Exhibit 10.1

FOIA CONFIDENTIAL TREATMENT REQUEST BY

BIODELIVERY SCIENCES INTERNATIONAL, INC.

IRS EMPLOYER IDENTIFICATION NUMBER 35-2089858

CONFIDENTIAL TREATMENT REQUESTED WITH RESPECT TO CERTAIN

PORTIONS HEREOF DENOTED WITH “***”

LICENSE AND DEVELOPMENT AGREEMENT

This License and Development Agreement (“Agreement”) is made as of May 11, 2016
(the “Effective Date”) by and between BioDelivery Sciences International, Inc.,
a Delaware corporation with its principal offices at 4131 Parklake Avenue, Suite
225, Raleigh, North Carolina 27612 (“Parent”), its wholly-owned subsidiary Arius
Pharmaceuticals, Inc., a Delaware corporation with an office at the same address
(“Arius”, and together with Parent, “BDSI”), and Collegium Pharmaceutical, Inc.,
a Virginia corporation with its principal office at 780 Dedham Street, Suite
800, Canton, MA 02021 (“Collegium”). BDSI and Collegium are sometimes referred
to collectively herein as the “Parties” or singly as a “Party.”

R E C I T A L S

WHEREAS, BDSI wishes to grant to Collegium, and Collegium wishes to obtain from
BDSI, an exclusive license to develop, manufacture (or have manufactured),
market, advertise, promote, distribute, offer for sale, sell, export, and import
BDSI’s BEMA fentanyl product called ONSOLIS® in the United States on the terms
and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants and agreements contained herein, the Parties hereto, intending to be
legally bound, do hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions. In addition to the capitalized terms defined elsewhere
in this Agreement, the following terms used in this Agreement shall have the
meaning set forth below:

“$*** Notice” shall have the meaning set forth in Section 4.01(c).

“AAA” shall have the meaning set forth in Section 14.03(c).

“Acquiring Entity” means any Third Party that acquires all or substantially all
of the stock, assets, or business of a Party (or all or substantially all of the
assets or business thereof related, in either case, to this Agreement) or
otherwise obtains control of a Party (with “control”, for purposes of this
definition, having the meaning set forth below in the definition of
“Affiliate”), or any Affiliate of such Third Party.

“Actavis Litigation” has the meaning set forth in Section 9.04.

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“ADE” means any Adverse Event associated with any BEMA Fentanyl Product or
Demonstration Sample (including Adverse Drug Reactions).

“Adverse Event” or “AE” means any untoward medical occurrence in a patient or
clinical investigation subject administered BEMA Fentanyl Products or
Demonstration Samples and which does not necessarily have to have a causal
relationship with such treatment.

“Adverse Reaction” or “Adverse Drug Reaction” or “ADR” means a response to any
BEMA Fentanyl Product or Demonstration Sample which is noxious and unintended
and which occurs at doses normally used in man for prophylaxis, diagnosis or
therapy of disease or for modification of physiological function.

“Affiliate” means an individual, trust, business trust, joint venture,
partnership, corporation, association or any other entity which controls, is
controlled by or is under common control with, a Party. For the purposes of this
definition, the term “control” (including, with correlative meanings, the terms
“controlled by” and “under common control with”) as used with respect to any
Party, shall mean the possession (directly or indirectly) of (a) more than fifty
percent (50%) (or such lesser percentage which is the maximum allowed to be
owned by a foreign corporation in a particular jurisdiction) of the outstanding
voting securities of a corporation or comparable equity interest in any other
type of entity or (b) the power to direct or cause the direction of the
management or policies of any such Party (whether through ownership of
securities or other ownership interests, by contract or otherwise).

“Agreement” shall have the meaning set forth in the introduction.

“Annual Net Sales” means the total Net Sales for all Licensed Products sold in
the Territory during a particular Calendar Year.

“API” means an active pharmaceutical ingredient.

“Applicable Laws” means all applicable laws, rules, regulations and guidelines
that may apply to the development, marketing, manufacturing or sale of any
Licensed Product or the performance of either Party’s obligations under this
Agreement, including but not limited to all laws, regulations and guidelines
governing the import, export, development, marketing, distribution and sale of
any Licensed Product in the Territory, to the extent relevant, all “current Good
Manufacturing Practices” or “current Good Clinical Practices” standards or
guidelines promulgated by the FDA or other Competent Authorities, all laws,
rules, regulations, and guidelines applicable to the manufacture, use, shipment,
handling, sale, marketing, and distribution of fentanyl as a Schedule II
controlled substance under the United States’ Controlled Substances Act of 1970
and any similar foreign laws, rules, and regulations, where applicable.

“Arius” shall have the meaning set forth in the introduction.

“Arius Two” shall have the meaning set forth in Section 11.13.

“Arius Two Agreement” shall have the meaning set forth in Section 11.13.

“Arius Two Consent” shall have the meaning set forth in Section 11.13.

 

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“Audited Party” shall have the meaning set forth in Section 14.11.

“Bad Debt Adjustment” shall have the meaning set forth in Section 4.01(b).

“BDSI” shall have the meaning set forth in the introduction.

“BDSI Indemnitees” shall have the meaning set forth in Section 10.02.

“BEMA” means the proprietary bioerodible, mucoadhesive multi-layer polymer film
technology Controlled by BDSI, as embodied in the Current Product, as it exists
as of the Effective Date, or described in or claimed in any Licensed Patents,
and as such may be improved or enhanced by any Licensed Improvement and
“BEMA-based Product” means any product that incorporates or is based directly on
the use of the BEMA technology.

“BEMA Fentanyl Product” means any Licensed Product or other BEMA-based Product
which (a) contains fentanyl as its sole API and (b) does not contain naloxone as
an additional ingredient.

“Books and Records” means, in whatever media, any and all books and records,
reports and accounts in connection with or related to any Licensed Product in
the Territory, the research, Development, manufacture, or Commercialization
thereof in the Territory, Competent Authorities, Applicable Laws, or this
Agreement, as the context requires. Books and Records shall also include any
market research and competitive reports, marketing reports, and related data
with respect to the Territory.

“Calendar Quarter” means each of those three (3) calendar month periods of each
Calendar Year ending March 31, June 30, September 30 and December 31, provided,
that the initial Calendar Quarter shall begin on the Effective Date and end June
30, 2016.

“Calendar Year” means (a) for the first Calendar Year, the period commencing on
the Effective Date and ending on December 31 of the same year, (b) for the
Calendar Year in which this Agreement expires or is terminated, the period
beginning on January 1 of such Calendar Year and ending on the effective date of
such expiration or termination, and (c) for all other years, each successive
twelve (12) consecutive month period beginning on January 1 and ending
December 31.

“CDC Agreement” means that certain Clinical Development and License Agreement
between BDSI and CDC IV, LLC (“CDC”) dated July 14, 2005, as amended, and
subject to that certain Sublicensing Consent and Amendment dated on or about the
Effective Date of this Agreement, between Parent, Arius, CDC, and NB Athyrium
LLC (the “CDC Consent”).

“CIOMS Form” shall have the meaning set forth in Section 6.04(d)(iii).

“CIOMS Line Listings” shall have the meaning set forth in Section 6.04(d)(iv).

“Claims” shall have the meaning set forth in Section 10.01.

“Collegium” shall have the meaning set forth in the introduction.

 

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“Collegium Affiliates” shall have the meaning set forth in Section 3.02(c).

“Collegium BEMA Improvement” means any Improvement directly concerning BEMA (or
the manufacture or use thereof) that is invented, conceived, or developed by or
on behalf of Collegium, any of its Affiliates, any Sublicensees, or any of its
or their employees, agents, contractors, or other representatives, whether alone
or jointly with BDSI, any Affiliate thereof, or any Third Party or any of its or
their employees, agents, or other representatives, in the course of the exercise
of the rights granted to Collegium with respect to any Licensed Product
hereunder or in connection with or as a result of their access to, or use or
knowledge of, BDSI’s Confidential Information or BEMA.

“Collegium Change” shall have the meaning set forth in Section 4.01(e)(i).

“Collegium Documentation” means all documentation, reports, case report forms,
data, information and the like, including all notes, summaries and analyses
related thereto, in whatever form or media, in the possession or Control of
Collegium or any Affiliate thereof, which result from or otherwise describe (i)
pre-clinical, clinical, or other research and development activities related to
any Licensed Product conducted by or for Collegium, its Affiliates, or any
Sublicensees in the Territory, including but not limited to Phase IV Studies or
manufacturing- or formulation-related activities, and/or any results thereof,
(ii) information obtained by or on behalf of Collegium or Affiliate thereof
concerning the use or administration of Licensed Products, including but not
limited to AEs, ADRs, ADEs, and/or SAEs, or (iii) or other Collegium Know-How
contained or referenced in any Governmental Approvals or Regulatory Filings.

“Collegium Improvements” shall have the meaning set forth in Section 3.05.

“Collegium Indemnitees” shall have the meaning set forth in Section 10.01.

“Collegium Know-How” means any Know-How generated by or on behalf of Collegium
or any Affiliate thereof during the Term, or that otherwise comes under the
Control of Collegium or any Affiliate thereof following the Effective Date and
during the Term, that relates to or results from the Development, manufacture,
or Commercialization of any Licensed Product hereunder by or on behalf of
Collegium, its Affiliates, or any Sublicensees, as applicable, or Collegium’s,
its Affiliates’, or Sublicensees’ access to, or use or knowledge of, BDSI’s
Confidential Information or BEMA, as applicable, including any Know-How coming
under the Control of Collegium or any Affiliate thereof relating to any
Collegium Improvement.

“Collegium Marks” means any trademarks, service marks, trade dress, or logos
used by Collegium, any Affiliate thereof, or any Sublicensee specifically for
any Licensed Product at any time in connection with the use, development,
promotion, marketing, distribution, offer for sale, or sale of any Licensed
Product in the Territory, other than (a) the Licensed Marks and (b) any
trademarks, trade names, service marks, trade dress, or logos that are generally
representative of Collegium, any Affiliate thereof, or any Sublicensee as a
business.

“Collegium Patents” means any Patents under the Control of Collegium or any
Affiliate thereof during the Term that (a) Cover any Collegium Know-How or any
Collegium Improvement or (b) are otherwise necessary for the Development,
manufacture, or

 

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Commercialization of any BEMA Fentanyl Product; provided that, notwithstanding
anything to the contrary, Collegium Patents shall not include any Patents that
are owned, licensed, or otherwise controlled at any time by any Acquiring Entity
of Collegium except to the extent that they come under the Control of Collegium
during the Term pursuant to a transfer or assignment to Collegium from any such
Acquiring Entity or were already included within the Collegium Patents
immediately prior to the date of the transaction by which such Acquiring Entity
first became an Acquiring Entity.

“Collegium Product-Specific Improvements” means any Collegium Improvement, other
than a Collegium BEMA Improvement, that is specifically related to a BEMA
Fentanyl Product (or the use or manufacture or manufacture of the foregoing).

“Commercialization” means the marketing, promotion, advertising, selling and/or
distribution of any Licensed Product while Governmental Approval therefor is
effective, including the conduct of any Phase IV Studies; and the term
“Commercialize” has a corresponding meaning.

“Commercially Reasonable Efforts” means, with respect to the efforts to be
expended by a Party with respect to any objective hereunder, those ***.
“Comparable market potential” shall be ***. The term “Commercially Reasonable”
has a corresponding meaning. Commercially Reasonable Efforts requires
***. Further, to the extent that ***.

“Competent Authorities” means, collectively, the Governmental Authorities in the
Territory responsible for the regulation of medicinal products intended for
human use, including the FDA.

“Competing Product” means a pharmaceutical product that incorporates fentanyl as
its sole API, with such API intended to be delivered orally through the mucosal
surface; provided, that any product containing naloxone shall not be a Competing
Product.

“Confidential Information” means all information and know-how and any tangible
embodiments thereof provided by or on behalf of one Party to the other Party or
an Affiliate thereof either in connection with the discussions and negotiations
pertaining to this Agreement or in the course of performing under this
Agreement, which may include data, knowledge, practices, processes, ideas,
research plans, formulation or manufacturing processes and techniques,
scientific, manufacturing, marketing and business plans, and financial and
personnel matters relating to the disclosing Party or to its present or future
products, sales, suppliers, customers, employees, investors or business, and
information, strategies and other matters relating to regulatory filings
(including pursuant to any securities law, regulation or rule); provided, that,
information or know-how of a Party will not be deemed Confidential Information
of such Party for purposes of this Agreement if such information or
know-how: (a) was already known to the receiving Party, other than under an
obligation of confidentiality or non-use, at the time of disclosure to such
receiving Party, as can be shown by written records; (b) was generally available
or known to parties reasonably skilled in the field to which such information or
know-how pertains, or was otherwise part of the public domain, at the time of
its disclosure to such receiving Party; (c) became generally available or known
to parties reasonably skilled in the field to which such information or know-how
pertains, or otherwise became part of the public domain,

 

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after its disclosure to such receiving Party through no fault of the receiving
Party; (d) was disclosed to such receiving Party, other than under an obligation
of confidentiality or non-use, by a Third Party who had no obligation to the
disclosing Party not to disclose such information or know-how to others, as can
be shown by written records; or (e) was independently discovered or developed by
such receiving Party, as can be shown by its written records, without the use or
benefit of, or reliance on, Confidential Information of the disclosing
Party. Notwithstanding anything to the contrary, and regardless of which Party
or Affiliate thereof first discloses any information concerning Collegium BEMA
Improvements to the other Party or any Affiliate thereof, any information
related to Collegium BEMA Improvements shall be the Confidential Information of
BDSI, and BDSI shall be deemed the disclosing Party, and Collegium the receiving
Party, with respect to such Confidential Information.

“Control” means, with respect to any intellectual property right, regulatory
documentation, clinical data, trademark or trade name, the possession of the
ability or right, whether by ownership, license or otherwise, to grant a license
or sublicense as provided for herein without violating the terms of any
agreement or other arrangement with any Third Party existing on the Effective
Date or, with respect to any intellectual property rights, regulatory
documentation, clinical data, trademark or trade name acquired from a Third
Party following the Effective Date, any agreements in effect at the time such
rights are acquired or licensed. For Know-How or Patents to which a Party
obtains control pursuant to a written agreement executed between such Party or
any Affiliate thereof and a Third Party after the Effective Date, “Control”
shall only be deemed to exist pursuant to the first sentence of this definition
if the grant of a license or sublicense thereunder in accordance with this
Agreement does not result in such Party or any Affiliate thereof owing payment
to a Third Party, unless the other Party agrees to pay the resulting amounts due
to the applicable Third Party as a condition of receiving such grant of rights.

“Controlled Collegium BEMA Improvement” means any Collegium BEMA Improvement
that is (i) invented, conceived, or developed by or on behalf of any
Sublicensees or any of their employees, agents, contractors, or other
representatives, whether alone or jointly with Collegium, BDSI, any Affiliate
thereof, or any Third Party or any of its or their employees, agents, or other
representatives and (ii) not assigned to Parent pursuant to Section 3.05.

“Cover” means that the use, manufacture, sale, offer for sale, development,
commercialization or importation of the subject matter in question by an
unlicensed entity would infringe a Valid Claim of a Patent.

“Current Product” means that certain Licensed Product that is the subject of NDA
022266 (the “Current Product NDA”).

“Debarred Entity” shall have the meaning set forth in Section 9.14.

“Defense/Enforcement Costs” shall have the meaning set forth in Section
4.01(e)(ii).

“Demonstration Samples” means a BEMA-based Product, lacking fentanyl or any
other API, that otherwise would constitute a BEMA Fentanyl Product and is used
to demonstrate the manner in which a BEMA Fentanyl Product is prepared and used,
and labeled “demonstration samples, for demonstration purposes only.”

 

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“Development” or “Develop” means engaging in preclinical, clinical, and other
research or development activities, which may include but is not limited to
research, pre-clinical, clinical and regulatory activities directed towards
obtaining Governmental Approval of any Licensed Product, and manufacturing,
using, exporting and importing a product for any of the foregoing purposes.

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

“Excess Requirement” shall have the meaning set forth in Section 13.06(e).

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

“FDCA” means the U.S. Food, Drug and Cosmetic Act, (21 U.S.C. §301 et seq.), as
amended from time to time, together with any rules, regulations, and compliance
guidance promulgated thereunder.

“Fentanyl-Specific Patent” shall have the meaning set forth in Section 7.01.

“First Commercial Sale” means the first sale, or other transfer, exchange, or
disposition for value, of a Licensed Product in the Territory by Collegium, an
Affiliate thereof, or a Sublicensee following the Effective Date.

“Force Majeure” shall have the meaning set forth in Section 14.02.

“Generic Product” means, with respect to a Licensed Product, a product sold by a
Third Party that ***.

“Generic Saturation” means, with respect to a particular Licensed Product,
***. For purposes of this definition, a ***.

“Governmental Approval” means all permits, licenses and authorizations,
including but not limited to, import permits and Marketing Authorizations,
required by any Competent Authority as a prerequisite to the manufacturing,
marketing, or selling of a Licensed Product for human therapeutic use in the
Territory.

“Governmental Authority” means any court, tribunal, arbitrator, agency,
legislative body, commission, official or other instrumentality of (a) any
government of any country, (b) a federal, state, province, county, city or other
political subdivision thereof or (c) any supranational body, including the FDA.

“Hatch-Waxman Act” shall have the meaning set forth in Section 7.04.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.

 

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“Improvements” means any and all developments, enhancements, inventions or
discoveries relating to BEMA, the Licensed Technology, or any Licensed Product
invented, conceived, developed or acquired by a Party, any Affiliate thereof, or
any employees, agents, or other representatives of any of the foregoing, or
otherwise coming under the Control of a Party or an Affiliate thereof, at any
time during the Term, including any of the foregoing intended to enhance the
safety and/or efficacy of a Licensed Product.

“Joint Improvement” shall have the meaning set forth in Section 3.05.

