief

 

54

 

 

 

 

 

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ARTICLE XIII Miscellaneous

 

54

13.1

Governing Law

 

54

13.2

Consent to Jurisdiction

 

54

13.3

Assignment

 

55

13.4

Entire Agreement; Amendments

 

55

13.5

Notices

 

55

13.6

Force Majeure

 

56

13.7

Compliance With Laws

 

56

13.8

Use Of Names, Logos Or Symbols

 

57

13.9

Independent Contractors

 

57

13.10

Headings

 

57

13.11

No Implied Waivers; Rights Cumulative

 

57

13.12

Severability

 

57

13.13

Execution In Counterparts

 

57

13.14

No Third Party Beneficiaries.

 

57

13.15

Performance by Affiliates.

 

58

13.16

Exhibits

 

58

 

 

 

 

 

Exhibits

 

Exhibit A:  Incyte Patent Rights

      Exhibit A-1: Genus Patent Rights

      Exhibit A-2: Selection Patent Rights

Exhibit B:  Initial Information Transfer

Exhibit C:  Initial Development Plans

Exhibit D:  Initial Press Release

Exhibit E: Hematology Field and Oncology Field

 

Schedules

 

Schedule 1.43:  [***]

Schedule 1.48:  Initial Licensed Back-Up Compounds

 

 

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LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

 

THIS LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (the “Agreement”) is
entered into as of the 18th day of December, 2009 (“Effective Date”), by and
between Incyte Corporation, a Delaware corporation having an office at
Experimental Station, Route 141 & Henry Clay Road, Wilmington, Delaware
(“Incyte”), and Eli Lilly and Company, an Indiana corporation having an office
at Lilly Corporate Center, Indianapolis, Indiana 46285 (“Lilly”).

WHEREAS, Incyte and Lilly are each in the business of discovering, developing
and commercializing pharmaceutical products;

WHEREAS, Incyte has discovered and commenced Development of the Licensed
Compounds (as defined below);

WHEREAS, Incyte has agreed to grant to Lilly a license to develop and
commercialize the Licensed Compounds;

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereby agree as follows:

ARTICLE I

 

DEFINITIONS

When used in this Agreement, each of the following terms shall have the meanings
set forth in this ARTICLE I:

1.1       “Accounting Standards” with respect to a Party means that such Party
shall maintain records and books of accounts in accordance with (a) US GAAP
(United States Generally Accepted Accounting Principles) or (b) to the extent
applicable, IFRS (International Financial Reporting Standards).

1.2       “Affiliate” means any Person that, directly or indirectly, controls,
is controlled by or is under common control with a Party.  For the purposes of
this Section 1.2, the word “control” (including, with correlative meaning, the
terms “controlled by” or “under common control with”) means the actual power,
either directly or indirectly through one or more intermediaries, to direct the
management and policies of such entity, whether by the ownership of [***] of the
Voting Stock of such entity, by contract or otherwise. The Parties acknowledge
that in the case of certain entities organized under the laws of certain
countries outside of the United States, the maximum percentage ownership
permitted by law for a foreign investor may be less than [***], and that in such
case such lower percentage shall be substituted in the preceding sentence,
provided that such foreign investor has the power to direct the management and
policies of such entity.

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1.3       “Annual Net Sales” means aggregate Net Sales of a Licensed Product by
Lilly or its Affiliates or sublicensees in any Calendar Year, or in the first
and last years of the term of this Agreement, the portion of such Calendar Year
during which this Agreement is in effect.

1.4       “Business Day” means a day other than a Saturday or Sunday or Federal
holiday in Wilmington, Delaware or Indianapolis, Indiana.

1.5       “Calendar Quarter” means a calendar quarter ending on the last day of
March, June, September or December.

1.6       “Calendar Year” means a period of time commencing on January 1 and
ending on the following December 31.

1.7       “Clinical Trial” means a Phase I Study, a Phase II Study, a Phase IIb
Study, a Phase III Study, a Phase IV Study or a combination of two (2) of any of
the foregoing studies.

1.8       “Commercialization” or “Commercialize” means any activities directed
to obtaining pricing and/or reimbursement approvals, marketing, promoting,
distributing, importing, offering to sell, and/or selling a product (including
establishing the price for such product).

1.9       “Commercially Reasonable Efforts” of a Party means, with respect to an
objective, the reasonable, diligent, good faith efforts of a Party, (including
the efforts of its Affiliates, and sublicensees) of the type to accomplish such
objective as a similarly situated (with respect to size, stage of development,
and assets) biotechnology or pharmaceutical company, as the case may be, would
normally use to accomplish a similar objective under similar circumstances, it
being understood and agreed that, with respect to efforts to be expended in
relation to a product (including implementation of Development and
Commercialization strategies to support the pursuit of multiple Indications in
accordance with Exhibit C), such efforts shall be substantially equivalent to
those efforts and resources that a similarly situated biotechnology or
pharmaceutical company, as the case may be, would typically devote to its own
internally discovered compound or product, which compound or product is at a
similar stage in its Development or product life and is of similar market and
economic potential as products expected to result from the Licensed Compounds at
a similar stage in their Development or product life, taking into account the
risks of development, the commercial potential for the Product, its proprietary
position and other relevant factors.

1.10     “Confidential Information” means (a) all confidential or proprietary
information relating to Licensed Compounds, and (b) all other confidential or
proprietary documents, technology, Know-How or other information (whether or not
patentable) actually disclosed by one Party to the other pursuant to this
Agreement or the Prior Confidentiality Agreement.

1.11     “Control” or “Controlled” means, with respect to any (a) material,
document, item of information, method, data or other Know-How or (b) Patent
Rights or other Intellectual Property Rights, the possession by a Party or its
Affiliates (whether by ownership or license (other than by a license granted
under this Agreement)), of the ability to grant to the other Party access, a
license and/or a sublicense as provided herein without requiring the consent of
a Third Party or violating the terms of any agreement or other arrangement with
any Third Party, in each

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case as of the Effective Date, or if any of the same are acquired or created
after the Effective Date, at the date it is acquired or created by the relevant
Party or its Affiliate.

1.12     “Cover”, “Covering” or “Covered” with respect to a product, technology,
process or method, means that, but for a license granted to a Person under a
Valid Claim included in the Patent Rights under which such license is granted,
the Development, manufacture, Commercialization and/or other use of such product
or the practice of such technology, process or method, by such Person would
infringe such Valid Claim (or, in the case of a Valid Claim that has not yet
issued, would infringe such Valid Claim if it were to issue).

1.13     “CPI” means the Consumer Price Index – Urban Wage Earners and Clerical
Workers, U.S. City Average, All Items, 1982-84 = 100, published by the United
States Department of Labor, Bureau of Statistics (or its successor equivalent
index).

1.14     “Detail” means face-to-face discussions or other direct communication
(e.g. edetailing) with physicians and other health care practitioners who are
permitted under applicable Laws to prescribe a Licensed Product for the purpose
of promoting a Licensed Product to such physicians or practitioners.

1.15     “Development” or “Develop” means, with respect to a compound,
preclinical and clinical drug development activities, including, among other
things:  the conduct of Clinical Trials, test method development and stability
testing, toxicology, formulation and delivery system development, process
development, pre-clinical and clinical drug substance and clinical drug product
supply, manufacturing scale-up, development-stage manufacturing, quality
assurance/quality control procedure development and performance with respect to
clinical materials, statistical analysis and report writing and clinical
studies, regulatory affairs, and all other pre-Regulatory Approval
activities.  When used as a verb, “Develop” means to engage in Development.

1.16     “Development Costs” means the costs and expenses incurred by or on
behalf of a Party attributable to, or reasonably allocable to, the Development
of Licensed Products and that are materially consistent, as applicable, with the
Development Plan and Development Budget.  Development Costs shall not include
[***].  “Development Costs” shall include (a) the costs of Clinical Trials, the
preparation, collation and/or validation of data from such Clinical Trials and
the preparation of medical writing and publishing; (b) the FTE costs of the
relevant Party or its Affiliates; (c) all Out-of-Pocket Costs incurred by the
Parties or their Affiliates, including payments made to Third Parties with
respect to any of the foregoing (except to the extent that such costs have been
included in FTE costs); (d) Out-of-Pocket Costs incurred by or on behalf of a
Party in connection with the preparation and filing of regulatory submissions
for Licensed Product and obtaining of Regulatory Approvals; and (e) the cost of
contract research organizations (CROs) and clinical supply, including: (i)
costs, packaging and distribution of Licensed Products used in Clinical Trials;
(ii) expenses incurred to purchase and/or package comparator drugs; and (iii)
costs and expenses of disposal of clinical samples.

1.17     “EMEA” means the European Medicines Agency, or a successor agency
thereto.

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1.18     “Exchange Act” means the Securities Exchange Act of 1934, as amended.

1.19     “Excluded Field” means any and all Indications in humans and animals in
the Hematology Field and the Oncology Field.

1.20     “Executive Officers” means the Chief Executive Officer of Incyte (or a
senior executive officer of Incyte designated by Incyte’s Chief Executive
Officer) and the Vice President Autoimmune Product Development of Lilly (or a
senior executive officer of Lilly or its Affiliate as designated by the Vice
President Autoimmune Product Development of Lilly).

1.21     “FDA” means the United States Food and Drug Administration, or a
successor agency thereto.

1.22     “Field” means the treatment, control, management, mitigation,
prevention or cure of any and all Inflammatory Disease Indications in humans and
animals in any formulation or dosage form, process or delivery method, but not
including the Topical Field.

1.23     “First Commercial Sale” means, with respect to a Licensed Product, the
first sale of commercially relevant quantities of such Licensed Product intended
for use by a patient, to a Third Party by, as applicable, Lilly or its
Affiliates or sublicensees in a country following applicable Regulatory Approval
(other than applicable governmental price and reimbursement approvals) of such
Licensed Product in such country.  For the avoidance of doubt, sales or
transfers of Licensed Product for Clinical Trial or other Development purposes,
or for compassionate or similar use, shall not be considered a First Commercial
Sale.

1.24     “Force Majeure Event” means an event, act, occurrence, condition or
state of facts, in each case outside the reasonable control of a Party,
including acts of God; acts of any government; any rules, regulations or orders
issued by any governmental authority or by any officer, department, agency or
instrumentality thereof; fire; storm; flood; earthquake; accident; war;
rebellion; insurrection; riot; terrorism and invasion, that interfere with the
normal business operations of such Party.

1.25     “FTE” means a full-time equivalent person year (consisting of a total
of [***] hours per year) of scientific or technical work undertaken by a Party’s
or its Affiliates’ employees, or a Third Party licensee/sublicensee to the
extent (a) mutually agreed by the Parties and (b)  permitted and in accordance
with the terms and conditions of this Agreement.

1.26     “FTE Rate” means the rate per FTE (which may be prorated on a daily
basis as necessary) of [***] and [***], with respect to Development and
manufacturing activities conducted pursuant to this Agreement, subject to annual
adjustment by the rate of the Employment Cost Index for total compensation for
the “management, professional and related” occupational group, as published by
the United States Department of Labor, Bureau of Labor Statistics (or any
similar index agreed upon by the Parties if such index ceases to be compiled and
published).

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1.27     “Generic Competition” means, with respect to a Licensed Product in any
country in a given Calendar Year, if, during such Calendar Year one or more
Generic Products shall be commercially available in such country and such
Generic Products shall in the aggregate have a market share of [***] of the
aggregate market share of such Licensed Product and Generic Products (based on
data provided by IMS International or, if such data is not available, such

other reliable data source as agreed by the Parties (such agreement not to be
unreasonably withheld)) as measured by unit sales in such country.

1.28     “Generic Product” means any pharmaceutical product that (a) contains a
Licensed Compound; (b) is sold by a Third Party that is not a licensee or
sublicensee of Lilly or its Affiliates, under a marketing authorization granted
by a Regulatory Authority to such Third Party; [***].

1.29     “Hematology Field” means the treatment, control, mitigation,
prevention, cure, or diagnosis of all hematologic Indications as defined in
subsections 280 – 289 (Diseases of the blood and blood-forming organs) of the
International Classification of Diseases, Ninth Revision, Clinical Modification
(ICD-9-CM), as set forth in Exhibit E.

1.30     “HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (15 U.S.C. §18a), and the rules and regulations promulgated
thereunder.

1.31     “Incyte IP” means Incyte Know-How and Incyte Patent Rights.

1.32     “Incyte Know-How” means all Know-How that (a) is Controlled by Incyte
or any of its Affiliates as of the Effective Date or during the Term; and (b) is
necessary or useful to Develop, manufacture or Commercialize any Licensed
Compounds or Licensed Products.

1.33     “Incyte Patent Rights” means all Patent Rights that (a) are Controlled
by Incyte or any of its Affiliates as of the Effective Date or during the Term;
and (b) (i) Covers a Licensed Compound or Licensed Product, a composition
containing Licensed Compound, a formulation containing a Licensed Product or
(ii) are otherwise necessary to Develop, manufacture or Commercialize any
Licensed Compounds or Licensed Products.  The Incyte Patent Rights that exist as
of the Effective Date are set forth in Exhibit A (A-1 and A-2).

1.34     “IND” means an Investigational New Drug Application filed with the FDA
under 21 C.F.R. Part 312 or similar non-United States application or submission
in any country or group of countries for permission to conduct human clinical
investigations.

1.35     “Indication” means any disease, condition or syndrome.

1.36     “Inflammatory Disease” means any inflammatory disease, including the
following Indications: rheumatoid arthritis (and other arthritides including
juvenile RA, ankylosing spondylitis, sero-negative spondyloarthropathies and
psoriatic arthritis), inflammatory bowel disease (ulcerative colitis and Crohn’s
Disease), asthma, chronic obstructive pulmonary disease, multiple sclerosis,
systemic lupus erythmatosus and psoriasis.  Notwithstanding the foregoing,
Inflammatory Disease specifically excludes any Indication included in the
Excluded Field.

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1.37     “Intellectual Property Rights” means Patent Rights, trade secrets,
copyrights and other forms of proprietary or industrial rights pertaining to
inventions, Know-How, original works, and other forms of intellectual property.

1.38     “Inventions” means all patentable inventions, discoveries, improvements
and other technology and any Patent Rights based thereon, that are discovered,
made or conceived

during and in connection with the research, Development, manufacture and
Commercialization of Licensed Compounds or Licensed Products.

1.39     “JAK” means human Jak Tyrosine Kinase.

1.40     “JAK1” means Jak1 Tyrosine Kinase.

1.41     “JAK2” means Jak2 Tyrosine Kinase.

1.42     “JAK Excluded Compound” means [***].

1.43     “JAK2 Inhibitor Compound” means [***] in Schedule 1.43.

1.44     “Know-How” means any information, ideas, data, inventions, works of
authorship, trade secrets, technology, or materials, including formulations,
molecules, assays, reagents, compounds, compositions, human or animal tissue,
samples or specimens, and combinations or components thereof, whether or not
proprietary or patentable, or public or confidential, and whether stored or
transmitted in oral, documentary, electronic or other form, including all
Regulatory Documentation, but excluding any such information or materials
publicly disclosed in Patent Rights.

1.45     “Law” means any law, statute, rule, regulation, ordinance or other
pronouncement having the effect of law, of any federal, national, multinational,
state, provincial, county, city or other political subdivision, including (a)
good clinical practices and adverse event reporting requirements, guidance from
the International Conference on Harmonization or other generally accepted
conventions, and all other rules, regulations and requirements of the FDA and
other applicable Regulatory Authorities; (b) the Foreign Corrupt Practices Act
of 1977, as amended, or any comparable laws in any country; and (c) all export
control laws.

1.46     “Lead Compound” means (a) the Initial Lead Compound or (b) the first
Licensed Back-Up Compound to achieve initiation of a Phase IIb Study (the
“Follow-On Lead Compound”).

1.47     “Licensed Back-Up Compounds” means all Licensed Compounds other than
the Initial Lead Compound.

1.48     “Licensed Compounds” means (a) the compound known as INCB28050 (the
chemical structure of which has been previously disclosed to Lilly) (the
“Initial Lead

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Compound”); (b) the back-up compounds set forth on Schedule 1.48 (the chemical
structures of which have previously been disclosed to Lilly) (each an “Initial
Licensed Back-Up Compounds”); (c) all other JAK2 Inhibitor Compounds (other than
JAK Excluded Compounds) Covered [***], within the Selection Patent Rights that
exist as of the Effective Date; (d) all salts, prodrugs, esters, metabolites,
solvates, stereoisomers and polymorphs of the foregoing; and (e) all derivatives
of the foregoing containing one or more atoms substituted with a radio isotope
(including derivatives containing deuterium).

1.49     “Licensed Product” means a product or product candidate that contains
one or more Licensed Compounds in any formulation as the active ingredient,
including all dosages of

such Licensed Compounds and all processes and delivery systems that incorporate
such Licensed Compounds, but not including the Topical Field.

1.50     “Major EU Countries” means [***].

1.51     “Major Market Country” means [***].

1.52     “Marketing and Sales Support”  means any direct support (internal or
external, but excluding any allocation of general, corporate or administrative
overhead) relating to the sale, promotion and marketing of Licensed Products,
including: (a) Detailing or such other contact  regarding Licensed Products; (b)
sample drops and any activities performed by medical information scientists,
market development specialists, managed care account directors and other
personnel; (c), market research, marketing communications, managed care, sales
meetings, sales force training, product hotlines, reimbursement support,
contracting, pricing, and telemarketing services; (d) advertising through any
means, including television and radio advertisements, advertisements appearing
in journals, newspapers, magazines or other media, packaging design, visual aids
and other selling materials, hospital formulary committee presentations and
presentations to state and other governmental formulary committees; and (e) any
public relations activity relating to a Licensed Product.

1.53     “MHLW” means the Japanese Ministry of Health, Labor and Welfare, or a
successor agency thereto.

1.54     “NDA” means (a) (i) a New Drug Application submitted to the FDA, or any
successor application or procedure, as more fully defined in 21 C.F.R. § 314.50
et. seq.; or (ii) any non-United States counterpart of such a New Drug
Application; and (b) all supplements and amendments, including supplemental New
Drug Applications (and any non-United States counterparts) that may be filed
with respect to the foregoing.

1.55     “Net Sales” means, with respect to any Licensed Product, the gross
amount invoiced by Lilly or its Affiliates, or sublicensees on sales or other
dispositions of Licensed Product to Third Parties, or otherwise directly or
indirectly paid to or earned by Lilly or its Affiliates or sublicensees with
respect to the sale of Licensed Product, less the following:

(a)        trade, cash and/or quantity discounts not already reflected in the
amount invoiced, to the extent related to the gross amount invoiced;

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(b)        allowances and adjustments credited or payable, including credit for
spoiled, damaged, outdated, recalled and returned Licensed Product, to the
extent related to the gross amount invoiced and substantiated by reasonable
documentation;

(c)        freight, insurance and other transportation charges incurred in
shipping a Product to Third Parties, to the extent identified as such in the
invoice to the Third Party, to the extent included in the gross amount invoiced;

(d)        amounts repaid or credited by reason of rejections, defects, recalls
or returns or because of chargebacks, refunds, rebates (including wholesaler
inventory management fees, retroactive price reductions, commissions, discounts
or billing errors, and any other allowances which effectively reduce the net
selling price);

(e)        all tariffs, duties, excises, sales taxes, or other taxes (including
VAT) and custom duties imposed on Licensed Products, in each case to the extent
invoiced to customers or otherwise included within gross amounts invoiced;

(f)         allowance for distribution expenses; and

(g)        other similar and customary deductions which are in accordance with
US GAAP.

Net Sales will not include sales between or among Lilly and its Affiliates
and/or sublicensees; provided, however, that any resale to Third Parties shall
be included in Net Sales.

Net Sales shall be calculated in accordance with Lilly’s standard internal
policies and procedures, which must be in accordance with Accounting
Standards.  In the case of any sale or other disposal for value, such as barter
or counter-trade, of Licensed Product, or part thereof, other than in an arm’s
length transaction exclusively for cash, Net Sales shall be calculated as above
on the value of the non-cash consideration received or the fair market price (if
higher) of the Licensed Product in the country of sale or disposal, as
determined in accordance with Accounting Standards. Donated product will be
excluded from Net Sales.

In the event the Licensed Product is sold in a finished dosage form containing
the Licensed Product in combination with one or more other active ingredients (a
“Combination Product”), the Net Sales of the Licensed Product, for the purposes
of determining royalty payments, shall be determined by multiplying the Net
Sales (as defined above in this Section) of the Combination Product by the
fraction, A/(A+B) where A is the weighted (by sales volume) average sale price
in a particular country of the Licensed Product in the prior Calendar Year when
sold separately in finished form and B is the weighted average sale price in
that country in the prior Calendar Year of the other product(s) sold separately
in finished form.

In the event that the weighted average sale price of the Licensed Product can be
determined but the weighted average sale price of the other product(s) cannot be
determined, Net Sales for purposes of determining royalty payments shall be
calculated by multiplying the Net Sales of the Combination Product by the
fraction A / C where A is the weighted average sale price of the Licensed
Product when sold separately in finished form and C is the weighted average sale
price of the Combination Product.

 

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In the event that the weighted average sale price of the other product(s) can be
determined but the weighted average sale price of the Licensed Product cannot be
determined, Net Sales for purposes of determining royalty payments shall be
calculated by multiplying the Net Sales of the Combination Product by the
following formula:  one (1) minus B / C where B is the weighted average sale
price of the other product(s) when sold separately in finished form and C is the
weighted average sale price of the Combination Product.

In the event that such average sale price cannot be determined for both the
Licensed Product and the other product(s) in combination, Net Sales for purposes
of determining royalty payments shall be agreed by the Parties based on the
relative value contributed by each component, such agreement shall not be
unreasonably withheld.

In the initial Calendar Year, a forecasted weighted average sale price will be
used for the Licensed Product, other product(s), or Combination Product. Any
over or under payment due to a difference between forecasted and actual weighted
average sale prices will be paid or credited in the first royalty payment of the
following Calendar Year.

1.56     “Oncology Field” means the treatment, control, mitigation, prevention,
cure, or diagnosis of any oncology Indications as defined in subsections 140 –
239 (Neoplasms) of the International Classification of Diseases, Ninth Revision,
Clinical Modification (ICD-9-CM) as set forth in Exhibit E, including all
hematologic malignancies, solid tumors and myeloproliferative diseases
(including Myelofibrosis, Polycythemia Vera and Essential Thrombocythemia) as
listed in ICD-9-CM.

1.57     “Out-of-Pocket Costs” means, with respect to certain activities
hereunder, direct expenses paid or payable by either Party or its Affiliates to
Third Parties (other than employees of such Party or its Affiliates) that are
specifically identifiable and incurred to conduct such activities for Licensed
Products and have been recorded in accordance with Accounting Standards.

1.58     “Party” means Lilly or Incyte.  “Parties” means Lilly and Incyte.

1.59     “Patent Rights” means all patents and patent applications in any
country in the world, including any continuations, continuations-in-part,
divisions, provisionals or any substitute applications, any patent issued with
respect to any such patent applications, any reissue, reexamination, renewal,
term adjustment, restoration, or extension (including any supplemental
protection certificate) of any such patent, and any confirmation patent or
registration patent or patent of addition based on any such patent, and all
non-United States counterparts of any of the foregoing.

1.60     “Patent Term Extension” means any patent term extension, adjustment or
restoration or supplemental protection certificates.

1.61     “Person” means any natural person, general or limited partnership,
corporation, limited liability company, limited liability partnership, firm,
association or organization or other legal entity.

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1.62     “Phase I Study” means a study in humans which provides for the first
introduction into humans of a product, conducted in healthy volunteers or
patients to obtain information on product safety, tolerability, pharmacological
activity or pharmacokinetics, as more fully defined in 21 C.F.R. § 312.21(a) (or
the non-United States equivalent thereof).

1.63     “Phase II Study” means a study in humans of the safety, dose ranging
and efficacy of a product, which is prospectively designed to generate
sufficient data (if successful) to commence pivotal clinical trials, as further
defined in 21 C.F.R. § 312.21(b) (or the non‑United States equivalent thereof).

1.64     “Phase IIb Study” means a well-controlled, dose ranging, multicenter
Phase II Study in patients with the disease or condition under study which is
conducted after a proof of concept study and that is adequately powered to
further evaluate efficacy and safety and define the dosage regimen of a product
in the target indication and which is intended to be among the last clinical
trials in the patient population performed prior to the initiation of Phase III
Studies.  A Phase IIb Study could include several hundred patients but not to
the extent required for registration.

1.65     “Phase III Study” means a controlled study in humans of the efficacy
and safety of a product, which is prospectively designed to demonstrate
statistically whether such product is effective and safe for use in a particular
Indication in a manner sufficient to file an NDA to obtain regulatory approval
to market the product, as further defined in 21 C.F.R. § 312.21(c) (or the
non-United States equivalent thereof).

1.66     “Phase IV Study” means a human clinical trial which is conducted on a
product after Regulatory Approval of the product has been obtained from an
appropriate Regulatory Authority, and includes (a) trials conducted voluntarily
for enhancing marketing or scientific knowledge of an approved Indication or (b)
trials conducted after Regulatory Approval due to request or requirement of a
Regulatory Authority or as a condition of a previously granted Regulatory
Approval.

1.67     “Prior Confidentiality Agreement”  means the Confidentiality Agreement
between Incyte and Lilly, dated April 23, 2009.

1.68     “Publication” means any publication in a scientific journal, any
abstract to be presented to any scientific audience, any presentation at any
scientific conference, including slides and texts of oral or other public
presentations, any other scientific presentation and any other oral, written or
electronic disclosure directed to a scientific audience which pertains to the
Licensed Compound, the Licensed Product or the use of the Licensed Product.

1.69     “Regulatory Approval” means all approvals (including any applicable
governmental price and reimbursement approvals), licenses, registrations, and
authorizations of any federal, national, multinational, state, provincial or
local Regulatory Authority, department, bureau and other governmental entity
that are necessary for the marketing and sale of a Licensed Product in a country
or group of countries.

1.70     “Regulatory Authority” means, with respect to a country, the regulatory
authority or regulatory authorities of such country with authority over the
testing, manufacture, use,

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storage, importation, promotion, marketing, pricing or sale of a pharmaceutical
product in such country.

1.71     “Regulatory Documentation” means, with respect to the Licensed
Compounds and Licensed Products, all INDs and other regulatory applications
submitted to any Regulatory Authority, copies of Regulatory Approvals,
regulatory materials, drug dossiers, master files (including Drug Master Files,
as defined in 21 C.F.R. 314.420 and any non-United States equivalents), and any
other reports, records, regulatory correspondence and other materials relating
to Regulatory Approval of a Licensed Compound or Licensed Product, or required
to

manufacture, distribute or sell the Licensed Products, including any information
that relates to pharmacology, toxicology, chemistry, manufacturing and controls
data, batch records, safety and efficacy, and any safety database required to be
maintained for Regulatory Authorities.

1.72     “Regulatory Exclusivity” means that Third Parties are prevented from
legally Developing, manufacturing or Commercializing a product that could
compete with a Licensed Product in a country, either through data exclusivity
rights, orphan drug designation, or such other rights conferred by a Regulatory
Authority in such country, other than through Patent Rights.

1.73     “Right of Reference or Use” means a “Right of Reference or Use” as that
term is defined in 21 C.F.R. §314.3(b) or any successor regulatory scheme, and
any non-United States equivalents.

1.74     “Selection Patent Rights” means the Incyte Patent Rights that are
designated as INCY0086 and Joint IP Covering the Licensed Compounds and Licensed
Products.  The Selection Patent Rights that exist as of the Effective Date are
set forth on Exhibit A-2.

1.75     “Territory” means the entire world.

1.76     “Third Party” means any Person other than a Party or any of its
Affiliates.

1.77     “Topical Field” means any topical, intranasal, ophthalmic or other
non-systemic formulations or dosage forms (e.g. cream, ointment, lotion,
solution, spray, suspension, emulsion, etc.) that are administered with the
intent to achieve a local/non-systemic pharmacologic activity that provides a
localized treatment [***]. For avoidance of doubt, Topical Field does not
include the administration of a drug through any route if the primary intent of
said administration is to achieve a systemic pharmacologic effect.

1.78     “Valid Claim” means (a) a claim of an issued patent that has not
expired or been abandoned, or been revoked, held invalid or unenforceable by a
patent office, court or other governmental agency of competent jurisdiction in a
final and non-appealable judgment (or judgment from which no appeal was taken
within the allowable time period) or (b) a claim within a patent application
[***] and which claim has not been revoked, cancelled, withdrawn, held invalid
or abandoned.

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1.79     “Voting Stock” means securities of any class or series of a
corporation, limited liability company, association or other entity, the holders
of which are ordinarily, in the absence of contingencies, entitled to vote
generally in matters put before the shareholders or members of such corporation,
limited liability company, association or other entity, including the right to
vote for the election of directors or members of an equivalent governing body.

1.80     Additional Definitions.  Each of the following definitions is set forth
in the section of this Agreement indicated below:

 

DEFINITION

    

SECTION

Abandoned Commercialization

 

5.1(b)

Abandoned Development

 

4.2(b)(iii)

Additional Field

 

2.4

Agreement

 

Preamble

Bankruptcy Code

 

2.3

Breaching Party

 

8.2(b)

Combination Product

 

1.55

Co-Promotion Option

 

5.4(a)

Development Budget

 

4.2(a)(iii)C

Development Plan

 

4.2(a)(iii)

Disclosing Party

 

11.1

Effective Date

 

Preamble

Follow-On Lead Compound

 

1.46

Future Incyte Patent Rights

 

6.2(a)

Genus Patent Rights

 

6.2(a)

Global Safety Database

 

4.5(c)

Incyte

 

Preamble

Incyte Indemnified Parties

 

9.1(a)

Incyte Phase IIa Study

 

4.2(a)(ii)

Initial Development Plan

 

4.2(a)(iii)

Initial Lead Compound

 

1.48

Initial Licensed Back-Up Compound

 

1.48

JDC

 

3.1(a)

Joint IP

 

6.1(b)

Lilly

 

Preamble

Lilly Indemnified Parties

 

9.2(a)

[***]

 

2.4

[***]

 

2.4

Non-Breaching Party

 

8.2(b)

Notice

 

13.5

Ongoing Studies

 

4.2(a)(i)

Promotional Plan

 

5.4(a)

Receiving Party

 

11.1

Royalty Term

 

7.3(b)

SEC

 

11.3(b)

Severed Clause

 

13.12

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DEFINITION

    

SECTION

Subcommittee

 

3.2

Term

 

8.1

Third-Party Infringement

 

6.3(a)

UCC

 

5.4(b)(iii)

Voting Securities

 

10.5(a)(i)

 

1.81     Construction.  In construing this Agreement, unless expressly specified
otherwise:

(a)        references to Articles, Sections, Exhibits and Schedules are to
articles and sections of, and exhibits and schedules to, this Agreement;

(b)        except where the context otherwise requires, use of either gender
includes the other gender, and use of the singular includes the plural and vice
versa;

(c)        headings and titles are for convenience only and do not affect the
interpretation of this Agreement;

(d)        any list or examples following the word “including” shall be
interpreted without limitation to the generality of the preceding words;

(e)        except where the context otherwise requires, the word “or” is used in
the inclusive sense;

(f)         all references to “dollars” or “$” herein shall mean U.S. Dollars;
and

(g)        each Party represents that it has been represented by legal counsel
in connection with this Agreement and acknowledges that it has participated in
the drafting hereof.  In interpreting and applying the terms and provisions of
this Agreement, the Parties agree that no presumption will apply against the
Party which drafted such terms and provisions.

ARTICLE II

 

LICENSES

2.1       Rights Granted by Incyte to Lilly.  Subject to the terms of this
Agreement, Incyte hereby grants Lilly, during the Term, an exclusive (even as to
Incyte and its Affiliates), royalty-bearing, non‑transferable (except in
accordance with Section 13.3) license, with the right to sublicense (subject to
Section 2.2), under Incyte IP, to research, Develop, Commercialize, make, have
made, use, offer for sale, sell and import Licensed Compounds and Licensed
Products in the Territory in the Field.

