Teva | North America

November 5, 2014

Zogenix, Inc.
12400 High Bluff Drive
Suite 650
San Diego, CA 92130
Attn:     Stephen J. Farr, President
Re: Right of Reference
Dear Mr. Farr:
This binding letter agreement (this “Letter Agreement”), effective as of the
date first set forth above (“Effective Date”), confirms the understanding and
agreement between Teva Pharmaceuticals USA, Inc. (“Teva”) and Zogenix, Inc.
(“Zogenix”) with regard to the grant by Zogenix to Teva of a right of reference
to the carcinogenicity data identified below that were generated by Zogenix for
the Zogenix Product (as defined below).
Pursuant to the terms of this Letter Agreement and subject to Teva's payment of
the Consideration (as defined below), Zogenix hereby grants to Teva, a
non-transferable, non-assignable right of reference to all Referenced Materials
(as defined below) to be submitted to the US Food and Drug Administration
(“FDA”) by Zogenix for the Zogenix Product (the “Right of Reference”). The Right
of Reference granted to Teva shall be solely for the purpose of Teva or its
Affiliate seeking Regulatory Approval (as defined below) for the Teva Product
(as defined below), and shall allow Teva or its Affiliate to cross reference,
file or incorporate by reference the Referenced Materials in submissions to FDA
or in order to comply with FDA requirements in support of Teva’s submissions for
Regulatory Approval. The Right of Reference does not include (and Teva is hereby
expressly prohibited from) publishing, disclosing and/or sharing the Referenced
Materials, CSRs (as defined below), Studies (as defined below) and/or any data
or results related to the foregoing with any third parties. The Right of
Reference shall be perpetual and irrevocable, subject to the satisfaction of the
payment of the Consideration as specified below.
In consideration for the Right of Reference, Teva shall pay to Zogenix a
one-time, irrevocable, non-refundable fee in the amount of Three Million Five
Hundred Thousand Dollars ($3,500,000.00) (US), which shall be paid within thirty
(30) days of the Effective Date (the "Consideration"). The payment of the
Consideration shall be sent by Teva to Zogenix by wire transfer of immediately
available funds to an account designated by Zogenix.
Upon receipt of the Consideration, Zogenix shall: (i) take all actions
reasonably necessary, and to the extent permitted by applicable laws, to allow
Teva to exercise its Right of Reference, including, but not limited to,
submitting a letter of authorization within five (5) business days of receipt of
the Consideration notifying the FDA that Teva is authorized by Zogenix to
reference the Referenced Materials, providing a copy of the letter of
authorization to Teva, which may be used by Teva in its regulatory submissions
to the FDA in support of obtaining Regulatory Approval for the Teva Product, and
providing the currently available draft reports, data and protocols for the
two-year rat and mouse carcinogenicity studies for the active pharmaceutical
ingredient, hydrocodone bitartrate (the “Studies”) within ten (10) business days
of receipt of the Consideration; and (ii) provide Teva with copies of the final
carcinogenicity study reports (“CSRs”) for the Studies promptly upon their
completion and submission to the FDA. Zogenix shall be solely responsible, at
its own expense, for filing and maintaining the Zogenix Regulatory Filings (as
defined below), including the Referenced Materials, for using commercially
reasonable efforts to complete and submit to the FDA for inclusion as part of
the Zogenix Regulatory Filings the Studies in accordance with FDA regulations
and requirements and in a timely manner, and for responding to all inquiries
from the FDA and other regulatory authorities with regard to the Studies and the
Zogenix Regulatory Filings.
Zogenix represents and warrants that it has the right and authority to grant
Teva the Right of Reference for all purposes identified in this Letter
Agreement, and to the actual knowledge of Zogenix the grant of such right to
Teva shall not infringe upon the intellectual property rights of any third
party; provided, however, that notwithstanding the foregoing, Teva acknowledges
and agrees that the Right of Reference granted hereunder shall not be deemed to
constitute any representation, warranty, promise, covenant or guarantee
whatsoever by Zogenix with respect to any Regulatory Approval that Teva or any
of its Affiliates seek to obtain.
TEVA ACKNOWLEDGES AND AGREES, ON BEHALF OF ITSELF AND ITS AFFILIATES, THAT,
EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED HEREIN, ZOGENIX
HAS MADE NO REPRESENTATION OR WARRANTY WHATSOEVER AND TEVA OR ITS AFFILIATES
HAVE NOT RELIED ON ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, EITHER IN
FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, INCLUDING ANY WARRANTY OF
QUALITY, FITNESS FOR A PARTICULAR PURPOSE, MERCHANTABILITY, CONDITION OF THE
REFERENCED MATERIALS, THE CSRs OR THE STUDIES, AS TO THE NON-INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHTS OF ANY PERSON OR AS TO ANY OTHER MATTER IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY.
For purposes of this Letter Agreement, the following terms shall have the
meanings provided below:
“Affiliate” shall mean, with respect to a party to this Letter Agreement, any
person, corporation, company, partnership, joint venture or other entity
controlling, controlled by or under common control with such party. For such
purpose, the term "control" means the holding of more than fifty percent (50%)
of the common voting stock or ordinary shares in, or the right to appoint fifty
percent (50%) or more of the directors of, or any other arrangement resulting in
the right to direct the management of, the said corporation, company,
partnership, joint venture or entity.
“Referenced Materials” shall mean the CSRs and the Studies.
“Regulatory Approval” shall mean any and all approvals, licenses, registrations
or authorizations from FDA necessary for the manufacture, use, storage, import,
export, distribution, transport, promotion, marketing, commercialization and/or
sale of the Teva Product for human use, including New Drug Application filings
for the Teva Product, and product license applications for the Teva Product.”
“Teva Product” shall mean the product set forth in New Drug Application 207975
and submitted to FDA on September 30, 2014.
“Zogenix Regulatory Filings” shall mean New Drug Application No. 202880, as
amended or supplemented, and any INDs referenced therein.
“Zogenix Product” shall mean Zohydro™ ER (hydrocodone bitartrate) extended
release capsules that are the subject of the Zogenix Regulatory Filings.
This Letter Agreement may not be amended except in writing signed by both
Parties and will be governed by the laws of the State of New York without regard
to its conflict of law principles.
This Letter Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original but all of which together shall constitute one
and the same instrument.
[SIGNATURE PAGE FOLLOWS]

Sincerely,
Teva Pharmaceuticals USA, Inc.

By: /s/ Ivana Magovčević-Liebisch        
Name: Ivana Magovčević-Liebisch        
Title: SVP, Global BD            

By: /s/ Gavin Samuels                
Name: Gavin Samuels                    
Title: VP, Global BD                

Accepted and agreed:
Zogenix, Inc.

By: /s/ Stephen J. Farr                
Name: Stephen J. Farr,
Title: President

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