“Know-How” means all know-how, trade secrets, inventions, data, processes,
techniques, procedures, compositions, devices, methods, formulas, protocols and
information, whether or not patentable, which are not generally publicly known,
including, without limitation, all chemical, biochemical, toxicological, and
scientific research information, whether in written, graphic or video form or
any other form or format.

“Knowledge” of a Party means (a) actual knowledge of any senior officer of such
Party or Affiliate thereof or (b) any fact or matter known to an employee of
such Party or an Affiliate thereof of which any such senior officer of such
Party or Affiliate would reasonably be expected to discover or otherwise become
aware of in the course of the reasonable conduct of his or her duties.

“Licensed Improvement” means (i) any Improvement, including any Joint
Improvement, directly concerning BEMA (or the manufacture or use thereof) that
is invented, conceived, or developed in whole or in part by or on behalf of
BDSI, any of its Affiliates, or any of its or their employees, agents,
contractors, or other representatives following the Effective Date, to the
extent Controlled by BDSI or any of its Affiliates during the Term and (ii) any
Collegium BEMA Improvement.

“Licensed Know-How” means all Know-How that is (a) under the Control of BDSI or
any of its Affiliates as of the Effective Date or comes under BDSI’s or any of
its Affiliates’ Control during the Term and (b) necessary or useful to Develop,
manufacture, or Commercialize Licensed Products in the Territory, including any
such Know-How concerning Licensed Improvements, provided that, notwithstanding
anything to the contrary, Licensed Know-How shall not include any Know-How that
is owned, licensed, or otherwise controlled at any time by any Acquiring Entity
of BDSI, except to the extent such Know-How comes under the Control of BDSI
during the Term pursuant to a transfer or assignment to BDSI from any such
Acquiring Entity or was already included within the BDSI Know-How immediately
prior to the date of the transaction by which such Acquiring Entity first became
an Acquiring Entity.

“Licensed Marks” means those logos, tradenames, trademarks, and associated
registrations or applications therefor in the Territory set forth on Exhibit A.

“Licensed Patents” means (a) those Patents set forth on Exhibit B attached
hereto (the “Initial Licensed Patents”); (b) any additions, divisionals,
continuations, continuations-in-part, conversion, supplemental examinations,
extensions, term restorations, registrations, re-instatements, amendments,
reissuances, corrections, substitutions, re-examinations, revalidations,
supplementary protection certificates, and renewals of the Initial Licensed
Patents

 

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in the Territory; (c) any other Patents in the Territory Controlled by BDSI
claiming priority to any of the foregoing or any of the Patents referenced in
clause (a) above; (d) all patents issuing in the Territory from any of the
Patents mentioned in clause (a), (b), or (c) above; and (e) all Patents
Controlled by BDSI in the Territory Covering or otherwise claiming any Licensed
Improvement; provided that, notwithstanding anything to the contrary, Licensed
Patents shall not include any patents or patent applications that are owned,
licensed, or otherwise controlled at any time by any Acquiring Entity of BDSI
except to the extent that they come under the Control of BDSI pursuant to a
transfer or assignment to BDSI from any such Acquiring Entity or were already
included within the Licensed Patents immediately prior to the date of the
transaction by which such Acquiring Entity first became an Acquiring Entity of
BDSI.

“Licensed Product” means the Current Product or any other BEMA-based
Product which (a) contains fentanyl as its sole API, (b) does not contain
naloxone as an additional ingredient, and (c) constitutes an alternative dosage
or formulation of the Current Product permitted under Section 2.02.

“Licensed Technology” means the Licensed Patents and the Licensed Know-How.

“Losses” shall have the meaning set forth in Section 10.01.

“Marketing Authorization” means all necessary and appropriate regulatory
approvals, including variations thereto, to put a Licensed Product on the market
for sale for human therapeutic use in a particular jurisdiction in the
Territory.

“Meda” means Meda AB.

“Meda License” shall have the meaning set forth in Section 8.02(d).

“Meda Termination Agreement” shall have the meaning set forth in Section
8.02(d).

“Mfg Transfer Plan” shall have the meaning set forth in Section 2.06.

“NDA” means a new drug application (as defined in the FDCA), all amendments and
supplements thereto, and all additional documentation required to be filed with
the FDA for approval to commence commercial sale of a Licensed Product in the
United States, including supplemental NDAs.

“NDA Assignment” shall have the meaning set forth in Section 6.02.

“Negotiation Notice” shall have the meaning set forth in Section 11.10(a).

“Negotiation Period” shall have the meaning set forth in Section 11.10(b).

“Net Sales” means ***.

“Orange Book” means the Approved Drug Products with Therapeutic Equivalence
Evaluations published by the FDA’s Center for Drug Evaluation and Research (or
any equivalent successor publication or listing in the United States), as
updated and modified from time to time.

 

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“Paid Party” shall have the meaning set forth in Section 4.03(e).

“Parent” shall have the meaning set forth in the introduction.

“Patents” means all rights under patents and patent applications, and any and
all patents issuing therefrom (including utility, model and design patents, and
certificates of invention), together with any and all substitutions, extensions
(including supplemental protection certificates), registrations, confirmations,
reissues, divisionals, continuations, continuations-in-part, re-examinations,
renewals and domestic and foreign counterparts of the foregoing, and all
improvements, supplements, modifications or additions.

“Paying Party” shall have the meaning set forth in Section 4.03(e).

“Phase IV Studies” means any clinical study the results of which are intended to
be used to support an expanded label claim for a Licensed Product in the
Territory (even if such expanded label claims are marketed in the Territory
under a different Marketing Authorization or trademark) such as new indications
or formulations, or otherwise support marketing of a Licensed Product in the
Territory.

“Prime Rate of Interest” means the prime rate of interest published from time to
time in the Wall Street Journal as the prime rate; provided, however that if the
Wall Street Journal does not publish the Prime Rate of Interest, then the term
“Prime Rate of Interest” shall mean the rate of interest publicly announced by
Bank of America, N.A., as its Prime Rate, Base Rate, Reference Rate or the
equivalent of such rate, whether or not such bank makes loans to customers at,
above, or below said rate.

“Product Recall” means any recall, market withdrawal, or field correction of a
Licensed Product from or in the Territory.

“Product-Related Contracts” shall have the meaning set forth in Section 13.06.

“Product-Related Materials” means all advertising and promotional materials
(including but not limited to flyers, brochures, pamphlets and electronic
media), labeling and packaging materials, and any materials or items similar to
the foregoing to the extent, in each case, pertaining exclusively to the
Licensed Products and in the possession or control of Collegium or any Affiliate
thereof, and all copyright and similar rights to the contents thereof, provided
that the foregoing rights shall not include any rights to any trademark, logos,
or the like other than Collegium Marks.

“PSURs” shall have the meaning set forth in Section 6.04(g).

“Regulatory Filing” means an NDA, investigational new drug application, any drug
master files or the like in the Territory, and any other filings or submissions
required by or provided to Competent Authorities in the Territory relating to
the Development, manufacture, or Commercialization of any Licensed Product,
including any supporting documentation,

 

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correspondence, meeting minutes, amendments, supplements, registrations,
governmental licenses or permits, regulatory drug lists, advertising and
promotion documents, adverse event files, complaint files, and manufacturing,
shipping, or storage records with respect to any of the foregoing.

“Relevant Factors” means ***.

“REMS” shall have the meaning set forth in Section 6.01.

“Requesting Party” shall have the meaning set forth in Section 14.11.

“Review Period” shall have the meaning set forth in Section 8.03.

“ROFN Notice” shall have the meaning set forth in Section 11.10(a).

“ROFN Notice Period” shall have the meaning set forth in Section 11.10(a).

“ROFN Product” shall have the meaning set forth in Section 11.10(a).

“Royalty Statement” shall have the meaning set forth in Section 4.03(a).

“Royalty Term” means, on a Licensed Product-by-Licensed Product basis, the
period beginning on the Effective Date and ending on the later of (a) expiration
of the last-to-expire Valid Claim of the Licensed Patents in the Territory
Covering a particular Licensed Product or (b) Generic Saturation for such
Licensed Product.

“Rules” shall have the meaning set forth in Section 14.03(c).

“Serious Adverse Event” or “SAE” means an Adverse Event that at any dose (a)
results in death, (b) is life-threatening, (c) requires inpatient
hospitalization or prolongation of existing hospitalization, (d) results in
persistent or significant disability/incapacity, or (e) results in a congenital
anomaly/birth defect. The term “life-threatening” in this definition refers to
an event in which the patient was at risk of death at the time of the event; it
does not refer to an event which hypothetically might have caused death if it
had been more severe. Important medical events that may not be immediately
life-threatening or result in death or hospitalization but may jeopardize the
patient or require intervention to prevent one of the other outcomes listed
above should also be included in this definition to the extent reasonable
medical and scientific judgement indicates that expedited reporting is
appropriate under Applicable Laws.

“Serious Adverse Reaction” or “SAR” means an Adverse Reaction that at any dose
(a) results in death, (b) is life-threatening, (c) requires inpatient
hospitalization or prolongation of existing hospitalization, (d) results in
persistent or significant disability/incapacity, or (e) results in a congenital
anomaly/birth defect. The term “life-threatening” in this definition refers to
an event in which the patient was at risk of death at the time of the event; it
does not refer to an event which hypothetically might have caused death if it
had been more severe. Important medical events that may not immediately result
in death or hospitalization but may jeopardize the

 

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patient or require intervention to prevent one of the other outcomes listed
above should also be included in this definition to the extent reasonable
medical and scientific judgement indicates that expedited reporting is
appropriate under Applicable Laws.

“SKU” shall have the meaning set forth in Section 4.03(a).

“SOPs” shall have the meaning set forth in Section 6.04(g).

“Sublicensee” means any Third Party, other than an Affiliate of Collegium, to
whom any of the rights granted to Collegium under this Agreement have been
sublicensed as permitted hereby.

“Supplement” shall have the meaning set forth in Section 2.01.

“Supplement Approval” means FDA’s approval of a filing intended to be made by
BDSI to the FDA pursuant to 21 U.S.C. §314.70(b)(1) with respect to the proposed
commercial manufacture of the Current Product by *** which, upon such approval,
would permit the sale of Current Product manufactured by *** for human
therapeutic use in the Territory under the Current Product NDA (such filing, the
“Supplemental Filing”).

“Supplement Approval Notice” shall have the meaning set forth in Section 2.01.

“*** Agreement” shall have the meaning set forth in Section 2.06.

“Term” shall have the meaning set forth in Section 13.01.

“Territory” means the United States of America and its territories and
protectorates.

“Therapeutic Equivalent” has the meaning given to such term by the FDA in the
current edition of the “Approved Drug Product with Therapeutic Equivalence
Evaluations”, as the same may be amended from time to time during the Term.

“Third Party” means any entity other than: (a) BDSI, (b) Collegium, or (c) an
Affiliate of BDSI or Collegium.

“Third Party Claim” shall have the meaning set forth in Section 7.05.

“Third Party IP Costs” shall have the meaning set forth in Section 4.01(e)(i).

“Third Party License” shall have the meaning set forth in Section 4.01(e)(i).

“Third Party Offer” shall have the meaning set forth in Section 11.10(e).

“Third Party Royalties” shall have the meaning set forth in Section 4.01(e)(i).

“TIRF” shall have the meaning set forth in Section 6.01.

 

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“TIRF Fees” shall have the meaning set forth in Section 6.01

“Valid Claim” means a claim of any pending Patent application or issued and
unexpired Patent that has not been disclaimed, revoked, held unenforceable,
unpatentable or invalid by a decision of a court or other Governmental Authority
of competent jurisdiction, unappealable or unappealed within the time allowed
for appeal, and that has not been admitted to be invalid or unenforceable
through re-examination, re-issue, disclaimer or otherwise, or lost in an
interference proceeding; provided, however, that a pending claim of a pending
Patent application shall only be considered a Valid Claim if it (a) continues to
be prosecuted in good faith during the Term, (b) has not been abandoned or
finally rejected without the possibility of appeal or refiling, and (c) has not
been pending for more than *** from the date of issuance of the first
substantive patent office action considering the patentability of such claim by
the applicable patent office in such country (at which time such pending claim
shall cease to be a Valid Claim for purposes of this Agreement unless and until
such claim becomes a claim of an issued Patent which is a Licensed Patent).

Section 1.02 Interpretation. The Section headings contained in this Agreement
are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement. Except where the context clearly requires to
the contrary: (a) each reference in this Agreement to a designated “Section” or
“Exhibit” is to the corresponding Section or Exhibit of or to this Agreement;
(b) instances of gender or entity-specific usage (e.g., “his” “her” “its”
“person” or “individual”) shall not be interpreted to preclude the application
of any provision of this Agreement to any individual or entity; (c) “including”
shall mean “including, without limitation”; (d) references to Applicable Laws
shall mean such Applicable Laws in effect during the Term (taking into account
any amendments thereto effective at such time without regard to whether such
amendments were enacted or adopted after the Effective Date); (e) references to
“$” or “dollars” shall mean the lawful currency of the United States; (f)
references to “Federal” or “federal” shall be to laws, agencies or other
attributes of the United States (and not to any State or locality thereof); (g)
the meaning of the terms “domestic” and “foreign” shall be determined by
reference to the United States; (h) references to “days” shall mean calendar
days; (i) references to months or years shall be to the actual calendar months
or years at issue (taking into account the actual number of days in any such
month or year); and (j) days, business days and times of day shall be determined
by reference to Raleigh, North Carolina.

ARTICLE II

DEVELOPMENT; FINAL APPROVAL; TRANSFER OF MANUFACTURING

Section 2.01 BDSI Development. BDSI shall use Commercially Reasonable Efforts to
obtain Supplement Approval as soon as reasonably possible following the
Effective Date and, in any event, BDSI shall use Commercially Reasonable Efforts
to make the supplemental filing contemplated by the definition of “Supplement
Approval” to the FDA by December 31, 2016 (such filing, the “Supplement”). BDSI
shall notify Collegium within *** business days following its receipt of an
official written approval of the Supplement from the FDA (such notice,
“Supplement Approval Notice”). BDSI acknowledges and agrees that, except to the
extent such costs and expenses are incurred in connection with the performance
of activities which are expressly set forth in the Mfg Transfer Plan, BDSI shall
be responsible for all costs and expenses it incurs in connection with its
performance of its obligations under this Section 2.01.

 

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Section 2.02 Collegium Development. Collegium shall use Commercially Reasonable
Efforts to comply with and, upon Supplement Approval, maintain all Governmental
Approvals in the Territory, including but not limited to the Current Product
NDA, and, subject to the remainder of this Section 2.02, Develop Licensed
Products in the Territory. BDSI will have the right to review and comment, and
have such comments reasonably considered by Collegium, reasonably in advance
with regard to all Development-, manufacturing-, and formulation-related
activities (including Phase IV Studies) proposed to be conducted by or on behalf
of Collegium in regards to any Licensed Product. In addition, Collegium shall
not, without BDSI’s consent, Develop, Commercialize, or otherwise undertake any
dosage-, manufacturing-, or formulation-related changes to the Current Product
or any other Licensed Product that would, as reasonably determined by BDSI in
good faith, have a material likelihood of adversely affecting BDSI’s, its
Affiliates’, or its or their licensees’ or sublicensees’ development or
commercialization of (a) BEMA Fentanyl Products or Competing Products outside
the U.S., (b) any other BEMA-based Products outside the U.S., or (c) any
BEMA-based Products, other than BEMA Fentanyl Products or Competing Products, in
the U.S., provided that, notwithstanding the foregoing, BDSI’s prior written
consent shall not be required under this Section 2.02 for those activities
specifically described on Exhibit C; and, provided, further, that if BDSI does
not notify Collegium in writing of its determination of a material likelihood of
adverse effect as described above in respect of any dosage-, manufacturing-, or
formulation-related changes to the Current Product or any other Licensed Product
proposed by Collegium in accordance with this Section 2.02 within *** days after
BDSI’s receipt of such proposal, then BDSI will be deemed to have waived its
consent right with regards to the specific changes described in Collegium’s
proposal and Collegium will be free to engage in those activities without the
need to seek further consent from BDSI hereunder.

Section 2.03 Regulatory Submissions. At all times, the Party preparing, filing,
and/or maintaining applications for Governmental Approval, or any supplements
thereto, in the Territory shall (a) inform the other Party of all material
communications with the relevant Competent Authority(ies) in the Territory
concerning the Licensed Product and (b) provide copies of proposed material
submissions to the relevant Competent Authority(ies) in the Territory concerning
the Licensed Product to the other Party prior to their submission to such
Competent Authority. To the extent either Party receives material written or
material oral communication from the FDA relating to any Governmental Approval
or related process in the Territory with respect to any Licensed Product, the
Party receiving such communication shall promptly notify the other Party and
provide a copy of any written communication as soon as reasonably
practicable. In addition, prior to Supplement Approval, Collegium will have a
reasonable right, but not the obligation, to participate in or review and
comment on, as applicable, any and all filings, meetings, responses,
submissions, communications and other interactions between BDSI or any of its
Affiliates and the FDA in regards to the Supplement and/or the Current Product
generally, including in regards to the Supplement Approval, provided that
Collegium shall not (and shall ensure that its representatives participating in
any such meetings with the FDA do not) make any statements or take any actions
in connection therewith that it knows or reasonably should know will have a
material likelihood of adversely affecting BDSI’s efforts to obtain Supplemental
Approval or the regulatory status of the Current Product.

 

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Except as expressly set forth in the Mfg Transfer Plan, each Party will be
responsible for its own costs and expenses incurred in connection with its
performance of the activities set forth in this Section 2.03.