2.2       Sublicense Rights.  Lilly shall have the right to grant sublicenses
within the scope of the license under Section 2.1 solely to its Affiliates and
to (a) Bona Fide Collaborators; (b) Third Parties for the purpose of
distributing, importing, marketing, promoting and selling a Licensed Product in
the Field (i) in any country other than a Major Market Country and (ii) in a
Major Market Country [***];

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or (c) Third Parties for the purpose of engaging such Third Parties as contract
research organizations, contract manufacturers, contract sales forces and
academic institutions in connection with Development and/or Commercialization of
Licensed Compounds and Licensed Products in the Field in the Territory; provided
that any sublicense granted under this Agreement shall be pursuant to a written
agreement that subjects such sublicensee to all relevant restrictions and
limitations set forth in this Agreement.  If Lilly grants a sublicense to a
Third Party pursuant to subclause (a) or (b) to research, Develop or
Commercialize Licensed Products in the United States, Major EU Countries or
Japan, as permitted by Section 2.2(a) or (b), then Lilly shall provide Incyte
with prompt written notice thereof and shall provide Incyte with an executed
copy of any such sublicense (redacted as necessary to protect confidential or
commercially sensitive information).  Except as otherwise agreed by the Parties
in writing, Lilly shall be jointly and severally responsible with its
sublicensees to Incyte for failure by its sublicensees to comply with, and Lilly
guarantees the compliance by each of its sublicensees with, all such applicable
restrictions and limitations in accordance with the terms and conditions of this
Agreement.  For the purposes this Section 2.2, a “Bona Fide Collaborator” means
a Third Party that has entered into a collaboration with Lilly for the research,
Development or Commercialization of Licensed Compounds and/or Licensed Products
in which Lilly plays a significant role in the decision-making process with
respect to the Development and/or Commercialization of such Licensed Compound
and/or Licensed Product.  For purposes of clarity, a Third Party that is granted
a sublicense in accordance with Section 2.2(b) or 2.2(c) shall not be deemed a
Bona Fide Collaborator.

2.3       Section 365(n) of The Bankruptcy Code.  All rights and licenses
granted under or pursuant to any section of this Agreement, including the
licenses granted under this ARTICLE II and the rights granted under Section
4.1(c), are and will otherwise be deemed to be for purposes of Section 365(n) of
the United States Bankruptcy Code (Title 11, U.S. Code), as amended (the
“Bankruptcy Code”), licenses of rights to “intellectual property” as defined in
Section 101(35A) of the Bankruptcy Code.  Lilly will retain and may fully
exercise all of its respective rights and elections under the Bankruptcy
Code.  Incyte agrees that Lilly, as licensee of such rights under this
Agreement, will retain and may fully exercise all of its rights and elections
under the Bankruptcy Code or any other provisions of applicable Law outside the
United States that provide similar protection for “intellectual
property.”  Incyte further agree that, in the event of the commencement of a
bankruptcy proceeding by or against Incyte under the Bankruptcy Code or
analogous provisions of applicable Law outside the United States, Lilly will be
entitled to a complete duplicate of (or complete access to, as Lilly deems
appropriate) such intellectual property and all embodiments of such intellectual
property, which, if not already in Lilly’s possession, will be promptly
delivered to it upon Lilly’s written request thereof.  Any agreements
supplemental hereto will be deemed to be “agreements supplementary to” this
Agreement for purposes of Section 365(n) of the Bankruptcy Code.

2.4       Field Expansion.  From time to time during the Term, Lilly shall have
the right, upon written notice to Incyte, to request to expand the Field to
[***] (each an “Additional Field”) in which Lilly has a good faith intention to
seek to Develop and Commercialize Licensed Compounds and Licensed Products,
which right shall be subject to any agreement which Incyte may have entered into
with a Third Party with respect to such

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Additional Field(s).  Following Incyte’s receipt of such written notice, and
upon mutual agreement of the Parties, the Field may be expanded to include such
Additional Field(s).  The milestone payments set forth in Section 7.2(a)(i)
shall apply as follows for the Lead Compound and in Section 7.2(a)(ii) for a
Licensed Back-Up Compound when Developed for such Additional Field: (a) [***]
payments shall apply for [***] means an [***] in [***]; and (b) [***] payments
shall apply for [***] means an [***] in [***].

2.5       Retained Rights.

(a)        No Implied Licenses or Rights.  Except as expressly provided in
Section 2.1 or elsewhere in this Agreement, all rights in and to the Incyte IP,
and any other Patent Rights or Know-How of Incyte and its Affiliates, are hereby
retained by Incyte and its Affiliates.

(b)        Other Retained Rights.

(i)         Notwithstanding the exclusive licenses granted to Lilly pursuant to
Section 2.1, Incyte retains the right to practice under the Incyte IP solely to
perform (and to sublicense Third Parties to perform) its obligations under this
Agreement (including the manufacture and supply of Licensed Compound and
Licensed Product to Lilly).

(ii)        For purposes of clarity, the license granted to Lilly in Section 2.1
shall not require Incyte to remove any Licensed Compounds from Incyte’s compound
library, provided, however, that Incyte shall have no right to Develop or
Commercialize any Licensed Compound or Licensed Product, even if included in
Incyte’s compound library.

2.6       Non-Compete.

(a)        Incyte agrees not to, and shall cause its Affiliates not to, directly
or indirectly, including through any ownership interest in any other entity
(other than through an ownership interest of [***] or less of a public company),
(i) Develop prior to the First Commercial Sale of the first Licensed Product;
and (ii) Commercialize prior to the First Commercial Sale of the first Licensed
Product and for a period of [***] from the First Commercial Sale of the first
Licensed Product, any JAK2 Inhibitor Compound in the Field anywhere in the
world, other than a Licensed Compound in accordance with the terms of this
Agreement.

(b)        Incyte shall cause its licensees of the Incyte Patent Rights (other
than Lilly with respect to Licensed Compounds pursuant to this Agreement) not to
use such Incyte Patent Rights to, directly or indirectly, including through any
ownership interest in any other entity (other than through an ownership interest
of [***] or less of a public company), (i) Develop prior to the First Commercial
Sale of the first Licensed Product; and (ii) Commercialize prior to the First
Commercial Sale of the first Licensed Product and for a period of [***] from the
First Commercial Sale of the first Licensed Product, any JAK2 Inhibitor

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Compound in the Field anywhere in the world, other than a Licensed Compound in
accordance with the terms of this Agreement.

(c)        Lilly agrees not to, and shall cause its Affiliates and sublicensees
not to, directly or indirectly, including through any ownership interest in any
other entity (other than through an ownership interest of [***] or less of a
public company), (i) Develop prior to the First Commercial Sale of the first
Licensed Product; and (ii) Commercialize prior to the First Commercial Sale of
the first Licensed Product and for a period of [***] from the First Commercial
Sale of the first Licensed Product, any JAK2 Inhibitor Compound in the Field
anywhere in the world, other than a Licensed Compound in accordance with the
terms of this Agreement.

(d)        Notwithstanding the foregoing: (i) nothing in this Agreement shall
prohibit either Party from Developing or Commercializing any JAK Excluded
Compound (other than any JAK Excluded Compound Covered [***] ) in any field
anywhere in the world and (ii) neither Party shall Develop or Commercialize any
JAK Excluded Compound Covered [***] anywhere in the world in or outside the
Field.

(e)        During the Term, Lilly shall not, nor shall Lilly allow its
Affiliates or sublicensees to, Develop or Commercialize any Licensed Compounds
anywhere in the world in the Excluded Field.

 

(f)         During the Term, Incyte shall not, nor shall Incyte allow its
Affiliates or its licensees of the Incyte Patent Rights (other than Lilly in the
Field in the Territory) to use such Incyte Patent Rights to, Develop or
Commercialize any Licensed Compounds anywhere in the world in or outside the
Field.

(g)        In the event that this Agreement is assigned by Incyte in connection
with the sale or transfer of all or substantially all of the business and assets
of Incyte or Incyte merges with or is consolidated with a Third Party, the
Development, manufacture or Commercialization of a compound or product that, as
of the date of such sale, transfer, merger or consolidation, is being Developed,
manufactured or Commercialized by the assignee or acquirer of Incyte or any
Affiliate controlled by (as “controlled by” is defined in Section 1.2) such
assignee or acquirer, shall not constitute a breach of this Agreement; provided
that (i) such compound or product is not a Licensed Product or Licensed
Compound; (ii) such assignee or acquirer or Affiliate keeps such Development,
manufacture or Commercialization program for such other product separate from
the Development, manufacture and Commercialization programs for Licensed
Products, and ensures that no Lilly Confidential Information is utilized in such
program; (iii) [***]; and (iv) Incyte continues to meet its obligations
hereunder.

(h)        In the event Lilly acquires control of any Third Party, the
activities of such Third Party shall not constitute a breach of this Agreement
provided that (i) within no later than [***],

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Lilly takes appropriate action, through divestiture of assets or otherwise, to
cause Lilly to come into compliance with the terms of this Agreement; (ii) Lilly
keeps such activities separate from the Development, manufacture and
Commercialization programs for Licensed Products, and ensures that no Incyte
Confidential Information is utilized in such activities; and (iii) Lilly
continues to meet its other obligations hereunder.

(i)         Notwithstanding the foregoing, nothing in this Agreement shall
prohibit either Party or an Affiliate of the Party from having or controlling
separate Development and/or Commercialization programs directed toward the use
of a JAK2 Inhibitor Compound outside the Field, provided that the JAK2 Inhibitor
Compound is not a Licensed Product or Licensed Compound, and the separate
Development and/or Commercialization program activities are separate from the
Development and Commercialization programs for Licensed Products, and such Party
ensures that no Confidential Information received from the other Party or Joint
IP is utilized in such activities.

ARTICLE III

 

GOVERNANCE

3.1       Joint Development Committee.

(a)        Establishment.  The Parties shall establish a joint development
committee (“JDC”) within thirty (30) days after the Effective Date that will
have the responsibility for the overall coordination and oversight of the
Development of Licensed Compounds and Licensed Products under this
Agreement.  As soon as practicable following the Effective Date (but in no event
more than thirty (30) days following the Effective Date), each Party shall
designate its initial three (3) representatives on the JDC.  Each Party’s
representatives and any substitute for a representative shall be bound by the
obligations of confidentiality set forth in ARTICLE XI. A representative from
Lilly shall act as the chairperson of the JDC.  The chairperson shall not have
any greater authority than any other representative on the JDC and shall conduct
the following activities of the JDC: (i) calling meetings of the JDC; (ii)
preparing and issuing minutes of each such meeting within thirty (30) days
thereafter; (iii) ensuring that any decision-making delegated to the JDC is
carried out in accordance with Section 3.5; and (iv) preparing and circulating
an agenda for the upcoming meeting; provided that the chairperson shall include
any agenda items proposed by Incyte.  Each Party shall be free to change its
representatives on notice to the other or to send a substitute representative to
any JDC meeting; provided, however,  that each Party shall ensure that at all
times during the existence of the JDC, its representatives on the JDC are
appropriate in terms of expertise and seniority for the then-current stage of
Development of the Licensed Products.

(b)        Responsibilities.  The JDC shall have responsibility for:  (i)
overseeing the initial transfer of information and designated activities from
Incyte to Lilly relating to the clinical Development of Licensed Compounds and
Licensed Products; (ii) the general oversight of the Development of Licensed
Compounds and Licensed Products, including the periodic review and approval of
the Development Plans (and any material updates, amendments and modifications
thereto) and the review and evaluation of the progress under the Development
Plans; (iii)

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reviewing, amending and approving the Development Budget(iv) selecting
Indications for Development in the Field; (v) reviewing the regulatory approach
and filing strategy with respect to seeking and obtaining Regulatory Approval of
Licensed Products in the Field in the Territory; and (vi) performing such other
functions as appropriate to further the purposes of this Agreement, as mutually
agreed upon by the Parties in writing.

3.2       Subcommittees.  The JDC may establish and disband such subcommittees
as deemed necessary by the JDC (each a “Subcommittee”).  Each Subcommittee shall
consist of the same number of representatives designated by each Party, which
number shall be mutually agreed by the Parties.  Each Party shall be free to
change its representatives on notice to the other or to send a substitute
representative to any Subcommittee meeting; provided,  however,  that each Party
shall ensure that at all times during the existence of any Subcommittee, its
representatives on such Subcommittee are appropriate in terms of expertise and
seniority for the then-current stage of Development of the Licensed Product in
the Field in the Territory and have the authority to bind such Party with
respect to matters within the purview of the relevant Subcommittee. Each Party’s
representatives and any substitute for a representative shall be bound by the
obligations of confidentiality set forth in ARTICLE XI.  Except as expressly
provided in this Agreement, no Subcommittee shall have the authority to bind the
Parties hereunder and each Subcommittee shall report to, and any decisions shall
be made by, the JDC.

3.3       Committee Meetings.  The JDC and each of the Subcommittees shall each
hold at least one (1) meeting per Calendar Quarter at such times during such
Calendar Quarter as the chairperson elects to do so.  Except where a Party fails
to appoint a member or members to the JDC or the Subcommittees or fails to
participate in meetings of the JDC or the Subcommittees pursuant to Section 3.6,
 meetings of the JDC and the Subcommittees, respectively, shall be effective
only if at least one (1) representative of each Party is present or
participating.  The JDC and the Subcommittees may meet either (i) in person at
either Party’s facilities or at such locations as the Parties may otherwise
agree or (ii) by audio or video teleconference; provided that no less than one
(1) meeting during each Calendar Year shall be conducted in person.  Other
representatives of each Party involved with Licensed Products (including
representatives of such Party’s alliance management function) may attend
meetings as non‑voting participants, subject to the confidentiality provisions
set forth in ARTICLE XI.  Additional meetings of the JDC and the Subcommittees
may also be held with the consent of each Party, or as required under this
Agreement, and neither Party shall unreasonably withhold its consent to hold
such additional meetings.  Each Party shall be responsible for all of its own
expenses incurred in connection with participating in all such meetings.

3.4       Authority.  The JDC and any Subcommittee shall have only the powers
assigned expressly to it in this ARTICLE III and elsewhere in this Agreement,
and shall not have any power to amend, modify or waive compliance with this
Agreement.  In furtherance thereof, each Party shall retain the rights, powers
and discretion granted to it under this Agreement and no such rights, powers or
discretion shall be delegated or vested in the JDC or any Subcommittee unless
such delegation or vesting of rights is expressly provided for in this Agreement
or the Parties expressly so agree in writing.

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3.5       Decisions.

(a)        Initial Dispute Resolution Procedures.  Subject to the provisions of
this Section 3.5, actions to be taken by the JDC and each of the Subcommittees
shall be taken only following a unanimous vote, with each Party having one (1)
vote.  If any Subcommittee fails to reach unanimous agreement on a matter before
it for decision for a period in excess of thirty (30) days, either Party shall
have the right to refer the matter to the JDC.

(b)        Final Decision-Making. If the JDC fails to reach unanimous agreement
on a matter properly before it (in accordance with this ARTICLE III) for
decision for a period in excess of thirty (30) days, the JDC representatives
appointed by Lilly shall have the deciding vote on any matter.  Incyte shall
have the right to appeal any such decision of the JDC to the Lilly Executive
Officer or a designee of the Lilly Executive Officer with decision-making
authority for resolution. In such case, the Lilly Executive Officer or designee
shall have the final decision-making authority on such issue.

(c)        Notwithstanding the foregoing, Lilly shall not exercise its right to
finally resolve a dispute pursuant to Section 3.5(b):  (i) in a manner that
expands Lilly’s rights or excuses Lilly from any of its obligations specifically
enumerated under this Agreement; (ii) in a manner that negates any consent
rights or other rights specifically allocated to Incyte under this Agreement;
(iii) to resolve any dispute regarding whether a milestone event set forth in
Section 7.2 has been achieved; or (iv) in a manner that would require Incyte to
perform any act that it reasonably believes to be inconsistent with any Law or
any approval, order, policy or guidelines of a Regulatory Authority.

3.6       Committee Membership.

(a)        Appointment is a Right.  The appointment of members of the JDC and
any Subcommittees is a right of each Party and not an obligation and shall not
be a “deliverable” as referenced in any existing authoritative accounting
literature.  Each Party shall be free to determine not to appoint members to the
JDC or any Subcommittee.

(b)        Consequence of Non-Appointment.  If a Party does not appoint members
of the JDC or any Subcommittee, it shall not be a breach of this Agreement, nor
shall any consideration be required to be returned, and unless and until such
members are appointed, the Party that has made the requisite appointments may
unilaterally discharge the roles of the JDC or any Subcommittee for which
members were not appointed,  provided that neither Party shall unilaterally
discharge the roles of the JDC or any Subcommittee as permitted under this
Section 3.6(b) unless the other Party has not appointed any members within
thirty (30) days after the first Party has completed its appointment of its
members.

3.7       Future Adjustments in Governance.  The Parties may at any time by
mutual agreement create or delete governance committees or subcommittees or make
other modifications to the governance structures contemplated by this Agreement
in order to promote the efficient operation of the collaboration.

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ARTICLE IV

 

DEVELOPMENT; REGULATORY MATTERS; SUPPLY

4.1       Initial Transfer.

(a)        Initial Information Transfer to Lilly.  (i) Within a reasonable
period not to exceed [***] after the Effective Date, Incyte shall make available
to Lilly, in a mutually-agreed upon format, the material clinical data and
manufacturing Know-How included in the Incyte Know-How and that is described in
Exhibit B; and (ii) from the Effective Date through [***], Incyte shall make its
relevant scientific and technical personnel reasonably available to Lilly at
Incyte’s offices, at reasonable times during Incyte’s normal business hours and
upon reasonable prior notice, to answer any questions or provide instruction as
reasonably requested by Lilly concerning the information delivered pursuant to
this Section 4.1.  Thereafter, with respect to any information that constitutes
Incyte Know-How not transferred to Lilly as contemplated above, Incyte will,
upon request by Lilly, use its good faith efforts to make available to Lilly
such Incyte Know-How as Lilly may reasonably request.

(b)        Transfer of Regulatory Documentation.  Upon Lilly’s request after
payment of the license fee in accordance with Section 7.1, Incyte shall transfer
ownership to Lilly of any Regulatory Documentation Controlled by Incyte and
existing as of the Effective Date.

(c)        Right of Reference or Use.  Incyte hereby grants to Lilly, solely for
the purposes set forth in this Agreement, a Right of Reference or Use to any and
all Regulatory Documentation Controlled by Incyte relating to Licensed Products
and existing as of the Effective Date or generated from any Clinical Trial
commenced by Incyte prior to the Effective Date, and agrees to sign, and cause
its Affiliates to sign, any instruments reasonably requested by Lilly in order
to effect such grant.  Notwithstanding the foregoing, nothing in this
Section 4.1 is intended to imply the existence of any particular data,
information, drug master file or other Regulatory Documentation.

(d)        Applicability of Bankruptcy Code.  For the avoidance of doubt, rights
granted under this ARTICLE IV shall be deemed to be license of rights to
“intellectual property” as defined in Section 101 (35A) of the Bankruptcy Code
and shall otherwise be subject to Section 2.3.

4.2       Conduct of Development Activities.

(a)        Generally.

(i)         Except as provided in Section 4.2(a)(ii), from and after the
Effective Date, Lilly will, subject to the terms of this Agreement, be
responsible, at its expense, for the Development of Licensed Products in the
Field in the Territory.  Without limiting the foregoing, except as provided in
Section 4.2(a)(ii),  Lilly shall be responsible for all Out-of-Pocket Costs,
including costs for contract research organizations and drug substance and drug
product costs, associated with studies 28050-103, 102 and 110 (the “Ongoing
Studies”) that are incurred after the Effective Date, it being understood that
Incyte shall be responsible for all costs

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incurred prior to the Effective Date, whether billed prior to the Effective Date
or thereafter.  Incyte shall transfer the Ongoing Studies to Lilly within [***]
after the Effective Date.  Incyte shall invoice Lilly for Incyte’s Out-of-Pocket
Costs incurred after the Effective Date and FTE costs in connection with the
management and supervision of such Ongoing Studies after the Effective Date.

(ii)        Incyte shall continue to advance, at its expense, all clinical
Development conducted by Incyte for the Initial Lead Compound through the
completion of the ongoing Phase IIa trial, Study INCB28050-201 (the “Incyte
Phase IIa Study”).

(iii)      The Development of Licensed Products shall be governed by Development
plans that describe the proposed overall program of Development for Licensed
Products (the “Development Plan”); including:

A.         overall goals of the program;

B.         the activities to be performed (including all Clinical Trials and
Regulatory Approvals required for manufacturing, marketing and selling Licensed
Products in the Territory), as well as the characterization of studies;

C.         a detailed budget of Development Costs, including the overall costs
for each study, annualized over the course of each such study (“Development
Budget”);

D.         anticipated timelines for performance; and

E.         specific deliverables.

(iv)       A current draft of a summary development plan for the Initial Lead
Compound is attached hereto as Exhibit C (the “Initial Development
Plan”).  Lilly shall have the sole right and responsibility for preparing the
Development Plan for each Licensed Product in the Field in the
Territory.  Except as otherwise provided in this Agreement, with respect to
Licensed Product in the Field in the Territory, all decisions with respect to
the creation, modification and implementation of the Initial Development Plan,
all other Development Plans and all Development activities shall be made by
Lilly in its sole discretion; provided that Lilly will present a draft
Development Plan for each Licensed Product and any material changes to the
Initial Development Plan to the JDC and will give due consideration to any
comments of Incyte thereto.  Notwithstanding the foregoing, each Development
Plan, as initially prepared and as created, modified and implemented, will
reflect and be consistent with the use of Commercially Reasonable Efforts to
Develop Licensed Products.

(b)        Diligence.

(i)         Lilly shall use Commercially Reasonable Efforts to (A) Develop
Licensed Compounds and Licensed Products in the Field in the Territory in
accordance with the Development Plans; and (B) seek and obtain Regulatory
Approval for Licensed Products in the Field in the Territory.  Incyte shall
reasonably cooperate with Lilly to obtain Regulatory

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Approval for Licensed Products in the Field in the Territory, including by
providing Lilly access to Incyte Know-How and Incyte personnel and consultants.

(ii)        Within either the later of (A) [***] after receipt of the [***]
clinical study results generated in the Phase IIa Study INCB28050-201 for
rheumatoid arthritis; or (B) [***] after receipt of the [***] clinical study
results generated in the Phase IIa Study INCB28050-201 for rheumatoid arthritis,
Lilly shall initiate a Phase IIb Study; provided that (1) the Phase IIa Study
INCB28050-201 supports initiation; (2) the clinical trial protocol is approved
and does not require any specialized equipment, testing, or site preparation;
(3) the clinical trial material is acceptable; (4) there are no delays caused by
a Regulatory Authority; and (5) there are no other factors that cause a delay
that could not have been reasonably avoided by Lilly.

(iii)      Lilly shall Develop, including seeking Regulatory Approval for, at
least [***].  If at any point in time prior to First Commercial Sale of a
Licensed Product, no Development activities conducted in good faith with the
intention of advancing at least [***] (and not for the sole purpose of
preserving rights hereunder), have occurred during at least the preceding [***]
and (x) no significant constraints on such Development imposed by a Regulatory
Authority or a Force Majeure Event have been in effect during such period and
(y) during such period Lilly has not engaged in bona fide sublicensing
negotiations with a Third Party with respect to the Development of Licensed
Compounds and Licensed Products in the United States and the Major EU Countries
(provided that the time period in which such negotiations have taken place does
not exceed [***]), then Lilly shall be deemed to have abandoned Development of
Licensed Compounds and Licensed Product (“Abandoned Development”).  For purposes
of clarity, [***].  If Incyte concludes that Lilly has Abandoned Development,
then Incyte shall deliver written notice to Lilly setting out the basis for
Incyte’s conclusion.  If Lilly disagrees with Incyte’s conclusion that Lilly has
Abandoned Development, then the Parties will meet within [***] to discuss the
disagreement.  If the Parties cannot agree after such discussion, then the terms
of 8.2(e) shall apply to resolve the dispute.  If Lilly has Abandoned
Development, then:

A.         If Lilly has not previously been properly deemed to have Abandoned
Development, then within [***] from receipt of notice from Incyte that Lilly has
Abandoned Development, Lilly shall either: (1) [***]; or (2) provide Incyte with
written notice that [***], in which case Incyte shall have the right to
terminate this Agreement in accordance with Section 8.2(d).  In the event that
Lilly elects to take the actions described in this subclause (A), Lilly shall
have an additional [***] from the delivery of [***] to initiate and diligently
pursue such steps that will result in Lilly not being deemed to have Abandoned
Development.  If Lilly fails to take such actions within such [***] period, then
Incyte may terminate this Agreement in accordance with Section 8.2(d).

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B.         If Lilly has previously been properly deemed to have Abandoned
Development and had previously elected to take the actions described in
subclause (A) above, Incyte shall have the right to terminate this Agreement in
accordance with Section 8.2(d).

4.3       Development Reports.  Lilly shall provide the JDC with a written
report at least [***] summarizing in reasonable detail Lilly’s and its
Affiliates’ activities and progress related to the Development of Licensed
Products in the Field in the Territory, including information concerning the
conduct of non-clinical activities and Clinical Trials, applications for and
securing of Regulatory Approvals, First Commercial Sale of the Licensed Product
on a country-by-country basis and any future planned Development activities.

4.4       Licensed Product Co-Development Option.   On a Licensed
Product-by-Licensed Product basis, for each Indication for which (x) Lilly
anticipates initiating a Phase IIb Study and (y) there is a means to separately
track the Annual Net Sales of such Licensed Product for such Indication (each a
“Co-Development Indication”) based on a new formulation or a new targeted
prescribing specialist group [***], and provided that Incyte has not exercised
the Incyte Development Opt Out in accordance with Section 4.4(c)(ii) for any
Licensed Product, Incyte shall have the option to co-fund Development of such
Co-Development Indication (the “Co-Development Option”) as follows:

(a)        Within [***] prior to the anticipated initiation of a Phase IIb Study
for the Co-Development Indication, Lilly shall notify Incyte of such anticipated
initiation and shall provide Incyte with the following information:  all
material pre-clinical and clinical data and related analysis and regulatory
information submitted to any Regulatory Authorities prior to the applicable
time-period mentioned above, and Lilly’s then current Development Plans and
total global Development Budget (including the overall costs for each study,
annualized over the course of each such study) with respect to such
Co-Development Indication (the “Co-Development Indication Budget”).  Incyte
shall have the option to co-fund Development of such Co-Development Indication,
exercisable by (i) providing Lilly written notice within [***] after receipt of
such information and (ii) co-funding thirty percent (30%) of Lilly’s total
global Development Costs for such Co-Development Indication incurred after the
date of such notice through the Regulatory Approval of such Co-Development
Indication on a country by country basis (“Incyte Target Global Funding”). As
used herein in this Section 4.4, Regulatory Approval costs include costs for any
post-launch studies required by a Regulatory Authority.

(b)        If Incyte timely delivers such notice, within [***] following the end
of each Calendar Quarter after Incyte has delivered such notice, Lilly shall
prepare and deliver to Incyte a quarterly report detailing its Development Costs
incurred during such period with respect to such Co-Development
Indication.  Lilly shall submit any supporting information reasonably requested
by Incyte related to such Development Costs included in its report within [***]
after its receipt of such request.  Lilly shall issue an invoice to Incyte for
thirty percent (30%) of the Development Costs identified in such report. Incyte
shall pay all amounts payable under any such invoice within [***] after its
receipt of such invoice, subject to Section 4.4(c).  Incyte shall have the right
to audit the records of Lilly with respect to any purported Development Costs
included in such reports, in accordance with Section 7.6.

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(c)        If Incyte exercises its Co-Development Option with respect to a
Licensed Product, in addition to the royalty rates set forth in Section 7.3,
Lilly shall pay Incyte an incremental [***] royalty (the “Target Co-Development
Royalty”) on Annual Net Sales of such Licensed Product for the Co-Development
Indication, provided that:

(i)         The JDC shall review and, as necessary, amend the Co-Development
Indication Budget no later than October 30th of each year and any interim
changes must be reviewed and approved by the JDC.  In the event that the actual
global Development Costs in a Calendar Year exceed (A) [***] of the annualized
Co-Development Indication Budget approved by the JDC for such Calendar Year no
later than October 30th of the preceding year or (B) [***] of the projected
total Development Costs for a particular study as set forth in the
Co-Development Indication Budget approved by the JDC that was in effect
immediately prior to the initiation of such study (the “Development Cap”), then
Incyte may elect, by providing Lilly with written notice of such election within
[***] after receipt of an invoice pursuant to 4.4(b) that would result in a
payment above the Development Cap, not to fund the Co-Development Indication
Budget for that year above the Development Cap (the “Funding Cap
Option”).  Except where the Development Cap has been reached pursuant to Section
4.4(c)(i)(B), Incyte shall resume its payment obligation pursuant to 4.4(b) on
January 1 following each such election of the Funding Cap Option.  In the event
that Incyte elects the Funding Cap Option, such election of the Funding Cap
Option shall not constitute a violation of this Section 4.4.  Such Funding Cap
Option does not impact the Target Co-Development Royalty for the Co-Development
Indication; however, Incyte agrees to reimburse Lilly for all unpaid Incyte
Target Global Funding pursuant to this Section 4.4(c)(i) solely in the form of a
reduction of future milestone payments and/or royalty payments as requested by
Lilly; and

(ii)        In the event that Incyte provides Lilly with written notice within
[***] after receipt of an invoice pursuant to 4.4(b) of its election not to fund
the entire amount of Incyte Target Global Funding for a Licensed Product
(“Incyte Development Opt Out”), then the Target Co-Development Royalty will be
adjusted based on the formula:

[***]

By way of example, if [***].

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(iii)      Further, election of the Incyte Development Opt Out for a Licensed
Product thereby terminates Incyte’s option to co-fund further Development Costs
for any Licensed Product and Incyte’s contribution to actual global Development
Costs is determined upon notice to Lilly that Incyte elects to exercise the
Incyte Development Opt Out.

4.5       Regulatory Matters Related to Licensed Products.

(a)        Regulatory Submissions.  Lilly shall oversee, monitor and coordinate
all regulatory actions, communications and filings with, and submissions to all
Regulatory Authorities with respect to Licensed Products in the Field in the
Territory.  Lilly shall keep the JDC reasonably informed in connection with the
preparation of all Regulatory Documentation, Regulatory Authority review of
Regulatory Documentation, and Regulatory Approvals, annual reports, annual
re-assessments, and variations and labeling, in each case with respect to the
Licensed Product in the Field; provided that Lilly shall have the right to
redact any information to the extent not related to Licensed Product in the
Field.  Lilly shall respond within a reasonable time frame to all reasonable
inquiries by Incyte with respect to any information provided pursuant to this
Section 4.5(a).  Unless already the Confidential Information of Incyte, any
information disclosed pursuant to this Section 4.5(a) shall be the Confidential
Information of Lilly.  Lilly shall use Commercially Reasonable Efforts to
promptly take the actions described in this Section 4.5(a).

(b)        Regulatory Meetings and Correspondence.

(i)         Lilly shall be responsible for interfacing, corresponding and
meeting with the FDA, EMEA, MHLW and other Regulatory Authorities with respect
to Licensed Products in the Field in the Territory.

(ii)        Incyte shall have the right to have a senior, experienced employee
reasonably acceptable to Lilly, participate as an observer in material or
scheduled face-to-face meetings, video conferences and any teleconferences,
involving participation of personnel beyond regulatory experts, with the FDA,
EMEA, and MHLW, and shall be provided with advance access to Lilly’s material
documentation prepared for such meetings.  Prior to submission of material
correspondence to the applicable Regulatory Authority, Lilly shall, sufficiently
in advance for Incyte to review and comment, provide Incyte any material
correspondence with the FDA, EMEA and MHLW related to such meetings.  Lilly
shall also provide Incyte with copies of any material correspondence with the
FDA, EMEA, and MHLW relating to Development of, or the process of obtaining
Regulatory Approval for, Licensed Products in the Field, and respond within a
reasonable time frame to all reasonable inquiries by Incyte with respect
thereto.

(c)        Global Safety Database.  Following the Effective Date, Lilly shall
establish, hold and maintain the global safety databases for each Licensed
Product (the “Global Safety Database”) into which it shall enter information on
all serious adverse events and suspected reactions concerning the Licensed
Product occurring anywhere in the world and reported to either of the Parties.
Such database shall comply in all material respects with all Laws

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reasonably applicable to pharmacovigilance anywhere where the Licensed Products
are being or have been Developed or Commercialized.

4.6       Manufacture and Supply.

(a)        As soon as reasonably practicable after the Effective Date, Incyte
and Lilly shall agree upon an appropriate manufacturing transfer plan and Incyte
shall use Commercially Reasonable Efforts to transition the responsibility for
manufacturing Licensed Compound and Licensed Product to Lilly in accordance with
such plan.  Lilly shall have the option, exercisable within [***] following the
Effective Date, to obtain Incyte’s existing inventory of Licensed Product and
any related raw materials or supplies at a price equal to [***] of Incyte’s
Out-of-Pocket Costs for such inventory of Licensed Product.  Lilly may exercise
such option by written notice to Incyte during such [***] period. In addition,
to the extent Incyte has contracts with Third Party contract manufacturers or
others relating to its manufacturing operations for Licensed Compounds and
Licensed Products, if Lilly so requests, Incyte will use its Commercially
Reasonable Efforts to assign such agreements to Lilly or otherwise facilitate
Lilly’s efforts to continue to utilize such manufacturers or suppliers.

(b)        Without limiting the foregoing, if Lilly does not assume direct
responsibilities for the manufacture of Licensed Compound and Licensed Product
within [***] after the Effective Date, Incyte will invoice Lilly for all
Out-of-Pocket Costs incurred by Incyte after the Effective Date for the
manufacture and supply of Licensed Compound and Licensed Product for Lilly as
well as Incyte's FTEs required to manage and supervise such manufacture and
supply.

(c)        Notwithstanding anything in this Agreement to the contrary, Incyte
shall not conduct any manufacturing related activities following the Effective
Date without the express written consent of Lilly, except for those activities
incidental to the transfer of manufacturing responsibility to Lilly in
accordance with the manufacturing transfer plan contemplated above.  If
requested by Lilly and agreed to by Incyte, Incyte shall supply Lilly with
clinical supplies of Licensed Product under the terms of a mutually acceptable
manufacturing agreement, quality agreement, and manufacturing requirements
document relating to Incyte’s activities, all upon commercially reasonable terms
consistent with this Agreement.

ARTICLE V

 

COMMERCIALIZATION

5.1       Commercialization Diligence.  During the Term, Lilly shall be solely
responsible for Commercializing Licensed Products in the Territory for use in
the Field.

(a)        Lilly shall use Commercially Reasonable Efforts, at its expense, to
Commercialize Licensed Products in the Field in the Territory after receipt of
Regulatory Approval therefor.  Notwithstanding the foregoing, Lilly shall (i)
Commercialize [***] after receipt of the relevant Regulatory Approval; (ii)
Commercialize [***] in at least [***]

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after receipt of the relevant Regulatory Approval; (iii) maintain minimum
combined Marketing and Sales Support (aggregated for all markets) per each [***]
period following First Commercial Sale for such Licensed Product of the lesser
of [***] or [***] of total sales of such Licensed Product in such Calendar; and
(iv) reach or contact, the top [***] of highest prescribing rheumatologists or
other appropriate specialist in the United States and the Major EU Countries on
average [***] times or more per Calendar Year, beginning in the second full
Calendar Year following First Commercial Sale, provided that there are no
significant constraints on such Commercialization or contacts imposed by a
Regulatory Authority in the respective jurisdictions.  These provisions will
apply for the first Regulatory Approval of the Licensed Product, and not per
Indication.  These provisions will not apply in the event that there are any
outstanding negotiations related to Regulatory Approval with any Regulatory
Authority (REMS, label(s), marketing materials or other related matters), or in
the event that Lilly is prevented from meeting the obligations by any other
factors that could not have been reasonably avoided by Lilly.  In the event that
this Agreement is assigned by Lilly in connection with the sale or transfer of
all or substantially all of the business and assets of Lilly or an Affiliate
controlled by (as “controlled by” is defined in Section 1.2) Lilly merges with
or is consolidated with a Third Party, and such sale, transfer, merger or
consolidation results in the stockholders of Lilly immediately prior to such
transaction owning less than [***] of the voting power of the Voting Stock of
the acquirer or surviving entity, as the case may be, immediately after such
transaction, then for [***] following such sale, transfer, merger or
consolidation, Lilly shall maintain Marketing and Sales Support for each
Licensed Product in each country in the Territory equal to no less than the
level of Marketing and Sales Support that Lilly maintained with respect to such
Licensed Product in such country in the [***] prior to such sale, transfer,
merger or consolidation, unless the relevant Licensed Product is within [***] of
the anticipated end of the Royalty Term for such country.

(b)        If at any point in time after First Commercial Sale of a Licensed
Product, Lilly does not promote such Licensed Product in at least [***] during
the preceding [***] and during that period (i) Lilly has not reasonably
determined that promotion in at least [***], as applicable, is likely to reduce
the overall commercial viability of such Licensed Product in the Territory; (ii)
no significant constraint on such promotion imposed by a Regulatory Authority
have been in effect in the jurisdictions in which such promotion failed to
occur; (iii) no Force Majeure Event has been in effect in any jurisdictions in
which such promotion failed to occur; and (iv) Lilly is not actively seeking
Regulatory Approval (including pricing and reimbursement approval) in at least
[***], as applicable in the jurisdiction in which such promotion failed to
occur; then Lilly shall be deemed to have abandoned Commercialization of
Licensed Compounds and Licensed Products in that country (“Abandoned
Commercialization”).  For purposes of clarity, [***].  If Incyte concludes that
Lilly has Abandoned Commercialization, then Incyte shall deliver written notice
to Lilly setting out the basis for Incyte’s conclusion.  If Lilly disagrees with
Incyte’s conclusion that Lilly has Abandoned Commercialization, then the Parties
will meet within [***] to discuss the

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disagreement.  If the Parties cannot agree after such discussion, then the terms
of 8.2(e) shall apply to resolve the dispute.  If Lilly has Abandoned
Commercialization, then:

(i)         If Lilly has not previously been properly deemed to have Abandoned
Commercialization, then within [***] from receipt of notice from Incyte that
Lilly has Abandoned Commercialization, Lilly shall either (1) [***] not being
deemed to have [***]; or (2) provide Incyte with written notice that it chooses
not to provide [***], in which case Incyte shall have the right to terminate
this Agreement in accordance with Section 8.2(d).  In the event that Lilly
elects to take the actions described in this subclause (i), Lilly shall have an
additional [***] from the delivery of [***] to initiate and diligently pursue
such steps that will result in Lilly not being deemed to have Abandoned
Commercialization.  If Lilly fails to take such actions within such [***]
period, then Incyte may terminate this Agreement in accordance with Section
8.2(d).

(ii)        If Lilly has previously been properly deemed to have Abandoned
Commercialization and had previously elected to take the actions described in
subclause (i) above, Incyte shall have the right to terminate this Agreement in
accordance with Section 8.2(d).

5.2          Marketing Responsibilities For Licensed Products.  Subject to the
provisions of Section 5.1, all business decisions regarding Commercialization of
Licensed Products in the Field in the Territory, including the design, sale,
pricing, and promotion of Licensed Products in the Field in the Territory under
this Agreement, shall be within the sole discretion of Lilly and its
Affiliates.  All materials used in the promotion of all Licensed Products in the
Field in the Territory, including product packaging, materials used in Detailing
doctors, product messaging and content used in the promotion of such Licensed
Products, shall be approved solely by Lilly.

5.3       Trademarks.

(a)        Lilly and its Affiliates shall select their own trademarks under
which they will market Licensed Products (provided that no such trademark shall
contain the word “Incyte”) and shall own such trademarks.

(b)        Lilly shall use, in connection with all packaging, literature, labels
and other printed matters, to the extent permitted by Law, an expression to the
effect that the Licensed Products were developed under license from Incyte,
together with the Incyte logo.

5.4       Co-Promotion.

(a)        Co-Promotion Option.  [***] Incyte shall have the option to
co-promote Licensed Products on a Licensed Product-by-Licensed Product basis in
the United States on the terms and conditions set forth in this Section 5.4
(“Co-Promotion Option”). Lilly shall notify Incyte at least [***] prior to the
anticipated launch of each Licensed Product in the United States and shall
provide Incyte with the following information:  Lilly’s then-current
Commercialization plans (“Promotional Plan”) with respect to each such Licensed
Product, which plan shall include (i) a description of the short- and long-term
vision for

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the Licensed Product and Licensed Product positioning; (ii) a Strengths,
Weaknesses, Opportunities and Threats (SWOT) analysis; (iii) a summary of the
minimum level of sales efforts to be dedicated to the promotion of the Licensed
Product, including the anticipated number of Details and targets of such
Details; and (iv) a detailed budget for the Commercialization
activities.  Incyte may exercise its Co-Promotion Option by providing Lilly
written notice at any time after receipt of Lilly’s notice and not later than
[***] prior to the initial anticipated launch of such Licensed Product in the
United States.

(b)        Effects of Exercise of Co-Promotion Option.  If Incyte exercises its
Co-Promotion Option:

(i)         The Parties shall, no later than [***] prior to the initial
anticipated launch of such Licensed Product in the United States, set out the
number of FTE sales representatives Detailing such Licensed Product in the
United States. In no event shall Incyte be responsible for a number of FTE sales
representatives Detailing such Licensed Product which exceeds [***] of the total
FTEs for such Licensed Product in the United States.

(ii)        Incyte shall be responsible for its costs in conducting co-Detailing
activities; provided that Lilly shall reimburse Incyte [***]. Incyte shall
provide an invoice to Lilly for such expense on a quarterly basis, and Lilly
shall pay such invoice within [***] after receipt.

(iii)      The Parties shall establish a joint U.S. Commercialization Committee
(“UCC”) to oversee the Detailing of the relevant Licensed Product in the
U.S.  Incyte shall be entitled to have one (1) representative sit on the UCC or
any group carrying out the UCC’s function after the Effective Date but prior to
the UCC’s establishment.  The UCC shall have responsibility for general
oversight of all promotion and Detailing activities with respect to such
Licensed Product in the United States.  The UCC (or any group carrying out the
UCC’s function after the exercise of the Co-Promotion Option but prior to the
UCC’s establishment) will meet quarterly or more frequently as agreed by the
Parties.  The term of the UCC will be determined by the Parties.  Lilly shall
have the right to make the final decision with respect to all matters within the
purview of the UCC related to Commercialization of the relevant Licensed
Product.

(iv)       Incyte’s sales representatives will be included in training programs
with respect to the applicable Licensed Product that Lilly provides to its own
sales representatives Detailing such Licensed Product. Such training shall be
provided by Lilly to Incyte [***], but Incyte shall be responsible for all of
its costs related to such training programs, including travel and lodging, for
its sales representatives.

(v)        Incyte’s sales representatives shall be provided, at Lilly’s expense,
with the same promotional materials, including literature and samples, as Lilly
provides to its own similarly-situated representatives.

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(vi)       Prior to the initiation of the co-promotion efforts contemplated
hereby, the Parties shall enter into a mutually acceptable co-promotion
agreement containing terms consistent with this Agreement.  Such co-promotion
agreement shall require Incyte to comply with all applicable Laws, with Lilly’s
Good Promotional Practices and other compliance related practices and
procedures, and with the terms of any order or consent decree applicable to
Lilly’s promotional activities.

ARTICLE VI

 

INTELLECTUAL PROPERTY OWNERSHIP,

 PROTECTION AND RELATED MATTERS

6.1       Inventorship; Ownership.

(a)        Inventorship.  Inventorship of Inventions conceived or reduced to
practice during the course of the performance of activities pursuant to this
Agreement shall be determined in accordance with the patent Laws of the United
States.

(b)        Ownership.  As between the Parties, all Inventions made or
information created by a Party’s or any of its Affiliates’ employees,
independent contractors or consultants, in the course of conducting activities
under this Agreement, together with all Intellectual Property Rights therein,
shall be owned by such Party.  All inventions or discoveries made, or
information created, jointly by each Party’s (or any of its Affiliates’)
employees, independent contractors or consultants, in the course of conducting
activities under this Agreement, together with all Intellectual Property Rights
therein, shall be jointly owned by the Parties and are “Joint IP”.  Joint IP
shall be owned jointly by Incyte and Lilly on the basis of an undivided interest
without a duty to account to the other Party and shall be deemed to be
Controlled by each Party.  Notwithstanding anything to the contrary herein, each
Party shall have the right to use such Joint IP, or license such Joint IP to its
Affiliates or any Third Party, or sell or otherwise transfer its interest in
such Joint IP to its Affiliates or a Third Party, in each case without the
consent of the other Party, so long as such use, sale, license or transfer is
subject to the licenses granted pursuant to this Agreement and is otherwise
consistent with this Agreement. The Parties, through the JDC, shall determine
which Party shall be responsible for the filing, prosecution and maintenance of
Joint IP on a case-by-case basis; provided that Lilly shall have the first right
to prosecute such Joint IP in accordance with Section 6.2(b) if such Joint IP
Covers Licensed Products.  Each Party hereby authorizes and grants the other
Party its permission and consent to assume, directly or through its authorized
agents, attorneys, or representatives, the responsibilities set forth in Section
6.2.

6.2       Prosecution and Maintenance of Patent Rights.

(a)        [***] Prosecution and Maintenance of Incyte Patent Rights.  [***]
shall have the sole right to file, prosecute and maintain, at [***] expense, the
Incyte Patent Rights designated as INCY0039 (the “Genus Patent Rights”) (the
Genus Patent Rights that exist as of the Effective Date are set forth on Exhibit
A-1).  [***] shall, subject to Section 6.2(a)(i), have the sole right to file,
prosecute and maintain, at [***] expense, the Incyte Patent Rights other than
the Genus Patent Rights and the Selection Patent Rights (the “Future Incyte
Patent Rights”)

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in the Territory.  If [***] declines to file, prosecute or maintain any Future
Incyte Patent Rights in any country in the Territory, desires to allow any
Future Incyte Patent Rights to lapse in any country in the Territory, or desires
to abandon any Future Incyte Patent Rights in any country in the Territory
before all appeals within the respective jurisdiction have been exhausted, then:

(i)         [***] may, in its sole discretion, provide [***] with reasonable
written notice of such decision so as to permit [***] to decide whether to file,
prosecute or maintain such Future Incyte Patent Right in such country and to
take any necessary action.

(ii)        Following notice from [***] pursuant to clause (i), [***] may, by
providing prompt written notice thereof to [***], assume control of the filing,
prosecution and/or maintenance of such Future Incyte Patent Right in such
country, at [***] expense.

(b)        [***] Prosecution and Maintenance of Selection Patent Rights.  [***]
shall have the first right to file, prosecute and maintain, at Lilly's expense,
the Selection Patent Rights in the Territory [***].  If [***] declines to file,
prosecute or maintain any Selection Patent Rights in any country in the
Territory, desires to allow any Selection Patent Rights to lapse in any country
in the Territory, or desires to abandon any Selection Patent Rights in any
country in the Territory before all appeals within the respective jurisdiction
have been exhausted, then:

(i)         [***] shall provide [***] with reasonable written notice of such
decision so as to permit [***] to decide whether to file, prosecute or maintain
such Selection Patent Right in such country and to take any necessary action.

(ii)        Following notice from [***] pursuant to clause (i), [***] may, by
providing prompt written notice thereof to [***], assume control of the filing,
prosecution and/or maintenance of such Selection Patent Right in such country,
at [***] expense.

(c)           Cooperation.  For the purposes of rights and obligations described
in Section 6.2, an individual Party responsible for the filing, prosecution and
maintenance of a Selection Patent Right will be referred to as the “Controlling
Party” and the other Party will be referred to as the “Non‑Controlling Party”.

(i)         The Non-Controlling Party shall, at the Controlling Party’s expense
and reasonable request, assist and cooperate in the filing, prosecution and
maintenance of or any related necessary action for Future Incyte Patent Rights
and Selection Patent Rights.

(ii)        The Controlling Party shall provide the Non-Controlling Party
sufficiently in advance, where reasonable, for the Non-Controlling Party to
comment, with copies of all patent applications and other material submissions
and communications (including oral communications) with any patent counsel or
patent authorities pertaining to Future Incyte Patent Rights and Selection
Patent Rights.

(iii)      The Controlling Party shall give due consideration to the
Non-Controlling Party’s comments, but shall have the final say in determining
whether or not to incorporate such comments.

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(iv)       [***] shall whenever possible provide [***] in advance with copies of
all material submissions or other communications with patent authorities
relating to the Genus Patent Rights, or, to the extent that [***] has the right
to do so, to communications with Third Parties relating to enforcement of the
Genus Patent Rights, in each case to the extent the same may be material to
Selection Patent Rights or Future Incyte Patent Rights, and consider in good
faith any comments [***] may make.

(v)        Each Party shall provide the other with copies of all material
communications received from any patent counsel or patent authorities pertaining
to such Future Incyte Patent Rights and Selection Patent Rights.

(vi)       As used in this Section 6.2(c) “material” means that the submission
or communication could affect the patentability or scope of the patents Covering
the Licensed Compounds or Licensed Products.

(d)        Patent Term Extensions.  [***] may select which, if any, Selection
Patent Rights for which a Patent Term Extension is to be sought or obtained. 
[***] may select which, if any, Genus Patent Rights and Future Incyte Patent
Rights for which a Patent Term Extension is to be sought or obtained.

6.3       Third Party Infringement.

(a)        Notice.  Each Party shall immediately provide the other Party with
written notice reasonably detailing any (i) known or alleged infringement of
Joint IP or any Selection Patent Rights by a Third Party which is infringing the
Joint IP or any Selection Patent Rights by making, using or selling a product
that competes with a Licensed Product in the Field in the Territory; (ii)
“patent certification” filed in the United States under 21 U.S.C. §355(b)(2) or
21 U.S.C. §355(j)(2) or similar provisions in other jurisdictions; and (iii) any
declaratory judgment, opposition, or similar action alleging the invalidity,
unenforceability or non-infringement of any such Intellectual Property Rights
(collectively “Third-Party Infringement”).  Within [***] after receipt of such
notice, the Parties shall consult to determine the response to any Third Party
Infringement.

(b)        Enforcement.

(i)         If within [***] after meeting pursuant to Section 6.3(a) the Parties
fail to agree on a joint course of action with respect to a Third Party
Infringement, [***] will have the first right to bring and control any legal
action in the Territory in connection with the Third Party Infringement against
a Third Party which is infringing the relevant Intellectual Property Rights by
making, using or selling a product that competes with a Licensed Product in the
Field in the Territory, at its own expense as it reasonably determines
appropriate, and [***] may choose, at its own expense, to be represented in any
such action by counsel of its own choice. If required, [***] agrees to be joined
as a necessary party to such action, wherein as a necessary party, [***] agrees
to be joined only to the extent necessary, and [***] shall not actively direct,
control or otherwise participate in the legal action; provided that [***] shall
pay [***] reasonable expenses associated therewith.  At the request and expense
of [***],  [***] shall provide reasonable assistance to [***] in connection
therewith, including by executing

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reasonably appropriate documents, cooperating in discovery and joining as a
party to the action.  In connection with any such proceeding, [***] shall not
enter into any settlement admitting the invalidity of, or otherwise impairing
[***] rights in, Joint IP or any Selection Patent Rights without the prior
written consent of [***].  Any recoveries resulting from such an action relating
to a claim of Third Party Infringement shall be applied as follows:

A.         First, to reimburse each Party for all Out-of-Pocket Costs in
connection with such proceeding (on a pro rata basis, based on each Party’s
respective litigation costs, to the extent the recovery was less than all such
litigation costs); and

B.         [***]

(ii)        If within [***] after [***] receipt of a notice of a Third Party
Infringement with respect to Joint IP or any Selection Patent Rights, [***] does
not bring legal action as permitted hereunder against a Third Party who is
infringing such Intellectual Property Rights by making, using or selling a
product that competes with a Licensed Product in the Territory, [***] may,
subject to the following sentence, in its sole discretion, bring and control any
legal action in connection therewith at its sole expense.  At the request and
expense of [***],  [***] shall provide reasonable assistance to [***] in
connection therewith, including by executing reasonably appropriate documents,
cooperating in discovery and joining as a party to the action.  In connection
with any such proceeding, [***] shall not enter into any settlement admitting
the invalidity of or otherwise impairing [***] rights under the Joint IP or such
Selection Patent Rights without the prior written consent of [***].  Any
recoveries resulting from such an action relating to a claim of Third Party
Infringement (after payment of each Party’s costs and expenses ) will be
retained by [***].

6.4       Patent Marking.  If permitted and to the extent that Lilly does so
with respect to its other products in the same geographic market, Lilly shall,
and shall cause its Affiliates, distributors and sublicensees, to (a) mark the
Licensed Products with the number of each issued patent under the Incyte Patent
Rights that apply to the Licensed Product and which Lilly determines reasonably
should be listed or marked and (b) comply with the patent marking statutes in
each country in which the Licensed Product is manufactured by or on behalf of
Lilly or its Affiliates.

ARTICLE VII

 

FINANCIAL PROVISIONS

7.1       License Fee.  Within [***] after the Effective Date, Lilly shall pay
to Incyte a one-time, non-creditable, non-refundable license fee of Ninety
Million U.S. Dollars (US$90,000,000).

7.2       Milestone Payments.

(a)        Development and Regulatory Milestones.

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(i)         Lilly shall pay Incyte the following one-time, non-refundable,
non-creditable milestone payments within [***] after the first achievement by
Lilly, its Affiliates or its sublicensees, or with respect to the milestone
event in Section 7.2(a)(i)(A), Incyte or one of Incyte’s Affiliates, of the
corresponding milestone events set forth below with respect to a Lead Compound
(provided that with respect to the Follow-On Lead Compound, such Follow-On Lead
Compound shall only be eligible for the milestone payments set forth below if
such payments have not previously been made with respect to the Initial Lead
Compound):

 

 

 

 

 

 

 

Milestone Event

    

First

Indication

[***]

[***]

[***] Incyte Phase IIa Study Efficacy

 

US $30,000,000   [***]

[***]

[***]

[***] First patient treated in a Phase III Study

 

US$50,000,000

US$30,000,000

US$20,000,000

[***] First NDA submission to the FDA for Regulatory Approval of a Licensed
Product

 

US$35,000,000

 

 

[***] First submission to the EMEA for Regulatory Approval of a Licensed Product

 

US$20,000,000

 

 

[***] Regulatory Approval of a Licensed Product from the FDA

 

US $100,000,000

[***]

[***]

[***]

 

[***]

[***]

[***]

[***] Regulatory Approval of a Licensed Product from the MHLW

 

US$15,000,000

[***]

[***]

 

With respect to the milestone set forth in [***], the milestone payment shall be
contingent [***] with a

 

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[***].

 

[***]

[***]*

[***]*

[***]

[***]

[***]

[***]

[***]

[***]

[***]

[***]

[***]

 

*  [***]

(ii)        Lilly shall pay Incyte the following non-refundable, non-creditable
(subject to Section 7.2(c)) milestone payments within [***] after the first
achievement by Lilly, its Affiliates or its sublicensees of the corresponding
milestone events set forth below with respect to a Licensed Back-Up Compound
(provided that with respect to the Follow-On Lead Compound, such Follow-On Lead
Compound shall only be eligible for any such milestone payment if it is not
eligible for the comparable one-time Lead Compound milestone payment set forth
in Section 7.2(a)(i)):

 

 

 

 

 

 

Milestone Event

   

[***]

[***]

[***]

[***]

 

[***]

[***]

[***]

[***]

 

[***]

[***]

[***]

[***]

 

[***]

[***]

[***]

[***]

 

[***]

[***]

[***]

[***]

 

 

[***]

[***]

[***]

[***]

 

[***]

[***]

[***]

 

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(iii)      For the avoidance of doubt, the registrations of line extensions
(i.e., different dosage forms or delivery) shall not be eligible for milestone
payments set forth in this Section 7.2(a).  Additionally, any Combination
Products containing a Lead Compound and a Licensed Back-Up Compound, wherein the
Licensed Back-Up Compound is only available in combination with such Lead
Compound, shall be solely eligible for the one-time Lead Compound milestone
payments set forth in Section 7.2(a)(i) and shall not additionally be eligible
for a Licensed Back-Up Compound milestone set forth in Section 7.2(a)(ii).

(b)        Sales Milestones.

(i)         Lilly shall make the following non-refundable, non-creditable,
one-time payments to Incyte within [***] upon the first achievement of aggregate
Annual Net Sales of all Licensed Products in the Territory that meet or exceed
the thresholds set forth below if such Licensed Products contain or incorporate
a Lead Compound:

 

Annual Net Sales of Licensed Products in the Territory Threshold

 

Milestone Payment

 

(A)  Annual Net Sales of Licensed Products equal to or greater than [***]

 

[***]

(B)  Annual Net Sales of Licensed Products equal to or greater than [***]

 

[***]

(C)  Annual Net Sales of Licensed Products equal to or greater than [***]

[***]

 

(ii)        Lilly shall make the following non-refundable, non-creditable,
one-time payments to Incyte within [***] upon the first achievement of aggregate
Annual Net Sales of all Licensed Products in the Territory that meet or exceed
the thresholds set forth below if such Licensed Products contain or incorporate
a Licensed Back-Up Compound (other than the Follow-On Lead Compound which, for
purposes of clarity, is subject to subsection (i) above):

 

 

 

 

 

Annual Net Sales of Licensed Products in the Territory Threshold

 

Milestone Payment

 

(A)  Annual Net Sales of Licensed Products equal to or greater than [***]

 

[***]

(B)  Annual Net Sales of Licensed Products equal to or greater than [***]

 

[***]

(C)  Annual Net Sales of Licensed Products equal to or greater than [***]

[***]

 

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Achievement of the milestone events above in this Section 7.2(b) shall be
determined based on Annual Net Sales of the Licensed Products made by Lilly and
its Affiliates and sublicensees throughout the Territory.  More than one of the
sales milestone payments may be earned concurrently based on the same Annual Net
Sales of the Licensed Products.  By way of example, if in the first Calendar
Year following the First Commercial Sale of a Licensed Product, the Annual Net
Sales for Licensed Products that contain the Lead Compound is equal to or
exceeds [***], but is less than [***], then Lilly shall pay Incyte the milestone
payments set forth in both Sections 7.2(b)(i)(A) and (B) (total [***]).

(c)        Except as otherwise specified, none of the payments listed in this
Section 7.2 shall be payable more than once, and each shall be payable at the
first achievement of a milestone event for a Licensed Product and shall not be
payable again if subsequently another Licensed Product achieves the same
milestone event.  For clarification, if a milestone is paid for a Licensed
Compound, that milestone will not be paid again for a back-up compound.

(d)        In the event that a milestone event described in Section 7.2(a) is
achieved, all milestones prior to that stage of Development for that Indication
shall be deemed to have been achieved as well, and if the related payment for
any such preceding milestone has not been previously paid, the previously unpaid
payments that would be due for the preceding milestones shall also become due
and payable, even though the missing milestone has not been achieved; provided
that the foregoing shall not apply to Section 7.2(a)(i)(A) milestone 1b.

7.3       Royalties.

(a)        Royalty Rates.

(i)         Lilly shall pay to Incyte royalties on aggregate worldwide Net Sales
of all Licensed Products that contain or incorporate a Lead Compound in the
Territory, on a Licensed Product-by-Licensed Product basis, at the following
rates:

 

 

 

Annual Net Sales of Licensed Product in the Territory

 

Royalty Rate

On Annual Net Sales less than or equal to [***]

 

[***]

On Annual Net Sales greater than [***] and less than or equal to [***]

 

[***]

On Annual Net Sales greater than [***] and less than or equal to [***]

 

[***]

On Annual Net Sales greater than [***]

 

20%

 

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(ii)        Lilly shall pay to Incyte royalties on aggregate worldwide Net Sales
of all Licensed Products that contain or incorporate a Licensed Back-Up Compound
(other than the Follow-On Lead Compound which, for purposes of clarity, is
subject to subsection (i) above) in the Territory, on a Licensed
Product-by-Licensed Product basis, at the following rates:

 

 

 

Annual Net Sales of Licensed Product in the Territory

 

Royalty Rate

On Annual Net Sales less than or equal to [***]

 

[***]

On Annual Net Sales greater than [***] and less than or equal to [***]

 

[***]

On Annual Net Sales greater than [***] and less than or equal to [***]

 

[***]

On Annual Net Sales greater than [***]

 

[***]

 

(iii)      [***]

(iv)       The royalty rates set forth in Section 7.3(a)(i) (and not Section
7.3(a)(ii)) shall apply to Annual Net Sales of any Combination Products
containing a Lead Compound and a Licensed Back-Up Compound, wherein the Licensed
Back-Up Compound is only available in combination with such Lead Compound.

(b)        Royalties payable under this Section 7.3 shall be paid by Lilly on a
Licensed Product-by-Licensed Product and country-by-country basis from the date
of First

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Commercial Sale of each Licensed Product with respect to which royalty payments
are due for a period which is the longer of: (i) the last to expire of any Valid
Claim of Incyte Patent Rights Covering such Licensed Product in such country;
(ii) [***] following the date of First Commercial Sale of such Licensed Product
in such country; and (iii) the expiration of Regulatory Exclusivity for such
Licensed Product in such country (each such term with respect to a Licensed
Product and a country, a “Royalty Term”).

(c)        Notwithstanding the foregoing, in the event that either (i) the
Royalty Term continues solely due to Section 7.3(b)(ii) (i.e. in a specific
country the Licensed Product is not Covered by a Valid Claim of Incyte Patent
Rights nor is such Licensed Product protected by Regulatory Exclusivity); or
(ii) Generic Competition exists with respect to a Licensed Product in the Field
in a country in the Territory in a Calendar Year, then the royalty rates in such
country for such Licensed Product for such Calendar Year will be reduced to
[***] of the applicable rate in Section 7.3(a);  provided that any reduction of
the applicable rate in Section 7.3(a) pursuant to subclause (ii) due to the
existence of Generic Competition shall be retroactively applied for the relevant
Calendar Year.

(d)        If Lilly (i) determines in good faith that, in order to avoid
infringement of any Patent Right not licensed hereunder, it is reasonably
necessary to obtain a license from a Third Party in order to Develop,
Commercialize, make, have made, use, offer for sale, sell or import the Licensed
Product in the Field in a country in the Territory and to pay a royalty or other
consideration under such license (including in connection with the settlement of
a patent infringement claim); or (ii) shall be subject to a final court or other
binding order or ruling requiring any payments, including the payment of a
royalty to a Third Party patent holder in respect of the Development,
Commercialization, making, having made, using, offering for sale, selling and
importing of a Licensed Product in the Field in a country in the Territory, then
the amount of Lilly’s royalty payments under Section 7.3(a) with respect to Net
Sales for such Licensed Product in such country shall be reduced by [***] of the
amount payable by Lilly to such Third Party that are reasonably and
appropriately allocable to the Licensed Product in the Field in the Territory,
provided, however, that in no event shall the aggregate deductions under this
Section 7.3(d) reduce any royalty payment made by Lilly in respect of Net Sales
of such Licensed Product pursuant to Section 7.3(a) by more than [***].

(e)        Upon the expiration of the Royalty Term with respect to a Licensed
Product in a country, the licenses granted by Incyte to Lilly pursuant to
Section 2.1 shall be deemed to be fully paid-up, irrevocable and perpetual with
respect to such Licensed Product in such country.

7.4       Royalty Reports; Payments.  Lilly shall deliver to Incyte, within
[***] after the end of each Calendar Quarter, a royalty report for such Calendar
Quarter, together with the required payments.  Such reports shall indicate, on a
country-by-country basis, the Net Sales and the calculation of royalties from
Net Sales with respect thereto, each determined in accordance with this
Agreement and, with respect to sales of Licensed Product in the United States,
such reports shall include gross sales and all deductions taken from gross
sales.  All payments due to Incyte pursuant to this Agreement shall be made in
United States dollars by wire transfer in immediately available funds from a
Lilly account in the United States to an account designated in advance by
Incyte.

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7.5       Financial Records.  Lilly shall keep complete and accurate books and
records in accordance with Accounting Standards. Lilly will keep such books and
records for at least [***] following the end of the Calendar Year to which they
pertain. Such books of accounts shall be kept at the principal place of business
of the financial personnel with responsibility for preparing and maintaining
such records.  With respect to royalties, such records shall be in sufficient
detail to support calculations of royalties due to Incyte.

7.6       Audits.  [***] during each Calendar Year for the Term, Incyte may
retain an independent certified public accountant reasonably acceptable to Lilly
to audit the records described in Section 7.5, upon at least [***] prior notice
to Lilly.  Incyte shall bear the costs of such audit, except as provided
below.  The results of such audit shall be made available to both Parties, but
shall be considered Lilly’s Confidential Information.  If the audit demonstrates
that the payments owed under this Agreement have been understated, Lilly shall
pay the balance to Incyte, together with interest in accordance with Section
7.9.  Further, if the amount of the understatement is greater than [***] of the
amount owed to Incyte with respect to the audited period, then Lilly shall
reimburse Incyte for the reasonable cost of the audit.  If the audit
demonstrates that the payments owed under this Agreement have been overstated,
Lilly shall be entitled to credit such amount against payments due to
Incyte.  All payments owed by Lilly under this Section 7.6 shall be made within
[***] after the results of the audit are delivered to the Parties.

7.7       Tax Matters.  The royalties, milestones and other amounts payable by
Lilly to Incyte pursuant to this Agreement shall not be reduced on account of
any taxes unless required by Law.  Lilly shall inform Incyte of any withholding
tax obligation on payments due to Incyte under this Agreement as soon as Lilly
becomes aware of the withholding tax obligation.  The Parties shall meet
promptly thereafter to discuss how best to minimize the amount of such
withholding tax obligation in accordance with Law, and Lilly shall take all
reasonable and lawful steps to minimize the amount of any such withholding tax
obligation.  The Parties agree to cooperate in good faith to provide one another
with such documents and certifications as are reasonably necessary to enable
Lilly and Incyte to minimize and/or recover any withholding tax
obligation.  Lilly shall provide to Incyte documentation of the payment of any
withholding tax that is paid pursuant to this Section 7.7.  Notwithstanding the
foregoing, Lilly represents that the payments to be paid by Lilly to Incyte
pursuant to Sections 7.1, 7.2 and 7.3 hereof shall not be subject to withholding
tax under conditions less favorable to Incyte than those applicable to
treaty-eligible residents under the income tax treaty between the United States
and the country of payment origination in force at the point of time such
payments are paid.  Payments to Incyte will be made from the United States
unless Incyte receives notice from Lilly that payments will be made from either
Puerto Rico or Ireland.