Section 2.04 Reporting. ***, BDSI shall provide Collegium with summary updates
regarding the progress of its activities with respect to its obligations under
this Article II. Within *** after ***, Collegium shall provide to BDSI a
reasonably detailed written report consisting of (a) an update on the progress
of Collegium’s, its Affiliates’, and Sublicensees’ Development and
Commercialization activities, including (i) key achievements or milestones to
date in the reporting period, and (ii) any clinical studies that are planned,
were run or completed, or are in process and (b) a summary of the planned
Development and Commercialization activities for the upcoming ***, such as
anticipated commercial launches in the Territory and other commercial
milestones, and, upon BDSI’s request, BDSI shall have a reasonable opportunity
to discuss any of the foregoing with Collegium. Without limiting the foregoing
and in conformity with standard pharmaceutical industry practices and the terms
and conditions of this Agreement, Collegium shall maintain complete and accurate
written records of its Development and Commercialization of the Licensed
Products for a minimum of *** following the end of the Calendar Year to which
they pertain, which records may be subject to audit and inspection by BDSI
pursuant to Section 14.11.

Section 2.05 Ownership of Regulatory and Clinical Documentation. Subject to the
terms of this Agreement, and without affecting ownership or title to any BDSI
Know-How contained or referenced therein, BDSI shall, promptly following receipt
of Supplement Approval of the Current Product, assign to Collegium all of BDSI’s
rights in and to the Current Product NDA, Governmental Approvals and all other
Regulatory Filings related thereto in the Territory and transfer to Collegium a
copy of BDSI’s safety database concerning the Licensed Product in the Territory.
The Parties acknowledge and agree that, except as set forth in Sections 2.06 and
9.15, Collegium is not, by virtue of its receipt of the Current Product NDA from
BDSI, assuming any responsibility or liability for any costs, debts, expenses,
commitments, agreements, obligations or other liabilities of any nature
whatsoever of BDSI, whether known or unknown, accrued or not accrued, to the
extent incurred or arising as a direct result of any actions or omissions by or
on behalf of BDSI in regards to any Licensed Products or Licensed Technology in
the Territory prior to the NDA Assignment, including any liability with respect
to any actual or alleged injury to persons relating to the Licensed Products
actually or allegedly caused by BDSI or its agents in the Territory prior to the
NDA Assignment, all of which are retained by BDSI.

Section 2.06 Transfer of Commercial Manufacturing to ***. BDSI shall use
Commercially Reasonable Efforts in good faith to (a) transfer the commercial
manufacture of Current Product to *** pursuant to the plan attached hereto as
Exhibit D (the “Mfg Transfer Plan”) and, as soon as reasonably possible
following the Effective Date, (b) negotiate and enter into a commercial supply
agreement with *** for the supply of Current Products for sale in the Territory
(the “*** Agreement”), provided that BDSI shall reasonably consult with
Collegium in the negotiation of such agreement and BDSI will not execute such an
agreement unless approved in writing by Collegium, such approval not to be
unreasonably withheld. Collegium will reimburse BDSI for any of BDSI’s
reasonable, documented out-of-pocket costs and expenses (including any amounts
due or payable to any Third Party contractor, including

 

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***) incurred in connection with the performance of the Mfg Transfer Plan, up to
a maximum aggregate amount of $2,000,000, within *** days of Collegium’s receipt
of any invoice with respect to any such reasonably documented out-of-pocket
costs and expenses (including any amounts due or payable to any Third Party
contractor, including ***), provided that Collegium acknowledges and agrees that
(i) BDSI may have performed some of the above-referenced activities described in
the Mfg Transfer Plan prior to the Effective Date and, for purposes of
clarification but not limitation, (ii) Collegium shall be obligated to reimburse
BDSI for costs incurred with respect to any such activities in accordance with
the foregoing, whether such activities occurred, or such costs were incurred,
prior to, on, or after the Effective Date. BDSI acknowledges and agrees that it
shall bear and be solely responsible for all costs and expenses it may incur in
connection with its performance of any activities under the Mfg Transfer Plan
which are in excess of the $2,000,000 aggregate cap, as well as any and all
costs and expenses it may incur in connection with the negotiation of the ***
Agreement, and that it may not assert or rely on the occurrence of any such
additional costs or expenses (whether planned or unplanned) as a justification
for suspending its negotiations of or failing to execute the *** Agreement. To
the extent Collegium requests any changes to the Mfg Transfer Plan that cause
the budget therefor to exceed the $2,000,000 aggregate cap, (i) BDSI shall
provide Collegium with an updated budget therefor reasonably demonstrating such
increase, (ii) the aggregate cap on expenses shall not be increased without
Collegium’s agreement thereto, and (iii) the Mfg Transfer Plan shall not be
amended to reflect Collegium’s requested changes unless BDSI agrees thereto and
Collegium agrees to increase the cap on the cost of the Mfg Transfer Plan to the
extent resulting from Collegium’s requested changes to the Mfg Transfer Plan.
BDSI shall assign the *** Agreement to Collegium as soon as reasonably possible
following Supplement Approval and assignment to Collegium of the Current Product
NDA, all Governmental Approvals and all other Regulatory Filings related thereto
in the Territory. Following execution of the *** Agreement (but prior to its
assignment to Collegium), BDSI shall not have any obligations to provide any
forecasts or orders to ***, or enter into any other financial commitments under
the *** Agreement, except to the extent requested in writing in a timely fashion
by Collegium, and Collegium shall reimburse BDSI, within *** of Collegium’s
receipt of an invoice, for any costs, expenses, or other financial liabilities
incurred by BDSI as a direct result of complying with any such request by
Collegium (i.e., submitting any such forecast or order or incurring any other
financial commitment requested by Collegium).

ARTICLE III

LICENSES; IMPROVEMENTS

Section 3.01 License Fee. In partial consideration for the licenses granted
under Section 3.02(a), Collegium shall pay to BDSI an initial one-time
non-refundable license fee of $2,500,000, by wire transfer of immediately
available funds to an account to be designated by BDSI. Collegium shall pay such
license fee within *** of the Effective Date.

Section 3.02 Licensed Technology. The terms and conditions of the license
granted to Collegium shall be as follows:

(a) Subject to the terms and conditions of this Agreement, BDSI hereby grants to
Collegium an exclusive (subject to the last sentence of this Section 3.02(a)),
royalty-bearing,

 

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license under the Licensed Technology to make, have made, use, sell, offer for
sale, import, Develop, and Commercialize the Licensed Product(s) in the
Territory, which license shall be sublicensable as set forth in the second
paragraph of this clause (a). Notwithstanding anything to the contrary
(including but not limited to the exclusivity of the rights granted above or
below), BDSI retains, on behalf of it, its Affiliates, and its or their
contractors, licensees, or sublicensees, sublicensable rights, transferable in
accordance with Section 14.01, under the Licensed Technology and Licensed Marks
to (i) perform BDSI’s obligations under Sections 2.01 and 2.06 and such other
obligations as are necessary to reflect BDSI’s status as the holder of the
Current Product NDA, but only during the period from the Effective Date until
the NDA Assignment, and (ii) research, develop, manufacture, have manufactured,
use, or import BEMA Fentanyl Products, Competing Products, or Demonstration
Samples in the Territory but solely for purposes of export, distribution, use,
development, or commercialization thereof outside the Territory; provided,
however, that neither BDSI nor any of its Affiliates’, or any of its or their
Third Party licensees’, sublicensees’, or contractors’ may conduct any human
clinical trials for any BEMA Fentanyl Product in the Territory without
Collegium’s prior written consent. For clarity, BDSI’s or its Affiliates’
purchase of BEMA Fentanyl Products, Competing Products, or Demonstration Samples
in the Territory and its or their subsequent sale and export of such BEMA
Fentanyl Products, Competing Products, or Demonstration Samples to BDSI’s
Affiliates or Third Parties located outside of the Territory for purposes of
enabling the sale and/or use of such products outside the Territory are included
within the scope of BDSI’s retained rights set forth in clause (ii) above.

Collegium shall have the right to sublicense any rights granted to it under this
clause (a) or Section 3.03(a) within the Territory, provided that (i) except in
respect of sublicenses to Affiliates or to any of the other entities referenced
in clauses (B) or (C) below, Collegium shall provide BDSI with a copy of any
executed sublicense agreement, (ii) except with respect to sublicenses granted
(A) to Collegium’s Affiliates, (B) to Third Party contractors for purposes of
manufacturing Licensed Products for use or sale in the Territory or performing
Development on Collegium’s or its Affiliates’ behalf and limited to rights to
use, make, have made, or import Licensed Products, or (C) to Third Party
contract sales organizations for the sole purposes of promoting and marketing
Licensed Products on behalf, and at the direction, of Collegium or an Affiliate
thereof in cases in which Collegium or an Affiliate thereof (and not such Third
Party) remains holder of the NDA and books all sales of Licensed Products,
Collegium shall not enter into any such sublicense unless consented to in
writing by BDSI, such consent not to be unreasonably withheld, conditioned or
delayed (iii) Collegium shall secure all reasonably appropriate covenants,
obligations and rights from each Sublicensee to ensure that Collegium can comply
with its obligations under this Agreement, (iv) Collegium shall be responsible
and liable for each Sublicensee’s performance of Collegium’s obligations
hereunder and compliance with the terms of this Agreement, (v) all Sublicensees
shall agree to be subject to the terms of this Agreement, and (vi) all
sublicenses shall terminate upon the termination of this Agreement. The copy of
any executed sublicense agreement provided by Collegium to BDSI pursuant to this
paragraph may be redacted as determined by Collegium, in good faith, to be
necessary to protect any of its or its Sublicensee’s confidential or proprietary
information unrelated to Collegium’s compliance with its obligations to BDSI
hereunder.

(b) Collegium acknowledges that it shall have no right, title or interest in or
to the Licensed Technology, Licensed Products, or Licensed Marks except to the
extent set forth in

 

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this Agreement, and BDSI reserves all rights to make, have made, use, sell,
offer for sale, and import the Licensed Technology and Licensed Products except
as otherwise expressly granted to Collegium pursuant to this Agreement. Nothing
in this Agreement shall be construed to grant Collegium any rights or license to
any intellectual property of BDSI or any Affiliate thereof other than as
expressly set forth herein and nothing in this Agreement shall be construed to
grant BDSI any rights or license to any intellectual property of Collegium or
any Affiliate thereof other than as expressly set forth herein.

(c) All Affiliates of Collegium which (i) are involved or otherwise engaged in
carrying out any of Collegium’s activities, performing any of Collegium’s
obligations or exercising any of Collegium’s rights under this Agreement, (ii)
are granted any rights under this Agreement by Collegium or any other Affiliate
thereof, (iii) have access to, or know or use, BDSI’s Confidential Information,
BEMA, or any Licensed Product, or (iv) did not become Affiliates of Collegium as
a direct result of any transaction by which any Third Party first became an
Acquiring Entity of Collegium (any such Affiliates, “Collegium Affiliates”),
shall be subject to the terms of this Agreement. Collegium shall be fully
responsible and liable for the acts and omissions of Collegium Affiliates in the
course of exercising any rights granted, or performing any obligations of
Collegium, under this Agreement as if such acts or omissions had been those of
Collegium, including but not limited to any breach of the provisions of this
Agreement in connection therewith, and Collegium shall ensure that (i) all
Collegium Affiliates shall comply with the terms of this Agreement and (ii) no
Affiliates other than Collegium Affiliates obtain access to, or know or use,
BDSI’s Confidential Information, BEMA, or any Licensed Product.

Section 3.03 Licensed Marks.

(a) License. Subject to the terms and conditions of this Agreement, BDSI hereby
grants to Collegium an exclusive, paid-up, sub-licensable (subject to the
constraints on sublicensing described in Section 3.02 above), royalty-free
license in the Territory to use the Licensed Marks during the Term solely in
connection with the Development, manufacture, and Commercialization of the
Licensed Products in the Territory. Collegium acknowledges that it shall have no
right, title or interest in or to the Licensed Marks except to the extent set
forth in the license granted to Collegium under this Section 3.03, and BDSI
reserves all rights to use the Licensed Marks other than those rights granted
herein. Notwithstanding anything to the contrary, Collegium shall be entitled to
use any trademark other than the Licensed Marks, together with the Licensed
Marks or otherwise, in connection with the use, development, promotion,
marketing, distribution, offer for sale, and sale of the Licensed Products in
the Territory.

(b) Use of Licensed Marks. Collegium shall comply with all Applicable Laws
pertaining to the proper use and designation of the Licensed
Marks. Additionally, Collegium shall:

(i) ensure that the Licensed Marks are accompanied by words accurately
describing the nature of the goods or services to which it relates and that the
Licensed Marks are displayed as set forth in Exhibit E;

 

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(ii) to the extent reasonably practicable after receipt of a written request
from BDSI, comply with the reasonable requirements of BDSI as to the form,
manner, scale and context of use of the Licensed Marks, the use of the
statements to accompany them, as well as the appearance of the Licensed Marks on
containers, packaging and related marketing and promotional materials to be used
for Licensed Product;

(iii) display the proper form of trademark and service mark notice associated
with each Licensed Mark in accordance with instructions received from BDSI;

(iv) include, on any item which bears a Licensed Mark, a statement identifying
BDSI as the owner of such Licensed Mark and stating that Collegium is an
authorized user of such Licensed Mark;

(v) not conduct, without the written consent of BDSI, the whole or any part of
its business under a business name or trading style which incorporates any of
the Licensed Marks;

(vi) neither use nor display any of the Licensed Marks in such relation to any
other mark or marks owned by any Third Party, Collegium, or an Affiliate of
Collegium as to suggest that the multiple marks constitute a single or composite
trademark, service mark, or are under the same proprietorship; and

(vii) ensure the Licensed Marks are only used with Licensed Products that are
made, used, and sold in compliance with Applicable Laws, Governmental Approvals
therefor, and Collegium’s quality standards with respect to their pharmaceutical
products generally.

(c) Additional Terms. Collegium shall not take any action inconsistent with
BDSI’s ownership of the Licensed Marks. Any benefits (including goodwill)
accruing from Collegium’s use of the Licensed Marks shall automatically vest in
BDSI. Collegium shall not form any combination trademarks or trade names with
the Licensed Marks. Collegium shall grant BDSI reasonable access to Collegium’s
and its Affiliates’ facilities, records, packaging and promotional materials for
the purpose of inspecting the use of the Licensed Marks pursuant to this
Agreement.

(d) Termination of License. BDSI shall be entitled to terminate the rights to
Licensed Marks granted above on written notice to Collegium if Collegium does
not use the Licensed Marks with respect to the Licensed Product for any
consecutive period of twelve (12) months or more.

Section 3.04 Limitations Prior to NDA Assignment. Collegium shall ensure that
neither Collegium, any Affiliate thereof, nor any Third Party acting on behalf
of either of the foregoing shall engage in any activity with respect to Licensed
Products prior to NDA Assignment except as permitted by this Agreement and
except as may be performed in accordance with Applicable Law by a party that
does not hold the NDA for any Licensed Products, provided that Collegium shall
provide BDSI with prior written notice describing in reasonable detail any
proposed such activity and, unless (x) BDSI reasonably determines in good

 

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faith that such proposed activity has a material likelihood of adversely
effecting (i) BDSI’s efforts to obtain Supplement Approval, (ii) the status of
the Current NDA, or (iii) the Commercialization of Licensed Products in the
Territory and (y) BDSI provides notice of such determination to Collegium within
*** of BDSI’s receipt of the above-referenced notice from Collegium describing
such proposed activity, Collegium shall be free to engage in such activity,
subject to the terms of this Agreement.

Section 3.05 Ownership of Improvements. Each Party will own all right, title and
interest in and to any Improvements conceived, developed, invented or otherwise
generated solely by such Party, its Affiliates, and all intellectual property
rights related thereto (such Improvements and intellectual property rights
related thereto (other than Collegium BEMA Improvements and all intellectual
property rights related thereto) to be owned solely by Collegium or any
Affiliate thereof pursuant to the foregoing, “Collegium Improvements”), and the
Parties shall jointly own all right, title, and interest in and to any
Improvements conceived, developed, invented or otherwise generated jointly by
(a) BDSI, any Affiliate thereof, or any officer, director, employee, agent, or
other representative of either of the foregoing and (b) Collegium, any Affiliate
thereof, or any officer, director, employee, agent, or other representative of
either of the foregoing, and all intellectual property rights related thereto
(such Improvements and intellectual property rights to be owned jointly by the
Parties pursuant to the foregoing, “Joint Improvements”), provided that,
notwithstanding anything to the contrary, Parent shall own, and Collegium shall
assign and hereby assigns to Parent, all of Collegium’s and Collegium
Affiliates’ right, title, and interest in and to any Collegium BEMA Improvements
and all intellectual property rights related thereto, free and clear of all
security interests and similar liens. Collegium shall ensure that that its
Affiliates assign any and all of their rights, including all intellectual
property rights, in any Collegium BEMA Improvements to Collegium and Collegium
shall use, and ensure that its Affiliates use, Commercially Reasonable Efforts
to cause their respective Sublicensees to assign or exclusively license any and
all rights they may have in any Collegium BEMA Improvements (and any Know-How
with respect thereto and/or Patents Covering such Collegium BEMA Improvements)
to Collegium and, in the case that such rights are licensed (rather than
assigned) to Collegium or any of its Affiliates, that those rights be freely
sublicensable by Collegium or its Affiliate, as applicable, to BDSI pursuant to
Section 3.06. Except as expressly provided in this Agreement and subject to any
restrictions herein, each joint owner of a Joint Improvement may make, sell,
use, license, assign, mortgage or keep Joint Improvements, and otherwise
undertake all activities a sole owner might undertake with respect to such
inventions, discoveries and know-how, without the consent of and without
accounting to the other joint owner, provided that any assignment, license or
other disposition or use (i) shall at all times be and remain subject to the
grants of rights and licenses and accompanying conditions and obligations with
respect thereto under this Agreement, including under Section 3.02(a) and
Section 13.06(a) and (ii) allow the Parties to exercise their rights and perform
their obligations under this Agreement, in particular to develop, manufacture,
and commercialize Licensed Products or BEMA Fentanyl Products in at least the
same scope as prior to such assignment, license or other such disposition. Each
Party shall take all actions and execute all documents necessary to effect the
purposes of the foregoing, as requested by the other Party, and cause its
respective Affiliates, and its and their officers, directors, employees, agents,
representatives, contractors, and other representatives to do the same. During
the Term, each Party shall promptly notify the other Party in writing and in
reasonable detail of any Improvements generated or Controlled by such Party or
any Affiliate thereof to which the other Party has any rights under this
Agreement.