7.8       Currency Exchange.  All payments to be made by Lilly to Incyte shall
be made in U.S. Dollars.  In the case of sales of Licensed Product outside the
United States, royalty payments by Lilly to Incyte shall be converted to U.S.
Dollars in accordance with the following:  the rate of currency conversion shall
be calculated using the average of the daily foreign exchange rates as published
by The Wall Street Journal, Eastern Edition, for the Calendar Quarter in which
such payments occurred.

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7.9       Late Payments.  The paying Party shall pay interest to the receiving
Party on the aggregate amount of any payments that are not paid on or before the
date such payments are due under this Agreement at a rate per annum equal to the
lesser of [***], as reported by The Wall Street Journal, Eastern Edition, [***]
or the highest rate permitted by applicable Law, calculated on the number of
days such payments are paid after the date such payments are due; provided, that
with respect to any disputed payments, no interest payment shall be due until
such dispute is resolved and the interest which shall be payable thereon shall
be based on the finally-resolved amount of such payment, calculated from the
original date on which the disputed payment was due through the date on which
payment is actually made.

ARTICLE VIII

 

TERM AND TERMINATION

8.1       Agreement Term.  The term of this Agreement shall commence on the
Effective Date and shall continue until the earlier of (i) the termination of
this Agreement in accordance with Section 8.2; or (ii) following the First
Commercial Sale of any Licensed Product, the expiration of the last-to-expire of
all Royalty Terms with respect to all Licensed Compounds and Licensed Products
(the “Term”).  Notwithstanding the above, if there are any ongoing disputes at
the end of the Term as set forth above, this Agreement shall remain in full
force and effect until all such disputes are resolved.

8.2       Termination.

(a)        Termination for Convenience.  Prior to the first anniversary of the
Effective Date, Lilly may elect to terminate this Agreement at any time by
providing [***] prior written notice to Incyte; provided, that at any time after
such notice by Lilly, Incyte may accelerate the effective date of such
termination by providing [***] prior written notice to Lilly of such accelerated
effective date.  After the first anniversary of the Effective Date, Lilly may
elect to terminate this Agreement at any time by providing [***] prior written
notice to Incyte; provided, that at any time after such notice by Lilly, Incyte
may accelerate the effective date of such termination by providing [***] prior
written notice to Lilly of such accelerated effective date.

(b)        Termination for Material Breach.  If either Party (the “Non-Breaching
Party”) believes that the other Party (the “Breaching Party”) is in material
breach of this Agreement, then the Non-Breaching Party may deliver notice of
such breach to the Breaching Party.  If the Breaching Party fails to cure such
breach, or to initiate such steps as would be considered reasonable to
effectively cure such breach (and thereafter diligently pursues such cure),
within [***] after receipt of such notice of breach, the Non‑Breaching Party may
terminate this Agreement upon written notice to the Breaching
Party.  Notwithstanding the foregoing, if a Party disputes the termination, then
8.2(e) shall apply.

(c)        Termination if Lilly Challenges Incyte IP.  If Lilly or any of its
Affiliates or sublicensees, directly or indirectly, (i) initiates or requests an
interference or opposition proceeding with respect to any Incyte Patent Right;
(ii) makes, files or maintains any claim,

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demand, lawsuit, or cause of action to challenge the validity or enforceability
of any Incyte Patent Right; or (iii) opposes any extension of, or the grant of a
supplementary protection certificate with respect to, any Incyte Patent Right,
Incyte shall have the right to terminate this Agreement upon [***] written
notice to Lilly.  Any such termination shall only become effective if Lilly or
its Affiliate or sublicensee, as applicable, has not withdrawn such action
before the end of the above notice period.

(d)        Termination for Lilly’s Abandonment of Development or
Commercialization.  Subject to Section 4.2(b)(iii)A and 5.1(b)(i), if Lilly has
Abandoned Development or Abandoned Commercialization in accordance with Section
4.2(a)(iii) or 5.1(b), as applicable, Incyte may elect to terminate this
Agreement by providing Lilly written notice of such termination, such
termination to be effective immediately.  Notwithstanding the foregoing, if
Lilly disputes the termination, then 8.2(e) shall apply.

(e)        Termination Disputes.  If a Party gives notice of termination under
Section 8.2(b), if the Parties dispute whether Lilly has Abandoned Development
or Abandoned Commercialization in accordance with Section 4.2(b)(iii) or 5.1(b),
as applicable, or Incyte gives notice of termination under 8.2(d), and the other
Party disputes whether such notice was proper, then the issue of whether or not
Lilly has Abandoned Development, Abandoned Commercialization, or if this
Agreement was properly terminated shall be resolved in accordance with ARTICLE
XII, and the Agreement shall remain in full force and effect until such dispute
is resolved.  If as a result of such dispute resolution process it is determined
that the notice of termination was proper, then such termination shall be deemed
to be effective on the date on which such dispute is resolved.  On the other
hand, if as a result of the dispute resolution process it is determined that the
notice of termination was improper, then no termination shall have occurred and
this Agreement shall remain in full force and effect.

8.3       Effects Of Termination.

(a)        Upon termination of this Agreement by Lilly under Section 8.2(a) or
by Incyte under Sections 8.2(b),  8.2(c) or 8.2(d):

(i)         all licenses granted by Incyte to Lilly hereunder shall terminate
and Lilly shall not have any rights to use or exercise any rights under the
Incyte IP;

(ii)        Lilly shall provide to Incyte a fair and accurate summary report of
the status of the Development and Commercialization of the Licensed Products in
each country in the Territory through the effective date of termination within
[***] after such termination;

(iii)      Lilly hereby grants to Incyte, exercisable from and after such
termination, an exclusive, worldwide, perpetual, irrevocable, royalty-free,
fully-paid license, with the right to grant sublicenses, under Lilly and its
Affiliates’ interest in the Joint IP and any Know-How or Patent Rights
Controlled by Lilly or its Affiliates as of the date of such termination solely
to the extent that such licenses are necessary to research, Develop, make, have
made, use, offer for sale, sell and import Licensed Products in the Field in the
Territory, and Lilly shall retain all other remaining rights;

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(iv)       Lilly shall promptly transfer and assign to Incyte all of Lilly’s and
its Affiliates’ rights, title and interests in and to the product trademark(s)
(but not any Lilly house marks or any trademark containing the word “Lilly”
owned by Lilly and used for the Licensed Products in the Field in the Territory)
owned by Lilly and used for the Licensed Products in the Field in the Territory;

(v)        Lilly shall as soon as reasonably practicable transfer and assign to
Incyte all Regulatory Documentation, the Global Safety Database and other
documented technical and other information or materials Controlled by Lilly
which are necessary or useful for the Development, manufacture and
Commercialization of the Licensed Compounds or Licensed Products; provided that
Lilly may retain a single copy of such items for its records.  Within [***]
after Incyte’s receipt of an invoice therefor, Incyte shall reimburse Lilly for
Lilly’s and its Affiliates’ reasonable Out-of-Pocket Costs incurred in
connection with such transfers and assignment (but not the generation, creation
or development of such information and materials);

(vi)       Incyte shall have the option, exercisable within [***] following the
effective date of such termination, to obtain Lilly inventory of Licensed
Products at a price equal to [***] of Lilly’s non-auditable “standard cost” that
Lilly uses for internal accounting purposes.  Lilly's “standard cost” does not
include the research and development costs to develop the molecule or costs not
associated with Licensed Products.  Incyte may exercise such option by written
notice to Lilly during such [***] period; provided that in the event Incyte
exercises such right to purchase such inventory, Lilly shall grant, and hereby
does grant, a royalty-free right and license to any trademarks, names and logos
of Lilly contained therein for a period of [***] solely to permit the orderly
sale of such inventory, except where Lilly reasonably believes that continued
sales would pose an unreasonable safety risk, and any materials having a Lilly
logo (a housemark or the word “Lilly”) that are released by Lilly must meet the
Lilly quality assurance standards;

(vii)      to the extent that Lilly is responsible for manufacturing a Licensed
Product prior to termination of this Agreement, Lilly shall:

A.         in exchange for a payment equal to [***] of Lilly’s “standard costs”,
use Commercially Reasonable Efforts to supply Incyte and its Affiliates with
comparable quantities of the Licensed Products in the dosage strength,
formulation and presentation as were being Commercialized as of the effective
date of termination until the earlier of [***] after the effective date of the
termination or establishment by Incyte of an alternative supply for such
Licensed Product, it being understood that Lilly is not obligated to manufacture
itself if Lilly reasonably believes that such manufacture and/or Licensed
Product would pose an unreasonable safety risk, and unless Lilly was
manufacturing itself immediately prior to termination, and in the event Lilly
was utilizing a contract manufacturer, Lilly’s obligation is to use Commercially
Reasonable Efforts to cooperate with Incyte to obtain Licensed Product from such
manufacturer; provided that Incyte shall use its Commercially Reasonable Efforts
to establish an alternative supply as promptly as reasonably practicable;

B.         cooperate with Incyte in reasonable respects to transfer

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manufacturing documents and materials which are used (at the time of the
termination) by Lilly in the Manufacture of the applicable Licensed Products;
and

C.         cooperate with Incyte in reasonable respects to transfer to Incyte,
or Incyte’s designated contract manufacturer, the manufacturing technologies
(including all relevant Know-How) that are used and necessary (at the time of
the termination) and Controlled by Lilly in the manufacture of the applicable
Licensed Products, provided that Incyte shall reimburse Lilly for Lilly’s
reasonable Out-of-Pocket Costs to provide such requested assistance;

(viii)    in the event that Incyte terminates this Agreement pursuant to Section
8.2(d) or Lilly terminates pursuant to 8.2(a) and such termination occurs after
Lilly has initiated a Phase III Study for a Licensed Product, [***]); and

(ix)       Section 8.3(d) shall apply.

(b)           Upon termination of this Agreement by Lilly in accordance with
Section 8.2(b):

(i)         the license granted to Lilly pursuant to Section 2.1 and the rights
and obligations of the Parties pursuant to Sections 6.2 and 6.3 shall remain in
effect and Lilly shall continue to pay to Incyte all royalties due under Section
7.3 and 4.4 and all milestones due under Section 7.2 in accordance with the
terms of this Agreement;

(ii)        until the last to expire of all Royalty Terms with respect to
Licensed Compounds and Licensed Products, the rights and obligations of the
Parties pursuant to Sections 2.6(d),  2.6(e),  2.6(f) shall survive; provided
however, that if the First Commercial Sale of a Licensed Product has not
occurred at the time of termination, then the rights and obligations of the
Parties pursuant to Sections 2.6(d), 2.6(e), 2.6(f) shall survive for [***]
after the effective date of such termination provided  further that if a First
Commercial Sale of a Licensed Product takes place within such [***] period,
Sections 2.6(d),  2.6(e),  2.6(f) shall survive until the last to expire of all
Royalty Terms; and

(iii)      Section 8.3(d) shall apply.

(c)        ARTICLE I (Definitions), IX  (Indemnification and Limitation of
Liability), XI  (Confidentiality), XII  (Dispute Resolution) and XIII
 (Miscellaneous) and Sections 6.1 (Inventorship; Ownership), 7.5  (Financial
Records), 7.6  (Audits), 8.3 (Effects of Termination), 10.4  (Disclaimer of
Warranty) and 10.5  (Standstill) shall survive termination or expiration of this
Agreement.

(d)        Termination of this Agreement shall be in addition to, and shall not
prejudice, the Parties’ remedies at law or in equity, including the Parties’
ability to receive legal damages and/or equitable relief with respect to any
breach of this Agreement, regardless of whether or not such breach was the
reason for the termination.

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ARTICLE IX

 

INDEMNIFICATION; LIMITATION OF LIABILITY

9.1       By Lilly.

(a)        Lilly agrees, at Lilly’s cost and expense, to defend, indemnify and
hold harmless Incyte and its Affiliates and their respective directors,
officers, employees and agents (the “Incyte Indemnified Parties”) from and
against any losses, costs, damages, fees or expenses arising out of any Third
Party claim relating to (i) any breach by Lilly of any of its representations,
warranties or obligations pursuant to this Agreement; (ii) the gross negligence
or willful misconduct of Lilly; and (iii) the Development, manufacture,
Commercialization, use, sale or other disposition by Lilly, its Affiliates or
sublicensees of any Licensed Compound or Licensed Product.

(b)        In the event of any such claim against the Incyte Indemnified Parties
by any Third Party, Incyte shall promptly notify Lilly in writing of the claim
and Lilly shall have the right, exercisable by notice to Incyte within [***]
after receipt of notice from Incyte of the claim, to assume direction and
control of the defense, litigation, settlement, appeal or other disposition of
the claim (including the right to settle the claim solely for monetary
consideration) with counsel selected by Lilly and reasonably acceptable to
Incyte.  The Incyte Indemnified Parties shall cooperate with Lilly and may, at
their option and expense, be separately represented in any such action or
proceeding.  Lilly shall not be liable for any litigation costs or expenses
incurred by the Incyte Indemnified Parties without Lilly’s prior written
authorization.  In addition, Lilly shall not be responsible for the
indemnification or defense of any Incyte Indemnified Party to the extent arising
from any negligent or intentional acts by any Incyte Indemnified Party or the
breach by Incyte of any obligation or warranty under this Agreement, or any
claims compromised or settled without its prior written consent. 
Notwithstanding the foregoing, Lilly shall not settle a Third Party claim
without the written consent of Incyte, if such settlement would impose any
monetary obligation on Incyte or require Incyte to submit to an injunction.

(c)        Notwithstanding anything to the contrary above, in the event of any
such claim against the Incyte Indemnified Parties by a governmental or criminal
action seeking an injunction against Incyte, Incyte shall have the right to
control the defense, litigation, settlement, appeal or other disposition of the
claim at Lilly’s expense.

9.2       By Incyte.

(a)        Incyte agrees, at Incyte’s cost and expense, to defend, indemnify and
hold harmless Lilly and its Affiliates and their respective directors, officers,
employees and agents (the “Lilly Indemnified Parties”) from and against any
losses, costs, damages, fees or expenses arising out of any Third Party claim
relating to (a) any breach by Incyte of any of its representations, warranties
or obligations pursuant to this Agreement, or (b) the gross negligence or
willful misconduct of Incyte, and (c) the Development, manufacture,
Commercialization, use, sale or other disposition by Incyte, its Affiliates or
sublicensees of any Licensed Compound or Licensed Product.

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(b)        In the event of any such claim against the Lilly Indemnified Parties
by any Third Party, Lilly shall promptly notify Incyte in writing of the claim.
Incyte shall have the right, exercisable by notice to Lilly within [***] after
receipt of notice from Lilly of the claim, to assume direction and control of
the defense, litigation, settlement, appeal or other disposition of the claim
(including the right to settle the claim solely for monetary consideration) with
counsel selected by Incyte and reasonably acceptable to Lilly. The Lilly
Indemnified Parties shall cooperate with Incyte and may, at their option and
expense, be separately represented in any such action or proceeding.  Incyte
shall not be liable for any litigation costs or expenses incurred by the Lilly
Indemnified Parties without Incyte’s prior written authorization.  In addition,
Incyte shall not be responsible for the indemnification or defense of any Lilly
Indemnified Party to the extent arising from any negligent or intentional acts
by any Lilly Indemnified Party, or the breach by Lilly of any representation,
obligation or warranty under this Agreement, or any claims compromised or
settled without its prior written consent.  Notwithstanding the foregoing,
Incyte shall not settle a Third Party claim without the written consent of
Lilly, if such settlement would impose any monetary obligation on Lilly or
require Lilly to submit to an injunction.

(c)        Notwithstanding anything to the contrary above, in the event of any
such claim against the Lilly Indemnified Parties by a governmental or criminal
action seeking an injunction against Lilly, Lilly shall have the right to
control the defense, litigation, settlement, appeal or other disposition of the
claim at Incyte’s expense.

9.3       Limitation of Liability.  EXCEPT WITH RESPECT TO A BREACH OF ARTICLE
XI, OR A PARTY’S LIABILITY PURSUANT TO ARTICLE IX, NEITHER PARTY SHALL BE LIABLE
FOR SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, MULTIPLE OR OTHER
INDIRECT OR REMOTE DAMAGES, OR, EXCEPT WITH RESPECT TO A BREACH OF SECTION 2.6,
FOR LOSS OF PROFITS, LOSS OF DATA OR LOSS OF USE DAMAGES ARISING IN ANY WAY OUT
OF THIS AGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, WHETHER BASED UPON
WARRANTY, CONTRACT, TORT, STRICT LIABILITY OR OTHERWISE, EVEN IF SUCH PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR LOSS.

ARTICLE X

 

REPRESENTATIONS AND WARRANTIES AND COVENANTS

10.1     Representation Of Authority; Consents.  Incyte and Lilly each
represents and warrants to the other Party that:

(a)        as of the Effective Date, it has full right, power and authority to
enter into this Agreement;

(b)        as of the Effective Date, this Agreement has been duly executed by
such Party and constitutes a legal, valid and binding obligation of such Party,
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium and other Laws relating to or affecting

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creditors’ rights generally and by general equitable principles and public
policy constraints (including those pertaining to limitations and/or exclusions
of liability, competition Laws, penalties and jurisdictional issues including
conflicts of Laws); and

(c)        as of the Effective Date, and except as otherwise contemplated in
this Agreement, all necessary consents, approvals and authorizations of all
government authorities and other persons required to be obtained by such Party
in connection with the execution, delivery and performance of this Agreement
have been and shall be obtained.

10.2     No Conflict.  Each Party represents and warrants to the other Party
that the execution and delivery of this Agreement and the performance of such
Party’s obligations hereunder (a) do not conflict with or violate such Party’s
corporate charter and bylaws or any requirement of applicable Laws and (b) do
not and shall not conflict with, violate or breach or constitute a default or
require any consent under, any material oral or written contractual obligation
of such Party.  Each Party agrees that it shall not during the term of this
Agreement grant any right, license, consent or privilege to any Third Party or
otherwise undertake any action, either directly or indirectly, that would
conflict with the rights granted to the other Party or interfere with any
obligations of such Party set forth in this Agreement.

10.3     Additional Incyte Representations and Warranties.  Incyte represents
and warrants that, as of the Effective Date, except as previously disclosed to
Lilly:

(a)        Neither it nor any of its Affiliates has received written notice of
any claim or litigation which alleges any Intellectual Property Rights of a
Third Party are infringed by a Licensed Compound or the Development or
Commercialization of any Licensed Compound; to the knowledge of Incyte and its
Affiliates, none of Incyte or any of its Affiliates has in the past infringed or
is currently infringing any Third Party Intellectual Property Rights through
activities related to the Licensed Compounds;

(b)        there are no claims, judgments or settlements against or owed by
Incyte or any of its Affiliates, nor, to the knowledge of Incyte or any of its
Affiliates, any pending reissue, reexamination, interference, opposition or
similar proceedings, with respect to any Licensed Compounds or Incyte IP, and
Incyte has not received written notice of any threatened claims or litigation or
any reissue, reexamination, interference, opposition or similar proceedings
seeking to invalidate or otherwise challenge any Incyte IP;

(c)        to the knowledge of Incyte and its Affiliates, no Third Party is
infringing any Incyte Patent Rights;

(d)        (i) Incyte is the legal and beneficial owner or has the right to
grant to Lilly the rights granted herein, to all Incyte IP; (ii) no Third Party
has any right, interest or claim in or to such rights that would limit the
rights granted to Lilly under this Agreement; and (iii) all assignments to
Incyte of inventorship rights relating to the Incyte Patent Rights Controlled by
Incyte are valid and enforceable;

(e)        all fees due to date that are required to maintain the Incyte IP have
been paid in full and to Incyte’s knowledge, the Incyte IP is valid and
enforceable;

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(f)         Incyte has not granted and shall not grant any Third Party rights
that are or would be inconsistent with Lilly’s rights hereunder and there are no
agreements or arrangements to which Incyte or any of its Affiliates is a party
relating to Licensed Compound or Incyte IP that would limit the rights granted
to Lilly under this Agreement; and

(g)        Incyte has disclosed to Lilly all material information known to it
and its Affiliates with respect to the safety and efficacy of each of the
Licensed Compounds.

(h)        Neither Incyte nor any of its Affiliates Controls any Patent Rights
or Know-How necessary to Develop, manufacture or Commercialize Licensed Products
and not included in the licenses granted hereunder to Lilly.  Subject to Section
13.3(b)(ii), in the event Incyte subsequently determines that any Patent Rights
or Know-How necessary to Develop, manufacture or Commercialize Licensed Products
is Controlled by any Affiliate of Incyte, and not Incyte, Incyte shall
immediately cause such Affiliate to grant to Incyte, a license (that is
sublicenseable to Lilly hereunder) to, or ownership of, such Patent Rights or
Know-How in a manner consistent with this Agreement.

(i)         None of the Incyte IP has been licensed or sublicensed from any
Third Party, and there are no royalties or other payments that would be due to
Third Parties on account of Development or Commercialization of Licensed
Compounds or Licensed Products hereunder as a result of any agreement entered
into by Incyte or any of its Affiliates.

10.4     Disclaimer of Warranty.  Nothing in this Agreement shall be construed
as a representation made or warranty given by Incyte that Lilly will be
successful in obtaining any Patent Rights, that any patents will issue based on
pending applications or that any such pending applications or patents issued
thereon will be valid.  ALL INCYTE IP TRANSFERRED PURSUANT TO THIS AGREEMENT
SHALL BE PROVIDED ON AN “AS IS” BASIS.  EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS, WAIVES, RELEASES AND RENOUNCES ANY
WARRANTY, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE AND NONINFRINGEMENT.

10.5     Standstill.

(a)        Lilly agrees that, for a period commencing on the Effective Date and
ending [***] after the Effective Date, unless specifically invited in writing to
do so by Incyte, Lilly and each of its Affiliates will not in any manner,
directly or indirectly:

(i)         effect, or seek, offer or propose to effect (whether publicly or
otherwise) or cause or participate in, (A) any acquisition of (1) any Voting
Stock of Incyte or any securities that at such time are convertible or
exchangeable into or exercisable for any Voting Stock of Incyte (collectively,
“Voting Securities”); (2) any direct or indirect rights or options to acquire
any Voting Securities; or (3) any assets or securities of Incyte or any of its
subsidiaries; (B) any merger, consolidation, tender or exchange offer, or other
business combination involving Incyte or any Affiliate thereof; (C) any
restructuring, recapitalization, liquidation, dissolution or similar transaction
with respect to Incyte or any Affiliate thereof; (D) any “solicitation” of
“proxies” (as such terms are defined or used in Regulation 14A under the
Exchange Act) or

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consents with respect to any Voting Securities, any “election contest” (as such
term is defined or used in Rule 14a-11 of the Exchange Act) with respect to
Incyte, or any demand for a copy of Incyte’s stock ledger, list of its
stockholders, or other books and records; or (E) any action inconsistent with
the terms of this Section 10.5;

(ii)        form, join, participate in or encourage the formation of any “group”
(within the meaning of Section 13(d)(3) of the Exchange Act) with respect to any
Voting Securities;

(iii)      otherwise act, alone or in concert with others (including by
providing financing for another party), to seek or offer to control or
influence, in any manner, the management, Board of Directors or policies of
Incyte;

(iv)       take any action that might force Incyte to make a public announcement
regarding any of the types of matters set forth in Section 10.5(a)(i);

(v)        make (publicly or to Incyte, or its directors, officers, employees,
agents or security holders, directly or indirectly) any request or proposal to
amend, waive or terminate any provision of this Section 10.5 or any inquiry or
statement relating thereto; or

(vi)       instigate, encourage or assist any Third Party to do any of the
foregoing.

(b)        Notwithstanding anything in this Section 10.5 to the contrary, the
provisions of this Section 10.5 shall immediately cease to be of any effect as
to Lilly and its Affiliates and shall be deemed to be waived in the event (i)
[***]; or (ii) a person or 13D Group not including Lilly or its Affiliates
[***].  In the event that the transactions contemplated by this clause shall
have been terminated or abandoned, and such termination or abandonment is
demonstrable by objective, written evidence provided by Incyte to Lilly, all of
the restrictions in this Section 10.5 shall again be applicable as to the
activities Lilly or its Affiliates initiate thereafter for the remainder of the
period specified herein.

(c)        Notwithstanding anything in the Section 10.5 to the contrary, Lilly
and its Affiliates may acquire an aggregate amount of Voting Securities that
would represent less than [***] of the voting power represented by Incyte’s
Voting Stock solely for the purposes of investment in the ordinary course of
business (so long as any decision to make such acquisition is in compliance with
United States securities laws).  Nothing in this Section 10.5 shall [***].

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(d)        This Section 10.5 shall not apply to any of the activities with
respect to Licensed Compounds or Licensed Products contemplated by this
Agreement.

 

(e)        Incyte [***] upon (i) [***]; and (ii) [***].

ARTICLE XI

 

CONFIDENTIALITY

11.1     Confidential Information.  All Confidential Information of a Party (the
“Disclosing Party”) shall not be used by the other Party (the “Receiving Party”)
except in performing its obligations or exercising rights explicitly granted
under this Agreement and shall be maintained in confidence by the Receiving
Party and shall not otherwise be disclosed by the Receiving Party to any Third
Party, without the prior written consent of the Disclosing Party with respect to
such Confidential Information, except to the extent that the Confidential
Information:

(a)        was known by the Receiving Party or its Affiliates prior to its date
of disclosure to the Receiving Party; or

(b)        is lawfully disclosed to the Receiving Party or its Affiliates by
sources other than the Disclosing Party rightfully in possession of the
Confidential Information; or

(c)        becomes published or generally known to the public through no fault
or omission on the part of the Receiving Party, its Affiliates or its
sublicensees; or

(d)        is independently developed by or for the Receiving Party or its
Affiliates without reference to or reliance upon such Confidential Information,
as established by written records.

Specific information shall not be deemed to be within any of the foregoing
exclusions merely because it is embraced by more general information falling
within those exclusions.

11.2     Permitted Disclosure.  The Receiving Party may provide the Disclosing
Party’s Confidential Information:

(a)        to the Receiving Party’s respective employees, consultants and
advisors, and to the employees, consultants and advisors of such Party’s
Affiliates, who have a need to know such information and materials for
performing obligations or exercising rights expressly granted under this
Agreement and have an obligation to treat such information and materials as
confidential;

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(b)        to patent offices in order to seek or obtain Patent Rights or to
Regulatory Authorities in order to seek or obtain approval to conduct Clinical
Trials or to gain Regulatory Approval with respect to the Licensed Product as
contemplated by this Agreement; provided, that such disclosure may be made only
to the extent reasonably necessary to seek or obtain such Patent Rights or
approvals; or

(c)        if such disclosure is required by Law or to defend or prosecute
litigation or arbitration; provided that prior to such disclosure, to the extent
permitted by Law, the Receiving Party promptly notifies the Disclosing Party of
such requirement and furnishes only that portion of the Disclosing Party’s
Confidential Information that the Receiving Party is legally required to
furnish.

11.3     Publicity; Attribution; Terms of this Agreement; Non-Use of Names.

(a)        Except as required by judicial order or applicable Law or as set
forth below, neither Party shall make any public announcement concerning this
Agreement without the prior written consent of the other Party, which consent
shall not be unreasonably withheld or delayed.  The Party preparing any such
public announcement shall provide the other Party with a draft thereof at least
[***] prior to the date on which such Party would like to make the public
announcement.  Notwithstanding the foregoing, the Parties shall issue a press
release, in the form attached as Exhibit D, within one (1) Business Day after
the Effective Date to announce the execution of this Agreement and describe the
material financial and operational terms of this Agreement.  For purposes of
disclosure to the investor community during conference calls, investor
presentations, and analyst meetings, the Parties acknowledge that Incyte can
disclose the following information, (i) base royalty: tiered, double digit
royalty payments on future global sales with rates ranging up to twenty percent,
(ii)  Development expenditure of thirty percent (30%) of Co-Development costs
through Regulatory Approval if Incyte fully participates in co-funding
Development, (iii) increased royalties payments on potential future global sales
with tiered rates ranging from twenty percent up to the high twenties, (iv) the
ability for Incyte to defer Development Costs that exceed a predetermined level
against future milestones and royalties, (v) the ability to terminate
Co-Development at any time for an incremental royalty commensurate with Incyte's
contribution, and (vi) based on the current Co-Development Budget, Incyte’s
option to fund thirty percent (30%) of Co-Development costs is expected to be
primarily funded by the anticipated development and regulatory milestones
associated with this collaboration.  Neither Party shall use the name,
trademark, trade name or logo of the other Party or its employees in any
publicity or news release relating to this Agreement or its subject matter,
without the prior express written permission of the other Party.

(b)        Notwithstanding the terms of this ARTICLE XI,

(i)         either Party shall be permitted to disclose the existence and terms
of this Agreement to the extent required, based on the advice of such Party’s
legal counsel, to comply with applicable Laws, including the rules and
regulations promulgated by the United States Securities and Exchange Commission
(the “SEC”) or any other governmental authority, or the rules or regulations of
the New York Stock Exchange (the “NYSE”), The NASDAQ Stock Market (“NASDAQ”) or
any other stock exchange on which securities issued by a Party or a Party’s
Affiliate are traded.  Notwithstanding the foregoing, before disclosing this
Agreement or

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any of the terms hereof pursuant to this Section 11.3(b), the Parties will
coordinate in advance with each other in connection with the redaction of
certain provisions of this Agreement with respect to any filings with the SEC,
the NYSE, NASDAQ or any other stock exchange on which securities issued by a
Party or a Party’s Affiliate are traded, and each Party will use Commercially
Reasonable Efforts to seek confidential treatment for such terms as may be
reasonably requested by the other Party;  provided that each Party will
ultimately retain control over what information that Party discloses to their
relevant exchange, and provided further that the Parties will use their
Commercially Reasonable Efforts to file redacted versions with any governing
bodies which are consistent with redacted versions previously filed with any
other governing bodies.  Other than such obligation, neither Party (nor its
Affiliates) will be obligated to consult with or obtain approval from the other
Party with respect to any filings to the SEC, the NYSE, NASDAQ or any other
stock exchange.

(ii)        Either Party may disclose the existence and terms of this Agreement
in confidence to its attorneys and advisors, and to potential acquirers (and
their respective professional attorneys and advisors), in connection with a
potential merger, acquisition or reorganization and to existing and potential
investors or lenders of such Party, as a part of their due diligence
investigations, or to existing and potential licensees or sublicensees or to
permitted assignees, in each case under an agreement to keep the terms of
confidentiality and non-use substantially no less rigorous than the terms
contained in this Agreement and to use such information solely for the purpose
permitted pursuant to this Section 11.3(b).

(iii)      Either Party may issue a press release or make a public disclosure
relating to this Agreement or the Parties’ activities under this Agreement to
the extent that such disclosure describes the commencement and/or “top-line”
results of Clinical Trials of the Licensed Product, the achievement of any
Development events with respect to the Licensed Product or the filing for or
receipt of Regulatory Approval with respect to the Licensed Product, amounts
paid to Incyte in respect of the achievement of any milestone events, Incyte’s
exercise of the co-Development option or the termination of this Agreement;
however, the Party responsible for particular Clinical Trials will coordinate
press release information and disclosures to protect rights to the Licensed
Product and communication strategies relating to the Licensed Product.  Prior to
making any such disclosure, the Party making the disclosure shall provide the
other Party with a draft of such proposed disclosure at least [***] (or, to the
extent timely disclosure of a material event is required by Law or stock
exchange or stock market rules, such period of time sufficiently in advance of
the disclosure so that the other Party will have the opportunity to comment upon
the disclosure) prior to making any such disclosure, for the other Party’s
review and comment.

(c)        For purposes of clarity, either Party may issue a press release or
public announcement or make such other disclosure relating to this Agreement if
the contents of such press release, public announcement or disclosure (i) has
previously been made public other than through a breach of this Agreement by the
issuing Party or its Affiliates or (ii) is contained in such Party’s financial
statements prepared in accordance with Accounting Standards.

11.4     Publications.  Each Party and its Affiliates shall have the right to
make disclosures pertaining to Licensed Compound or Licensed Product to Third
Parties in Publications in accordance with the following procedure (provided
that Incyte shall abide by such  procedure to

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the extent possible under any Clinical Trial agreement(s) that Incyte entered
into prior to the Effective Date):  The publishing Party shall provide the
non-publishing Party with an advance copy of the proposed Publication, and each
Party shall then have [***] prior to submission for any Publication in which to
recommend any changes it reasonably believes are necessary to preserve any
Patent Rights or Know-How belonging in whole or in part to the non-publishing
Party.  If the non-publishing Party informs the publishing Party that such
Publication, in the non-publishing Party’s reasonable judgment, could be
expected to have a material adverse effect on any patentable invention owned by
or licensed, in whole or in part, to the non-publishing Party (other than
pursuant to a license granted under this Agreement), or on any Know-How which is
Confidential Information of the non-publishing Party, the publishing Party shall
delay or prevent such Publication as follows:  (i) with respect to a patentable
invention, such Publication shall be delayed sufficiently long (not to exceed
[***]) to permit the timely preparation and filing of a patent application; and
(ii) with respect to Know-How which is Confidential Information of such
non-publishing Party, such Know-How shall be deleted from the
Publication.  Following the initiation of Phase III Clinical Trials with respect
to a Licensed Product, all Publications relating to such Licensed Product shall
be controlled by Lilly, and Incyte shall have no right (other than as required
pursuant to any publication provisions contained in any Clinical Trial
agreement(s) that Incyte entered into prior to the Effective Date) to publish
without Lilly’s prior written consent.  Notwithstanding the foregoing, Lilly
shall be permitted to disclose information on sites such as clinicaltrials.gov
in accordance with Lilly’s normal business practices.