 

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Section 3.06 Licenses to BDSI. Collegium hereby grants to BDSI (I) a
non-exclusive, royalty-free, fully-paid, transferable, freely sublicensable,
worldwide, perpetual, irrevocable license and right of reference, transferable
in accordance with Section 14.01, (X) under the Collegium Documentation,
Governmental Approvals, Regulatory Filings, and, to the extent contained or
referenced in any of the foregoing, Collegium Know-How to (i) make, have made,
use, sell, offer for sale, import, research, develop, and commercialize any
BEMA-based Products other than BEMA Fentanyl Products and (Y) under the
Collegium Product-Specific Improvements (and any directly related Collegium
Know-How and Collegium Patents), Collegium Documentation, Governmental
Approvals, Regulatory Filings, and, to the extent contained or referenced in any
of the foregoing, Collegium Know-How to (1) make, have made, use, import,
research, and develop BEMA Fentanyl Products and Demonstration Samples and (2)
sell, offer for sale, and otherwise commercialize BEMA Fentanyl Products and
Demonstration Samples outside the Territory and, upon termination of this
Agreement, inside the Territory, and, subject to the rights granted to Collegium
under Section 3.02(a), (II) a royalty-free, fully-paid, transferable, freely
sublicensable, worldwide, perpetual, irrevocable, exclusive license,
transferable in accordance with Section 14.01, under all Controlled Collegium
BEMA Improvements, any Know-How with respect thereto, and/or any Patents
Covering such Collegium BEMA Improvements to the extent, in each case,
Controlled by Collegium or an Affiliate thereof to make, have made, use, sell,
offer for sale, and import any product, method, process, or service. Collegium
shall, upon reasonable request of BDSI, promptly provide BDSI with copies of any
Collegium Documentation, Collegium Know-How, Collegium Patents, or Patents
Covering any Collegium Product-Specific Improvements or Controlled Collegium
BEMA Improvements (and any Know-How with respect thereto and/or Patents Covering
such Collegium BEMA Improvements) to the extent not previously provided to BDSI
and BDSI has been granted rights thereto pursuant to this Agreement.

ARTICLE IV

ROYALTY AND MILESTONE PAYMENTS

Section 4.01 Payments on Sales.

(a) Except as otherwise set forth in this Agreement, Collegium will make
quarterly royalty payments to BDSI equaling the applicable percentage of Annual
Net Sales set forth below. Such royalty payments shall be calculated based on
Annual Net Sales of all Licensed Products by applying the tiered royalty rate
shown below:

 

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Annual Net Sales

   Royalty

Annual Net Sales up to and including $***

   ***%

Annual Net Sales over $***

   ***%

For example, if, during a Calendar Year, Annual Net Sales of Licensed Products
were equal to $***, then the royalties payable for such Calendar Year would be
calculated by adding (a) the royalties with respect to the first $*** at ***
percent (***%) [***] and (b) the royalties with respect to the next ***, for a
total royalty of $***.

(b) Upon ***, the royalty rate ***, provided that, ***.

(c) If, for any full Calendar Year that begins following ***. If Collegium
reasonably determines in good faith ***. If Collegium does not ***.

(d) Collegium’s payment obligations under this Section 4.01 shall in any event
expire, on a Licensed Product-by-Licensed Product basis, on the expiration of
each Licensed Product’s Royalty Term, provided that, notwithstanding anything to
the contrary, if (A) all Valid Claims of the Licensed Patents in the Territory
Covering a particular Licensed Product have expired, (B) no commercial sale by a
Third Party in the Territory of a Generic Product with respect to such Licensed
Product has occurred, and (C) a Licensed Patent that contains one or more Valid
Claims Covering such Licensed Product issues in the Territory and is published
in the Orange Book prior to the end of the applicable Royalty Term, the
royalties set forth in Section 4.01 shall be payable with respect to all Net
Sales of such Licensed Product occurring on or after the date of such
publication until all Valid Claims of the Licensed Patents in the Territory
Covering a particular Licensed Product have again expired, at which point the
adjustments set forth in Sections 4.01(b) and/or 4.01(c) shall apply as set
forth therein.

(e) Payment for Third Party Licenses and Defense/Enforcement Costs.

(i) If, following the Effective Date, it is necessary for Collegium to license
one or more Patents in the Territory from one or more Third Parties in order to
Commercialize any Licensed Product in the Territory, *** will have the right to,
and may, in its sole discretion, negotiate and obtain a license under such
Patents with respect to Licensed Products (each such Third Party license is
referred to herein as a “Third Party License”). A license to Third Party Patents
will be deemed “necessary” under this Section 4.01(e)(i) (A) if ***. Except as
set forth in clause (ii) below, Collegium shall bear (x) any payments associated
with such Third Party License, including any sales-based running royalties on
sales of Licensed Products that may be owed to any Third Party for such a Third
Party License (collectively, such running royalties, the “Third Party
Royalties”), (y) any Losses paid by Collegium to a Third Party with respect to
any Claim for which Collegium is obligated to indemnify, defend, and hold
harmless pursuant to clause (I)(d) of the first sentence of Section 10.02 to the
extent such Losses (or the associated Claim) are not the direct result of any
Collegium Change(s), and (z) any

 

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damages, liabilities, expenses and/or losses paid by Collegium, other than those
Losses described in the preceding clause (y), with respect to any suits, claims,
proceedings or causes of action by Third Parties made with respect to
Collegium’s, its Affiliates’, Sublicensees’, or any of Collegium’s, its
Affiliates’, or Sublicensees’ directors’, officers’, employees’, agents’, or
other representatives’ infringement or misappropriation of any Third Party’s
Patent or other intellectual property rights in the manufacture, use, sale,
offer for sale, Development, Commercialization, import, or export of any
Licensed Product(s) in the Territory to the extent any such suits, claims,
proceedings or causes of action or associated damages, liabilities, expenses
and/or losses are not the direct result of any Collegium Change(s)
(collectively, Third Party Royalties, such Losses, and such damages,
liabilities, expenses and/or losses, “Third Party IP Costs”).

(ii) If Collegium undertakes to defend any of the Fentanyl-Specific Patents
against any Third Party challenge to the validity, enforceability, or scope
thereof under Section 7.01 and/or to enforce any of the Fentanyl-Specific
Patents against any Third Party infringer thereof under Section 7.03(b) and, in
either case, prevails in such defense or enforcement as determined by final
decision of a court or other Governmental Authority of competent jurisdiction
that is unappealable or unappealed within the time allowed for appeal, then the
amount by which the reasonable, documented out-of-pocket costs and expenses
(including attorneys’ fees) Collegium incurs in connection with such activities
exceed any damages, monetary awards, or other amounts recovered or received in
settlement by Collegium or any Affiliate thereof with respect to such defense,
enforcement, or voluntary disposition or settlement thereof
(“Defense/Enforcement Costs”) shall ***, Collegium shall, without limitation of
any reimbursement obligations for the benefit of BDSI under Article VII, not be
entitled to take into account such Defense/Enforcement Costs that have been
offset when calculating the Parties’ split of any damages, monetary awards, or
other amounts recovered or received in settlement by Collegium with respect to
the defense, enforcement, or voluntary disposition or settlement of such action.

(iii) Collegium may ***, provided that ***.

Section 4.02 Milestone Payments. Collegium shall pay to BDSI, as additional
license fees, the following non-refundable, non-creditable milestone payments
upon the occurrence of the specified milestone event:

(a) $4,000,000 upon First Commercial Sale of any Licensed Product;

(b) $*** upon the publication in the Orange Book of a Patent that issues from
(i) ***, (ii) ***, or (iii) any continuation application claiming priority to
either of the foregoing Patent applications or any other application or patent
within the priority claim of those applications and the subject of which claims
the Current Product and/or the use of fentanyl, provided, however, that ***;
and, provided further, that ***;

(c) $*** when Annual Net Sales first exceed $***

(d) $*** when Annual Net Sales first exceed $***; and

 

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(e) $*** when Annual Net Sales first exceed $***.

For the avoidance of doubt, each milestone payment referred to in this Section
4.02 shall be paid only once by Collegium, the first time the relevant milestone
is achieved. Collegium shall provide BDSI written notice of the achievement of
milestone specified in clause (a) above, and Collegium shall pay BDSI the
designated amount for such milestone, within *** of such achievement. BDSI shall
provide Collegium written notice of the achievement of the milestone specified
in clause (b) above, and Collegium shall pay BDSI the designated amount for such
milestone within *** of its receipt of such notice. Collegium shall provide BDSI
written notice of the achievement of each milestone specified in clauses (c),
(d) and (e) above, and pay the indicated amount, within *** of the achievement
of the relevant milestone.

Section 4.03 Reports and Payments.

(a) Collegium, on behalf of itself and its Affiliates, shall, beginning with the
initial Calendar Quarter during which the First Commercial Sale occurs, furnish
to BDSI a quarterly written report (each, a “Royalty Statement”) showing in
reasonably specific detail (i) Collegium’s, its Affiliates’, and Sublicensees’
inventory on hand of each stock keeping unit (“SKU”) of Licensed Products, sales
of Licensed Products per SKU and Net Sales; (ii) amounts payable under this
Agreement based upon such Net Sales (which shall include an accounting of all
amounts and calculations required to determine Net Sales and the amounts payable
under this Agreement consistent with Sections 4.01 and 4.02, including the
amount of any bad debt or recovered bad debt used to calculate Net Sales
pursuant to the Bad Debt Adjustment); (iii) withholding taxes, if any, required
by law to be deducted with respect to any payments due BDSI under this
Agreement; and (iv) the date of the First Commercial Sale of any Licensed
Product in the Territory during the reporting period. Royalty Statements shall
be due no later than *** following the close of each Calendar Quarter.

(b) All payments due BDSI under Section 4.01 with respect to a particular
Calendar Quarter shall be due no later than *** following the end of each
Calendar Quarter. All payments hereunder shall be payable in United States
dollars. All payments owed under this Agreement shall be made by wire transfer
to one or more bank accounts (which may each be the account of such Party, any
Affiliate thereof, or any Third Party), in such allocation between such
accounts, as shall be designated by the Party owed payment from time-to-time
upon written notice, unless otherwise specified in writing by such Party, with
any such designated account(s) and/or allocation(s) to remain effective with
respect to payments owed to such Party until it provides written notice to the
other Party setting forth any changes to such account(s) or allocation(s) for
payment (in which case any changes specified in such notice shall become
effective on the date specified therein).

(c) In the event that any payment due hereunder is not made when due, such
payment shall accrue interest from the date due at a rate equal to the greater
of (i) ***, or (ii) ***, or, if less, the maximum legally permissible interest
rate, calculated based on the number of days such payments are paid after the
date such payments are due. The payment of such interest shall not limit a Party
from exercising any other rights it may have under this Agreement as a
consequence of the lateness of any payment.

 

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(d) During the Term and for a period of *** thereafter, or longer if and as
required in order for Collegium to comply with Applicable Law, Collegium shall
keep complete and accurate records in sufficient detail to permit BDSI to
confirm the completeness and accuracy of (i) the information presented in each
Royalty Statement and all payments due hereunder and (ii) the calculation of Net
Sales. BDSI and any designee thereof (including but limited to Meda) shall have
the right to audit and inspect such Books and Records pursuant to the terms of
Section 14.11.

(e) All taxes levied on account of the payments accruing to a Party under this
Agreement shall be paid by such Party for its own account, including taxes
levied thereon as income to such Party. If provision is made in applicable law
or regulation for withholding, such tax shall be deducted from the payment made
by a Party (the “Paying Party”) to the other Party (the “Paid Party”) hereunder,
shall be paid to the proper taxing authority by the Paying Party, and a receipt
of payment of such tax shall be secured and promptly delivered to the Paid
Party. Each Party agrees to reasonably assist the other Party in claiming
exemption from such deductions or withholdings under any double taxation or
similar agreement or treaty from time to time in force or in otherwise seeking
the return, refund, or credit of any such withheld amount as applicable.

ARTICLE V

COMMERCIALIZATION

Section 5.01 Promotion and Marketing Obligations.

(a) Collegium shall use Commercially Reasonable Efforts to cause the First
Commercial Sale of the Current Product to occur within ***, and Collegium shall
use Commercially Reasonable Efforts to Commercialize Licensed Products in the
Territory. As between the Parties, Collegium, at its own expense, will be
responsible for all of its Commercialization activities related to the Licensed
Products in the Territory.

(b) In the event Collegium sublicenses any of its rights under this Agreement,
the activities of Sublicensees may apply to the satisfaction of Collegium’s
obligations under this Article V, provided, that, subject to the foregoing,
Collegium’s obligations under this Agreement shall not be reduced or otherwise
affected by any sublicensing by Collegium of its rights under this Agreement.

(c) Upon the request of BDSI, but in no event ***, Collegium shall provide to
BDSI in writing its then-current proposed marketing, sales and distribution plan
for the Licensed Products, including a high-level summary Collegium’s, its
Affiliates’, and Sublicensees’ proposed marketing, sales and distribution
strategy and tactics for the sale and distribution of the Licensed Products in
the Territory during the following Calendar Year.

Section 5.02 Publicity. BDSI and Collegium will use Commercially Reasonable
Efforts to collaborate to create a public relations campaign with respect to the
relationship established under this Agreement reasonably intended to maximize
shareholder value for both Parties, which may include the issuance of mutually
agreeable press releases concerning the

 

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following in the Territory (to the extent permitted under Applicable Laws and
stock exchange rules): (a) deal closure, (b) data transfer, (c) FDA submissions
concerning any Licensed Product, (d) Governmental Approvals of any Licensed
Product, (e) First Commercial Sale of each Licensed Product in the Territory,
(f) key data from publications of Phase IV Studies concerning any Licensed
Product in the Territory, (g) submission and Governmental Approval of additional
indications for any Licensed Product in the Territory, (h) payment of any
milestone to BDSI hereunder, and (i) other events in the Territory as agreed by
both Parties. The Parties shall reasonably cooperate on all of the
aforementioned activities which they agree to collaborate on as needed.

ARTICLE VI

REGULATORY COMPLIANCE

Section 6.01 Marketing Authorization Holder. Subject to Collegium’s obligations
upon termination pursuant to Section 13.06, Collegium shall, upon assignment of
the Current Product NDA to Collegium following Supplement Approval, be the
holder and owner of all Marketing Authorizations and Governmental Approvals in
the Territory concerning Licensed Products and responsible for all associated
legal obligations with respect thereto, including but not limited to the
performance of all obligations with respect to Licensed Products under the
Transmucosal Immediate Release Fentanyl (“TIRF”) Risk Evaluation and Mitigation
Strategy (“REMS”) program established by FDA. Collegium acknowledges and agrees
that such responsibilities under such TIRF REMS program shall include appointing
a Collegium representative on the relevant TIRF REMS working group established
by the FDA or otherwise associated with such program and paying its portion of
all fees, costs, and expenses imposed on, or incurred as, members of such group
or otherwise imposed by FDA with respect to such program or group (“TIRF Fees”),
and Collegium further agrees that it shall promptly reimburse BDSI for the
portion of any TIRF Fees paid by BDSI after the Effective Date which correspond
to any period of time during which Collegium is the holder of the Current
Product NDA.

Section 6.02 Maintenance of Marketing Authorizations. With respect to the
Licensed Products, upon assignment of the Current Product NDA to Collegium (“NDA
Assignment”), Collegium agrees, at its sole cost and expense, to maintain all
Marketing Authorizations and Governmental Approvals in the Territory throughout
the Term, including submitting any supplemental applications, annual reports,
variations or renewals thereof that are required by Applicable Law to be
obtained in order to maintain the Marketing Authorizations and Governmental
Approvals.

Section 6.03 Interaction with Competent Authorities. After the Effective Date,
each Party shall provide to the other Party a copy of any material
correspondence or materials that it receives from a Competent Authority
regarding any Licensed Product. Such correspondence or summary shall be provided
within *** of receipt thereof by the relevant Party. BDSI shall be provided
reasonable advance written notice of all material meetings, conferences, or
calls with Competent Authorities in the Territory concerning any Licensed
Product and BDSI shall be permitted to have one regulatory representative attend
all such meetings, conferences, or calls that could reasonably be anticipated to
materially concern issues that are related or relevant to BEMA generally or any
BEMA-based Products other than Licensed Products. With respect to

 

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any Licensed Product, Collegium shall provide BDSI with copies of any materials
relating to any material regulatory matter in the Territory and, when reasonably
practicable, shall provide copies of any documents to be presented to any
Competent Authority in respect of such matters prior to their presentation
thereto, so that BDSI, if practicable, shall have an opportunity to review in
advance. The materials provided to BDSI under this Article VI with respect to
material interactions with any Competent Authority will be considered
Collegium’s Confidential Information.

Section 6.04 ADE Reporting and Phase IV Surveillance.

(a) General. Upon NDA Assignment, Collegium shall, at its sole cost and expense,
be responsible for all post-Governmental Approval reporting of ADEs and
surveillance of Phase IV Studies in the Territory, if and as required by
Competent Authorities. All correspondence and communication will be in English.
The Party sending the communication will translate as necessary. Collegium shall
provide BDSI with (i) a copy of all safety-related correspondence with any
Competent Authority within *** of its receipt or submission and (ii) any other
information concerning any ADE, AE, or ADR concerning any Licensed Product
coming into Collegium’s or any of its Affiliates’ knowledge or possession that
Collegium believes or is informed by BDSI to be reasonably necessary to enable
BDSI, any Affiliate thereof, or any licensee or sublicensee of any of the
foregoing to comply with any applicable legal or regulatory requirements of any
jurisdiction outside the Territory with respect to any BEMA Fentanyl Product, on
such time frame as is reasonably sufficient to enable such compliance in a
timely manner.

(b) Safety Related Regulatory Documents. Upon NDA Assignment, Collegium will be
responsible for (i) maintaining the company core safety information, as included
in the company core data sheet, in the Territory and (ii) maintaining the
company core safety information, as included in the package insert/prescribing
information, in the Territory. Collegium will also be responsible for submission
of any safety-related supplemental applications for changes to any package
insert or other labeling.

(c) Safety Databases. Upon NDA Assignment, Collegium (or its agent) will
maintain a pharmacovigilance database for each Licensed Product in the Territory
(or each country thereof, if/as applicable). The database(s) will include all
ADE reports from spontaneous sources, scientific literature, and PMS reports
(serious) and SAE reports from clinical studies coming into the actual knowledge
of Collegium, its Affiliates, or any Sublicensee (or any agent of the
foregoing). Spontaneous cases will include reports received from both healthcare
professionals and consumers. AE data will be coded to the latest version of
MedDRA. Report handling and classifying will be carried out in accordance with
Collegium’s (or its agent’s) SOPs (as defined below). All reasonable assistance
and access requested by either Party in responding to safety inquiries will be
provided upon request. Information in Collegium’s safety databases will be used
by Collegium to compile PSURs (as defined below) to the FDA (providing a waiver
of the requirement to submit postmarketing periodic safety reports in the format
described in the regulations has been granted) and other Competent Authorities
in the Territory and prepare safety-related supplemental applications for
changes in the package insert(s)/labelling for Licensed Products in the
Territory.

 

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(d) Reporting of Adverse Drug Reactions (ADRs)

(i) The Parties shall keep each other informed on all safety matters related to
the BEMA Fentanyl Products and on any information received from any source
concerning any ADR coming to either Party’s (or any of its Affiliates’) actual
knowledge with regard to the BEMA Fentanyl Products.

(ii) Each Party is responsible for fulfilling its reporting obligations to the
appropriate Competent Authorities with respect to the BEMA Fentanyl Products in
accordance with the applicable national laws and regulations of the different
countries.

(iii) Independently of any national reporting requirements, the Parties hereto
shall, in relation to the BEMA Fentanyl Products, report to each other all SAEs
from clinical trials with a reasonable suspicion of causal relationship to the
administered study medication and all serious spontaneously reported suspected
ADRs within the ***, but not later than *** after having come to a Party’s
attention including a case description and medical causality assessment on the
International Adverse Event Report Form (“CIOMS Form”) in English. If required,
follow up will be carried out by the Marketing Authorization holder on all SARs
(listed and unlisted) and non-serious unlisted ADRs in the Territory according
to its own internal procedures, which shall be commercially reasonable and
consistent with industry standards. Upon assignment of the Current Product NDA
to Collegium, non-serious listed ADRs in the Territory shall be followed up by
Collegium if there is a safety concern; and pregnancy and in utero reports will
be followed up by Collegium at the expected due date. Reasonable attempts shall
be made by Collegium to obtain the required minimum information: identifiable
patient, reporter, suspect drug, and AE.

(iv) Life-threatening or fatal SAEs originating from clinical trials in the
Territory with a reasonable suspicion of causal relationship to the BEMA
Fentanyl Products shall be reported by a Party to the other Party and, if and as
required thereby, by the appropriate Party (as determined by Applicable Law) to
appropriate Competent Authorities within ***, but not later than ***. In the
case of incomplete or insufficient data available, an initial report has to be
issued meeting the time frame, followed by reasonably prompt follow up
report(s). Any ADRs originated by either Party are to be reported on CIOMS Form
as soon as reasonably possible, but no later than *** days after first receipt.
Collegium will report all other ADRs in tabular format (“CIOMS Line Listings”)
in monthly intervals.

(v) In any case where a change in the risk-benefit-ratio of the BEMA Fentanyl
Products becomes evident or safety actions due to ADR seem to be necessary (e.g.
change of the label, product information, special information/warnings to the
medical profession, patients, or authorities, or

 

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Product Recall), the Parties hereto will inform each other without delay and use
commercially reasonable efforts to harmonize further measures as appropriate.
Such exchange of information is realized through direct contacts between the
responsible departments. Therefore, both Parties undertake to inform each other
on any change in the responsible persons, the address, telephone and fax-numbers
in due time. If specific safety measures are to be taken with respect to any
Licensed Products in the Territory following NDA Assignment, Collegium will
ensure the implementation of such in the Territory within reasonable timeframes
or according to regulatory obligations.

(vi) Regulatory inquiries related to safety concerns for the Licensed Products
received by either Party will be promptly forwarded to the other Party. The
Parties shall work in good faith to develop a mutually agreeable response with
respect to any such inquiry in the Territory at least *** before the response is
required. The aforementioned information shall be addressed to:

In case of BDSI:

***

BioDelivery Sciences International, Inc.

4131 Parklake Avenue, Suite #225

Raleigh, North Carolina 27612

Tel.: ***

Fax: 919-582-9051

Email: ***

In case of Collegium:

***

COLLEGIUM Pharmaceutical, Inc.

780 Dedham Street, Suite 800

Canton, MA 02021

Tel.: *** | Fax.: 781.828.4697

Mobile: ***

Main Tel.: 781.713.3699

***

(e) Literature for marketed products. Collegium will have the primary
responsibility for reviewing the world-wide relevant scientific literature for
any serious and non-serious unlisted ADRs related to the Licensed Products in
the Territory according to Applicable Laws.

(f) Signal detection / Safety monitoring. Collegium will perform signal
detection concerning the Licensed Products according to its own internal
documented practices (as outlined in SOPs/guidelines), which shall be
commercially reasonable and consistent with industry standards. Any conclusion
raised from the subsequent analysis revealing relevant safety concerns regarding
the Licensed Products will be communicated to BDSI in due time or immediately if
the conclusions affect the safety profile of the Licensed Products.

 

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(g) Periodic reports. Upon NDA Assignment, Collegium will be responsible for
preparing the periodic reports to be submitted to Competent Authorities in the
Territory (Periodic Safety Update Reports (“PSURs”), Annual Safety Reports for
clinical trials) in accordance with its own standard operating procedures
(“SOPs”), which shall be commercially reasonable and consistent with industry
standards, and Applicable Laws. BDSI will, on Collegium’s reasonable request
provide Collegium with all data (e.g. CIOMS Line Listings for SAEs originating
from BDSI’s clinical trials) in its possession which may reasonably be required
for regulatory report compilation in the Territory.

Section 6.05 Assistance. Upon receipt of a written request, each Party shall
provide reasonable assistance to the other Party, in connection with such
Party’s obligations pursuant to this Article VI, subject to prompt reimbursement
of all of its pre-approved out-of-pocket costs by the requesting Party.

Section 6.06 Compliance. Collegium and BDSI shall comply with all Applicable
Laws in exercising their rights and performing their obligations under this
Agreement, including the provision of information by Collegium and BDSI, to the
extent in its possession, to each other necessary for BDSI and Collegium to
comply with any mandatory reporting requirements. Each Party shall promptly
notify the other Party of any comments, responses or notices received from, or
inspections by, any applicable Competent Authorities, which relate to or may
impact any BEMA Fentanyl Product or the manufacture of any BEMA Fentanyl Product
or the sales and marketing of any BEMA Fentanyl Product, and shall promptly
inform the other Party of any responses to such comments, responses, notices or
inspections and the resolution of any issue raised by any Competent Authorities
with respect to any BEMA Fentanyl Product.

Section 6.07 Safety/Pharmacoviligance Agreement(s). The Parties agree that, upon
the written request of any Party or Meda, (i) they shall use Commercially
Reasonable Efforts in good faith to negotiate and execute one or more customary
and reasonable forms of safety data exchange agreements and/or pharmacovigilance
agreements intended to enable the Parties and/or Meda to comply with their
respective reporting, monitoring, and related obligations under Applicable Law,
or applicable laws, rules, and regulations outside the Territory, with respect
to BEMA Fentanyl Products and, if applicable, (ii) BDSI shall use Commercially
Reasonable Efforts in good faith to cause Meda to negotiate and execute such
agreement(s) pursuant to the terms of any applicable Meda Termination Agreement.

ARTICLE VII

PATENTS AND TRADEMARKS

Section 7.01 Maintenance of Licensed Patents and Licensed Marks. BDSI shall
control and, except as explicitly set forth in this Article VII, have full
discretion in the preparation, filing, prosecution, maintenance, and defense of
the Licensed Patents and Licensed Marks in the Territory, including any ex parte
reexamination proceedings, inter partes review

 

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proceeding, post grant review proceeding, derivation proceeding, action for
declaratory judgment, interference proceeding or other attack upon the validity,
title or enforceability of any Licensed Patents in the Territory. Upon written
request by BDSI, Collegium shall provide such assistance as may be necessary to
enable BDSI to prosecute and obtain new patents related to any Licensed
Improvements Controlled by BDSI, other than Joint Improvements, with the cost
and expense of such assistance to be borne by BDSI. BDSI shall keep Collegium
advised by forwarding to Collegium copies of all official correspondence
(including, but not limited to, applications, office actions, responses, etc.)
relating to the prosecution and maintenance of the Licensed Patents, and shall
provide Collegium an opportunity to comment on any proposed responses, voluntary
amendments, submissions, or other actions of any kind to be made with respect to
Licensed Patents. In the event that BDSI desires to abandon any Licensed Patents
and/or the Licensed Marks in the Territory, BDSI shall provide reasonable prior
written notice to Collegium of its intention to abandon and a reasonable
opportunity to discuss BDSI’s rationale supporting such abandonment. In the
event that BDSI decides to abandon any Licensed Patent in the Territory that
contains Valid Claims that are specific to fentanyl and Cover any Licensed
Product, but does not contain any Valid Claims that Cover any BEMA-based
products incorporating any API other than fentanyl (such a Licensed Patent, a
“Fentanyl-Specific Patent”), (a) BDSI shall provide prompt written notice of
such decision to Collegium and (b) Collegium may elect by written notice to
BDSI, given within *** days of the aforementioned notice from BDSI, continue the
maintenance, defense or prosecution of such Fentanyl-Specific Patent at
Collegium’s expense, and Collegium shall be entitled to undertake such
maintenance, defense, or prosecution if BDSI does not, within *** following such
written election by Collegium, notify Collegium in writing that BDSI will
instead continue the maintenance, defense or prosecution of such
Fentanyl-Specific Patent. If BDSI does provide a subsequent notice to Collegium
electing to retain control of such maintenance, defense or prosecution of a
particular Licensed Patent, BDSI shall retain such control until such time as it
later again elects to abandon such Licensed Patent, in which case the rights and
obligations of the Parties with respect thereto hereunder shall again apply. In
the event Collegium does actually assume maintenance, defense, and prosecution
of a Fentanyl-Specific Patent pursuant to the foregoing, (i) the ownership of
such Fentanyl-Specific Patent shall be retained by BDSI and (ii) Collegium will
not be obligated to pay any royalties to BDSI in regards to any Licensed Product
that is (A) Covered by Valid Claims of one or more Fentanyl-Specific Patents for
which Collegium has assumed responsibility for prosecution, defense or
maintenance in accordance with this Section 7.01 and (B) not Covered by any
Valid Claim(s) of any other Licensed Patents.

Section 7.02 Filing, Prosecution, and Maintenance of Patents Covering Collegium
Improvements. Collegium shall control and, except as explicitly set forth in
this Section 7.02, have full discretion in the preparation, filing, prosecution,
maintenance, and defense of any Patents owned or controlled by Collegium or any
Affiliate thereof Covering any Collegium Improvement, including any ex parte
reexamination proceedings, inter partes review proceeding, post grant review
proceeding, derivation proceeding, action for declaratory judgment, interference
proceeding or other attack upon the validity, title or enforceability of any
such Patents in the Territory. Collegium shall keep BDSI advised with respect to
the foregoing by forwarding to BDSI copies of all official correspondence
(including, but not limited to, applications, office actions, responses, etc.)
relating to the prosecution and maintenance of such Patents, and shall provide
BDSI a reasonable advance opportunity (to be no less than ***) to review and
comment on any proposed patent applications, responses, voluntary amendments,

 

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submissions, or other actions of any kind to be made with respect to any such
Patents, and Collegium shall reasonably take into consideration any reasonable
comments made by BDSI with respect thereto. In the event that Collegium desires
to abandon any such Patents Covering Collegium Product-Specific Improvements,
Collegium shall provide reasonable prior written notice to BDSI of Collegium’s
intention to abandon and a reasonable opportunity to discuss Collegium’s
rationale supporting such abandonment.

Section 7.03 Prosecution of Infringement.

(a) During the Term, each Party shall give prompt written notice to the other
Party of any Third Party act in the Territory that (a) concerns any product(s)
that contain fentanyl as the sole API but do not contain naloxone and (b) may
infringe the Licensed Patents and/or the Licensed Marks in the Territory. BDSI
shall, as between the Parties, have the sole and exclusive right with respect to
Licensed Marks and Licensed Patents other than Fentanyl-Specific Patents, and
the first right with respect to Fentanyl-Specific Patents, but not, in either
case, the obligation, to bring and control any action or proceeding (i)
concerning any potential or actual infringement of the Licensed Patents or
Licensed Marks, (ii) any statutory act of infringement under the Hatch-Waxman
Act (including but not limited to on account of any certification provided
thereunder (including but not limited to as set forth in Section 7.04)), or
(iii) concerning any potential or actual misappropriation of any Licensed
Know-How. If BDSI is unable to initiate or to prosecute such action solely in
its own name or it is otherwise Commercially Reasonable and reasonably advisable
to obtain an effective or interim remedy, Collegium shall, if and as requested
by BDSI, join such action and take such other reasonable steps requested by BDSI
as are necessary for BDSI to initiate litigation to prosecute and maintain such
action, provided, that, under no circumstances will Collegium be obligated to,
amend or alter any of the terms of this Agreement in a manner adverse to
Collegium’s interests in order to enable BDSI to initiate litigation to
prosecute and maintain such action. Collegium shall provide, at BDSI’s expense,
such other assistance and cooperation to BDSI as may be necessary to prosecute
any action against such Third Party. Any damages, monetary awards, or other
amounts recovered or received in settlement by BDSI shall be ***.

(b) In the event that BDSI decides not to enforce, or to abandon or discontinue
the enforcement of, any Fentanyl-Specific Patent against any Third Party
infringer thereof, BDSI will notify Collegium and the Parties will use
Commercially Reasonable Efforts in good faith to agree within *** (or, in the
case of any statutory act of infringement under the Hatch-Waxman Act, within
***) after Collegium’s receipt of such notice on an approach to address such
infringement in a way that is designed to preserve both the validity and
enforceability of the infringed Fentanyl-Specific Patent and the commercial
value of the Licensed Products in the Territory, which approach may include
(without limitation) giving Collegium the right to initiate litigation to
prosecute or maintain such action against any Third Party infringer. In the
event the Parties are unable to agree upon a reasonable course of action within
such ***, as applicable, then BDSI shall authorize Collegium to enforce the
applicable Fentanyl-Specific Patent against the Third Party infringer
thereof. Without limiting the foregoing, if BDSI has authorized an infringement
action by Collegium pursuant to this Section 7.03, but Collegium is not
recognized by the applicable court or other relevant body as having the
requisite standing to pursue such action, then at Collegium’s written request,
Collegium shall be entitled to join BDSI as a necessary party to such action and
BDSI shall reasonably cooperate with Collegium, at

 

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Collegium’s expense. Collegium shall not enter into a settlement, consent
judgment, or other voluntary disposition of any such infringement action by
Collegium without BDSI’s prior written approval. Any damages, monetary awards,
or other amounts recovered or received in settlement by Collegium shall be
***. Notwithstanding the foregoing, BDSI, at its expense, shall have the right
to be represented by counsel of its choice in any proceeding governed by this
Section 7.03(b).

Section 7.04 Hatch-Waxman Act Litigation. Notwithstanding anything herein to the
contrary, should a Party receive a certification for a Licensed Product pursuant
to the Drug Price Competition and Patent Term Restoration Act of 1984 (Public
Law 98-417), as amended (the “Hatch-Waxman Act”), including any notice under 21
U.S.C. §355(b)(2)(A)(iv) or 355(j)(2)(A)(vii)(IV) or a similar notice with
respect to, in either case, any Licensed Product or any Competing Product in the
Territory, then such Party shall immediately (and in any event no later than
within *** after such receipt) provide the other Party with a copy of such
certification.

Section 7.05 Infringement Claimed by Third Parties. In the event a Third Party
commences a judicial or administrative proceeding against a Party and such
proceeding, other than a proceeding to which Section 7.01 applies, pertains to
the manufacture, use, sale, marketing, or import of a Licensed Product in the
Territory by or on behalf of Collegium, an Affiliate thereof, or a Sublicensee
(the “Third Party Claim”), or threatens to commence such a Third Party Claim,
the Party against whom such proceeding is threatened or commenced shall give
prompt notice to the other Party.

Section 7.06 Payment of Costs and Expenses. Upon its receipt of a reasonably
detailed invoice setting forth a Party’s reasonable, documented costs and
expenses incurred pursuant to any provision of this Article VII relating to the
Territory, for which the other Party shall be liable in accordance with this
Article VII, such other Party shall pay such costs and expenses within *** of
receipt of an invoice therefor.

ARTICLE VIII

CONFIDENTIALITY

Section 8.01 Confidentiality. The Parties agree that, for the Term and for ***
thereafter, each Party will keep completely confidential and will not publish,
submit for publication or otherwise disclose, and will not use for any purpose
except for the purposes contemplated by this Agreement (including but not
limited to the exercise or enforcement of rights or performance of obligations
under this Agreement), any Confidential Information of the other Party.