11.5     Term.  All obligations under this ARTICLE XI shall expire (a) [***]
following expiration of this Agreement pursuant to Section 8.1 or (b) [***]
following termination of this Agreement pursuant to Sections 8.2(a),  8.2(b),
 8.2(c) or 8.2(d).

11.6     Return of Confidential Information.  Upon the expiration or termination
of this Agreement, upon request, the Receiving Party shall return to the
Disclosing Party or destroy all Confidential Information received by the
Receiving Party from the Disclosing Party (and all copies and reproductions
thereof).  In addition, the Receiving Party shall destroy:  (a) any notes,
reports or other documents prepared by the Receiving Party which contain
Confidential Information of the Disclosing Party; and (b) any Confidential
Information of the Disclosing Party (and all copies and reproductions thereof)
which is in electronic form or cannot otherwise be returned to the Disclosing
Party.   Nothing in this Section 11.6 shall require the alteration,
modification, deletion or destruction of archival tapes or other electronic
back-up media made in the ordinary course of business; provided that the
Receiving Party shall continue to be bound by its obligations of confidentiality
and other obligations under this ARTICLE XI with respect to any Confidential
Information contained in such archival tapes or other electronic back-up
media.  Any requested destruction of Confidential Information shall be certified
in writing to the Disclosing Party by an authorized officer of the Receiving
Party supervising such destruction.  Notwithstanding the foregoing, (i) the
Receiving Party may retain one copy of the Disclosing Party’s Confidential
Information solely for the purpose of determining the Receiving Party’s
continuing obligations under this ARTICLE XI and (ii) the Receiving Party may
retain the Disclosing Party’s Confidential Information and its own notes,
reports and other documents to the extent reasonably required (x) to exercise
the rights and licenses of the Receiving Party expressly surviving expiration or
termination of this Agreement; (y) to perform the obligations of the Receiving
Party expressly surviving expiration or termination of this Agreement, and for

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regulatory or archival purposes.  Notwithstanding the return or destruction of
the Disclosing Party’s Confidential Information, the Receiving Party shall
continue to be bound by its obligations of confidentiality and other obligations
under this ARTICLE XI.

ARTICLE XII

 

DISPUTE RESOLUTION

12.1     Dispute Resolution Process.  Matters before the JDC and Subcommittees
shall be governed by the process specified in Section 3.5.  Any controversy,
claim or dispute arising out of or relating to this Agreement that is not
subject to Section 3.5, shall be settled, if possible, through good faith
negotiations between the Parties.  If the Parties are unable to settle such
dispute within [***],  and a Party wishes to pursue the matter, the matter may
be referred by either Party to the Executive Officers, who shall meet to attempt
to resolve the dispute in good faith.  Such resolution, if any, of a referred
issue shall be final and binding on the Parties.  All negotiations pursuant to
this Section 12.1 are confidential and shall be treated as compromise and
settlement negotiations for purposes of applicable rules of evidence.  If the
Executive Officers are unable to settle the dispute within [***] after referral
thereto pursuant to Section 12.1, then each Party reserves its right to any and
all remedies available under law or equity with respect to the dispute, subject
to Section 12.2.

12.2     Injunctive Relief.  Notwithstanding anything to the contrary in this
ARTICLE XII, any Party may seek immediate injunctive or other interim relief
from any court of competent jurisdiction as necessary to enforce the provisions
of Section 10.5 or ARTICLE XI and to enforce and prevent infringement or
misappropriation of the Patent Rights, Know-How or Confidential Information
Controlled by such Party.

ARTICLE XIII

 

MISCELLANEOUS

13.1     Governing Law.  This Agreement (and any claims or disputes arising out
of or related thereto or to the transactions contemplated thereby or to the
inducement of any party to enter therein, whether for breach of contract,
tortious conduct, or otherwise and whether predicated on common law, statute or
otherwise) shall in all respects be governed by and construed in accordance with
the laws of the State of New York, including all matters of construction,
validity and performance, in each case without reference to any conflict of law
rules that might lead to the application of the laws of any other jurisdiction.

13.2     Consent to Jurisdiction.  Each Party irrevocably submits to the
exclusive jurisdiction of the United States District Court for the Southern
District of New York or the United States District Court for the District of
Delaware, for the purposes of any suit, action or other proceeding arising out
of the Transaction.  Each Party agrees to commence any such action, suit or
proceeding either in the United States District Court for the Southern District
of New York or the United States District Court for the District of Delaware or
if such suit, action or other proceeding may not be brought in such court for
jurisdictional reasons, in the Supreme Court of the State of New York, New York
County.  Each Party further agrees that service of any

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process, summons, notice or document by U.S. registered mail to such Party’s
respective address set forth in Section 13.5 shall be effective service of
process for any action, suit or proceeding in New York or Delaware with respect
to any matters to which it has submitted to jurisdiction in this Section 13.2.
Each Party irrevocably and unconditionally waives any objection to the laying of
venue of any action, suit or proceeding arising out of this Agreement in (i) the
United States District Court for the Southern District of New York or (ii) the
United States District Court for the District of Delaware, and hereby and
thereby further irrevocably and unconditionally waives and agrees not to plead
or claim in any such court that any such action, suit or proceeding brought in
any such court has been brought in an inconvenient forum.

13.3     Assignment.

(a)        Neither Party may assign its rights and obligations under this
Agreement without the prior written consent of the other Party, except that
either Party may make such assignment without the prior written consent of the
other Party to an Affiliate (so long as such Party shall remain jointly and
severally liable with such Affiliate with respect to all obligations so
assigned).  Any request for consent to assignment shall not be unreasonably
withheld or delayed.  Any purported assignment in contravention of this Section
13.3 shall, at the option of the non-assigning Party, be null and void and of no
effect.  No assignment shall release either Party from responsibility for the
performance of any accrued obligation of such Party hereunder.  This Agreement
shall be binding upon and enforceable against the successor to or any permitted
assignee from either of the Parties.

(b)        Each Party agrees that, notwithstanding any provisions of this
Agreement to the contrary:

(i)         Either Party may assign this Agreement and the rights, obligations
and licenses granted hereunder to a Third Party in connection with a sale or
transfer of all or substantially all of the assigning Party’s business to which
this Agreement relates or if a Party merges or consolidates with a Third Party.

(ii)        In the event that this Agreement is assigned by either Party in
connection with a sale or transfer of all or substantially all of the assigning
Party’s business to which this Agreement relates, such assignment shall not
provide (A) the non-assigning Party with rights or access to Intellectual
Property Rights of the assignee or acquirer of such Party, nor (B) the assignee
or acquirer with rights or access to Intellectual Property Rights of the
non-assigning Party.

13.4     Entire Agreement; Amendments.  This Agreement and the Exhibits and
Schedules referred to in this Agreement constitute the entire agreement between
the Parties with respect to the subject matter hereof, and supersede all
previous arrangements with respect to the subject matter hereof, whether written
or oral, including the Prior Confidentiality Agreement.  Any amendment or
modification to this Agreement shall be made in writing signed by both Parties.

13.5     Notices.  Notices to Incyte shall be addressed to:

Incyte Corporation

Experimental Station, Route 141 & Henry Clay Road

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Wilmington, Delaware 19880

Attention: Chief Commercial Officer

Facsimile No.: [***]

with a copy to:

Incyte Corporation

Experimental Station, Route 141 & Henry Clay Road

Building E336

Wilmington, Delaware 19880

Attention: General Counsel

Facsimile No.: [***]

Notices to Lilly shall be addressed to:

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana  46285
Attention: Vice President and President, Established Markets

 

with a copy to:

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana  46285

Attention:  General Patent Counsel

Facsimile No.: [***]

Either Party may change its address to which notices shall be sent by giving
notice to the other Party in the manner herein provided.  All reports,
approvals, and notices required or permitted by this Agreement to be given to a
Party (each a “Notice”) shall be given in writing, by personal delivery,
telecopy or overnight courier, to the Party concerned at its address as set
forth above (or at such other address as a Party may specify by written notice
pursuant to this Section 13.5 to the other). All Notices shall be deemed
effective, delivered and received (a) if given by personal delivery, or by
overnight courier, when actually delivered and signed for; or (b) if given by
facsimile, when such facsimile is transmitted to the facsimile number specified
above and receipt therefor is confirmed.

13.6     Force Majeure.  No failure or omission by either Party in the
performance of any obligation of this Agreement shall be deemed a breach of this
Agreement or create any liability if the same shall arise from a Force Majeure
Event; provided that the Party affected by such cause promptly notifies the
other Party and uses diligent efforts to cure such failure or omission as soon
as is practicable after the occurrence of one or more of the above mentioned
causes.

13.7     Compliance With Laws.  Each Party shall perform its obligations under
this Agreement in compliance with all applicable Laws.

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13.8     Use Of Names, Logos Or Symbols.  Subject to Sections 5.3 and 11.3, no
Party shall use the name, trademarks, logos, physical likeness, employee names
or owner symbol of the other Party for any purpose, including private or public
securities placements, without the prior written consent of the affected
Party.  Nothing contained in this Agreement shall be construed as granting
either Party any rights or license to use any of the other Party’s trademarks or
trade names or the names of any employees thereof, without separate, express
written permission of the owner of such trademark or trade name or name.

13.9     Independent Contractors.  It is understood and agreed that the
relationship between the Parties is that of independent contractors and that
nothing in this Agreement shall be construed to create a joint venture or any
relationship of employment, agency or partnership between the Parties to this
Agreement.  Neither Party is authorized to make any representations,

commitments, or statements of any kind on behalf of the other Party or to take
any action that would bind the other Party except as explicitly provided in this
Agreement.  Furthermore, none of the transactions contemplated by this Agreement
shall be construed as a partnership for any tax purposes.

13.10   Headings.  The captions or headings of the sections or other
subdivisions hereof are inserted only as a matter of convenience or for
reference and shall have no effect on the meaning of the provisions hereof.

13.11   No Implied Waivers; Rights Cumulative.  No failure on the part of Incyte
or Lilly to exercise, and no delay by either Party in exercising, any right,
power, remedy or privilege under this Agreement, or provided by statute or at
law or in equity or otherwise, shall impair, prejudice or constitute a waiver of
any such right, power, remedy or privilege by such Party or be construed as a
waiver of any breach of this Agreement or as an acquiescence therein by such
Party, nor shall any single or partial exercise of any such right, power, remedy
or privilege by a Party preclude any other or further exercise thereof or the
exercise of any other right, power, remedy or privilege.

13.12   Severability.  If, under applicable Laws, any provision of this
Agreement is invalid or unenforceable, or otherwise directly or indirectly
affects the validity of any other material provision(s) of this Agreement (such
invalid or unenforceable provision, a “Severed Clause”), this Agreement shall
endure except for the Severed Clause.  The Parties shall consult one another and
use good faith efforts to agree upon a valid and enforceable provision that is a
reasonable substitute for the Severed Clause in view of the intent of this
Agreement.

13.13   Execution In Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.  Signatures provided by
facsimile transmission or in Adobe™ Portable Document Format (PDF) sent by
electronic mail shall be deemed to be original signatures.

13.14   No Third Party Beneficiaries.  No Person other than Lilly and Incyte
(and their respective assignees) shall be deemed an intended beneficiary
hereunder or have any right to enforce any obligation of this Agreement.

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13.15   Performance by Affiliates.  Either Party may use one or more of its
Affiliates to perform its obligations and duties hereunder and Affiliates of a
Party are expressly granted certain rights herein; provided that each such
Affiliate shall be bound by the corresponding obligations of such Party and the
Parties shall remain liable hereunder for the prompt payment and performance of
all their respective obligations hereunder.

13.16   Exhibits.  In the event of inconsistencies between this Agreement and
any exhibits, schedules or attachments hereto, the terms of this Agreement shall
control.

 

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the Parties have caused their duly authorized officers to
execute and acknowledge this Agreement as of the date first written above.

 

 

 

 

 

 

ELI LILLY AND COMPANY

    

INCYTE CORPORATION

 

 

 

By:

/s/ Steven M. Paul

 

By:

/s/ Paul A. Friedman

Name:

Steven M. Paul, M.D.

 

Name:

Paul A. Friedman

Title:

EVP, Science and Technology

 

Title:

President & CEO

 

 

 

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Exhibit A

Incyte Patent Rights

 

 

 

[***] Confidential material redacted and filed separately with the Commission.

 

 

Exhibit A-1

Genus Patent Rights

[***]

 

 

 

 

 

 

 

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[***] Confidential material redacted and filed separately with the Commission.

 

 

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Exhibit A-2

Selection Patent Rights

 

[***]

 

 

 

 

 

 

 

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-6-

 

 

Exhibit B

Initial Information Transfer

Described below are the items to be provided to Lilly by Incyte pursuant to
Section 4.1(a) of the Agreement, which include the material documents,
information and data listed in this Exhibit B that are recorded in tangible form
that are Incyte Know-How, to the extent each of which exists as of the Effective
Date and has not already been provided to Lilly.  Within sixty (60) days after
the Effective Date, Lilly will confirm in writing to Incyte whether Incyte’s
initial data transfer obligations, as described in Section 4.1(a) of the
Agreement, have been achieved.

 

Clinical & Regulatory Documents and Information

     Clinical study related documents, information and data that are recorded
in tangible form, including those currently possessed by CROs and other third
party vendors

     Regulatory Authority submissions, correspondence and all communications,
including minutes from teleconferences and contact reports (US and ex-US)

     Regulatory Authority meeting briefing documents and related minutes (US
and ex-US)

     Pre-IND submissions

     IND submissions

     Annual reports to IND(s)

     CTA/IMPD submissions

     Annual Safety Reports submissions

     Investigator’s Brochures and any updates thereto

     Safety reports (CIOMSs and/or Medwatch reports)

     Documents related to serious adverse events (“SAEs”)

     Investigator Safety Letters, actions taken for safety reasons, and other
relevant safety information

     Safety pharmacology and toxicology study related documents, information
and data that are recorded in tangible form

     Pharmacology and Absorption, Distribution, Metabolism, and Excretion
(ADME) related documents, information and data that are recorded in tangible
form

 

Licensed Compound Documents

Incyte may retain (x) originals of all documents, information and data,
including regulatory submissions, correspondence, and clinical trial data and
(y) originals of regulatory submissions, correspondence, and clinical trial data
directly related to Study 201 until fifteen (15) Business Days after
responsibility for the relevant regulatory filing or clinical trial has been
transferred to Lilly in accordance with the Agreement and this Exhibit
B.  Incyte will provide both a shared electronic depository and paper copies of
all requested documents, information and data where both electronic and paper
versions are currently available.

 

Manufacturing Know-How

Incyte will prepare and compile an inventory of relevant documents and transfer
all Incyte Know-How for manufacturing Licensed Products including: laboratory
notebook data, batch

 

 

 

 

records, process data, stability data, summary reports, formulation folders,
analytical methods, development reports, quality and regulatory documentation,
validation reports and other material data related to the development,
manufacturing, and/or distribution of Licensed Compounds and/or Licensed
Products. As part of the Know-How transfer, Incyte shall cooperate with Lilly to
establish a transfer protocol and make resources available at Incyte's cost to
enable the successful execution of the transfer protocol.  Additionally, Incyte
will disclose and transfer as necessary, any vendor sourcing and/or contracting
information that Lilly may reasonably request.

 

 

 

 

Exhibit C

Initial Development Plans

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

 

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

 

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

 

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

 

 

 

Exhibit D

Press Release

 

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

Date: December 21, 2009

 

 

For Release:   Immediately

Refer to:         (317) 276-5795 – Mark E. Taylor (Lilly)

(302) 498-6944 – Pamela Murphy (Incyte)

 

 

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

Lilly and Incyte Announce Collaboration for Development and Commercialization of
Oral Anti-Inflammatory and Autoimmune Therapies

Lilly Gains Worldwide Rights for Incyte’s Novel JAK1/JAK2 Inhibitor, INCB28050,
for Inflammatory and Autoimmune Diseases

Incyte to Receive $90 Million Upfront Payment and up to $665 Million in
Potential Milestones, Plus Royalties on Future Sales

Incyte Retains Co-Development & Co-Promotion Options

INDIANAPOLIS, IN and WILMINGTON, DE --  Eli Lilly and Company (NYSE:LLY) and
Incyte Corporation (NASDAQ:INCY) announced today that they have entered into an
exclusive worldwide license and collaboration agreement for the development and
commercialization of Incyte’s oral JAK1/JAK2 inhibitor, INCB28050, and certain
follow on compounds, for inflammatory and autoimmune diseases. The lead
compound, INCB28050, is currently being studied in a six-month dose-ranging
Phase II trial for rheumatoid arthritis.

Under the terms of the agreement, Lilly will receive worldwide rights to develop
and commercialize INCB28050 as an oral treatment for all inflammatory
conditions. In exchange for these rights, Incyte will receive an initial payment
of $90 million and is eligible for up to $665 million in additional potential
development, regulatory, and commercialization milestones, as well as tiered,
double-digit royalty payments on future global sales with rates ranging up to
twenty percent if a product is successfully commercialized.

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

“This new alliance with Incyte reinforces Lilly’s commitment to expand our
presence in inflammation and autoimmunity through the development of a new class
of oral anti-inflammatory therapies,” said Eiry Roberts, M.D. Lilly vice
president for autoimmune product development. “We look forward to continuing the
development of INCB28050 in RA and initiating additional clinical studies to
help address the unmet patient needs from debilitating autoimmune and
inflammatory diseases.”

Paul Friedman, Incyte’s president and chief executive officer, stated, "Lilly’s
success in bringing novel therapies to market, their commitment to building a
franchise in inflammation and autoimmunity, and their enthusiasm regarding the
potential of JAK inhibition gives us confidence that the full therapeutic and
commercial potential of INCB28050 in RA as well as other autoimmune and
inflammatory conditions can be rapidly and effectively achieved through this
agreement.  This collaboration leverages the capabilities and strengths of each
partner and achieves our objective to retain significant value for Incyte’s
shareholders.”

Incyte will retain the option to co-develop its JAK1/JAK2 inhibitors with Lilly
on a compound-by-compound and indication-by-indication basis beginning at the
initiation of Phase IIb development. Under the agreement, if Incyte elects to
co-develop any compounds and/or indications, Incyte would be responsible for
funding thirty percent of the associated future global development costs from
the initiation of a Phase IIb trial. Incyte would receive an incremental royalty
rate increase across all tiers resulting in effective royalty rates ranging up
to the high twenties on potential future global sales for compounds and/or
indications that Incyte elects to co-develop. Incyte expects that the earliest
it would consider exercising a co-development option would be in the second half
of 2010, concurrent with the potential initiation of a Phase IIb trial with
INCB28050.

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

Development of the JAK1/JAK2 inhibitors will be governed by a joint development
committee. Incyte also has the option to co-promote products in the US.

As a result of this transaction, Lilly expects to incur a charge to earnings in
the fourth quarter of 2009 of approximately $.05 per share. The company
reconfirmed its full-year 2009 earnings-per-share guidance of $3.90 to $4.00 per
share on a reported basis, or $4.30 to $4.40 per share on a pro forma non-GAAP
basis.

About Rheumatoid Arthritis (RA)

Rheumatoid arthritis is an autoimmune disease, estimated to affect about 1% of
the world's population. The disease is characterized by aberrant immune
mechanisms that lead to joint inflammation and swelling with progressive
destruction of joints. In addition to affecting the joints, RA can affect
connective tissue in the skin and organs of the body.  Current treatments
include the non-steroidal anti-inflammatory drugs, disease-modifying
anti-rheumatic drugs such as methotrexate, and the newer injectable biological
response modifiers that target tumor necrosis factor alpha, a pro-inflammatory
cytokine implicated in the pathogenesis of rheumatoid arthritis. None of these
treatments is curative and RA remains a disease for which there is still a
significant unmet clinical need.

About JAK Inhibition

There are four known JAK enzymes: JAK1, 2, 3 and TYK2. These enzymes are
critical components of signaling mechanisms utilized by a number of cytokines
and growth factors, including those that are elevated in RA patients. Cytokines
such as interleukin-6, -12, and -23

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

signal through the JAK pathway and have been clinically validated as therapeutic
targets in inflammatory diseases. Additional JAK-dependent cytokines have also
been implicated in a number of inflammatory and autoimmune diseases suggesting
that JAK inhibitors may be useful for the treatment of a broad range of
inflammatory conditions.

About INCB28050

INCB28050 is an orally-available, potent and selective JAK1/JAK2 inhibitor that
is currently in Phase II development as a treatment for RA. In previously
conducted Phase II studies, Incyte’s JAK1/JAK2 inhibitors have demonstrated
efficacy and have been well tolerated in clinical studies to date.

About Incyte

Incyte Corporation is a Wilmington, Delaware-based drug discovery and
development company focused on developing proprietary small molecule drugs for
oncology, inflammation and diabetes. Incyte’s most advanced compound, INCB18424,
is in Phase III development for myelofibrosis. For additional information on
Incyte, visit the Company's web site at www.incyte.com.

About Eli Lilly and Company

Lilly, a leading innovation-driven corporation, is developing a growing
portfolio of pharmaceutical products by applying the latest research from its
own worldwide laboratories and from collaborations with eminent scientific
organizations. Headquartered in Indianapolis, Ind., Lilly provides answers –
through medicines and information – for some of the world's most urgent medical
needs.  Additional information about Lilly is available at www.lilly.com.  C-LLY

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

Lilly Safe Harbor Statement

This press release contains forward-looking statements that are based on
management's current expectations, but actual results may differ materially due
to various factors. There are significant risks and uncertainties in
pharmaceutical research and development. There can be no guarantees with respect
to pipeline products (including the compounds discussed in this press release)
that the products will receive the necessary clinical and manufacturing
regulatory approvals or that they will prove to be commercially successful. The
company's results may also be affected by such factors as competitive
developments affecting current products; the rate of sales growth of recently
launched products; the timing of anticipated regulatory approvals and launches
of new products; other regulatory developments and government investigations;
patent disputes and other litigation involving current and future products; the
impact of governmental actions regarding pricing, importation, and reimbursement
for pharmaceuticals; business development transactions; changes in tax law;
asset impairments and restructuring charges and the impact of exchange rates.
For additional information about the factors that affect the company's business,
please see the company's latest Form 10-K, filed February 2009, and Form 10-Q
filed October 2009. The company undertakes no duty to update forward-looking
statements.

 

Incyte Safe Harbor Statement

 

Except for the historical information contained herein, the matters set forth in
this press release, including statements with respect to with respect to the
potential for Incyte to receive up to $665 million in additional potential
milestones, Incyte’s expectation for the earliest time for it to consider
exercising a co-development option, Incyte’s confidence that the full
therapeutic and commercial potential of INCB28050 in RA as well as other
inflammatory conditions can be rapidly and effectively achieved through the
collaboration agreement, and the potential for JAK inhibitors to be useful for
the treatment of a broad range of inflammatory conditions, are all
forward-looking statements within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to risks and uncertainties that may cause the parties not
to achieve some or all of the commercial and developmental milestones set forth
in the collaboration agreement and that may otherwise cause Incyte’s actual
results and timing to differ materially, including the high degree of risk and
uncertainty associated with drug development and clinical trials, the
uncertainty associated with the regulatory approval processes, risks related to
the timing of and patient enrollment in clinical trials, risks related to the
potential failure of INCB28050 to demonstrate safety and efficacy in clinical
testing, risks and uncertainty associated with the therapeutic and commercial
value of INCB28050, risks relating to Lilly’s and Incyte’s abilities to
successfully develop and commercialize drug candidates, risks relating to market
competition, risks associated with

 

 

 

 

 

 

Picture 1 [incy20190930ex1020eebfd001.jpg]

Picture 2 [incy20190930ex1020eebfd002.jpg]

 

Eli Lilly and Company

Lilly Corporate Center

Indianapolis, Indiana 46285

U.S.A.

 

 

Incyte's dependence on its relationship with its collaboration partners, and
other risks detailed from time to time in Incyte's filings with the Securities
and Exchange Commission, including its Quarterly Report on Form 10-Q for the
quarter ended September 30, 2009. Incyte disclaims any intent or obligation to
update these forward-looking statements.

 

#     #     #

 

 

 

 

 

 

 

 

Exhibit E

Hematology Field and Oncology Field  (ICD-9CM)

2.  NEOPLASMS (140-239)

1.         Content:

This chapter contains the following broad groups:

140-195         Malignant neoplasms, stated or presumed to be primary, of
specified sites, except of lymphatic and hematopoietic tissue

196-198         Malignant neoplasms, stated or presumed to be secondary, of
specified sites

199                Malignant neoplasms, without specification of site

200-208         Malignant neoplasms, stated or presumed to be primary, of
lymphatic and hematopoietic tissue

209                Neuroendocrine tumors

210-229         Benign neoplasms

230-234         Carcinoma in situ

235-238         Neoplasms of uncertain behavior [see Note, at beginning of
section 235-238]

239                Neoplasms of unspecified nature

2.         Functional activity

All neoplasms are classified in this chapter, whether or not functionally
active. An additional code from Chapter 3 may be used to identify such
functional activity associated with any neoplasm, e.g.:

catecholamine-producing malignant pheochromocytoma of adrenal:

code 194.0, additional code 255.6

basophil adenoma of pituitary with Cushing's syndrome:

code 227.3, additional code 255.0

3.         Morphology [Histology]

For those wishing to identify the histological type of neoplasms, a
comprehensive coded nomenclature, which comprises the morphology rubrics of the
ICD-Oncology, is given after the E-code chapter.

4.         Malignant neoplasms overlapping site boundaries

Categories 140-195 are for the classification of primary malignant neoplasms
according to their point of origin.  A malignant neoplasm that overlaps two or
more subcategories within a three-digit rubric and whose point of origin cannot
be determined should be classified to the subcategory .8 "Other."  For example,
"carcinoma involving tip and ventral surface of tongue" should be assigned to
141.8. On the other hand, "carcinoma of tip of tongue, extending to involve the
ventral surface" should be coded to 141.2, as the point of origin, the tip, is
known.  Three subcategories (149.8, 159.8, 165.8) have been provided for
malignant neoplasms that overlap the boundaries of three-digit rubrics within
certain systems.  Overlapping malignant neoplasms that cannot be classified as
indicated above should be assigned to the appropriate subdivision of category
195 (Malignant neoplasm of other and ill-defined sites).

MALIGNANT NEOPLASM OF LIP, ORAL CAVITY, AND PHARYNX (140-149)

Excludes:       carcinoma in situ (230.0)

 

 

140         Malignant neoplasm of lip

 

 

 

 

 

Excludes:        skin of lip (173.0)

140.0      Upper lip, vermilion border

Upper lip:

NOS

external

lipstick area

140.1      Lower lip, vermilion border

Lower lip:

NOS

external

lipstick area

140.3      Upper lip, inner aspect

Upper lip:

buccal aspect

frenulum

mucosa

oral aspect

140.4      Lower lip, inner aspect

Lower lip:

buccal aspect

frenulum

mucosa

oral aspect

140.5      Lip, unspecified, inner aspect

Lip, not specified whether upper or lower:

buccal aspect

frenulum

mucosa

oral aspect

140.6      Commissure of lip

Labial commissure

140.8      Other sites of lip

Malignant neoplasm of contiguous or overlapping sites of lip whose point of
origin cannot be determined

140.9      Lip, unspecified, vermilion border

Lip, not specified as upper or lower:

NOS

external

lipstick area

 

 

141         Malignant neoplasm of tongue

 

141.0      Base of tongue

Dorsal surface of base of tongue

Fixed part of tongue NOS

141.1      Dorsal surface of tongue

Anterior two-thirds of tongue, dorsal surface

Dorsal tongue NOS

-2-

 

 

Midline of tongue

Excludes:        dorsal surface of base of tongue (141.0)

141.2      Tip and lateral border of tongue

141.3      Ventral surface of tongue

Anterior two-thirds of tongue, ventral surface

Frenulum linguae

141.4      Anterior two-thirds of tongue, part unspecified

Mobile part of tongue NOS

141.5      Junctional zone

Border of tongue at junction of fixed and mobile parts at insertion of anterior
tonsillar pillar

141.6      Lingual tonsil

141.8      Other sites of tongue

Malignant neoplasm of contiguous or overlapping sites of tongue whose point of
origin cannot be determined

141.9      Tongue, unspecified

Tongue NOS

 

 

142         Malignant neoplasm of major salivary glands

 

Includes:         salivary ducts

Excludes:        malignant neoplasm of minor salivary glands:

NOS (145.9)

buccal mucosa (145.0)

soft palate (145.3)

tongue (141.0-141.9)

tonsil, palatine (146.0)

142.0      Parotid gland

142.1      Submandibular gland

Submaxillary gland

142.2      Sublingual gland

142.8      Other major salivary glands

Malignant neoplasm of contiguous or overlapping sites of salivary glands and
ducts whose point of origin cannot be determined

142.9      Salivary gland, unspecified

Salivary gland (major) NOS

 

 

143         Malignant neoplasm of gum

 

Includes:         alveolar (ridge) mucosa

gingiva (alveolar) (marginal)

interdental papillae

Excludes:        malignant odontogenic neoplasms (170.0-170.1)

143.0      Upper gum

143.1      Lower gum

-3-

 

 

143.8      Other sites of gum

Malignant neoplasm of contiguous or overlapping sites of gum whose point of
origin cannot be determined

143.9      Gum, unspecified

 

 

144         Malignant neoplasm of floor of mouth

 

144.0      Anterior portion

Anterior to the premolar-canine junction

144.1      Lateral portion

144.8      Other sites of floor of mouth

Malignant neoplasm of contiguous or overlapping sites of floor of mouth whose
point of origin cannot be determined

144.9      Floor of mouth, part unspecified

 

 

145         Malignant neoplasm of other and unspecified parts of mouth

 

Excludes:        mucosa of lips (140.0-140.9)

145.0      Cheek mucosa

Buccal mucosa

Cheek, inner aspect

145.1      Vestibule of mouth

Buccal sulcus (upper) (lower)

Labial sulcus (upper) (lower)

145.2      Hard palate

145.3      Soft palate

Excludes:        nasopharyngeal [posterior] [superior] surface of soft palate
(147.3)

145.4      Uvula

145.5      Palate, unspecified

Junction of hard and soft palate

Roof of mouth

145.6      Retromolar area

145.8      Other specified parts of mouth

Malignant neoplasm of contiguous or overlapping sites of mouth whose point of
origin cannot be determined

145.9      Mouth, unspecified

Buccal cavity NOS

Minor salivary gland, unspecified site

Oral cavity NOS

 

 

146         Malignant neoplasm of oropharynx

 

146.0      Tonsil

Tonsil:

NOS

faucial

-4-

 

 

palatine

Excludes:        lingual tonsil (141.6)

pharyngeal tonsil (147.1)

146.1      Tonsillar fossa

146.2      Tonsillar pillars (anterior) (posterior)

Faucial pillar

Glossopalatine fold

Palatoglossal arch

Palatopharyngeal arch

146.3      Vallecula

Anterior and medial surface of the pharyngoepiglottic fold

146.4      Anterior aspect of epiglottis

Epiglottis, free border [margin]

Glossoepiglottic fold(s)

Excludes:        epiglottis:

NOS (161.1)

suprahyoid portion (161.1)

146.5      Junctional region

Junction of the free margin of the epiglottis, the aryepiglottic fold, and the
pharyngoepiglottic fold

146.6      Lateral wall of oropharynx

146.7      Posterior wall of oropharynx

146.8      Other specified sites of oropharynx

Branchial cleft

Malignant neoplasm of contiguous or overlapping sites of oropharynx whose point
of origin cannot be determined

146.9      Oropharynx, unspecified

 

 

147         Malignant neoplasm of nasopharynx

 

147.0      Superior wall

Roof of nasopharynx

147.1      Posterior wall

Adenoid

Pharyngeal tonsil

147.2      Lateral wall

Fossa of Rosenmüller

Opening of auditory tube

Pharyngeal recess

147.3      Anterior wall

Floor of nasopharynx

Nasopharyngeal [posterior] [superior] surface of soft palate

Posterior margin of nasal septum and choanae

147.8      Other specified sites of nasopharynx

-5-

 

 

Malignant neoplasm of contiguous or overlapping sites of nasopharynx whose point
of origin cannot be determined

147.9      Nasopharynx, unspecified

Nasopharyngeal wall NOS

 