Section 8.02 Authorized Disclosure. Each Party may disclose Confidential
Information of the other Party to the extent that such disclosure is:

(a) made in response to a valid order of a court of competent jurisdiction;
provided, however, that in each case such disclosing Party will, to the extent
reasonably practicable, (i) first have given written notice to the other Party
and given such other Party a reasonable opportunity to take appropriate action
and (ii) cooperate with such other Party as necessary to obtain an appropriate
protective order or other protective remedy or treatment;

 

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provided, further, that in each case, the Confidential Information disclosed in
response to such court or governmental order will be limited to that information
which is legally required to be disclosed in response to such court or
governmental order, as determined in good faith by the Party that is obligated
to disclose Confidential Information pursuant to such order;

(b) otherwise required to be disclosed by any applicable law, rule, or
regulation (including, without limitation, the U.S. federal securities laws and
the rules and regulations promulgated thereunder) or the requirements of any
stock exchange to which a Party or any Affiliate thereof is subject; provided,
however, that the Party that is so required will provide such other Party with
written notice of such disclosure reasonably in advance thereof to the extent
reasonably practicable and reasonable measures will be taken to assure
confidential treatment of such information, including such measures as may be
reasonably requested by the disclosing Party with respect to such Confidential
Information;

(c) made by such Party, in connection with the performance of this Agreement, to
such Party’s Affiliates, licensees, sublicensees, contractors, directors,
officers, employees, consultants, representatives or agents, or to other Third
Parties, in each case on a need to know basis and solely to use such information
for business purposes relevant to and permitted or required by this Agreement,
and provided that (i) each such party to whom such Confidential Information is
disclosed is bound in writing to non-use and non-disclosure obligations
substantially as protective as those set forth in this Agreement and (ii) the
Party making such disclosure shall be liable for such Third Parties’ compliance
with such obligations; or

(d) made by (x) such Party to existing or potential acquirers, existing or
potential collaborators, licensees, licensors, sublicensees, investment bankers,
accountants, attorneys, existing or potential investors, merger or acquisition
targets, partners, venture capital firms or other financial institutions or
investors for use of such information for business purposes relevant to this
Agreement or for due diligence in connection with the financing, licensing or
acquisition of such Party or an Affiliate thereof (or such Party’s or its
Affiliate’s acquisition of, or merger with, a Third Party) or (y) BDSI to Meda
in performance of its obligations under, or with respect to any agreement
entered into between BDSI and Meda concerning the termination, prior to the
effectiveness of this Agreement, of that certain previous agreement between Meda
and BDSI pursuant to which Meda enjoyed certain rights to BEMA Fentanyl Products
in the Territory (such previous agreement, the “Meda License”; any such
termination-related agreement, a “Meda Termination Agreement”), and provided
that (i) each individual and entity to whom such Confidential Information is
disclosed is bound in writing to non-use and non-disclosure obligations (or in
the case of attorneys or accountants, an equivalent professional duty of
confidentiality) substantially as protective as those set forth in this
Agreement and (ii) the Party making such disclosure shall be liable for such
Third Parties’ compliance with such obligations.

Section 8.03 Publications. Subject to Sections 8.01 and 8.02 and this Section
8.03, each Party shall have the right to publish, present or otherwise disclose,
including in scientific journals or promotional literature, information in its
possession or control pertaining to any BEMA Fentanyl Product developed or
commercialized by or for it or any Affiliate thereof, or, in the case of BDSI,
pertaining directly to any Licensed Technology; provided, however, that if

 

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Collegium or any Affiliate thereof desires to publish or present any such
information in regards to any of their respective BEMA Fentanyl Products, then
the following procedure shall apply: (a) Collegium shall first provide a copy of
the proposed publication or presentation to BDSI for review and comment *** in
advance of any submission for publication or presentation (or, in the case of
any presentation, *** in advance of such submission) (such ***, the “Review
Period”); (b) if during the Review Period Collegium receives written notice from
BDSI identifying specific Confidential Information of BDSI in such a proposed
publication or presentation, then, at the reasonable request of BDSI in such
notice and at BDSI’s option, Collegium shall, and Collegium shall ensure that
its Affiliates, delete such Confidential Information from the proposed
publication and/or delay such publication or presentation for up to an
additional thirty *** in order to permit BDSI to file a patent application
covering such Confidential Information.

Section 8.04 Disclosure of Agreement. Neither Party shall release to any Third
Party or publish in any way any non-public information with respect to the terms
of this Agreement without the prior written consent of the other Party, which
consent shall not be unreasonably withheld. Notwithstanding the foregoing, (x) a
Party may disclose the terms of this Agreement to actual or potential investors,
lenders, investment bankers, and other financial institutions of its choice
solely for purposes of financing the business operations of such Party or an
Affiliate thereof, or, to any prospective or actual licensee, sublicensee,
licensor, manufacturer, marketing or other corporate partner, acquirer, or
merger or acquisition target and (y) BDSI shall be entitled to disclose the
terms of this Agreement to Meda pursuant to any Meda Termination Agreement;
provided such disclosing Party only discloses such information under conditions
of confidentiality on terms substantially as protective as those contained in
this Article VIII. Nothing contained in this paragraph shall prohibit either
Party from filing this Agreement as required by the rules and regulations of the
Securities and Exchange Commission, national securities exchanges (including
those located in countries outside of the United States) or the Nasdaq Stock
Market; provided the disclosing Party discloses only such information required
to be disclosed in order to comply with such requirements, as reasonably
determined by such Party, including requesting confidential treatment of this
Agreement (after providing a reasonable opportunity for consultation by the
other Party) and filing this Agreement in redacted form. The Parties agree to
cooperate with respect to requests for confidential treatment to be submitted to
the Securities and Exchange Commission or any similar foreign authority with
respect to certain portions of this Agreement and any redactions thereof for
such purposes.

ARTICLE IX

REPRESENTATIONS AND WARRANTIES

Section 9.01 Corporate Power. As of the Effective Date, each Party hereby
represents and warrants that such Party is duly organized and validly existing
under the laws of the jurisdiction of its organization and has full corporate
power and authority to enter into this Agreement and the transactions
contemplated hereby and to carry out the provisions hereof.

Section 9.02 Due Authorization. As of the Effective Date, each Party hereby
represents and warrants that such Party is duly authorized to execute and
deliver this Agreement and to perform its obligations hereunder.

 

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Section 9.03 Binding Obligation. As of the Effective Date, each Party hereby
represents and warrants that this Agreement is a legal and valid obligation
binding upon it and is enforceable in accordance with its terms, except that the
enforcement of the rights and remedies created hereby is subject to bankruptcy,
insolvency, reorganization and similar laws of general application affecting the
rights and remedies of creditors and that the availability of the remedy of
specific performance or of injunctive relief is subject to the discretion of the
court before which any proceeding therefor may be brought. As of the Effective
Date, each Party represents and warrants that the execution, delivery and
performance of this Agreement by such Party does not conflict with any
agreement, instrument or understanding, oral or written, to which it is a party
or by which it may be bound, nor violate any law or regulation of any court,
governmental body or administrative or other agency having authority over it.

Section 9.04 Legal Proceedings. As of the Effective Date, each Party hereby
represents and warrants to the other Party that, except, with respect to BDSI,
for those proceedings described on Exhibit F with respect to a BEMA-based
Product other than a BEMA Fentanyl Product (the “Actavis Litigation”), there is
no action, suit or proceeding pending against or affecting, or, to the Knowledge
of either Party, threatened against or affecting that Party, or any of its
assets, before any court or arbitrator or any governmental body, agency or
official that would, if decided against either Party, have a material adverse
impact on the business, properties, assets, liabilities or financial condition
of that Party (that are not already reflected in that Party’s respective
financial statements as filed with the Securities and Exchange Commission (or
foreign equivalent thereof) or otherwise made public or provided to the other
Party) and which would have a material adverse effect on that Party’s ability to
consummate the transactions and perform the obligations contemplated by this
Agreement.

Section 9.05 Limitation on Warranties. Except as expressly set forth in this
Agreement, nothing herein shall be construed as a representation or warranty by
BDSI to Collegium that the Licensed Technology is not infringed by any Third
Party, or that the practice of such rights does not infringe any intellectual
property rights of any Third Party.

Section 9.06 No Guarantee of Success. Collegium and BDSI acknowledge and agree
that nothing in this Agreement will be construed as representing any estimate or
projection of (i) the successful Development or Commercialization of any
Licensed Product under this Agreement, (ii) the number of Licensed Products that
will or may be successfully Developed or Commercialized under this Agreement,
(iii) anticipated sales or the actual value of any Licensed Products that may be
successfully Developed or Commercialized under this Agreement or (iv) the
damages, if any, that may be payable if this Agreement is terminated for any
reason. Neither Party makes any warranties, express or implied, or covenants
concerning the success of the Development or Commercialization of any Licensed
Products or the commercial utility, merchantability, or fitness for a particular
purpose of any Licensed Product. In addition, Collegium makes no representation,
warranty or covenant, either express or implied, that (A) it will successfully
Develop or Commercialize or continue to Develop or Commercialize any Licensed
Product in the Territory, (B) if Commercialized, that any Licensed Product will
achieve any particular sales level in the Territory or (C) it will devote, or
cause to be devoted, any level of diligence or resources to Developing or
Commercializing any Licensed Product in the Territory, other than is expressly
required under Sections 2.02 and 5.01(a) and Article VI.

 

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Section 9.07 Sufficient Rights. BDSI represents and warrants that (a) it has and
shall maintain during the Term of this Agreement (i) an exclusive license to or
ownership of, as applicable, the Licensed Technology, the Licensed Marks and any
other intellectual property rights which are the subject of Collegium’s licenses
under this Agreement and (ii) the right to grant the licenses described in this
Agreement, and (b) the grant of such licenses by BDSI will not conflict with or
violate any of the terms of any agreement of BDSI concerning the Licensed
Technology or the Licensed Marks.

Section 9.08 No Infringement. BDSI represents and warrants that, to BDSI’s
Knowledge as of the Effective Date, BDSI is not aware of any Third Party
intellectual property rights which would be infringed by the Development or
Commercialization, including the manufacture, use, or sale, of the Current
Product in the Territory.

Section 9.09 Intellectual Property. BDSI represents and warrants that (i) to
BDSI’s Knowledge as of the Effective Date, the Licensed Technology, Licensed
Marks and other intellectual property rights which are the subject of the
licenses granted to Collegium hereunder comprise, all intellectual property
rights reasonably necessary for Collegium to Develop and Commercialize the
Current Product and (ii) there are no other intellectual property rights owned
or Controlled by BDSI or any of its Affiliates as of the Effective Date, other
than the rights in the Licensed Technology, which cover the Current Product or
would otherwise prevent Collegium from Developing and/or Commercializing the
Current Product in the Territory as set forth herein.

Section 9.10 Documents. BDSI represents and warrants that, to its Knowledge as
of the Effective Date, all documents provided to Collegium by or on behalf of
BDSI prior to the Effective Date are materially true and correct and no document
provided to Collegium by or on behalf of BDSI, contains any untrue statement of
a relevant material fact or omits to state a relevant material fact necessary
not to make the statements contained in the document materially misleading.

Section 9.11 HSR Determination. Collegium represents and warrants that it has
determined in good faith, prior to the Effective Date, that it is not required
to make any filing with respect to this Agreement or the transactions
contemplated hereby in order to comply with any obligations under the HSR Act.

Section 9.12 Collegium Affiliates. Collegium represents and warrants that, as of
the Effective Date, there are no Affiliates of Collegium.

Section 9.13 Termination of CDC Agreement and Survival. BDSI covenants to make
all payments and to provide all reports, notices and materials to CDC when due
under the CDC Agreement and to exercise its rights and perform its obligations
thereunder to the extent necessary to maintain such rights under the CDC
Agreement in a manner consistent with the license rights granted to Collegium
pursuant to this Agreement. Without limiting the foregoing, BDSI shall not (a)
knowingly commit any act or omission that would reasonably be expected to give
rise to any right of CDC to terminate the CDC Agreement or CDC Consent or (b)
exercise any right it may have to terminate the CDC Agreement or CDC Consent, or
otherwise amend the CDC Agreement or CDC Consent, in a way that adversely
affects Collegium’s rights hereunder with respect to any of the Licensed
Technology, without the prior written consent of an officer of

 

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Collegium, provided that such covenant shall not be construed to require BDSI to
(i) pay any amounts to CDC in excess of the amounts properly due such parties
under the CDC Agreement or (ii) agree to become subject to any obligations in
excess of those currently provided under the CDC Agreement. If BDSI does not
make any payment or take any required action under the CDC Agreement when due,
Collegium may, but shall not be obligated to and without prejudicing any of its
other rights or remedies, make such payment or take such action for BDSI’s
account with the right to credit such payment or costs against any amounts
payable from Collegium to BDSI under this Agreement. BDSI represents and
warrants that, subject to Section 13.06(e), any licenses granted to Collegium
under this Agreement will, as described in CDC Consent, (A) survive any
exclusive licensing and assignment to CDC, upon termination of the CDC Agreement
by CDC pursuant to Section 10.2 or 10.3 thereof, of BDSI’s rights under the
Licensed Technology, Licensed Marks, and other intellectual property rights
which are the subject of Collegium’s licenses under this Agreement and (B) be
assigned to CDC, subject to Collegium’s continued compliance with the terms of
this Agreement, provided that such termination of the CDC Agreement does not
result from and is not related to any uncured material breach of this Agreement
by Collegium.

Section 9.14 Debarment. Each Party represents and warrants to the other that, as
of the Effective Date, it has never been and is not currently debarred by the
FDA pursuant to 21 U.S.C. §335(a) or (b) (“Debarred Entity”), and each Party
agrees that it will not obtain advice or assistance from any individual debarred
pursuant to 21 U.S.C. §335(a) or (b). Each Party represents and warrants to the
other that it has no Knowledge, as of the Effective Date, of any circumstances
that may affect the accuracy of the foregoing warranties and representations,
including, but not limited to, FDA investigations of, or debarment proceedings
against, it or any person or entity with which it is associated or that provides
services to such Party, and such Party will immediately notify the other in
writing if it becomes aware of any such circumstances during the term of this
Agreement.

Section 9.15 CDC Acknowledgement. Collegium hereby expressly acknowledges to CDC
that, to the extent (a) provided in this Agreement or the CDC Consent and (b)
provisions of the CDC Agreement, as modified by the CDC Consent, expressly apply
to sublicensees of BDSI thereunder, this Agreement shall be subject to the
rights of CDC under the CDC Agreement.

ARTICLE X

INDEMNIFICATION; INSURANCE; LIMITATION OF LIABILITY

Section 10.01 Indemnification by BDSI. Subject to Section 10.03, BDSI hereby
agrees to defend, indemnify and hold harmless Collegium, its Affiliates, and its
and their respective directors, officers, employees, agents, other
representatives, and successors and assigns (“Collegium Indemnitees”) from and
against all suits, claims, proceedings or causes of action brought by Third
Parties (“Claims”), and all associated damages, liabilities, expenses and/or
loss, including reasonable legal expenses and reasonable attorneys’ fees
(collectively, “Losses”), arising out of BDSI’s, its Affiliates’, or BDSI’s or
its Affiliates’ officers’, directors’, employees’, agents’, or other
representatives’ (i) negligence or willful misconduct with respect to the
subject matter of this Agreement, (ii) breach of this Agreement, (iii) failure
to comply with any Applicable Law with respect to the subject matter of this
Agreement, or (iv) manufacture, use,

 

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sale, offer for sale, development, commercialization, import, or export of any
BEMA Fentanyl Product(s) within or outside the Territory; provided, that BDSI
shall not have any such obligation if and to the extent any such Claims or
Losses result from any Collegium Indemnitees’ (A) negligence or willful
misconduct, (B) breach of this Agreement, (C) failure to comply with Applicable
Laws with respect to the subject matter of this Agreement, or (D) manufacture,
use, sale, offer for sale, Development, Commercialization, import, or export of
any Licensed Product(s) not in accordance with this Agreement.

Section 10.02 Indemnification by Collegium. Subject to Section 10.03, Collegium
hereby agrees to indemnify, defend and hold BDSI, its Affiliates, CDC, NB
Athyrium LLC, and BDSI’s, its Affiliates’, CDC’s, and NB Athyrium LLC’s
officers, directors, employees, contractors, agents, other representatives, and
successors and assigns (collectively, “BDSI Indemnitees”) harmless from and
against any Losses resulting from Claims brought against any BDSI Indemnitee(s)
resulting from (I) Collegium’s, its Affiliates’, Sublicensees’, or any of
Collegium’s, its Affiliates’, or Sublicensees’ directors’, officers’,
employees’, agents’, or other representatives’ (a) negligence or willful
misconduct with respect to the subject matter of this Agreement, (b) failure to
comply with Applicable Laws with respect to the subject matter of this
Agreement, (c) manufacture, use, sale, offer for sale, Development,
Commercialization, import, or export of any Licensed Product(s) or other
exercise of the rights granted to Collegium under this Agreement, or (d) alleged
or actual infringement or misappropriation of any Third Party’s Patents or other
intellectual property rights in the manufacture, use, sale, offer for sale,
Development, Commercialization, import, or export of any Licensed Product(s) in
the Territory or (II) Collegium’s, its Affiliates’, or any of Collegium’s, its
Affiliates’, or its or their directors’, officers’, employees’, agents’, or
other representatives’ breach of this Agreement, except if and to the extent
such Claims or Losses result from any BDSI Indemnitee’s (i) negligence or
willful misconduct, (ii) breach of this Agreement, or (iii) failure to comply
with any Applicable Laws with respect to the subject matter of this Agreement.

Section 10.03 Indemnification Procedures. Each Party’s agreement to indemnify,
defend, and hold harmless under Section 10.01 or 10.02, as applicable, is
conditioned upon the indemnified party (a) providing written notice to the
indemnifying Party of any Claim or Loss arising out of the indemnified matter as
soon as reasonably possible, and in any event no later than within *** after the
indemnified Party has actual Knowledge of such Claim or Loss, (b) permitting the
indemnifying Party to assume control over the investigation of, preparation and
defense against, and settlement or voluntary disposition of any Claim, (c)
assisting the indemnifying Party, at the indemnifying Party’s reasonable
expense, in the investigation, preparation, defense, and settlement or voluntary
disposition of any such Claim or Loss, and (d) not compromising, settling, or
entering into any voluntary disposition of any such Claim without the
indemnifying Party’s prior written consent, which consent shall not be
unreasonably withheld; provided, however, that, if the party entitled to
indemnification fails to promptly notify the indemnifying Party pursuant to the
foregoing clause (a), the indemnifying Party will only be relieved of its
indemnification obligation under this Article X to the extent materially
prejudiced by such failure. In no event may the indemnifying Party compromise,
settle, or enter into any voluntary disposition of any claim, demand or action
in any manner that explicitly admits material fault or wrongdoing on the part of
the indemnified party or incurs non-indemnified liability (including any payment
obligation) on the part of the indemnified party without the prior written
consent of the indemnified party, and in no event may the indemnifying Party
settle,

 

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compromise, or agree to any voluntary disposition of any matter subject to
indemnification hereunder in any manner which would, in the case of any
settlement, compromise or voluntary disposition effected by Collegium pursuant
to its obligations under Section 10.02, reasonably be anticipated to have a
material likelihood of adversely affecting any portion of the Licensed
Technology or the Licensed Marks, or BDSI’s, its Affiliates’, or any of their
respective Third Party licensees’ or Third Party sublicensees’ ability to
manufacture, Develop, or Commercialize BEMA Fentanyl Products outside the
Territory, or any other then-current BEMA-based products anywhere in the world,
without BDSI’s prior written consent or, in the case of any settlement,
compromise or voluntary disposition effected by BDSI pursuant to its obligations
under Section 10.01, negatively affect the scope of the licenses granted to
Collegium in Section 3.02 or Section 3.03 or that would reasonably be
anticipated to have a material likelihood of negatively affecting Collegium’s
ability to Commercialize and Develop the Licensed Products in the Territory,
without Collegium’s prior written consent.

Section 10.04 Insurance.

(a) Except as otherwise provided below, BDSI shall maintain insurance, including
commercial general liability, product liability and, for clinical trials it
sponsors, clinical trials liability insurance, workers compensation and
employer’s liability and errors and omissions liability insurance, with respect
to its activities under this Agreement regarding Licensed Products in such
amount as it customarily maintains with respect to similar activities for its
other products, but not less than (i) $*** each occurrence and $*** aggregate
for commercial general liability, (ii) $*** each occurrence and aggregate for
product liability, and (iii) such amount as is reasonable and customary in the
U.S. pharmaceutical industry for errors and omissions liability insurance,
workers compensation, and employer’s liability. Such coverage shall be
maintained for not less than *** following expiration or termination of this
Agreement or if such coverage is of the “claims made” type, for *** following
expiration or termination of this Agreement. Upon written request, BDSI shall
provide Collegium with written evidence of the required coverage. Coverage may
be in the form of primary insurance or a combination of primary and excess
insurance.

(b) Except as otherwise provided below, Collegium shall maintain insurance,
including commercial general liability, product liability and, for clinical
trials it sponsors, clinical trials liability insurance, workers compensation
and employer’s liability and errors and omissions liability insurance, with
respect to its activities under this Agreement regarding Licensed Products in
such amount as it customarily maintains with respect to similar activities for
its other products, but not less than the greater of (i) $*** each occurrence
and aggregate for commercial general liability, (ii) $*** each occurrence and
aggregate for product liability at all times prior to the first commercial sale
of a Licensed Product by Collegium or any Affiliate thereof or first sale of a
Licensed Product by any Sublicensee, and $*** each occurrence and aggregate for
product liability at all times thereafter, (iii) $*** each occurrence and
aggregate for clinical trials liability in connection with any clinical trials
conducted by or on behalf of Collegium or any Affiliate thereof hereunder prior
to the first commercial sale of a Licensed Product by Collegium or any Affiliate
thereof, and $*** each occurrence and aggregate for clinical trials liability in
connection with any clinical trials conducted by or on behalf of Collegium or
any Affiliate thereof at all times thereafter, and (iv) such amount as is
reasonable and customary in the U.S. pharmaceutical industry for errors and
omissions liability insurance,

 

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workers compensation and employer’s liability. Such coverage shall be maintained
for not less than *** following expiration or termination of this Agreement or
if such coverage is of the “claims made” type, for *** following expiration or
termination of this Agreement. Upon written request, Collegium shall provide
BDSI with written evidence of the required coverage. Coverage may be in the form
of primary insurance or a combination of primary and excess insurance.

(c) Each Party shall provide the other Party *** notice of any material change,
cancellation or non-renewal of any required insurance under this Agreement. In
the event of a material change, cancellation, or non-renewal in coverage, each
Party shall replace such coverage to comply with this Agreement so that there is
no lapse of coverage for any time period. It is understood that the
above-required insurance shall not be construed to create a limit of either
Party’s liability, with respect to its indemnification obligations or otherwise,
under this Agreement.

Section 10.05 Limitation of Liability. IN NO EVENT WILL EITHER PARTY BE LIABLE
TO THE OTHER PARTY OR TO ANY AFFILIATE THEREOF OR TO ANY THIRD PARTY CLAIMING
UNDER OR THROUGH SUCH PARTY OR ANY OF ITS AFFILIATES FOR LOST PROFITS, LOST
REVENUE, LOST SAVINGS, LOSS OF USE, DAMAGE TO GOODWILL, OR FOR ANY SPECIAL,
INDIRECT, INCIDENTAL, EXEMPLARY CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER
CAUSED, UNDER ANY THEORY OF LIABILITY (WHETHER BREACH OF CONTRACT, NEGLIGENCE,
STRICT LIABILITY, OR OTHERWISE) AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES, ARISING UNDER ANY CAUSE OF ACTION AND
ARISING IN ANY WAY OUT OF THIS AGREEMENT, PROVIDED THAT, NOTWITHSTANDING THE
FOREGOING, THE FOREGOING LIMITATION WILL NOT LIMIT EITHER PARTY’S (A)
INDEMNIFICATION OBLIGATIONS FOR CLAIMS OR LOSSES UNDER ARTICLE 10.01 OR 10.02 OR
(B) LIABILITY FOR WILLFUL PATENT INFRINGEMENT, PATENT INFRINGEMENT OUTSIDE OF
THE TERRITORY, PATENT INFRINGEMENT OCCURRING FOLLOWING ANY TERMINATION OF THIS
AGREEMENT, PATENT INFRINGEMENT IN THE TERRITORY WITH RESPECT TO ANY SUBJECT
MATTER OTHER THAN A BEMA FENTANYL PRODUCT (OR THE MANUFACTURE OR USE THEREOF),
OR ANY BREACH OF ARTICLE VIII.

ARTICLE XI

COVENANTS

Section 11.01 Access to Books and Records. Each Party covenants and agrees that
it shall permit the other Party (or any Third Party allowed to be granted such
rights by the other Party under this Agreement) to exercise such inspection
rights with regards to such Party’s Books and Records as expressly set forth in
Section 14.11 of this Agreement.

Section 11.02 Marketing Expenses. Collegium covenants and agrees that, as
between Collegium and BDSI, Collegium shall be solely responsible for the cost
and implementation of all of its own marketing, sales, promotional and related
activities concerning the marketing, sale and promotion of the Licensed Products
in the Territory.

 

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Section 11.03 Affiliates. Without limitation of Section 3.02(c), each of
Collegium and BDSI shall cause its respective Affiliates who engage in the
performance of any activities, exercise any rights, assume any obligations
hereunder, or have access to, or know or use, the other Party’s Confidential
Information, to comply with all obligations applicable to such Affiliates in
connection therewith under this Agreement. Each Party shall be responsible and
liable for any performance of its obligations hereunder by any of its Affiliates
and their compliance with the terms of this Agreement in connection therewith,
and any breach of the terms of this Agreement by any Affiliate of a Party shall
be deemed a breach of this Agreement by such Party. In addition, Parent shall be
jointly and severally liable with Arius for any breach by Arius of any of the
terms of this Agreement, as a primary obligor and not merely as a surety, and
Collegium shall not be required to pursue any right or remedy it may have
against Arius as a condition to enforcement against Parent arising from any such
breach.

Section 11.04 Compliance. Collegium covenants and agrees that it shall comply in
all material respects with all Applicable Laws affecting the use, possession,
distribution, advertising and all forms of promotion in connection with its sale
and distribution of the Licensed Products and Demonstration Samples in the
Territory following the NDA Assignment. Notwithstanding anything to the
contrary, any failure of Collegium, any Affiliate thereof, or any Sublicensee to
adhere to any Applicable Laws in the Territory concerning the handling of
narcotics which materially adversely affects BDSI’s, its Affiliates’, or any of
its or their licensees’ or sublicensees’ future manufacture, use, shipment,
handling, sale, marketing, or distribution of fentanyl (or any product
incorporating fentanyl) in connection with the Licensed Technology shall be
deemed a material breach of this Agreement entitling BDSI, subject to prior
notice and, with respect solely to the first *** failures, a right to cure in
the same manner as provided in Section 13.02(b), to terminate this Agreement
immediately pursuant to Section 13.02(b). For the avoidance of doubt, the
foregoing covenant does and shall not apply to, and BDSI acknowledges and agrees
that Collegium is not assuming any responsibility or liability under any
circumstances for, the use, possession, distribution, advertising or promotion
of any Licensed Products or Demonstration Samples or any failure to comply with
Applicable Laws concerning the handling of any narcotics, including fentanyl, by
or on behalf of BDSI, any of its Affiliates or any Third Party on its or their
behalf or for its or their benefit prior to the NDA Assignment.

Section 11.05 Reports. Collegium covenants and agrees that, except as otherwise
specified in this Agreement, Collegium shall, following NDA Assignment, have the
obligation and responsibility for and shall make any and all necessary reports
to each Competent Authority with respect to the Licensed Product and shall
provide BDSI with a complete copy of any such report simultaneously with its
submission of the report to each Competent Authority. Collegium covenants and
agrees that, except as otherwise specified in this Agreement, Collegium shall,
following NDA Assignment, have the obligation and responsibility for and shall
make any and all necessary reports in respect of the safe and lawful handling of
the Licensed Products as a narcotic substance to each Competent Authority, and
shall provide BDSI with a complete copy of any such report simultaneously with
the submission of the report to each Competent Authority.

 

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Section 11.06 Further Actions. Upon the terms and subject to the conditions
hereof, each of the Parties hereto shall use its Commercially Reasonable Efforts
to (a) take, or cause to be taken, all appropriate action and do, or cause to be
done, all things necessary, proper or advisable under Applicable Law or
otherwise to consummate and make effective the transactions contemplated by this
Agreement, (b) obtain from Competent Authorities any consents, licenses,
permits, waivers, approvals, authorizations or orders required to be obtained or
made by the Parties in connection with the authorization, execution and delivery
of this Agreement and the consummation of the transactions contemplated by this
Agreement, and (c) make all necessary filings, and thereafter make any other
required submissions, with respect to this transaction under (i) the United
States’ Securities Exchange Act of 1934, as amended and the United States’
Securities Act of 1933, as amended, and the rules and regulations thereunder and
any other applicable securities laws and (ii) any other Applicable Law. The
Parties hereto shall cooperate with each other in connection with the making of
all such filings, including by providing copies of all such documents to the
other Party’s counsel (subject to appropriate confidentiality restrictions)
prior to filing and, if requested, by accepting all reasonable additions,
deletions or changes suggested in connection therewith.

Section 11.07 Protection of the Licensed Marks. Collegium covenants and agrees
that neither it nor its Affiliates shall publish, employ, or cooperate in the
publication of any advertising material with regard to the Licensed Technology,
the Licensed Marks, or any other trademarks of BDSI which Collegium knows are
misleading or deceptive and both Parties covenant and agree that neither it nor
any of its Affiliates shall publish, employ, or cooperate in the publication of
any advertising materials with regard to the Parties or any BEMA Fentanyl
Products which it knows are misleading or deceptive.

Section 11.08 Equitable Relief. The Parties understand and agree that because of
the difficulty of measuring economic losses to the non-breaching Party as a
result of a breach of (i) the covenants set forth in Article VIII or this
Article XI or (ii) the licenses granted under this Agreement (taking into
account any expressly reserved or retained rights thereunder), and because of
the immediate and irreparable damage that may be caused to the non-breaching
Party for which monetary damages may not be a sufficient remedy, the Parties
agree that the non-breaching Party may be entitled to seek specific performance,
temporary and permanent injunctive relief, and such other equitable remedies to
which it may then be entitled against the breaching Party. This Section 11.08
shall not limit any other legal or equitable remedies that the non-breaching
Party may have against the breaching Party for violation of (1) the covenants
set forth in Article VIII or this Article XI or (2) the licenses granted under
this Agreement (taking into account any expressly reserved or retained rights
thereunder). The Parties agree that the non-breaching Party shall have the right
to seek relief for any violation or threatened violation of Article VIII, this
Article XI, or the licenses granted under this Agreement (taking into account
any expressly reserved or retained rights thereunder) by the breaching Party
from any court of competent jurisdiction in any jurisdiction authorized to grant
the relief necessary to prohibit the violation or threatened violation of
Article VIII, this Article XI, or the licenses granted under this Agreement
(taking into account any expressly reserved or retained rights thereunder). This
Section 11.08 shall apply with equal force to the breaching Party’s Affiliates.

Section 11.09 Competing Products. During the Term, neither BDSI, any Affiliate
thereof, Collegium, nor any Collegium Affiliate shall, directly or indirectly
(through Third

 

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Parties or, in the case of Collegium or a Collegium Affiliate, Affiliates of
Collegium that are not Collegium Affiliates), knowingly or recklessly enable or
contract with any Third Party or, in the case of Collegium or a Collegium
Affiliate, Affiliates thereof other than Collegium Affiliates, to develop,
manufacture, market, sell or distribute any Competing Product in the Territory
for the Territory or itself develop, manufacture, market, sell or distribute any
Competing Product in the Territory for the Territory, provided that,
notwithstanding anything to the contrary, (X) neither the foregoing nor any
other provision of this Agreement (other than Section 3.02(a)) shall be
construed to limit BDSI’s, its Affiliates’, or any of its or their Third Party
licensees’, sublicensees’, or contractors’ rights to (a) develop, manufacture,
have manufactured, or use, in the Territory any products (including BEMA
Fentanyl Products or Competing Products) which are intended solely for
commercial sale to Third Parties located outside the Territory, (b) develop,
manufacture, have manufactured, use, sell, or offer for sale in the Territory
any products other than BEMA Fentanyl Products or Competing Products, or (c)
otherwise exercise BDSI’s reserved rights under Section 3.02(a) and (Y) this
Section 11.09 shall not apply to any Affiliate of BDSI that is not controlled by
Parent or Arius (with “controlled” having, for purposes of this clause (Y), the
meaning set forth in the definition of Affiliate established under Article I) or
any Affiliate of Collegium that is not a Collegium Affiliate.

Section 11.10 ***.

Section 11.11 No Encumbrances. Except to the extent Collegium may assign this
Agreement under Section 14.01, Collegium shall not, without the prior written
consent of BDSI, such consent not to be unreasonably withheld, sell, license or
sublicense (except as permitted by Section 3.02(a)), encumber or otherwise
transfer to a Third Party any of Collegium’s rights in Governmental Approvals,
Marketing Authorizations, or Regulatory Filings in respect to any Licensed
Product. Except to the extent BDSI may assign this Agreement under Section
14.01, BDSI shall not sell, assign, license, sublicense, encumber or otherwise
transfer to a Third Party any of BDSI’s rights in any Licensed Technology, or
otherwise take any action, that would diminish the rights under the Licensed
Technology granted to Collegium under this Agreement.

Section 11.12 ***.

Section 11.13 Arius Two Agreement and Consent. BDSI shall not (a) knowingly
commit any act or omission that would reasonably be expected to give rise to any
right of Arius Two, Inc. to terminate that certain BEMA License Agreement
between Arius Two, Inc. (“Arius Two”) and Arius, dated September 5, 2007, as
amended (the “Arius Two Agreement”) or that certain Sublicensing Consent between
Arius and Arius Two, dated on or about the Effective Date of this Agreement (the
“Arius Two Consent”), or (b) exercise any right it may have to terminate the
Arius Two Agreement or Arius Two Consent, or otherwise amend the Arius Two
Agreement or Arius Two Consent, in a way that adversely affects Collegium’s
rights hereunder with respect to any of the Licensed Technology without the
prior written consent of an officer of Collegium.

 

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ARTICLE XII

PRODUCT RECALL

Section 12.01 Product Recall Determination. If at any time or from time to time,
a Competent Authority requests Collegium to conduct a Product Recall of any
Licensed Product Developed or Commercialized by or for Collegium, any Affiliate
thereof, or any Sublicensee in the Territory or if a voluntary Product Recall of
any such Licensed Product in the Territory is contemplated by Collegium, any
Affiliate thereof, or any Sublicensee, Collegium shall immediately notify BDSI
in writing, and except as otherwise set forth in this Article XII, Collegium
will, at its sole cost and expense, conduct such Product Recall in as
reasonable, prudent, and expeditious a manner as possible to preserve the
goodwill and reputation of such Licensed Products and the goodwill and
reputation of the Parties, provided that:

(a) Collegium shall not, and shall ensure that its Affiliates and Sublicensees
do not, carry out a voluntary Product Recall in the Territory with respect to
such Licensed Product without the prior written approval of BDSI, such approval
not to be unreasonably withheld, conditioned or delayed (for the avoidance of
doubt, any Product Recall that is reasonably deemed necessary in order to avoid
serious personal injury shall not be considered as a voluntary Product Recall,
provided that Collegium shall provide BDSI the opportunity to advise and comment
with respect to any such Product Recall prior to its execution); and

(b) the Parties shall reasonably cooperate, at Collegium’s expense, in the
conduct of any Product Recall for such Licensed Product in the Territory.