 

148         Malignant neoplasm of hypopharynx

 

148.0      Postcricoid region

148.1      Pyriform sinus

Pyriform fossa

148.2      Aryepiglottic fold, hypopharyngeal aspect

Aryepiglottic fold or interarytenoid fold:

NOS

marginal zone

Excludes:        aryepiglottic fold or interarytenoid fold, laryngeal aspect
(161.1)

148.3      Posterior hypopharyngeal wall

148.8      Other specified sites of hypopharynx

Malignant neoplasm of contiguous or overlapping sites of hypopharynx whose point
of origin cannot be determined

148.9      Hypopharynx, unspecified

Hypopharyngeal wall NOS

Hypopharynx NOS

 

 

149         Malignant neoplasm of other and ill-defined sites within the lip,
oral cavity, and pharynx

 

149.0      Pharynx, unspecified

149.1      Waldeyer's ring

149.8      Other

Malignant neoplasms of lip, oral cavity, and pharynx whose point of origin
cannot be assigned to any one of the categories 140-148

Excludes:        "book leaf" neoplasm [ventral surface of tongue and floor of
mouth] (145.8)

149.9      Ill-defined

MALIGNANT NEOPLASM OF DIGESTIVE ORGANS AND PERITONEUM (150-159)

Excludes:       carcinoma in situ (230.1-230.9)

 

150         Malignant neoplasm of esophagus

 

150.0      Cervical esophagus

150.1      Thoracic esophagus

150.2      Abdominal esophagus

Excludes:        adenocarcinoma (151.0)

cardio-esophageal junction (151.0)

-6-

 

 

150.3      Upper third of esophagus

Proximal third of esophagus

150.4      Middle third of esophagus

150.5      Lower third of esophagus

Distal third of esophagus

Excludes:        adenocarcinoma (151.0)

cardio-esophageal junction (151.0)

150.8      Other specified part

Malignant neoplasm of contiguous or overlapping sites of esophagus whose point
of origin cannot be determined

150.9      Esophagus, unspecified

 

 

151         Malignant neoplasm of stomach

 

Excludes:        benign carcinoid tumor of stomach (209.63)

malignant carcinoid tumor of stomach (209.63)

151.0      Cardia

Cardiac orifice

Cardio-esophageal junction

Excludes:        squamous cell carcinoma (150.2, 150.5)

151.1      Pylorus

Prepylorus

Pyloric canal

151.2      Pyloric antrum

Antrum of stomach NOS

151.3      Fundus of stomach

151.4      Body of stomach

151.5      Lesser curvature, unspecified

Lesser curvature, not classifiable to 151.1-151.4

151.6      Greater curvature, unspecified

Greater curvature, not classifiable to 151.0-151.4

151.8      Other specified sites of stomach

Anterior wall, not classifiable to 151.0-151.4

Posterior wall, not classifiable to 151.0-151.4

Malignant neoplasm of contiguous or overlapping sites of stomach whose point of
origin cannot be determined

151.9      Stomach, unspecified

Carcinoma ventriculi

Gastric cancer

 

 

152         Malignant neoplasm of small intestine, including duodenum

 

Excludes:        benign carcinoid tumor of small intestine and duodenum
(209.40-209.43)

malignant carcinoid tumor of small intestine and duodenum (209.00-209.03)

152.0      Duodenum

-7-

 

 

152.1      Jejunum

152.2      Ileum

Excludes:        ileocecal valve (153.4)

152.3      Meckel's diverticulum

152.8      Other specified sites of small intestine

Duodenojejunal junction

Malignant neoplasm of contiguous or overlapping sites of small intestine whose
point of origin cannot be determined

152.9      Small intestine, unspecified

 

 

153         Malignant neoplasm of colon

 

Excludes:        benign carcinoid tumor of colon (209.50-209.56)

malignant carcinoid tumor of colon (209.10-209.16)

153.0      Hepatic flexure

153.1      Transverse colon

153.2      Descending colon

Left colon

153.3      Sigmoid colon

Sigmoid (flexure)

Excludes:        rectosigmoid junction (154.0)

153.4      Cecum

Ileocecal valve

153.5      Appendix

153.6      Ascending colon

Right colon

153.7      Splenic flexure

153.8      Other specified sites of large intestine

Malignant neoplasm of contiguous or overlapping sites of colon whose point of
origin cannot be determined

Excludes:        ileocecal valve (153.4)

rectosigmoid junction (154.0)

153.9      Colon, unspecified

Large intestine NOS

 

 

154         Malignant neoplasm of rectum, rectosigmoid junction, and anus

 

Excludes:        benign carcinoid tumor of rectum (209.57)

malignant carcinoid tumor of rectum (209.17)

154.0      Rectosigmoid junction

Colon with rectum

Rectosigmoid (colon)

154.1      Rectum

Rectal ampulla

-8-

 

 

154.2      Anal canal

Anal sphincter

Excludes:        skin of anus (172.5, 173.5)

154.3      Anus, unspecified

Excludes:        anus:

margin (172.5, 173.5)

skin (172.5, 173.5)

perianal skin (172.5, 173.5)

154.8      Other

Anorectum

Cloacogenic zone

Malignant neoplasm of contiguous or overlapping sites of rectum, rectosigmoid
junction, and anus whose point of origin cannot be determined

 

 

155         Malignant neoplasm of liver and intrahepatic bile ducts

 

155.0      Liver, primary

Carcinoma:

liver, specified as primary

hepatocellular

liver cell

Hepatoblastoma

155.1      Intrahepatic bile ducts

Canaliculi biliferi

Interlobular:

bile ducts

biliary canals

Intrahepatic:

biliary passages

canaliculi

gall duct

Excludes:        hepatic duct (156.1)

155.2      Liver, not specified as primary or secondary

 

 

156         Malignant neoplasm of gallbladder and extrahepatic bile ducts

 

156.0      Gallbladder

156.1      Extrahepatic bile ducts

Biliary duct or passage

NOS

Common bile duct

Cystic duct

Hepatic duct

Sphincter of Oddi

156.2      Ampulla of Vater

156.8      Other specified sites of gallbladder and extrahepatic bile ducts

Malignant neoplasm of contiguous or overlapping sites of gallbladder and
extrahepatic bile ducts whose point of origin cannot be determined

156.9      Biliary tract, part unspecified

-9-

 

 

Malignant neoplasm involving both intrahepatic and extrahepatic bile ducts

 

 

157         Malignant neoplasm of pancreas

 

157.0      Head of pancreas

157.1      Body of pancreas

157.2      Tail of pancreas

157.3      Pancreatic duct

Duct of:

Santorini

Wirsung

157.4      Islets of Langerhans

Islets of Langerhans, any part of pancreas

Use additional code to identify any functional activity

157.8      Other specified sites of pancreas

Ectopic pancreatic tissue

Malignant neoplasm of contiguous or overlapping sites of pancreas whose point of
origin cannot be determined

157.9      Pancreas, part unspecified

 

 

158         Malignant neoplasm of retroperitoneum and peritoneum

 

158.0      Retroperitoneum

Periadrenal tissue

Perinephric tissue

Perirenal tissue

Retrocecal tissue

158.8      Specified parts of peritoneum

Cul-de-sac (of Douglas)

Mesentery

Mesocolon

Omentum

Peritoneum:

parietal

pelvic

Rectouterine pouch

Malignant neoplasm of contiguous or overlapping sites of retroperitoneum and
peritoneum whose point of origin cannot be determined

158.9      Peritoneum, unspecified

 

 

159         Malignant neoplasm of other and ill-defined sites within the
digestive organs and peritoneum

 

159.0      Intestinal tract, part unspecified

Intestine NOS

159.1      Spleen, not elsewhere classified

Angiosarcoma of spleen

Fibrosarcoma of spleen

Excludes:        Hodgkin's disease (201.0-201.9)

-10-

 

 

lymphosarcoma (200.1)

reticulosarcoma (200.0)

159.8      Other sites of digestive system and intra-abdominal organs

Malignant neoplasm of digestive organs and peritoneum whose point of origin
cannot be assigned to any one of the categories 150-158

Excludes:        anus and rectum (154.8)

cardio-esophageal junction (151.0)

colon and rectum (154.0)

159.9      Ill-defined

Alimentary canal or tract NOS

Gastrointestinal tract NOS

Excludes:        abdominal NOS (195.2)

intra-abdominal NOS (195.2)

MALIGNANT NEOPLASM OF RESPIRATORY AND INTRATHORACIC ORGANS (160-165)

Excludes:       carcinoma in situ (231.0-231.9)

 

160         Malignant neoplasm of nasal cavities, middle ear, and accessory
sinuses

 

160.0      Nasal cavities

Cartilage of nose

Conchae, nasal

Internal nose

Septum of nose

Vestibule of nose

Excludes:        nasal bone (170.0)

nose NOS (195.0)

olfactory bulb (192.0)

posterior margin of septum and choanae (147.3)

skin of nose (172.3, 173.3)

turbinates (170.0)

160.1      Auditory tube, middle ear, and mastoid air cells

Antrum tympanicum

Eustachian tube

Tympanic cavity

Excludes:        auditory canal (external) (172.2, 173.2)

bone of ear (meatus) (170.0)

cartilage of ear (171.0)

ear (external) (skin) (172.2, 173.2)

160.2      Maxillary sinus

Antrum (Highmore) (maxillary)

160.3      Ethmoidal sinus

160.4      Frontal sinus

160.5      Sphenoidal sinus

160.8      Other

-11-

 

 

Malignant neoplasm of contiguous or overlapping sites of nasal cavities, middle
ear, and accessory sinuses whose point of origin cannot be determined

160.9      Accessory sinus, unspecified

 

 

161         Malignant neoplasm of larynx

 

161.0      Glottis

Intrinsic larynx

Laryngeal commissure (anterior) (posterior)

True vocal cord

Vocal cord NOS

161.1      Supraglottis

Aryepiglottic fold or interarytenoid fold, laryngeal aspect

Epiglottis (suprahyoid portion) NOS

Extrinsic larynx

False vocal cords

Posterior (laryngeal) surface of epiglottis

Ventricular bands

Excludes:        anterior aspect of epiglottis (146.4)

aryepiglottic fold or interarytenoid fold:

NOS (148.2)

hypopharyngeal aspect (148.2)

marginal zone (148.2)

161.2      Subglottis

161.3      Laryngeal cartilages

Cartilage:

arytenoid

cricoid

cuneiform

thyroid

161.8      Other specified sites of larynx

Malignant neoplasm of contiguous or overlapping sites of larynx whose point of
origin cannot be determined

161.9      Larynx, unspecified

 

 

162         Malignant neoplasm of trachea, bronchus, and lung

 

Excludes:        benign carcinoid tumor of bronchus (209.61)

malignant carcinoid tumor of bronchus (209.21)

162.0      Trachea

Cartilage of trachea

Mucosa of trachea

162.2      Main bronchus

Carina

Hilus of lung

162.3      Upper lobe, bronchus or lung

162.4      Middle lobe, bronchus or lung

-12-

 

 

162.5      Lower lobe, bronchus or lung

162.8      Other parts of bronchus or lung

Malignant neoplasm of contiguous or overlapping sites of bronchus or lung whose
point of origin cannot be determined

162.9      Bronchus and lung, unspecified

 

 

163         Malignant neoplasm of pleura

 

163.0      Parietal pleura

163.1      Visceral pleura

163.8      Other specified sites of pleura

Malignant neoplasm of contiguous or overlapping sites of pleura whose point of
origin cannot be determined

163.9      Pleura, unspecified

 

 

164         Malignant neoplasm of thymus, heart, and mediastinum

 

164.0      Thymus

Excludes:        benign carcinoid tumor of the thymus (209.62)

malignant carcinoid tumor of the thymus (209.22)

164.1      Heart

Endocardium

Epicardium

Myocardium

Pericardium

Excludes:        great vessels (171.4)

164.2      Anterior mediastinum

164.3      Posterior mediastinum

164.8      Other

Malignant neoplasm of contiguous or overlapping sites of thymus, heart, and
mediastinum whose point of origin cannot be determined

164.9      Mediastinum, part unspecified

 

 

165         Malignant neoplasm of other and ill-defined sites within the
respiratory system and intrathoracic organs

 

165.0      Upper respiratory tract, part unspecified

165.8      Other

Malignant neoplasm of respiratory and intrathoracic organs whose point of origin
cannot be assigned to any one of the categories 160-164

165.9      Ill-defined sites within the respiratory system

Respiratory tract NOS

Excludes:        intrathoracic NOS (195.1)

thoracic NOS (195.1)

-13-

 

 

MALIGNANT NEOPLASM OF BONE, CONNECTIVE TISSUE, SKIN, AND BREAST (170-176)

Excludes:       carcinoma in situ:

breast (233.0)

skin (232.0-232.9)

 

170         Malignant neoplasm of bone and articular cartilage

 

Includes:         cartilage (articular) (joint)

periosteum

Excludes:        bone marrow NOS (202.9)

cartilage:

ear (171.0)

eyelid (171.0)

larynx (161.3)

nose (160.0)

synovia (171.0-171.9)

170.0      Bones of skull and face, except mandible

Bone:

ethmoid

frontal

malar

nasal

occipital

orbital

parietal

sphenoid

temporal

zygomatic

Maxilla (superior)

Turbinate

Upper jaw bone

Vomer

Excludes:        carcinoma, any type except intraosseous or odontogenic:

maxilla, maxillary (sinus) (160.2)

upper jaw bone (143.0)

jaw bone (lower) (170.1)

170.1      Mandible

Inferior maxilla

Jaw bone NOS

Lower jaw bone

Excludes:        carcinoma, any type except intraosseous or odontogenic:

jaw bone NOS (143.9)

lower (143.1)

upper jaw bone (170.0)

170.2      Vertebral column, excluding sacrum and coccyx

Spinal column

Spine

Vertebra

Excludes:        sacrum and coccyx (170.6)

170.3      Ribs, sternum, and clavicle

Costal cartilage

-14-

 

 

Costovertebral joint

Xiphoid process

170.4      Scapula and long bones of upper limb

Acromion

Bones NOS of upper limb

Humerus

Radius

Ulna

170.5      Short bones of upper limb

Carpal

Cuneiform, wrist

Metacarpal

Navicular, of hand

Phalanges of hand

Pisiform

Scaphoid (of hand)

Semilunar or lunate

Trapezium

Trapezoid

Unciform

170.6      Pelvic bones, sacrum, and coccyx

Coccygeal vertebra

Ilium

Ischium

Pubic bone

Sacral vertebra

170.7      Long bones of lower limb

Bones NOS of lower limb

Femur

Fibula

Tibia

170.8      Short bones of lower limb

Astragalus [talus]

Calcaneus

Cuboid

Cuneiform, ankle

Metatarsal

Navicular (of ankle)

Patella

Phalanges of foot

Tarsal

170.9      Bone and articular cartilage, site unspecified

 

 

171         Malignant neoplasm of connective and other soft tissue

 

Includes:         blood vessel

bursa

fascia

fat

ligament, except uterine

muscle

peripheral, sympathetic, and parasympathetic nerves and ganglia

-15-

 

 

synovia

tendon (sheath)

Excludes:        cartilage (of):

articular (170.0-170.9)

larynx (161.3)

nose (160.0)

connective tissue:

breast (174.0-175.9)

internal organs code to malignant neoplasm of the site [e.g., leiomyosarcoma of
stomach, 151.9]

heart (164.1)

uterine ligament (183.4)

171.0      Head, face, and neck

Cartilage of:

ear

eyelid

171.2      Upper limb, including shoulder

Arm

Finger

Forearm

Hand

171.3      Lower limb, including hip

Foot

Leg

Popliteal space

Thigh

Toe

171.4      Thorax

Axilla

Diaphragm

Great vessels

Excludes:        heart (164.1)

mediastinum (164.2-164.9)

thymus (164.0)

171.5      Abdomen

Abdominal wall

Hypochondrium

Excludes:        peritoneum (158.8)

retroperitoneum (158.0)

171.6      Pelvis

Buttock

Groin

Inguinal region

Perineum

Excludes:        pelvic peritoneum (158.8)

retroperitoneum (158.0)

uterine ligament, any (183.3-183.5)

171.7      Trunk, unspecified

Back NOS

-16-

 

 

Flank NOS

171.8      Other specified sites of connective and other soft tissue

Malignant neoplasm of contiguous or overlapping sites of connective tissue whose
point of origin cannot be determined

171.9      Connective and other soft tissue, site unspecified

 

 

172         Malignant melanoma of skin

 

Includes:         melanocarcinoma

melanoma in situ of skin

melanoma (skin) NOS

Excludes:        skin of genital organs (184.0-184.9, 187.1-187.9)

sites other than skin - code to malignant neoplasm of the site

172.0      Lip

Excludes:        vermilion border of lip (140.0-140.1, 140.9)

172.1      Eyelid, including canthus

172.2      Ear and external auditory canal

Auricle (ear)

Auricular canal, external

External [acoustic] meatus

Pinna

172.3      Other and unspecified parts of face

Cheek (external)

Chin

Eyebrow

Forehead

Nose, external

Temple

172.4      Scalp and neck

172.5      Trunk, except scrotum

Axilla

Breast

Buttock

Groin

Perianal skin

Perineum

Umbilicus

Excludes:        anal canal (154.2)

anus NOS (154.3)

scrotum (187.7)

172.6      Upper limb, including shoulder

Arm

Finger

Forearm

Hand

172.7      Lower limb, including hip

Ankle

Foot

-17-

 

 

Heel

Knee

Leg

Popliteal area

Thigh

Toe

172.8      Other specified sites of skin

Malignant melanoma of contiguous or overlapping sites of skin whose point of
origin cannot be determined

172.9      Melanoma of skin, site unspecified

 

 

173         Other malignant neoplasm of skin

 

Includes:         malignant neoplasm of:

sebaceous glands

sudoriferous, sudoriparous glands

sweat glands

Excludes:        Kaposi's sarcoma (176.0-176.9)

malignant melanoma of skin (172.0-172.9)

skin of genital organs (184.0-184.9, 187.1-187.9)

173.0      Skin of lip

Excludes:        vermilion border of lip (140.0-140.1, 140.9)

173.1      Eyelid, including canthus

Excludes:        cartilage of eyelid (171.0)

173.2      Skin of ear and external auditory canal

Auricle (ear)

Auricular canal, external

External meatus

Pinna

Excludes:        cartilage of ear (171.0)

173.3      Skin of other and unspecified parts of face

Cheek, external

Chin

Eyebrow

Forehead

Nose, external

Temple

173.4      Scalp and skin of neck

173.5      Skin of trunk, except scrotum

Axillary fold

Perianal skin

Skin of:

abdominal wall

anus

back

breast

buttock

chest wall

groin

-18-

 

 

perineum

Umbilicus

Excludes:        anal canal (154.2)

anus NOS (154.3)

skin of scrotum (187.7)

173.6      Skin of upper limb, including shoulder

Arm

Finger

Forearm

Hand

173.7      Skin of lower limb, including hip

Ankle

Foot

Heel

Knee

Leg

Popliteal area

Thigh

Toe

173.8      Other specified sites of skin

Malignant neoplasm of contiguous or overlapping sites of skin whose point of
origin cannot be determined

173.9      Skin, site unspecified

 

 

174         Malignant neoplasm of female breast

 

Includes:         breast (female)

connective tissue

soft parts

Paget's disease of:

breast

nipple

Use additional code to identify estrogen receptor status (V86.0, V86.1)

Excludes:        skin of breast (172.5, 173.5)

174.0      Nipple and areola

174.1      Central portion

174.2      Upper-inner quadrant

174.3      Lower-inner quadrant

174.4      Upper-outer quadrant

174.5      Lower-outer quadrant

174.6      Axillary tail

174.8      Other specified sites of female breast

Ectopic sites

Inner breast

Lower breast

Midline of breast

-19-

 

 

Outer breast

Upper breast

Malignant neoplasm of contiguous or overlapping sites of breast whose point of
origin cannot be determined

174.9      Breast (female), unspecified

 

 

175         Malignant neoplasm of male breast

 

Use additional code to identify estrogen receptor status (V86.0, V86.1)

Excludes:        skin of breast (172.5, 173.5)

175.0      Nipple and areola

175.9      Other and unspecified sites of male breast

Ectopic breast tissue, male

 

 

176         Kaposi's sarcoma

 

176.0      Skin

176.1      Soft tissue

Blood vessel

Connective tissue

Fascia

Ligament

Lymphatic(s) NEC

Muscle

Excludes:        lymph glands and nodes (176.5)

176.2      Palate

176.3      Gastrointestinal sites

176.4      Lung

176.5      Lymph nodes

176.8      Other specified sites

Oral cavity NEC

176.9      Unspecified

Viscera NOS

MALIGNANT NEOPLASM OF GENITOURINARY ORGANS (179-189)

Excludes:       carcinoma in situ (233.1-233.9)

 

179         Malignant neoplasm of uterus, part unspecified

180         Malignant neoplasm of cervix uteri

 

Includes:         invasive malignancy [carcinoma]

Excludes:        carcinoma in situ (233.1)

180.0      Endocervix

Cervical canal NOS

Endocervical canal

-20-

 

 

Endocervical gland

180.1      Exocervix

180.8      Other specified sites of cervix

Cervical stump

Squamocolumnar junction of cervix

Malignant neoplasm of contiguous or overlapping sites of cervix uteri whose
point of origin cannot be determined

180.9      Cervix uteri, unspecified

 

 

181         Malignant neoplasm of placenta

 

Choriocarcinoma NOS

Chorioepithelioma NOS

Excludes:        chorioadenoma (destruens) (236.1)

hydatidiform mole (630)

malignant (236.1)

invasive mole (236.1)

male choriocarcinoma NOS (186.0-186.9)

 

182         Malignant neoplasm of body of uterus

 

Excludes:        carcinoma in situ (233.2)

182.0      Corpus uteri, except isthmus

Cornu

Endometrium

Fundus

Myometrium

182.1      Isthmus

Lower uterine segment

182.8      Other specified sites of body of uterus

Malignant neoplasm of contiguous or overlapping sites of body of uterus whose
point of origin cannot be determined

Excludes:        uterus NOS (179)

 

 

183         Malignant neoplasm of ovary and other uterine adnexa

 

Excludes:        Douglas' cul-de-sac (158.8)

183.0      Ovary

Use additional code to identify any functional activity

183.2      Fallopian tube

Oviduct

Uterine tube

183.3      Broad ligament

Mesovarium

Parovarian region

183.4      Parametrium

Uterine ligament NOS

Uterosacral ligament

-21-

 

 

183.5      Round ligament

183.8      Other specified sites of uterine adnexa

Tubo-ovarian

Utero-ovarian

Malignant neoplasm of contiguous or overlapping sites of ovary and other uterine
adnexa whose point of origin cannot be determined

183.9      Uterine adnexa, unspecified

 

 

184         Malignant neoplasm of other and unspecified female genital organs

 

Excludes:        carcinoma in situ (233.30-233.39)

184.0      Vagina

Gartner's duct

Vaginal vault

184.1      Labia majora

Greater vestibular [Bartholin's] gland

184.2      Labia minora

184.3      Clitoris

184.4      Vulva, unspecified

External female genitalia NOS

Pudendum

184.8      Other specified sites of female genital organs

Malignant neoplasm of contiguous or overlapping sites of female genital organs
whose point of origin cannot be determined

184.9      Female genital organ, site unspecified

Female genitourinary tract NOS

 

 

185         Malignant neoplasm of prostate

 

Excludes:        seminal vesicles (187.8)

 

 

186         Malignant neoplasm of testis

 

Use additional code to identify any functional activity

186.0      Undescended testis

Ectopic testis

Retained testis

186.9      Other and unspecified testis

Testis:

NOS

descended

scrotal

 

 

187         Malignant neoplasm of penis and other male genital organs

 

187.1      Prepuce

Foreskin

187.2      Glans penis

-22-

 

 

187.3      Body of penis

Corpus cavernosum

187.4      Penis, part unspecified

Skin of penis NOS

187.5      Epididymis

187.6      Spermatic cord

Vas deferens

187.7      Scrotum

Skin of scrotum

187.8      Other specified sites of male genital organs

Seminal vesicle

Tunica vaginalis

Malignant neoplasm of contiguous or overlapping sites of penis and other male
genital organs whose point of origin cannot be determined

187.9      Male genital organ, site unspecified

Male genital organ or tract NOS

 

 

188         Malignant neoplasm of bladder

 

Excludes:        carcinoma in situ (233.7)

188.0      Trigone of urinary bladder

188.1      Dome of urinary bladder

188.2      Lateral wall of urinary bladder

188.3      Anterior wall of urinary bladder

188.4      Posterior wall of urinary bladder

188.5      Bladder neck

Internal urethral orifice

188.6      Ureteric orifice

188.7      Urachus

188.8      Other specified sites of bladder

Malignant neoplasm of contiguous or overlapping sites of bladder whose point of
origin cannot be determined

188.9      Bladder, part unspecified

Bladder wall NOS

 

 

189         Malignant neoplasm of kidney and other and unspecified urinary
organs

 

Excludes:        benign carcinoid tumor of kidney (209.64)

malignant carcinoid tumor of kidney (209.64)

189.0      Kidney, except pelvis

Kidney NOS

Kidney parenchyma

189.1      Renal pelvis

-23-

 

 

Renal calyces

Ureteropelvic junction

189.2      Ureter

Excludes:        ureteric orifice of bladder (188.6)

189.3      Urethra

Excludes:        urethral orifice of bladder (188.5)

189.4      Paraurethral glands

189.8      Other specified sites of urinary organs

Malignant neoplasm of contiguous or overlapping sites of kidney and other
urinary organs whose point of origin cannot be determined

189.9      Urinary organ, site unspecified

Urinary system NOS

MALIGNANT NEOPLASM OF OTHER AND UNSPECIFIED SITES (190-199)

Excludes:       carcinoma in situ (234.0-234.9)

 

190         Malignant neoplasm of eye

 

Excludes:        carcinoma in situ (234.0)

dark area on retina and choroid (239.81)

eyelid (skin) (172.1, 173.1)

cartilage (171.0)

optic nerve (192.0)

orbital bone (170.0)

retinal freckle (239.81)

190.0      Eyeball, except conjunctiva, cornea, retina, and choroid

Ciliary body

Crystalline lens

Iris

Sclera

Uveal tract

190.1      Orbit

Connective tissue of orbit

Extraocular muscle

Retrobulbar

Excludes:        bone of orbit (170.0)

190.2      Lacrimal gland

190.3      Conjunctiva

190.4      Cornea

190.5      Retina

190.6      Choroid

190.7      Lacrimal duct

Lacrimal sac

-24-

 

 

Nasolacrimal duct

190.8      Other specified sites of eye

Malignant neoplasm of contiguous or overlapping sites of eye whose point of
origin cannot be determined

190.9      Eye, part unspecified

 

 

191         Malignant neoplasm of brain

 

Excludes:        cranial nerves (192.0)

retrobulbar area (190.1)

191.0      Cerebrum, except lobes and ventricles

Basal ganglia

Cerebral cortex

Corpus striatum

Globus pallidus

Hypothalamus

Thalamus

191.1      Frontal lobe

191.2      Temporal lobe

Hippocampus

Uncus

191.3      Parietal lobe

191.4      Occipital lobe

191.5      Ventricles

Choroid plexus

Floor of ventricle

191.6      Cerebellum NOS

Cerebellopontine angle

191.7      Brain stem

Cerebral peduncle

Medulla oblongata

Midbrain

Pons

191.8      Other parts of brain

Corpus callosum

Tapetum

Malignant neoplasm of contiguous or overlapping sites of brain whose point of
origin cannot be determined

191.9      Brain, unspecified

Cranial fossa NOS

 

 

192         Malignant neoplasm of other and unspecified parts of nervous system

 

Excludes:        peripheral, sympathetic, and parasympathetic nerves and ganglia
(171.0-171.9)

192.0      Cranial nerves

-25-

 

 

Olfactory bulb

192.1      Cerebral meninges

Dura (mater)

Falx (cerebelli) (cerebri)

Meninges NOS

Tentorium

192.2      Spinal cord

Cauda equina

192.3      Spinal meninges

192.8      Other specified sites of nervous system

Malignant neoplasm of contiguous or overlapping sites of other parts of nervous
system whose point of origin cannot be determined

192.9      Nervous system, part unspecified

Nervous system (central) NOS

Excludes:        meninges NOS (192.1)

 

 

193         Malignant neoplasm of thyroid gland

 

Thyroglossal duct

Use additional code to identify any functional activity

 

 

194         Malignant neoplasm of other endocrine glands and related structures

 

Excludes:        islets of Langerhans (157.4)

neuroendocrine tumors (209.00-209.69)

ovary (183.0)

testis (186.0-186.9)

thymus (164.0)

194.0      Adrenal gland

Adrenal cortex

Adrenal medulla

Suprarenal gland

194.1      Parathyroid gland

194.3      Pituitary gland and craniopharyngeal duct

Craniobuccal pouch

Hypophysis

Rathke's pouch

Sella turcica

194.4      Pineal gland

194.5      Carotid body

194.6      Aortic body and other paraganglia

Coccygeal body

Glomus jugulare

Para-aortic body

194.8      Other

Pluriglandular involvement NOS

Note:     If the sites of multiple involvements are known, they should be coded
separately.

-26-

 

 

194.9      Endocrine gland, site unspecified

 

 

195         Malignant neoplasm of other and ill-defined sites

 

Includes:         malignant neoplasms of contiguous sites, not elsewhere
classified, whose point of origin cannot be determined

Excludes:        malignant neoplasm:

lymphatic and hematopoietic tissue (200.0-208.9)

secondary sites (196.0-198.8)

unspecified site (199.0-199.1)

195.0      Head, face, and neck

Cheek NOS

Jaw NOS

Nose NOS

Supraclavicular region NOS

195.1      Thorax

Axilla

Chest (wall) NOS

Intrathoracic NOS

195.2      Abdomen

Intra-abdominal NOS

195.3      Pelvis

Groin

Inguinal region NOS

Presacral region

Sacrococcygeal region

Sites overlapping systems within pelvis, as:

rectovaginal (septum)

rectovesical (septum)

195.4      Upper limb

195.5      Lower limb

195.8      Other specified sites

Back NOS

Flank NOS

Trunk NOS

 

 

196         Secondary and unspecified malignant neoplasm of lymph nodes

 

Excludes:        any malignant neoplasm of lymph nodes, specified as primary
(200.0-202.9)

Hodgkin's disease (201.0-201.9)

lymphosarcoma (200.1)

reticulosarcoma (200.0)

other forms of lymphoma (202.0-202.9)

secondary neuroendocrine tumor of (distant) lymph nodes (209.71)

196.0      Lymph nodes of head, face, and neck

Cervical

Cervicofacial

Scalene

Supraclavicular

-27-

 

 

196.1      Intrathoracic lymph nodes

Bronchopulmonary

Intercostal

Mediastinal

Tracheobronchial

196.2      Intra-abdominal lymph nodes

Intestinal

Mesenteric

Retroperitoneal

196.3      Lymph nodes of axilla and upper limb

Brachial

Epitrochlear

Infraclavicular

Pectoral

196.5      Lymph nodes of inguinal region and lower limb

Femoral

Groin

Popliteal

Tibial

196.6      Intrapelvic lymph nodes

Hypogastric

Iliac

Obturator

Parametrial

196.8      Lymph nodes of multiple sites

196.9      Site unspecified

Lymph nodes NOS

 

 

197         Secondary malignant neoplasm of respiratory and digestive systems

 

Excludes:        lymph node metastasis (196.0-196.9)

secondary neuroendocrine tumor of liver (209.72)

secondary neuroendocrine tumor of respiratory organs (209.79)

197.0      Lung

Bronchus

197.1      Mediastinum

197.2      Pleura

197.3      Other respiratory organs

Trachea

197.4      Small intestine, including duodenum

197.5      Large intestine and rectum

197.6      Retroperitoneum and peritoneum

197.7      Liver, specified as secondary

197.8      Other digestive organs and spleen

-28-

 

 

 

198         Secondary malignant neoplasm of other specified sites

 

Excludes:        lymph node metastasis (196.0-196.9)

secondary neuroendocrine tumor of other specified sites (209.79)

198.0      Kidney

198.1      Other urinary organs

198.2      Skin

Skin of breast

198.3      Brain and spinal cord

198.4      Other parts of nervous system

Meninges (cerebral) (spinal)

198.5      Bone and bone marrow

198.6      Ovary

198.7      Adrenal gland

Suprarenal gland

198.8      Other specified sites

198.81    Breast

Excludes:        skin of breast (198.2)

198.82    Genital organs

198.89    Other

Excludes:        retroperitoneal lymph nodes (196.2)

 

 

199         Malignant neoplasm without specification of site

 

Excludes:        malignant carcinoid tumor of unknown primary site (209.20)

malignant (poorly differentiated) neuroendocrine carcinoma, any site (209.30)

malignant (poorly differentiated) neuroendocrine tumor, any site (209.30)

neuroendocrine carcinoma (high grade), any site (209.30)

199.0      Disseminated

Carcinomatosis unspecified site (primary) (secondary)

Generalized:

cancer unspecified site (primary) (secondary)

malignancy unspecified site (primary) (secondary)

Multiple cancer unspecified site (primary) (secondary)

199.1      Other

Cancer unspecified site (primary) (secondary)

Carcinoma unspecified site (primary) (secondary)

Malignancy unspecified site (primary) (secondary)

199.2      Malignant neoplasm associated with transplanted organ

Code first complication of transplanted organ (996.80-996.89)

Use additional code for specific malignancy

MALIGNANT NEOPLASM OF LYMPHATIC AND HEMATOPOIETIC TISSUE (200-208)

-29-

 

 

Excludes:       autoimmune lymphoproliferative syndrome (279.41)

secondary neoplasm of:

bone marrow (198.5)

spleen (197.8)

secondary and unspecified neoplasm of lymph nodes (196.0-196.9)

The following fifth-digit subclassification is for use with categories 200-202:

0  unspecified site, extranodal and solid organ sites

1  lymph nodes of head, face, and neck

2  intrathoracic lymph nodes

3  intra-abdominal lymph nodes

4  lymph nodes of axilla and upper limb

5  lymph nodes of inguinal region and lower limb

6  intrapelvic lymph nodes

7  spleen

8  lymph nodes of multiple sites

 

200         Lymphosarcoma and reticulosarcoma and other specified malignant
tumors of lymphatic tissue

 

Requires fifth digit. See note before section 200 for codes and definitions.

200.0      Reticulosarcoma

[0-8]

Lymphoma (malignant):

histiocytic (diffuse):

nodular

pleomorphic cell type

reticulum cell type

Reticulum cell sarcoma:

NOS

pleomorphic cell type

200.1      Lymphosarcoma

[0-8]

Lymphoblastoma (diffuse)

Lymphoma (malignant):

lymphoblastic (diffuse)

lymphocytic (cell type) (diffuse)

lymphosarcoma type

Lymphosarcoma:

NOS

diffuse NOS

lymphoblastic (diffuse)

lymphocytic (diffuse)

prolymphocytic

Excludes:        lymphosarcoma:

follicular or nodular (202.0)

mixed cell type (200.8)

lymphosarcoma cell leukemia (207.8)

200.2      Burkitt's tumor or lymphoma

[0-8]

Malignant lymphoma, Burkitt's type

200.3      Marginal zone lymphoma

[0-8]

-30-

 

 

Extranodal marginal zone B cell lymphoma

Mucosa associated lymphoid tissue [MALT]

Nodal marginal zone B cell lymphoma

Splenic marginal zone B cell lymphoma

200.4      Mantle cell lymphoma

[0-8]

200.5      Primary central nervous system lymphoma

[0-8]

200.6      Anaplastic large cell lymphoma

[0-8]

200.7      Large cell lymphoma

[0-8]

200.8      Other named variants

[0-8]

Lymphoma (malignant):

lymphoplasmacytoid type

mixed lymphocytic-histiocytic (diffuse)

Lymphosarcoma, mixed cell type (diffuse)

Reticulolymphosarcoma (diffuse)

 

 

201         Hodgkin's disease

 

Requires fifth digit. See note before section 200 for codes and definitions.

201.0      Hodgkin's paragranuloma

[0-8]

201.1      Hodgkin's granuloma

[0-8]

201.2      Hodgkin's sarcoma

[0-8]

201.4      Lymphocytic-histiocytic predominance

[0-8]

201.5      Nodular sclerosis

[0-8]

Hodgkin's disease, nodular sclerosis:

NOS

cellular phase

201.6      Mixed cellularity

[0-8]

201.7      Lymphocytic depletion

[0-8]

Hodgkin's disease, lymphocytic depletion:

NOS

diffuse fibrosis

reticular type

201.9      Hodgkin's disease, unspecified

-31-

 

 

[0-8]

Hodgkin's:

disease NOS

lymphoma NOS

Malignant:

lymphogranuloma

lymphogranulomatosis

 

 

202         Other malignant neoplasms of lymphoid and histiocytic tissue

 

Requires fifth digit. See note before section 200 for codes and definitions.

202.0      Nodular lymphoma

[0-8]

Brill-Symmers disease

Lymphoma:

follicular (giant) (large cell)

lymphocytic, nodular

Lymphosarcoma:

follicular (giant)

nodular

202.1      Mycosis fungoides

[0-8]

Excludes:        peripheral T-cell lymphoma (202.7)

202.2      Sézary's disease

[0-8]

202.3      Malignant histiocytosis

[0-8]

Histiocytic medullary reticulosis

Malignant:

reticuloendotheliosis

reticulosis

202.4      Leukemic reticuloendotheliosis

[0-8]

Hairy-cell leukemia

202.5      Letterer-Siwe disease

[0-8]

Acute:

differentiated progressive histiocytosis

histiocytosis X (progressive)

infantile reticuloendotheliosis

reticulosis of infancy

Excludes:        Hand-Schüller-Christian disease (277.89)

histiocytosis (acute) (chronic) (277.89)

histiocytosis X (chronic) (277.89)

202.6      Malignant mast cell tumors

[0-8]

Malignant:

mastocytoma

mastocytosis

Mast cell sarcoma

-32-

 

 

Systemic tissue mast cell disease

Excludes:        mast cell leukemia (207.8)

202.7      Peripheral T cell lymphoma

[0-8]

202.8      Other lymphomas

[0-8]

Lymphoma (malignant):

NOS

diffuse

Excludes:        benign lymphoma (229.0)

202.9      Other and unspecified malignant neoplasms of lymphoid and histiocytic
tissue

[0-8]

Follicular dendritic cell sarcoma

Interdigitating dendritic cell sarcoma

Langerhans cell sarcoma

Malignant neoplasm of bone marrow NOS

 

 

203         Multiple myeloma and immunoproliferative neoplasms

 

The following fifth-digit subclassification is for use with category 203:

0  without mention of having achieved remission

failed remission

1  in remission

2  in relapse

203.0      Multiple myeloma

[0-2]

Kahler's disease

Myelomatosis

Excludes:        solitary myeloma (238.6)

203.1      Plasma cell leukemia

[0-2]

Plasmacytic leukemia

203.8      Other immunoproliferative neoplasms

[0-2]

 

 

204         Lymphoid leukemia

 

Includes:         leukemia:

lymphatic

lymphoblastic

lymphocytic

lymphogenous

The following fifth-digit subclassification is for use with category 204:

0  without mention of having achieved remission

failed remission

1  in remission

2  in relapse

204.0      Acute

[0-2]

-33-

 

 

Excludes:        acute exacerbation of chronic lymphoid leukemia (204.1)

204.1      Chronic

[0-2]

204.2      Subacute

[0-2]

204.8      Other lymphoid leukemia

[0-2]

Aleukemic leukemia:

lymphatic

lymphocytic

lymphoid

204.9      Unspecified lymphoid leukemia

[0-2]

 

 

205         Myeloid leukemia

 

Includes:         leukemia:

granulocytic

myeloblastic

myelocytic

myelogenous

myelomonocytic

myelosclerotic

myelosis

The following fifth-digit subclassification is for use with category 205:

0  without mention of having achieved remission

failed remission

1  in remission

2  in relapse

205.0      Acute

[0-2]

Acute promyelocytic leukemia

Excludes:        acute exacerbation of chronic myeloid leukemia (205.1)

205.1      Chronic

[0-2]

Eosinophilic leukemia

Neutrophilic leukemia

205.2      Subacute

[0-2]

205.3      Myeloid sarcoma

[0-2]

Chloroma

Granulocytic sarcoma

205.8      Other myeloid leukemia

[0-2]

Aleukemic leukemia:

granulocytic

myelogenous

-34-

 

 

myeloid

Aleukemic myelosis

205.9      Unspecified myeloid leukemia

[0-2]

 

 

206         Monocytic leukemia

 

Includes:         leukemia:

histiocytic

monoblastic

monocytoid

The following fifth-digit subclassification is for use with category 206:

0  without mention of having achieved remission

failed remission

1  in remission

2  in relapse

206.0      Acute

[0-2]

Excludes:        acute exacerbation of chronic monocytic leukemia (206.1)

206.1      Chronic

[0-2]

206.2      Subacute

[0-2]

206.8      Other monocytic leukemia

[0-2]

Aleukemic:

monocytic leukemia

monocytoid leukemia

206.9      Unspecified monocytic leukemia

[0-2]

 

 

207         Other specified leukemia

 

Excludes:        leukemic reticuloendotheliosis (202.4)

plasma cell leukemia (203.1)

The following fifth-digit subclassification is for use with category 207:

0  without mention of having achieved remission

failed remission

1  in remission

2  in relapse

207.0      Acute erythremia and erythroleukemia

[0-2]

Acute erythremic myelosis

Di Guglielmo's disease

Erythremic myelosis

207.1      Chronic erythremia

[0-2]

Heilmeyer-Schöner disease

-35-

 

 

207.2      Megakaryocytic leukemia

[0-2]

Megakaryocytic myelosis

Thrombocytic leukemia

207.8      Other specified leukemia

[0-2]

Lymphosarcoma cell leukemia

 

 

208         Leukemia of unspecified cell type

 

The following fifth-digit subclassification is for use with category 208:

0  without mention of having achieved remission

failed remission

1  in remission

2  in relapse

208.0      Acute

[0-2]

Acute leukemia NOS

Blast cell leukemia

Stem cell leukemia

Excludes:        acute exacerbation of chronic unspecified leukemia (208.1)

208.1      Chronic

[0-2]

Chronic leukemia NOS

208.2      Subacute

[0-2]

Subacute leukemia NOS

208.8      Other leukemia of unspecified cell type

[0-2]

208.9      Unspecified leukemia

[0-2]

Leukemia NOS

NEUROENDOCRINE TUMORS (209)

 

 

209         Neuroendocrine tumors

 

Code first any associated multiple endocrine neoplasia syndrome (258.01-258.03)

Use additional code to identify associated endocrine syndrome, such as:

carcinoid syndrome (259.2)

Excludes:        benign pancreatic islet cell tumors (211.7)

malignant pancreatic islet cell tumors (157.4)

209.0      Malignant carcinoid tumors of the small intestine

209.00    Malignant carcinoid tumor of the small intestine, unspecified portion

209.01    Malignant carcinoid tumor of the duodenum

209.02    Malignant carcinoid tumor of the jejunum

-36-

 

 

209.03    Malignant carcinoid tumor of the ileum

209.1      Malignant carcinoid tumors of the appendix, large intestine, and
rectum

209.10    Malignant carcinoid tumor of the large intestine, unspecified portion

Malignant carcinoid tumor of the colon NOS

209.11    Malignant carcinoid tumor of the appendix

209.12    Malignant carcinoid tumor of the cecum

209.13    Malignant carcinoid tumor of the ascending colon

209.14    Malignant carcinoid tumor of the transverse colon

209.15    Malignant carcinoid tumor of the descending colon

209.16    Malignant carcinoid tumor of the sigmoid colon

209.17    Malignant carcinoid tumor of the rectum

209.2      Malignant carcinoid tumors of other and unspecified sites

209.20    Malignant carcinoid tumor of unknown primary site

209.21    Malignant carcinoid tumor of the bronchus and lung

209.22    Malignant carcinoid tumor of the thymus

209.23    Malignant carcinoid tumor of the stomach

209.24    Malignant carcinoid tumor of the kidney

209.25    Malignant carcinoid tumor of the foregut NOS

209.26    Malignant carcinoid tumor of the midgut NOS

209.27    Malignant carcinoid tumor of the hindgut NOS

209.29    Malignant carcinoid tumors of other sites

209.3      Malignant poorly differentiated neuroendocrine tumors

209.30    Malignant poorly differentiated neuroendocrine carcinoma, any site

High grade neuroendocrine carcinoma, any site

Malignant poorly differentiated neuroendocrine tumor NOS

Excludes:        Merkel cell carcinoma (209.31-209.36)

209.31    Merkel cell carcinoma of the face

Merkel cell carcinoma of the ear

Merkel cell carcinoma of the eyelid, including canthus

Merkel cell carcinoma of the lip

209.32    Merkel cell carcinoma of the scalp and neck

209.33    Merkel cell carcinoma of the upper limb

209.34    Merkel cell carcinoma of the lower limb

209.35    Merkel cell carcinoma of the trunk

-37-

 

 

209.36    Merkel cell carcinoma of other sites

Merkel cell carcinoma of the buttock

Merkel cell carcinoma of the genitals

Merkel cell carcinoma NOS

209.4      Benign carcinoid tumors of the small intestine

209.40    Benign carcinoid tumor of the small intestine, unspecified portion

209.41    Benign carcinoid tumor of the duodenum

209.42    Benign carcinoid tumor of the jejunum

209.43    Benign carcinoid tumor of the ileum

209.5      Benign carcinoid tumors of the appendix, large intestine, and rectum

209.50    Benign carcinoid tumor of the large intestine, unspecified portion

Benign carcinoid tumor of the colon NOS

209.51    Benign carcinoid tumor of the appendix

209.52    Benign carcinoid tumor of the cecum

209.53    Benign carcinoid tumor of the ascending colon

209.54    Benign carcinoid tumor of the transverse colon

209.55    Benign carcinoid tumor of the descending colon

209.56    Benign carcinoid tumor of the sigmoid colon

209.57    Benign carcinoid tumor of the rectum

209.6      Benign carcinoid tumors of other and unspecified sites

209.60    Benign carcinoid tumor of unknown primary site

Carcinoid tumor NOS

Neuroendocrine tumor NOS

209.61    Benign carcinoid tumor of the bronchus and lung

209.62    Benign carcinoid tumor of the thymus

209.63    Benign carcinoid tumor of the stomach

209.64    Benign carcinoid tumor of the kidney

209.65    Benign carcinoid tumor of the foregut NOS

209.66    Benign carcinoid tumor of the midgut NOS

209.67    Benign carcinoid tumor of the hindgut NOS

209.69    Benign carcinoid tumors of other sites

209.7      Secondary neuroendocrine tumors

Secondary carcinoid tumors

209.70    Secondary neuroendocrine tumor, unspecified site

209.71    Secondary neuroendocrine tumor of distant lymph nodes

-38-

 

 

Mesentery metastasis of neuroendocrine tumor

209.72    Secondary neuroendocrine tumor of liver

209.73    Secondary neuroendocrine tumor of bone

209.74    Secondary neuroendocrine tumor of peritoneum

209.75    Secondary Merkel cell carcinoma

Merkel cell carcinoma nodal presentation

Merkel cell carcinoma visceral metastatic presentation

Secondary Merkel cell carcinoma, any site

209.79    Secondary neuroendocrine tumor of other sites

BENIGN NEOPLASMS (210-229)

 

 

210         Benign neoplasm of lip, oral cavity, and pharynx

 

Excludes:        cyst (of):

jaw (526.0-526.2, 526.89)

oral soft tissue (528.4)

radicular (522.8)

210.0      Lip

Frenulum labii

Lip (inner aspect) (mucosa) (vermilion border)

Excludes:        labial commissure (210.4)

skin of lip (216.0)

210.1      Tongue

Lingual tonsil

210.2      Major salivary glands

Gland:

parotid

sublingual

submandibular

Excludes:        benign neoplasms of minor salivary glands:

NOS (210.4)

buccal mucosa (210.4)

lips (210.0)

palate (hard) (soft) (210.4)

tongue (210.1)

tonsil, palatine (210.5)

210.3      Floor of mouth

210.4      Other and unspecified parts of mouth

Gingiva

Gum (upper) (lower)

Labial commissure

Oral cavity NOS

Oral mucosa

Palate (hard) (soft)

Uvula

Excludes:        benign odontogenic neoplasms of bone (213.0-213.1)

-39-

 

 

developmental odontogenic cysts (526.0)

mucosa of lips (210.0)

nasopharyngeal [posterior] [superior] surface of soft palate (210.7)

210.5      Tonsil

Tonsil (faucial) (palatine)

Excludes:        lingual tonsil (210.1)

pharyngeal tonsil (210.7)

tonsillar:

fossa (210.6)

pillars (210.6)

210.6      Other parts of oropharynx

Branchial cleft or vestiges

Epiglottis, anterior aspect

Fauces NOS

Mesopharynx NOS

Tonsillar:

fossa

pillars

Vallecula

Excludes:        epiglottis:

NOS (212.1)

suprahyoid portion (212.1)

210.7      Nasopharynx

Adenoid tissue

Lymphadenoid tissue

Pharyngeal tonsil

Posterior nasal septum

210.8      Hypopharynx

Arytenoid fold

Laryngopharynx

Postcricoid region

Pyriform fossa

210.9      Pharynx, unspecified

Throat NOS

 

 

211         Benign neoplasm of other parts of digestive system

 

Excludes:        benign stromal tumors of digestive system (215.5)

211.0      Esophagus

211.1      Stomach

Body of stomach

Cardia of stomach

Fundus of stomach

Cardiac orifice

Pylorus

Excludes:        benign carcinoid tumors of the stomach (209.63)

211.2      Duodenum, jejunum, and ileum

Small intestine NOS

Excludes:        ampulla of Vater (211.5)

-40-

 

 

benign carcinoid tumors of the small intestine (209.40-209.43)

ileocecal valve (211.3)

211.3      Colon

Appendix

Cecum

Ileocecal valve

Large intestine NOS

Excludes:        benign carcinoid tumors of the large intestine (209.50-209.56)

rectosigmoid junction (211.4)

211.4      Rectum and anal canal

Anal canal or sphincter

Anus NOS

Rectosigmoid junction

Excludes:        anus:

margin (216.5)

skin (216.5)

perianal skin (216.5)

benign carcinoid tumors of the rectum (209.57)

211.5      Liver and biliary passages

Ampulla of Vater

Common bile duct

Cystic duct

Gallbladder

Hepatic duct

Sphincter of Oddi

211.6      Pancreas, except islets of Langerhans

211.7      Islets of Langerhans

Islet cell tumor

Use additional code to identify any functional activity

211.8      Retroperitoneum and peritoneum

Mesentery

Mesocolon

Omentum

Retroperitoneal tissue

211.9      Other and unspecified site

Alimentary tract NOS

Digestive system NOS

Gastrointestinal tract NOS

Intestinal tract NOS

Intestine NOS

Spleen, not elsewhere classified

 

 

212         Benign neoplasm of respiratory and intrathoracic organs

 

212.0      Nasal cavities, middle ear, and accessory sinuses

Cartilage of nose

Eustachian tube

Nares

Septum of nose

Sinus:

-41-

 

 

ethmoidal

frontal

maxillary

sphenoidal

Excludes:        auditory canal (external) (216.2)

bone of:

ear (213.0)

nose [turbinates] (213.0)

cartilage of ear (215.0)

ear (external) (skin) (216.2)

nose NOS (229.8)

skin (216.3)

olfactory bulb (225.1)

polyp of:

accessory sinus (471.8)

ear (385.30-385.35)

nasal cavity (471.0)

posterior margin of septum and choanae (210.7)

212.1      Larynx

Cartilage:

arytenoid

cricoid

cuneiform

thyroid

Epiglottis (suprahyoid portion) NOS

Glottis

Vocal cords (false) (true)

Excludes:        epiglottis, anterior aspect (210.6)

polyp of vocal cord or larynx (478.4)

212.2      Trachea

212.3      Bronchus and lung

Carina

Hilus of lung

Excludes:        benign carcinoid tumors of bronchus and lung (209.61)

212.4      Pleura

212.5      Mediastinum

212.6      Thymus

Excludes:        benign carcinoid tumors of thymus (209.62)

212.7      Heart

Excludes:        great vessels (215.4)

212.8      Other specified sites

212.9      Site unspecified

Respiratory organ NOS

Upper respiratory tract NOS

Excludes:        intrathoracic NOS (229.8)

thoracic NOS (229.8)

-42-

 

 

 

213         Benign neoplasm of bone and articular cartilage

 

Includes:         cartilage (articular) (joint)

periosteum

Excludes:        cartilage of:

ear (215.0)

eyelid (215.0)

larynx (212.1)

nose (212.0)

exostosis NOS (726.91)

synovia (215.0-215.9)

213.0      Bones of skull and face

Excludes:        lower jaw bone (213.1)

213.1      Lower jaw bone

213.2      Vertebral column, excluding sacrum and coccyx

213.3      Ribs, sternum, and clavicle

213.4      Scapula and long bones of upper limb

213.5      Short bones of upper limb

213.6      Pelvic bones, sacrum, and coccyx

213.7      Long bones of lower limb

213.8      Short bones of lower limb

213.9      Bone and articular cartilage, site unspecified

 

 

214         Lipoma

 

Includes:         angiolipoma

fibrolipoma

hibernoma

lipoma (fetal) (infiltrating) (intramuscular)

myelolipoma

myxolipoma

214.0      Skin and subcutaneous tissue of face

214.1      Other skin and subcutaneous tissue

214.2      Intrathoracic organs

214.3      Intra-abdominal organs

214.4      Spermatic cord

214.8      Other specified sites

214.9      Lipoma, unspecified site

 

 

215         Other benign neoplasm of connective and other soft tissue

 

Includes:         blood vessel

bursa

-43-

 

 

fascia

ligament

muscle

peripheral, sympathetic, and parasympathetic nerves and ganglia

synovia

tendon (sheath)

Excludes:        cartilage:

articular (213.0-213.9)

larynx (212.1)

nose (212.0)

connective tissue of:

breast (217)

internal organ, except lipoma and hemangioma - code to benign neoplasm of the
site

lipoma (214.0-214.9)

215.0      Head, face, and neck

215.2      Upper limb, including shoulder

215.3      Lower limb, including hip

215.4      Thorax

Excludes:        heart (212.7)

mediastinum (212.5)

thymus (212.6)

215.5      Abdomen

Abdominal wall

Benign stromal tumors of abdomen

Hypochondrium

215.6      Pelvis

Buttock

Groin

Inguinal region

Perineum

Excludes:        uterine:

leiomyoma (218.0-218.9)

ligament, any (221.0)

215.7      Trunk, unspecified

Back NOS

Flank NOS

215.8      Other specified sites

215.9      Site unspecified

 

 

216         Benign neoplasm of skin

 

Includes:         blue nevus

dermatofibroma

hydrocystoma

pigmented nevus

syringoadenoma

syringoma

Excludes:        skin of genital organs (221.0-222.9)

-44-

 

 

216.0      Skin of lip

Excludes:        vermilion border of lip (210.0)

216.1      Eyelid, including canthus

Excludes:        cartilage of eyelid (215.0)

216.2      Ear and external auditory canal

Auricle (ear)

Auricular canal, external

External meatus

Pinna

Excludes:        cartilage of ear (215.0)

216.3      Skin of other and unspecified parts of face

Cheek, external

Eyebrow

Nose, external

Temple

216.4      Scalp and skin of neck

216.5      Skin of trunk, except scrotum

Axillary fold

Perianal skin

Skin of:

abdominal wall

anus

back

breast

buttock

chest wall

groin

perineum

Umbilicus

Excludes:        anal canal (211.4)

anus NOS (211.4)

skin of scrotum (222.4)

216.6      Skin of upper limb, including shoulder

216.7      Skin of lower limb, including hip

216.8      Other specified sites of skin

216.9      Skin, site unspecified

 

 

217         Benign neoplasm of breast

 

Breast (male) (female)

connective tissue

glandular tissue

soft parts

Excludes:        adenofibrosis (610.2)

benign cyst of breast (610.0)

fibrocystic disease (610.1)

skin of breast (216.5)

-45-

 

 

 

218         Uterine leiomyoma

 

Includes:         fibroid (bleeding) (uterine)

uterine:

fibromyoma

myoma

218.0      Submucous leiomyoma of uterus

218.1      Intramural leiomyoma of uterus

Interstitial leiomyoma of uterus

218.2      Subserous leiomyoma of uterus

Subperitoneal leiomyoma of uterus

218.9      Leiomyoma of uterus, unspecified

 

 

219         Other benign neoplasm of uterus

 

219.0      Cervix uteri

219.1      Corpus uteri

Endometrium

Fundus

Myometrium

219.8      Other specified parts of uterus

219.9      Uterus, part unspecified

 

 

220         Benign neoplasm of ovary

 

Use additional code to identify any functional activity (256.0-256.1)

Excludes:        cyst:

corpus albicans (620.2)

corpus luteum (620.1)

endometrial (617.1)

follicular (atretic) (620.0)

graafian follicle (620.0)

ovarian NOS (620.2)

retention (620.2)

 

 

221         Benign neoplasm of other female genital organs

 

Includes:         adenomatous polyp

benign teratoma

Excludes:        cyst:

epoophoron (752.11)

fimbrial (752.11)

Gartner's duct (752.11)

parovarian (752.11)

221.0      Fallopian tube and uterine ligaments

Oviduct

Parametrium

Uterine ligament (broad) (round) (uterosacral)

Uterine tube

-46-

 

 

221.1      Vagina

221.2      Vulva

Clitoris

External female genitalia NOS

Greater vestibular [Bartholin's] gland

Labia (majora) (minora)

Pudendum

Excludes:        Bartholin's (duct) (gland) cyst (616.2)

221.8      Other specified sites of female genital organs

221.9      Female genital organ, site unspecified

Female genitourinary tract NOS

 

 

222         Benign neoplasm of male genital organs

 

222.0      Testis

Use additional code to identify any functional activity

222.1      Penis

Corpus cavernosum

Glans penis

Prepuce

222.2      Prostate

Excludes:        adenomatous hyperplasia of prostate (600.20-600.21)

prostatic:

adenoma (600.20-600.21)

enlargement (600.00-600.01)

hypertrophy (600.00-600.01)

222.3      Epididymis

222.4      Scrotum

Skin of scrotum

222.8      Other specified sites of male genital organs

Seminal vesicle

Spermatic cord

222.9      Male genital organ, site unspecified

Male genitourinary tract NOS

 

 

223         Benign neoplasm of kidney and other urinary organs

 

223.0      Kidney, except pelvis

Kidney NOS

Excludes:        benign carcinoid tumors of kidney (209.64)

renal:

calyces (223.1)

pelvis (223.1)

223.1      Renal pelvis

223.2      Ureter

Excludes:        ureteric orifice of bladder (223.3)

-47-

 

 

223.3      Bladder

223.8      Other specified sites of urinary organs

223.81    Urethra

Excludes:        urethral orifice of bladder (223.3)

223.89    Other

Paraurethral glands

223.9      Urinary organ, site unspecified

Urinary system NOS

 

 

224         Benign neoplasm of eye

 

Excludes:        cartilage of eyelid (215.0)

eyelid (skin) (216.1)

optic nerve (225.1)

orbital bone (213.0)

224.0      Eyeball, except conjunctiva, cornea, retina, and choroid

Ciliary body

Iris

Sclera

Uveal tract

224.1      Orbit

Excludes:        bone of orbit (213.0)

224.2      Lacrimal gland

224.3      Conjunctiva

224.4      Cornea

224.5      Retina

Excludes:        hemangioma of retina (228.03)

224.6      Choroid

224.7      Lacrimal duct

Lacrimal sac

Nasolacrimal duct

224.8      Other specified parts of eye

224.9      Eye, part unspecified

 

 

225         Benign neoplasm of brain and other parts of nervous system

 

Excludes:        hemangioma (228.02)

neurofibromatosis (237.7)

peripheral, sympathetic, and parasympathetic nerves and ganglia (215.0-215.9)

retrobulbar (224.1)

225.0      Brain

225.1      Cranial nerves

225.2      Cerebral meninges

-48-

 

 

Meninges NOS

Meningioma (cerebral)

225.3      Spinal cord

Cauda equina

225.4      Spinal meninges

Spinal meningioma

225.8      Other specified sites of nervous system

225.9      Nervous system, part unspecified

Nervous system (central) NOS

Excludes:        meninges NOS (225.2)

 

 

226         Benign neoplasm of thyroid glands

 

Use additional code to identify any functional activity

 

 

227         Benign neoplasm of other endocrine glands and related structures

 

Use additional code to identify any functional activity

Excludes:        ovary (220)

pancreas (211.6)

testis (222.0)

227.0      Adrenal gland

Suprarenal gland

227.1      Parathyroid gland

227.3      Pituitary gland and craniopharyngeal duct (pouch)

Craniobuccal pouch

Hypophysis

Rathke's pouch

Sella turcica

227.4      Pineal gland

Pineal body

227.5      Carotid body

227.6      Aortic body and other paraganglia

Coccygeal body

Glomus jugulare

Para-aortic body

227.8      Other

227.9      Endocrine gland, site unspecified

 

 

228         Hemangioma and lymphangioma, any site

 

Includes:         angioma (benign) (cavernous) (congenital) NOS

cavernous nevus

glomus tumor

hemangioma (benign) (congenital)

Excludes:        benign neoplasm of spleen, except hemangioma and lymphangioma
(211.9)

-49-

 

 

glomus jugulare (227.6)

nevus:

NOS (216.0-216.9)

blue or pigmented (216.0-216.9)

vascular (757.32)

228.0      Hemangioma, any site

228.00    Of unspecified site

228.01    Of skin and subcutaneous tissue

228.02    Of intracranial structures

228.03    Of retina

228.04    Of intra-abdominal structures

Peritoneum

Retroperitoneal tissue

228.09    Of other sites

Systemic angiomatosis

228.1      Lymphangioma, any site

Congenital lymphangioma

Lymphatic nevus

 

 

229         Benign neoplasm of other and unspecified sites

 

229.0      Lymph nodes

Excludes:        lymphangioma (228.1)

229.8      Other specified sites

Intrathoracic NOS

Thoracic NOS

229.9      Site unspecified

CARCINOMA IN SITU (230-234)

Includes:        Bowen's disease

erythroplasia

Queyrat's erythroplasia

Excludes:       leukoplakia - see Alphabetic Index

 

230         Carcinoma in situ of digestive organs

 

230.0      Lip, oral cavity, and pharynx

Gingiva

Hypopharynx

Mouth [any part]

Nasopharynx

Oropharynx

Salivary gland or duct

Tongue

Excludes:        aryepiglottic fold or interarytenoid fold, laryngeal aspect
(231.0)

-50-

 

 

epiglottis:

NOS (231.0)

suprahyoid portion (231.0)

skin of lip (232.0)

230.1      Esophagus

230.2      Stomach

Body of stomach

Cardia of stomach

Fundus of stomach

Cardiac orifice

Pylorus

230.3      Colon

Appendix

Cecum

Ileocecal valve

Large intestine NOS

Excludes:        rectosigmoid junction (230.4)

230.4      Rectum

Rectosigmoid junction

230.5      Anal canal

Anal sphincter

230.6      Anus, unspecified

Excludes:        anus:

margin (232.5)

skin (232.5)

perianal skin (232.5)

230.7      Other and unspecified parts of intestine

Duodenum

Ileum

Jejunum

Small intestine NOS

Excludes:        ampulla of Vater (230.8)

230.8      Liver and biliary system

Ampulla of Vater

Common bile duct

Cystic duct

Gallbladder

Hepatic duct

Sphincter of Oddi

230.9      Other and unspecified digestive organs

Digestive organ NOS

Gastrointestinal tract NOS

Pancreas

Spleen

 

 

231         Carcinoma in situ of respiratory system

 

231.0      Larynx

-51-

 

 

Cartilage:

arytenoid

cricoid

cuneiform

thyroid

Epiglottis:

NOS

posterior surface

suprahyoid portion

Vocal cords (false) (true)

Excludes:        aryepiglottic fold or interarytenoid fold:

NOS (230.0)

hypopharyngeal aspect (230.0)

marginal zone (230.0)

231.1      Trachea

231.2      Bronchus and lung

Carina

Hilus of lung

231.8      Other specified parts of respiratory system

Accessory sinuses

Middle ear

Nasal cavities

Pleura

Excludes:        ear (external) (skin) (232.2)

nose NOS (234.8)

skin (232.3)

231.9      Respiratory system, part unspecified

Respiratory organ NOS

 

 

232         Carcinoma in situ of skin

 

Includes:         pigment cells

Excludes:        melanoma in situ of skin (172.0-172.9)

232.0      Skin of lip

Excludes:        vermilion border of lip (230.0)

232.1      Eyelid, including canthus

232.2      Ear and external auditory canal

232.3      Skin of other and unspecified parts of face

232.4      Scalp and skin of neck

232.5      Skin of trunk, except scrotum

Anus, margin

Axillary fold

Perianal skin

Skin of:

abdominal wall

anus

back

breast

-52-

 

 

buttock

chest wall

groin

perineum

Umbilicus

Excludes:        anal canal (230.5)

anus NOS (230.6)

skin of genital organs (233.30-233.39, 233.5-233.6)

232.6      Skin of upper limb, including shoulder

232.7      Skin of lower limb, including hip

232.8      Other specified sites of skin

232.9      Skin, site unspecified

 

 

233         Carcinoma in situ of breast and genitourinary system

 

233.0      Breast

Excludes:        Paget's disease (174.0-174.9)

skin of breast (232.5)

233.1      Cervix uteri

Adenocarcinoma in situ of cervix

Cervical intraepithelial glandular neoplasia, grade III

Cervical intraepithelial neoplasia III [CIN III]

Severe dysplasia of cervix

Excludes:        cervical intraepithelial neoplasia II [CIN II] (622.12)

cytologic evidence of malignancy without histologic confirmation (795.06)

high grade squamous intraepithelial lesion (HGSIL) (795.04)

moderate dysplasia of cervix (622.12)

233.2      Other and unspecified parts of uterus

233.3      Other and unspecified female genital organs

233.30    Unspecified female genital organ

233.31    Vagina

Severe dysplasia of vagina

Vaginal intraepithelial neoplasia [VAIN III]

233.32    Vulva

Severe dysplasia of vulva

Vulvar intraepithelial neoplasia [VIN III]

233.39    Other female genital organ

233.4      Prostate

233.5      Penis

233.6      Other and unspecified male genital organs

233.7      Bladder

233.9      Other and unspecified urinary organs

-53-

 

 

 

234         Carcinoma in situ of other and unspecified sites

 

234.0      Eye

Excludes:        cartilage of eyelid (234.8)

eyelid (skin) (232.1)

optic nerve (234.8)

orbital bone (234.8)

234.8      Other specified sites

Endocrine gland [any]

234.9      Site unspecified

Carcinoma in situ NOS

NEOPLASMS OF UNCERTAIN BEHAVIOR (235-238)

Note:     Categories 235-238 classify by site certain histo-morphologically
well-defined neoplasms, the subsequent behavior of which cannot be predicted
from the present appearance.

 

 

235         Neoplasm of uncertain behavior of digestive and respiratory systems

 

Excludes:        stromal tumors of uncertain behavior of digestive system
(238.1)

235.0      Major salivary glands

Gland:

parotid

sublingual

submandibular

Excludes:        minor salivary glands (235.1)

235.1      Lip, oral cavity, and pharynx

Gingiva

Hypopharynx

Minor salivary glands

Mouth

Nasopharynx

Oropharynx

Tongue

Excludes:        aryepiglottic fold or interarytenoid fold, laryngeal aspect
(235.6)

epiglottis:

NOS (235.6)

suprahyoid portion (235.6)

skin of lip (238.2)

235.2      Stomach, intestines, and rectum

 

 

235.3   Liver and biliary passages

Ampulla of Vater

Bile ducts [any]

Gallbladder

Liver

235.4      Retroperitoneum and peritoneum

235.5      Other and unspecified digestive organs

Anal:

canal

-54-

 

 

sphincter

Anus NOS

Esophagus

Pancreas

Spleen

Excludes:        anus:

margin (238.2)

skin (238.2)

perianal skin (238.2)

235.6      Larynx

Excludes:        aryepiglottic fold or interarytenoid fold:

NOS (235.1)

hypopharyngeal aspect (235.1)

marginal zone (235.1)

235.7      Trachea, bronchus, and lung

235.8      Pleura, thymus, and mediastinum

235.9      Other and unspecified respiratory organs

Accessory sinuses

Middle ear

Nasal cavities

Respiratory organ NOS

Excludes:        ear (external) (skin) (238.2)

nose (238.8)

skin (238.2)

 

 

236         Neoplasm of uncertain behavior of genitourinary organs

 

236.0      Uterus

236.1      Placenta

Chorioadenoma (destruens)

Invasive mole

Malignant hydatid(iform) mole

236.2      Ovary

Use additional code to identify any functional activity

236.3      Other and unspecified female genital organs

236.4      Testis

Use additional code to identify any functional activity

236.5      Prostate

236.6      Other and unspecified male genital organs

236.7      Bladder

236.9      Other and unspecified urinary organs

236.90    Urinary organ, unspecified

236.91    Kidney and ureter

-55-

 

 

236.99    Other

 

 

237         Neoplasm of uncertain behavior of endocrine glands and nervous
system

 

237.0      Pituitary gland and craniopharyngeal duct

Use additional code to identify any functional activity

237.1      Pineal gland

237.2      Adrenal gland

Suprarenal gland

Use additional code to identify any functional activity

237.3      Paraganglia

Aortic body

Carotid body

Coccygeal body

Glomus jugulare

237.4      Other and unspecified endocrine glands

Parathyroid gland

Thyroid gland

237.5      Brain and spinal cord

237.6      Meninges

Meninges:

NOS

cerebral

spinal

237.7      Neurofibromatosis

von Recklinghausen's disease

237.70    Neurofibromatosis, unspecified

237.71    Neurofibromatosis, type 1 [von Recklinghausen's disease]

237.72    Neurofibromatosis, type 2 [acoustic neurofibromatosis]

237.9      Other and unspecified parts of nervous system

Cranial nerves

Excludes:        peripheral, sympathetic, and parasympathetic nerves and ganglia
(238.1)

 

 

238         Neoplasm of uncertain behavior of other and unspecified sites and
tissues

 

238.0      Bone and articular cartilage

Excludes:        cartilage:

ear (238.1)

eyelid (238.1)

larynx (235.6)

nose (235.9)

synovia (238.1)

238.1      Connective and other soft tissue

Peripheral, sympathetic, and parasympathetic nerves and ganglia

Stromal tumors of digestive system

-56-

 

 

Excludes:        cartilage (of):

articular (238.0)

larynx (235.6)

nose (235.9)

connective tissue of breast (238.3)

238.2      Skin

Excludes:        anus NOS (235.5)

skin of genital organs (236.3, 236.6)

vermilion border of lip (235.1)

238.3      Breast

Excludes:        skin of breast (238.2)

238.4      Polycythemia vera

238.5      Histiocytic and mast cells

Mast cell tumor NOS

Mastocytoma NOS

238.6      Plasma cells

Plasmacytoma NOS

Solitary myeloma

238.7      Other lymphatic and hematopoietic tissues

Excludes:        acute myelogenous leukemia (205.0)

chronic myelomonocytic leukemia (205.1)

myelosclerosis NOS (289.89)

myelosis:

NOS (205.9)

megakaryocytic (207.2)

238.71    Essential thrombocythemia

Essential hemorrhagic thrombocythemia

Essential thrombocytosis

Idiopathic (hemorrhagic) thrombocythemia

Primary thrombocytosis

238.72    Low grade myelodysplastic syndrome lesions

Refractory anemia (RA)

Refractory anemia with excess blasts-1 (RAEB-1)

Refractory anemia with ringed sideroblasts (RARS)

Refractory cytopenia with multilineage dysplasia (RCMD)

Refractory cytopenia with multilineage dysplasia and ringed sideroblasts
(RCMD-RS)

238.73    High grade myelodysplastic syndrome lesions

Refractory anemia with excess blasts-2 (RAEB-2)

238.74    Myelodysplastic syndrome with 5q deletion

5q minus syndrome NOS

Excludes:        constitutional 5q deletion (758.39)

high grade myelodysplastic syndrome with 5q deletion (238.73)

238.75    Myelodysplastic syndrome, unspecified

238.76    Myelofibrosis with myeloid metaplasia

-57-

 

 

Agnogenic myeloid metaplasia

Idiopathic myelofibrosis (chronic)

Myelosclerosis with myeloid metaplasia

Primary myelofibrosis

Excludes:        myelofibrosis NOS (289.83)

myelophthisic anemia (284.2)

myelophthisis (284.2)

secondary myelofibrosis (289.83)

238.77    Post-transplant lymphoproliferative disorder (PTLD)

Code first complications of transplant (996.80-996.89)

238.79    Other lymphatic and hematopoietic tissues

Lymphoproliferative disease (chronic) NOS

Megakaryocytic myelosclerosis

Myeloproliferative disease (chronic) NOS

Panmyelosis (acute)

238.8      Other specified sites

Eye

Heart

Excludes:        eyelid (skin) (238.2)

cartilage (238.1)

238.9      Site unspecified

NEOPLASMS OF UNSPECIFIED NATURE (239)

 

 

239         Neoplasms of unspecified nature

 

Note:     Category 239 classifies by site neoplasms of unspecified morphology
and behavior. The term "mass," unless otherwise stated, is not to be regarded as
a neoplastic growth.

Includes:         "growth" NOS

neoplasm NOS

new growth NOS

tumor NOS

239.0      Digestive system

Excludes:        anus:

margin (239.2)

skin (239.2)

perianal skin (239.2)

239.1      Respiratory system

239.2      Bone, soft tissue, and skin

Excludes:        anal canal (239.0)

anus NOS (239.0)

bone marrow (202.9)

cartilage:

larynx (239.1)

nose (239.1)

connective tissue of breast (239.3)

skin of genital organs (239.5)

vermilion border of lip (239.0)

-58-

 

 

239.3      Breast

Excludes:        skin of breast (239.2)

239.4      Bladder

239.5      Other genitourinary organs

239.6      Brain

Excludes:        cerebral meninges (239.7)

cranial nerves (239.7)

239.7      Endocrine glands and other parts of nervous system

Excludes:        peripheral, sympathetic, and parasympathetic nerves and ganglia
(239.2)

239.8      Other specified sites

Excludes:        eyelid (skin) (239.2)

cartilage (239.2)

great vessels (239.2)

optic nerve (239.7)

239.81    Retina and choroid

Dark area on retina

Retinal freckle

239.89    Other specified sites

239.9      Site unspecified

 

4.  DISEASES OF THE BLOOD AND BLOOD-FORMING ORGANS (280-289)

 

280         Iron deficiency anemias

 

Includes:         anemia:

asiderotic

hypochromic-microcytic

sideropenic

Excludes:        familial microcytic anemia (282.49)

280.0      Secondary to blood loss (chronic)

Normocytic anemia due to blood loss

Excludes:        acute posthemorrhagic anemia (285.1)

280.1      Secondary to inadequate dietary iron intake

280.8      Other specified iron deficiency anemias

Paterson-Kelly syndrome

Plummer-Vinson syndrome

Sideropenic dysphagia

280.9      Iron deficiency anemia, unspecified

Anemia:

achlorhydric

chlorotic

idiopathic hypochromic

iron [Fe] deficiency NOS

-59-

 

 

 

281         Other deficiency anemias

 

281.0      Pernicious anemia

Anemia:

Addison's

Biermer's

congenital pernicious

Congenital intrinsic factor [Castle's] deficiency

Excludes:        combined system disease without mention of anemia (266.2)

subacute degeneration of spinal cord without mention of anemia (266.2)

281.1      Other vitamin B12 deficiency anemia

Anemia:

vegan's

vitamin B12 deficiency (dietary)

due to selective vitamin B12 malabsorption with proteinuria

Syndrome:

Imerslund's

Imerslund-Gräsbeck

Excludes:        combined system disease without mention of anemia (266.2)

subacute degeneration of spinal cord without mention of anemia (266.2)

281.2      Folate-deficiency anemia

Congenital folate malabsorption

Folate or folic acid deficiency anemia:

NOS

dietary

drug-induced

Goat's milk anemia

Nutritional megaloblastic anemia (of infancy)

Use additional E code to identify drug

281.3      Other specified megaloblastic anemias, not elsewhere classified

Combined B12 and folate-deficiency anemia

281.4      Protein-deficiency anemia

Amino-acid-deficiency anemia

281.8      Anemia associated with other specified nutritional deficiency

Scorbutic anemia

281.9      Unspecified deficiency anemia

Anemia:

dimorphic

macrocytic

megaloblastic NOS

nutritional NOS

simple chronic

 

 

282         Hereditary hemolytic anemias

 

282.0      Hereditary spherocytosis

Acholuric (familial) jaundice

Congenital hemolytic anemia (spherocytic)

Congenital spherocytosis

-60-

 

 

Minkowski-Chauffard syndrome

Spherocytosis (familial)

Excludes:        hemolytic anemia of newborn (773.0-773.5)

282.1      Hereditary elliptocytosis

Elliptocytosis (congenital)

Ovalocytosis (congenital) (hereditary)

282.2      Anemias due to disorders of glutathione metabolism

Anemia:

6-phosphogluconic dehydrogenase deficiency

enzyme deficiency, drug-induced

erythrocytic glutathione deficiency

glucose-6-phosphate dehydrogenase [G-6-PD] deficiency

glutathione-reductase deficiency

hemolytic nonspherocytic (hereditary), type I

Disorder of pentose phosphate pathway

Favism

282.3      Other hemolytic anemias due to enzyme deficiency

Anemia:

hemolytic nonspherocytic (hereditary), type II

hexokinase deficiency

pyruvate kinase [PK] deficiency

triosephosphate isomerase deficiency

282.4      Thalassemias

Excludes:        sickle-cell:

disease (282.60-282.69)

trait (282.5)

282.41    Sickle-cell thalassemia without crisis

Sickle-cell thalassemia NOS

Thalassemia Hb-S disease without crisis

282.42    Sickle-cell thalassemia with crisis

Sickle-cell thalassemia with vaso-occlusive pain

Thalassemia Hb-S disease with crisis

Use additional code for type of crisis, such as:

Acute chest syndrome (517.3)

Splenic sequestration (289.52)

282.49    Other thalassemia

Cooley's anemia

Hb-Bart's disease

Hereditary leptocytosis

Mediterranean anemia (with other hemoglobinopathy)

Microdrepanocytosis

Thalassemia (alpha) (beta) (intermedia) (major) (minima) (minor) (mixed) (trait)
(with other hemoglobinopathy)

Thalassemia NOS

282.5      Sickle-cell trait

Hb-AS genotype

Hemoglobin S [Hb-S] trait

Heterozygous:

-61-

 

 

hemoglobin S

Hb-S

Excludes:        that with other hemoglobinopathy (282.60-282.69)

that with thalassemia (282.49)

282.6      Sickle-cell disease

Sickle-cell anemia

Excludes:        sickle-cell thalassemia (282.41-282.42)

sickle-cell trait (282.5)

282.60    Sickle-cell disease, unspecified

Sickle-cell anemia NOS

282.61    Hb-SS disease without crisis

282.62    Hb-SS disease with crisis

Hb-SS disease with vaso-occlusive pain

Sickle-cell crisis NOS

Use additional code for type of crisis, such as:

Acute chest syndrome (517.3)

Splenic sequestration (289.52)

282.63    Sickle-cell/Hb-C disease without crisis

Hb-S/Hb-C disease without crisis

282.64    Sickle-cell/HB-C disease with crisis

Hb-S/Hb-C disease with crisis

Sickle-cell/Hb-C disease with vaso-occlusive pain

Use additional code for types of crisis, such as:

Acute chest syndrome (517.3)

Splenic sequestration (289.52)

282.68    Other sickle-cell disease without crisis

Hb-S/Hb-D disease without crisis

Hb-S/Hb-E disease without crisis

Sickle-cell/Hb-D disease without crisis

Sickle-cell/Hb-E disease without crisis

282.69    Other sickle-cell disease with crisis

Hb-S/Hb-D disease with crisis

Hb-S/Hb-E disease with crisis

Sickle-cell/Hb-D disease with crisis

Sickle-cell/Hb-E disease with crisis

Other sickle-cell disease with vaso-occlusive pain

Use additional code for type of crisis, such as:

Acute chest syndrome (517.3)

Splenic sequestration (289.52)

282.7      Other hemoglobinopathies

Abnormal hemoglobin NOS

Congenital Heinz-body anemia

Disease:

hemoglobin C [Hb-C]

hemoglobin D [Hb-D]

hemoglobin E [Hb-E]

-62-

 

 

hemoglobin Zurich [Hb-Zurich]

Hemoglobinopathy NOS

Hereditary persistence of fetal hemoglobin [HPFH]

Unstable hemoglobin hemolytic disease

Excludes:        familial polycythemia (289.6)

hemoglobin M [Hb-M] disease (289.7)

high-oxygen-affinity hemoglobin (289.0)

282.8      Other specified hereditary hemolytic anemias

Stomatocytosis

282.9      Hereditary hemolytic anemia, unspecified

Hereditary hemolytic anemia NOS

 

 

283         Acquired hemolytic anemias

 

283.0      Autoimmune hemolytic anemias

Autoimmune hemolytic disease (cold type) (warm type)

Chronic cold hemagglutinin disease

Cold agglutinin disease or hemoglobinuria

Hemolytic anemia:

cold type (secondary) (symptomatic)

drug-induced

warm type (secondary) (symptomatic)

Use additional E code to identify cause,  if drug-induced

Excludes:        Evans' syndrome (287.32)

hemolytic disease of newborn (773.0-773.5)

283.1      Non-autoimmune hemolytic anemias

283.10    Non-autoimmune hemolytic anemia, unspecified

283.11    Hemolytic-uremic syndrome

283.19    Other non-autoimmune hemolytic anemias

Hemolytic anemia:

mechanical

microangiopathic

toxic

Use additional E code to identify cause

283.2      Hemoglobinuria due to hemolysis from external causes

Acute intravascular hemolysis

Hemoglobinuria:

from exertion

march

paroxysmal (cold) (nocturnal)

due to other hemolysis

Marchiafava-Micheli syndrome

Use additional E code to identify cause

283.9      Acquired hemolytic anemia, unspecified

Acquired hemolytic anemia NOS

Chronic idiopathic hemolytic anemia

-63-

 

 

 

284         Aplastic anemia and other bone marrow failure syndromes

 

284.0      Constitutional aplastic anemia

284.01    Constitutional red blood cell aplasia

Aplasia, (pure) red cell:

congenital

of infants

primary

Blackfan-Diamond syndrome

Familial hypoplastic anemia

284.09    Other constitutional aplastic anemia

Fanconi's anemia

Pancytopenia with malformations

284.1      Pancytopenia

Excludes:        pancytopenia (due to) (with):

aplastic anemia NOS (284.9)

bone marrow infiltration (284.2)

constitutional red blood cell aplasia (284.01)

drug induced (284.89)

hairy cell leukemia (202.4)

human immunodeficiency virus disease (042)

leukoerythroblastic anemia (284.2)

malformations (284.09)

myelodysplastic syndromes (238.72-238.75)

myeloproliferative disease (238.79)

other constitutional aplastic anemia (284.09)

284.2      Myelophthisis

Leukoerythroblastic anemia

Myelophthisic anemia

Code first the underlying disorder, such as:

malignant neoplasm of breast (174.0-174.9, 175.0-175.9)

tuberculosis (015.0-015.9)

Excludes:        idiopathic myelofibrosis (238.76)

myelofibrosis NOS (289.83)

myelofibrosis with myeloid metaplasia (238.76)

primary myelofibrosis (238.76)

secondary myelofibrosis (289.83)

284.8      Other specified aplastic anemias

284.81    Red cell aplasia (acquired) (adult) (with thymoma)

Red cell aplasia NOS

284.89    Other specified aplastic anemias

Aplastic anemia (due to):

chronic systemic disease

drugs

infection

radiation

toxic (paralytic)

Use additional E code to identify cause

-64-

 

 

284.9      Aplastic anemia, unspecified

Anemia:

aplastic (idiopathic) NOS

aregenerative

hypoplastic NOS

nonregenerative

Medullary hypoplasia

Excludes:        refractory anemia (238.72)

 

 

285         Other and unspecified anemias

 

285.0      Sideroblastic anemia

Anemia:

hypochromic with iron loading

sideroachrestic

sideroblastic:

acquired

congenital

hereditary

primary

secondary (drug-induced) (due to disease)

sex-linked hypochromic

vitamin B6-responsive

Pyridoxine-responsive (hypochromic) anemia

Excludes:        refractory sideroblastic anemia (238.72)

Use additional E code to identify cause, if drug-induced

285.1      Acute posthemorrhagic anemia

Anemia due to acute blood loss

Excludes:        anemia due to chronic blood loss (280.0)

blood loss anemia NOS (280.0)

285.2      Anemia of chronic disease

Anemia in (due to) (with) chronic illness

285.21    Anemia in chronic kidney disease

Anemia in end-stage renal disease

Erythropoietin-resistant anemia (EPO resistant anemia)

285.22    Anemia in neoplastic disease

Excludes:  anemia due to antineoplastic chemotherapy (285.3)

285.29    Anemia of other chronic disease

Anemia in other chronic illness

285.3      Antineoplastic chemotherapy induced anemia

Anemia due to antineoplastic chemotherapy

Excludes:   anemia due to drug NEC - code to type of anemia

anemia in neoplastic disease (285.22)

aplastic anemia due to antineoplastic chemotherapy (284.89)

285.8      Other specified anemias

Anemia:

dyserythropoietic (congenital)

dyshematopoietic (congenital)

-65-

 

 

von Jaksch's

Infantile pseudoleukemia

285.9      Anemia, unspecified

Anemia:

NOS

essential

normocytic, not due to blood loss

profound

progressive

secondary

Oligocythemia

Excludes:        anemia (due to):

blood loss:

acute (285.1)

chronic or unspecified (280.0)

iron deficiency (280.0-280.9)

 

 

286         Coagulation defects

 

286.0      Congenital factor VIII disorder

Antihemophilic globulin [AHG] deficiency

Factor VIII (functional) deficiency

Hemophilia:

NOS

A

classical

familial

hereditary

Subhemophilia

Excludes:        factor VIII deficiency with vascular defect (286.4)

286.1      Congenital factor IX disorder

Christmas disease

Deficiency:

factor IX (functional)

plasma thromboplastin component [PTC]

Hemophilia B

286.2      Congenital factor XI deficiency

Hemophilia C

Plasma thromboplastin antecedent [PTA] deficiency

Rosenthal's disease

286.3      Congenital deficiency of other clotting factors

Congenital afibrinogenemia

Deficiency:

AC globulin

factor:

I [fibrinogen]

II [prothrombin]

V [labile]

VII [stable]

X [Stuart-Prower]

XII [Hageman]

XIII [fibrin stabilizing]

-66-

 

 

Laki-Lorand factor

proaccelerin

Disease:

Owren's

Stuart-Prower

Dysfibrinogenemia (congenital)

Dysprothrombinemia (constitutional)

Hypoproconvertinemia

Hypoprothrombinemia (hereditary)

Parahemophilia

286.4      von Willebrand's disease

Angiohemophilia (A) (B)

Constitutional thrombopathy

Factor VIII deficiency with vascular defect

Pseudohemophilia type B

Vascular hemophilia

von Willebrand's (-Jürgens') disease

Excludes:        factor VIII deficiency:

NOS (286.0)

with functional defect (286.0)

hereditary capillary fragility (287.8)

286.5      Hemorrhagic disorder due to intrinsic circulating anticoagulants

Antithrombinemia

Antithromboplastinemia

Antithromboplastino-genemia

Hyperheparinemia

Increase in:

anti-VIIIa

anti-IXa

anti-Xa

anti-XIa

antithrombin

Secondary hemophilia

Systemic lupus erythematosus [SLE] inhibitor

286.6      Defibrination syndrome

Afibrinogenemia, acquired

Consumption coagulopathy

Diffuse or disseminated intravascular coagulation [DIC syndrome]

Fibrinolytic hemorrhage, acquired

Hemorrhagic fibrinogenolysis

Pathologic fibrinolysis

Purpura:

fibrinolytic

fulminans

Excludes:        that complicating:

abortion (634-638 with .1, 639.1)

pregnancy or the puerperium (641.3, 666.3)

disseminated intravascular coagulation in newborn (776.2)

286.7      Acquired coagulation factor deficiency

Deficiency of coagulation factor due to:

liver disease

vitamin K deficiency

-67-

 

 

Hypoprothrombinemia, acquired

Excludes:        vitamin K deficiency of newborn (776.0)

Use additional E-code to identify cause, if drug-induced

286.9      Other and unspecified coagulation defects

Defective coagulation NOS

Deficiency, coagulation factor NOS

Delay, coagulation

Disorder:

coagulation

hemostasis

Excludes:        abnormal coagulation profile (790.92)

hemorrhagic disease of newborn (776.0)

that complicating:

abortion (634-638 with .1, 639.1)

pregnancy or the puerperium (641.3, 666.3)

 

 

287         Purpura and other hemorrhagic conditions

 

Excludes:        hemorrhagic thrombocythemia (238.79)

purpura fulminans (286.6)

287.0      Allergic purpura

Peliosis rheumatica

Purpura:

anaphylactoid

autoimmune

Henoch's

nonthrombocytopenic:

hemorrhagic

idiopathic

rheumatica

Schönlein-Henoch

vascular

Vasculitis, allergic

Excludes:        hemorrhagic purpura (287.39)

purpura annularis telangiectodes (709.1)

287.1      Qualitative platelet defects

Thrombasthenia (hemorrhagic) (hereditary)

Thrombocytasthenia

Thrombocytopathy (dystrophic)

Thrombopathy (Bernard-Soulier)

Excludes:        von Willebrand's disease (286.4)

287.2      Other nonthrombocytopenic purpuras

Purpura:

NOS

senile

simplex

287.3      Primary thrombocytopenia

Excludes:        thrombotic thrombocytopenic purpura (446.6)

transient thrombocytopenia of newborn (776.1)

287.30    Primary thrombocytopenia unspecified

-68-

 

 

Megakaryocytic hypoplasia

287.31    Immune thrombocytopenic purpura

Idiopathic thrombocytopenic purpura

Tidal platelet dysgenesis

287.32    Evans' syndrome

287.33    Congenital and hereditary thrombocytopenic purpura

Congenital and hereditary thrombocytopenia

Thrombocytopenia with absent radii (TAR) syndrome

Excludes:        Wiskott-Aldrich syndrome (279.12)

287.39    Other primary thrombocytopenia

287.4      Secondary thrombocytopenia

Posttransfusion purpura

Thrombocytopenia (due to):

dilutional

drugs

extracorporeal circulation of blood

massive blood transfusion

platelet alloimmunization

Use additional E code to identify cause

Excludes:        heparin-induced thrombocytopenia (HIT) (289.84)

transient thrombocytopenia of newborn (776.1)

287.5      Thrombocytopenia, unspecified

287.8      Other specified hemorrhagic conditions

Capillary fragility (hereditary)

Vascular pseudohemophilia

287.9      Unspecified hemorrhagic conditions

Hemorrhagic diathesis (familial)

 

 

288         Diseases of white blood cells

 

Excludes:        leukemia (204.0-208.9)

288.0      Neutropenia

Decreased Absolute Neutrophil Count (ANC)

Use additional code for any associated:

fever (780.61)

mucositis (478.11, 528.00-528.09, 538, 616.81)

Excludes:        neutropenic splenomegaly (289.53)

transitory neonatal neutropenia (776.7)

288.00    Neutropenia, unspecified

288.01    Congenital neutropenia

Congenital agranulocytosis

Infantile genetic agranulocytosis

Kostmann's syndrome

288.02    Cyclic neutropenia

Cyclic hematopoiesis

-69-

 

 

Periodic neutropenia

288.03    Drug induced neutropenia

Use additional E code to identify drug

288.04    Neutropenia due to infection

288.09    Other neutropenia

Agranulocytosis

Neutropenia:

immune

toxic

288.1      Functional disorders of polymorphonuclear neutrophils

Chronic (childhood) granulomatous disease

Congenital dysphagocytosis

Job's syndrome

Lipochrome histiocytosis (familial)

Progressive septic granulomatosis

288.2      Genetic anomalies of leukocytes

Anomaly (granulation) (granulocyte) or syndrome:

Alder's (-Reilly)

Chédiak-Steinbrinck (-Higashi)

Jordan's

May-Hegglin

Pelger-Huet

Hereditary:

hypersegmentation

hyposegmentation

leukomelanopathy

288.3      Eosinophilia

Eosinophilia

allergic

hereditary

idiopathic

secondary

Eosinophilic leukocytosis

Excludes:        Löffler's syndrome (518.3)

pulmonary eosinophilia (518.3)

288.4      Hemophagocytic syndromes

Familial hemophagocytic lymphohistiocytosis

Familial hemophagocytic reticulosis

Hemophagocytic syndrome, infection-associated

Histiocytic syndromes

Macrophage activation syndrome

288.5      Decreased white blood cell count

Excludes:        neutropenia (288.01-288.09)

288.50    Leukocytopenia, unspecified

Decreased leukocytes, unspecified

Decreased white blood cell count, unspecified

Leukopenia NOS

-70-

 

 

288.51    Lymphocytopenia

Decreased lymphocytes

288.59    Other decreased white blood cell count

Basophilic leukopenia

Eosinophilic leukopenia

Monocytopenia

Plasmacytopenia

288.6      Elevated white blood cell count

Excludes:   eosinophilia (288.3)

288.60    Leukocytosis, unspecified

Elevated leukocytes, unspecified

Elevated white blood cell count, unspecified

288.61    Lymphocytosis (symptomatic)

Elevated lymphocytes

288.62    Leukemoid reaction

Basophilic leukemoid reaction

Lymphocytic leukemoid reaction

Monocytic leukemoid reaction

Myelocytic leukemoid reaction

Neutrophilic leukemoid reaction

288.63    Monocytosis (symptomatic)

Excludes:  infectious mononucleosis (075)

288.64    Plasmacytosis

288.65    Basophilia

288.66    Bandemia

Bandemia without diagnosis of specific infection

Excludes:  confirmed infection - code to infection

leukemia  (204.00-208.9)

288.69    Other elevated white blood cell count

288.8      Other specified disease of white blood cells

Excludes:        decreased white blood cell counts (288.50-288.59)

elevated white blood cell counts (288.60-288.69)

immunity disorders (279.0-279.9)

288.9      Unspecified disease of white blood cells

 

 

289         Other diseases of blood and blood-forming organs

 

289.0      Polycythemia, secondary

High-oxygen-affinity hemoglobin

Polycythemia:

acquired

benign

due to:

fall in plasma volume

high altitude

-71-

 

 

emotional

erythropoietin

hypoxemic

nephrogenous

relative

spurious

stress

Excludes:        polycythemia:

neonatal (776.4)

primary (238.4)

vera (238.4)

289.1      Chronic lymphadenitis

Chronic:

adenitis any lymph node, except mesenteric

lymphadenitis any lymph node, except mesenteric

Excludes:        acute lymphadenitis (683)

mesenteric (289.2)

enlarged glands NOS (785.6)

289.2      Nonspecific mesenteric lymphadenitis

Mesenteric lymphadenitis (acute) (chronic)

289.3      Lymphadenitis, unspecified, except mesenteric

289.4      Hypersplenism

"Big spleen" syndrome

Dyssplenism

Hypersplenia

Excludes:        primary splenic neutropenia (289.53)

289.5      Other diseases of spleen

289.50    Disease of spleen, unspecified

289.51    Chronic congestive splenomegaly

289.52    Splenic sequestration

Code first sickle-cell disease in crisis (282.42, 282.62, 282.64, 282.69)

289.53    Neutropenic splenomegaly

289.59    Other

Lien migrans

Perisplenitis

Splenic:

abscess

atrophy

cyst

fibrosis

infarction

rupture, nontraumatic

Splenitis

Wandering spleen

Excludes:        bilharzial splenic fibrosis (120.0-120.9)

hepatolienal fibrosis (571.5)

splenomegaly NOS (789.2)

-72-

 

 

289.6      Familial polycythemia

Familial:

benign polycythemia

erythrocytosis

289.7      Methemoglobinemia

Congenital NADH [DPNH]-methemoglobin-reductase deficiency

Hemoglobin M [Hb-M] disease

Methemoglobinemia:

NOS

acquired (with sulfhemoglobinemia)

hereditary

toxic

Stokvis' disease

Sulfhemoglobinemia

Use additional E code to identify cause

289.8      Other specified diseases of blood and blood-forming organs

289.81    Primary hypercoagulable state

Activated protein C resistance

Antithrombin III deficiency

Factor V Leiden mutation

Lupus anticoagulant

Protein C deficiency

Protein S deficiency

Prothrombin gene mutation

289.82    Secondary hypercoagulable state

Excludes:        heparin-induced thrombocytopenia (HIT) (289.84)

289.83    Myelofibrosis

Myelofibrosis NOS

Secondary myelofibrosis

Code first the underlying disorder, such as:

malignant neoplasm of breast (174.0-174.9, 175.0-175.9)

Use additional code for associated therapy-related myelodysplastic syndrome, if
applicable (238.72, 238.73)

Use additional external cause code if due to anti-neoplastic chemotherapy
(E933.1)

Excludes:  idiopathic myelofibrosis (238.76)

leukoerythroblastic anemia (284.2)

myelofibrosis with myeloid metaplasia (238.76)

myelophthisic anemia (284.2)

myelophthisis (284.2)

primary myelofibrosis (238.76)

289.84    Heparin-induced thrombocytopenia (HIT)

289.89    Other specified diseases of blood and blood-forming organs

Hypergammaglobulinemia

Pseudocholinesterase deficiency

289.9      Unspecified diseases of blood and blood-forming organs

Blood dyscrasia NOS

Erythroid hyperplasia

 

 

 

-73-

[***] Confidential material redacted and filed separately with the Commission.

 

Schedule 1.43

 

[***]

 

[***]

 

-74-

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

-75-

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

-76-

[***] Confidential material redacted and filed separately with the Commission.

 

[***]

 

-77-

[***] Confidential material redacted and filed separately with the Commission.

 

Schedule 1.48

Initial Licensed Back-Up Compounds

 

[***]

[***]

[***]

[***]

 

 

-78-