Notwithstanding the foregoing, Collegium, any Affiliate thereof, or any
Sublicensee may, without BDSI’s prior consent, immediately effect any Product
Recall (i) resulting from any death or life-threatening Adverse Event associated
with any Licensed Product or (ii) required to comply with any Applicable Law
with respect to any Licensed Product. In the event Collegium notifies BDSI, or
BDSI otherwise becomes aware, that Collegium, any Affiliate thereof, or any
Sublicensee does not intend to undertake a Product Recall of the type described
in clauses (i) or (ii) above, BDSI shall be entitled to do so upon notice to
Collegium without Collegium’s prior written consent.

Section 12.02 Product Recall Management. Collegium shall have the right to
control and/or conduct any Product Recall of any Licensed Product Developed or
Commercialized by or for it, any Affiliate thereof, or any Sublicensee in the
Territory, subject to Section 12.01. The Product Recall shall be the sole
responsibility of Collegium, its Affiliates, or Sublicensees, as applicable, and
shall be carried out by Collegium, its Affiliates, or Sublicensees in as
reasonable, prudent, and expeditious a manner as possible to preserve the
goodwill and reputation of the affected Licensed Products and the goodwill and
reputation of the Parties. Collegium, its Affiliates or Sublicensees, as
applicable, shall maintain records of all sales and distribution of Licensed
Products and customers in the Territory sufficient to reasonably adequately
administer a Product Recall, for the period required by Applicable Law, and make
such records available to BDSI or any designee thereof immediately upon request.

 

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Section 12.03 Product Recall Costs. Notwithstanding Section 12.02, Collegium
shall bear all costs and expenses related to the conduct of any Product Recall
of any Licensed Product Developed or Commercialized by or for it, its Affiliates
or Sublicensees in the Territory.

Section 12.04 Notification of Threatened Action. Throughout the duration of this
Agreement and with respect to all Licensed Products, the Parties shall
immediately notify each other of any information a Party receives regarding any
threatened or pending action, inspection or communication by or from a concerned
Competent Authority which may affect the safety or efficacy claims of the
Licensed Products or the continued marketing of the Licensed Products.

ARTICLE XIII

TERM AND TERMINATION

Section 13.01 Term. This Agreement shall commence as of the Effective Date and
expire on the expiration of the last-to-expire Royalty Term (“Term”). Upon
expiration of the Term of this Agreement, (a) the rights granted to Collegium in
the Territory under Section 3.02 shall survive and become perpetual,
irrevocable, royalty-free, and fully-paid, and nonexclusive and (b) the rights
granted to Collegium in the Territory under Section 3.03 shall survive, provided
that BDSI shall retain the right to terminate such rights granted under Section
3.03 as set forth therein or, in a manner substantially similar to that set
forth in Section 13.02(b), for Collegium’s material, uncured breach of Section
3.03.

Section 13.02 Termination by Either Party for Cause. Subject to Section 13.07,
either Party may terminate this Agreement prior to the expiration of this
Agreement upon the occurrence of any of the following:

(a) upon or after the permanent cessation of operations of the other Party
without a successor, or the bankruptcy or judicially declared insolvency of such
Party, or the dissolution or winding up of the other Party (other than
dissolution or winding up for the purposes or reconstruction or amalgamation)
without a successor; or

(b) upon or after the material breach of this Agreement by the other Party
(other than a failure to pay by Collegium, which is addressed in Section
13.03(c)), if the breaching Party has not cured such breach, if capable of being
cured within such time period, within *** after written notice thereof by the
non-breaching Party, provided that, notwithstanding the foregoing, BDSI shall be
entitled to terminate this Agreement pursuant to Section 13.03(c) without
providing the aforementioned opportunity to cure.

Section 13.03 Termination by BDSI. Subject to Section 13.07, BDSI may, by
written notice to Collegium, terminate this Agreement:

(a) upon the failure by Collegium to pay the license fee pursuant to Section
3.01 within the time period set forth therein;

(b) (i) upon the loss, revocation, suspension, termination, or expiration of
Collegium’s (or any Collegium Affiliates’ or Sublicensees’) license to sell
narcotics in the Territory, if (A) as a result of such loss, revocation,
suspension, termination or expiration none of

 

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the foregoing entities would be legally permitted to sell Licensed Products in
the Territory and (B) Collegium (or the applicable Collegium Affiliate or
Sublicensee) fails to take all actions necessary to reinstate such license
within *** of such loss, revocation, suspension, termination, or expiration, or
(ii) any material breach of the second sentence of Section 11.04 which is not
remedied within *** thereof;

(c) upon the failure by Collegium on *** to pay any amount overdue under this
Agreement within *** from receipt of a written notice (as given pursuant to
Section 14.06 hereof) thereof to Collegium from BDSI (with respect to any
amounts due under this Agreement pursuant to an invoice to be sent by BDSI, the
first such invoice shall not be deemed “notice” for purposes of this paragraph);

(d) upon the occurrence of any material misrepresentation or omission in any
Royalty Statement, which misrepresentation or omission is caused by Collegium’s
willful misconduct, gross negligence or bad faith; or

(e) in the event the First Commercial Sale of a Licensed Product hereunder does
not occur by the date ***, provided that, to the extent that Collegium can
reasonably demonstrate that manufacturing or supply delays outside of
Collegium’s, its Affiliates’, and Sublicensees’ reasonable control prevented the
First Commercial Sale from occurring by such date, such date shall be
automatically by an amount equal to the extent of such manufacturing or supply
delays.

Section 13.04 Termination by Collegium. Collegium shall have the right,
following the Effective Date and in its sole discretion, to terminate this
Agreement upon *** written notice to BDSI.

Section 13.05 Remedies. All of a non-breaching Party’s remedies with respect to
a breach of this Agreement shall be cumulative, and the exercise of one remedy
under this Agreement by the non-breaching Party shall not be deemed to be an
election of remedies. These remedies shall include the non-breaching Party’s
right to sue for damages for such breach without terminating this Agreement and
to seek such other remedies as may be available to such Party at law or in
equity.

Section 13.06 Effect of Termination.

(a) Upon any termination of this Agreement by either Party, and subject to
Section 13.06(b) and the exercise of the rights granted thereunder, (i) the
rights granted under Sections 3.02 and 3.03 with respect to the Licensed Marks
and the Licensed Technology, and any sublicenses granted thereunder, shall
terminate, (ii) Collegium and its Affiliates shall immediately transfer to BDSI
all information in Collegium’s and its Affiliates’ possession concerning the
following: Licensed Products, Licensed Product inventory, Collegium Know-How,
Collegium Patents, Collegium Marks, Collegium Documentation, Product-Related
Materials, Regulatory Filings, Marketing Authorizations, and Governmental
Approvals, and, if and as subsequently requested by BDSI in writing, transfer
and assign to BDSI all right, title, and interest in all Demonstration Samples
and Licensed Product inventory, Regulatory Filings, Marketing Authorizations,
and Governmental Approvals, and Product-Related Materials (other

 

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than Collegiums’ right, title or interest in or to any Collegium Know-How,
Collegium Patents, Collegium Marks or any other Collegium intellectual property
rights embodied in any of the foregoing), (iii) Collegium hereby grants BDSI and
its Affiliates the perpetual, irrevocable, royalty-free, fully-paid,
transferable, exclusive right and license, with rights of sublicense, under the
Collegium Know-How and Collegium Patents, and a perpetual, irrevocable,
royalty-free, fully-paid, transferable, non-exclusive license, with rights of
sublicense, under the Collegium Marks, to develop, make, have made, use, sell,
offer for sale, import, and export, market and promote BEMA Fentanyl Products
and Demonstration Samples in the Territory (including but not limited to all
Licensed Products Commercialized or under Developed by Collegium or any of its
Affiliates or Sublicensees as of the effective date of termination), and (iv)
Collegium shall provide BDSI all information requested by BDSI concerning any
manufacturing, supplier, distributor, research, development, clinical study, or
other contracts concerning the Development, manufacture, or Commercialization of
Licensed Products or Demonstration Samples entered into by Collegium or its
Affiliates with Third Parties (“Product-Related Contracts”) and, if and as
subsequently requested by BDSI, assign such Product-Related Contracts to BDSI or
otherwise reasonably facilitate BDSI’s establishment of similar relationships
with such Third Parties.

(b) Upon termination of this Agreement other than by BDSI pursuant to Section
13.02 or 13.03, or as permitted in writing by BDSI in the event of any
termination by BDSI pursuant to Section 13.02 or 13.03, Collegium (and/or its
Affiliates and Sublicensees, if and as applicable) shall have the right, for a
period of *** from the date of termination to distribute and sell existing
inventory of Licensed Products subject to the terms of this Agreement (including
Article IV hereof), provided that such Licensed Products shall be sold at a
Commercially Reasonable price, and Collegium shall, in the event
post-termination sales of Licensed Products are permitted pursuant to the
foregoing, not be required to comply with its obligations under Section 13.06(a)
to assign any assets to BDSI (including Regulatory Filings, Marketing
Authorizations, and Governmental Approvals) that are reasonably necessary to
exercise such post-termination right, until the expiration of the
above-referenced *** period.

(c) Except as otherwise provided in this Agreement, expiration or termination of
this Agreement shall not relieve the Parties of any obligation accruing prior to
such expiration or termination. Except as set forth below or elsewhere in this
Agreement, the obligations and rights of the Parties under Sections 2.03
(Regulatory Submissions) (with respect to Collegium’s obligations thereunder),
3.02(b) (Licensed Technology), 3.02(c) (Licensed Technology) (with respect to
the surviving terms of this Agreement), 3.03(b) (Use of Licensed Marks) (with
respect to expiration, but not termination), 3.03(c) (Additional Terms) (with
respect to expiration, but not termination), 3.03(d) (Termination of License)
(with respect to expiration, but not termination), 3.05 (Ownership of
Improvements), 3.06 (Licenses to BDSI), 4.03 (Reports and Payments) (for Net
Sales of Licensed Products sold during the Term or pursuant to Section
13.06(b)), 6.01 (Marketing Authorization Holder) (with respect to expiration,
but not termination), 6.03 (Interaction with Competent Authorities) (with
respect to expiration, but not termination), 6.04 (a) (General) (with respect to
expiration, but not termination), 6.04(b) (Safety Related Regulatory Documents)
(with respect to expiration, but not termination), 6.04(c) (Safety Databases)
(with respect to expiration, but not termination), 6.04(d) (Reporting of Adverse
Drug Reactions), 6.04(e) (Literature for marketed products) (with respect to
expiration, but not

 

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termination), 6.04(f) (Signal detection/Safety Monitoring) (with respect to
expiration, but not termination), 6.04(g) (Periodic reports) (with respect to
expiration, but not termination), 6.05 (Assistance) (with respect to the
applicable surviving terms of this Agreement), 6.06 (Compliance) (with respect
to expiration, but not termination), 7.02 (Filing, Prosecution, and Maintenance
of Patents Covering Collegium Improvements), 7.03 (Prosecution of Infringement)
(for infringements that occurred during the Term), 7.05 (Infringement Claimed by
Third Parties), 7.06 (Payment of Costs and Expenses) (with respect to the
applicable surviving terms of Article VII), 11.01 (Access to Books and Records),
11.03 (Affiliates) (with respect to the applicable surviving terms of this
Agreement), 11.04 (Compliance) (with respect to expiration, but not
termination), 11.05 (Reports) (with respect to expiration, but not termination),
11.07 (Protection of the Licensed Marks) (with respect to expiration, but not
termination), 11.08 (Equitable Relief) and 11.10 (Right of First Negotiation;
Right of First Refusal) (for any ROFN Product for which an ROFN Notice was or
should have been given during the Term) and Articles I (Definitions), VIII
(Confidentiality), IX (Representations and Warranties) (except Section 9.13 with
respect to termination), X (Indemnification; Insurance; Limitation of
Liability), XII (Product Recall), XIII (Term and Termination) and XIV
(Miscellaneous) shall survive expiration or termination of this Agreement.

(d) Subject to the provisions of this Section 13.06, and except as necessary to
enable the exercise of any rights granted under this Agreement or perform any
obligations under this Agreement following its termination, within *** following
the termination of this Agreement by either Party, each Party shall return to
the other Party, or destroy, upon the written request of the other Party, any
and all Confidential Information of the other Party in its possession and upon a
Party’s request, such destruction (or delivery) shall be confirmed in writing to
such Party by a responsible officer of the other Party.

(e) In the event BDSI’s rights with respect to Licensed Products under the
Licensed Technology, Licensed Marks, and any other intellectual property rights
which are the subject of Collegium’s licenses under this Agreement are, in the
case of a termination of the CDC Agreement by CDC pursuant to Section 10.2 or
10.3 thereof, exclusively licensed and assigned to CDC then the rights and
benefits of BDSI under this Agreement, to the extent (i) not imposing
obligations in excess of those imposed on CDC under the CDC Agreement (any such
excess cost or obligation, an “Excess Requirement”) and (ii) relating to the
rights of BDSI subject to the above referenced termination by CDC, shall be
automatically assigned to CDC, as described in the CDC Consent to provide for
Collegium’s continued quiet enjoyment of the rights granted to it under this
Agreement in accordance with its terms. If Collegium asks CDC to satisfy any
Excess Requirement, CDC declines to satisfy such Excess Requirement, Collegium
asks BDSI to satisfy such Excess Requirement, and BDSI declines to satisfy such
Excess Requirement, then BDSI represents and warrants that CDC and BDSI shall
have agreed in the CDC Consent that, at Collegium’s own expense, Collegium may
(but shall not be obligated to) undertake, perform or satisfy such Excess
Requirement, in whole or in part, or take such other actions as it reasonably
determines in good faith are reasonably consistent with maintaining the benefits
intended for Collegium under this Agreement.

Section 13.07 Suspension of Cure Period Pending Dispute Resolution. If a Party
gives notice of breach under Section 13.02 or Section 13.03 and the other Party,
acting in good faith, disputes in writing prior to the end of the applicable
cure period whether such notice was proper,

 

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then the issue of whether a material breach has occurred shall be resolved in
accordance with Section 14.03. If as a result of such dispute resolution process
it is determined that the notice of breach was proper, then such notice shall be
deemed to have been effective if the breaching Party fails thereafter to cure
such breach in accordance with the determination made in the resolution process
within the applicable cure period following such determination. If as a result
of such dispute resolution process it is determined that the notice of breach
was improper, then no such notice shall be deemed to have been effective and
this Agreement shall remain in effect. All of the terms and conditions of this
Agreement, including all of the licenses granted hereunder, shall remain in full
force and effect during the pendency of such dispute resolution process.

ARTICLE XIV

MISCELLANEOUS

Section 14.01 Assignment. Except as explicitly contemplated by this Agreement,
neither this Agreement nor any rights or obligations hereunder may be assigned
or otherwise transferred by either Party without the prior written consent of
the other Party (which consent shall not be unreasonably withheld); provided,
however, that either Party may assign this Agreement and its rights and
obligations hereunder without the other Party’s consent (a) in connection with
the transfer or sale of all or substantially all of the business of such
assigning Party to which this Agreement relates to a Third Party, whether by
merger, sale of stock, sale of assets or otherwise, or (b) to any of its
Affiliates. Notwithstanding the foregoing, any such assignment to an Affiliate
shall not relieve the assigning Party of its responsibilities for performance of
its obligations under this Agreement, so long as such Affiliate remains an
Affiliate of the assigning Party. Each Party shall promptly notify the other
Party of any purported assignment of this Agreement. The rights and obligations
of the Parties under this Agreement shall be binding upon and inure to the
benefit of the successors and permitted assigns of the Parties. Any purported
assignment not in accordance with this Agreement shall be void.

Section 14.02 Force Majeure. Neither Party shall be held liable or responsible
to the other Party nor be deemed to have defaulted under or breached this
Agreement for failure or delay in fulfilling or performing any term of this
Agreement when such failure or delay is caused by or results from causes beyond
the reasonable control of the affected Party, including, but not limited to,
fire, floods, embargoes, terrorism, war, acts of war (whether war be declared or
not), insurrections, riots, civil commotions, strikes, lockouts or other labor
disturbances, acts of God or acts, omissions or delays in acting by any
Governmental Authority or the other Party, or for any other reason which is
completely beyond the reasonable control of the Party (collectively a “Force
Majeure”); provided that the Party whose performance is delayed or prevented
shall continue to use good faith diligent efforts to mitigate, avoid or end such
delay or failure in performance as soon as practicable.

Section 14.03 Governing Law; Jurisdiction; Dispute Resolution.

(a) This Agreement shall be governed by and construed under the state laws of
the State of New York, without reference to its conflicts of laws principles.

 

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(b) In the event that any controversy or claim shall arise between the Parties
under, out of, in connection with, or relating to this Agreement or the breach
thereof, the Party initiating such controversy or making such claim shall
provide to the other Party written notice containing a brief and concise
statement of the initiating Party’s claims, together with relevant facts
supporting them. During a period of ***, or such longer period as may be
mutually agreed upon in writing by the Parties, following the date of said
notice, the Parties shall make good faith efforts to settle the dispute. Such
efforts may include, but shall not be limited to, full presentation of both
Parties’ claims and responses, with or without the assistance of counsel, before
the chief executive officers (or their designees) of the Parties. If for
whatever reason the Parties are unable to resolve the dispute within *** after
the issuance of a notice of dispute, then either Party may, by written notice to
the other Party, submit the dispute to binding arbitration in accordance with
the provisions of Section 14.03(c).

(c) In the event that the Parties have been unable to reach accord using the
procedures set forth in Section 14.03(b), either Party may seek final resolution
of the matter through binding arbitration upon written notice to the other
Party. The failure of a Party to comply with the provisions of Section 14.03(b)
with respect to any controversy or claim shall, except as set forth in Section
14.03(d), constitute an absolute bar to the institution of any proceedings, by
arbitration or otherwise, by such Party with respect to such controversy or
claim. Any such arbitration shall be held in a location that is mutually agreed
upon by the Parties, which provides neither party an advantage (or, if the
Parties are unable to agree on a location within *** of the initiation of
arbitration hereunder, such location shall be New York, New York), in the
English language before a single independent, neutral arbitrator, who shall be
selected by agreement of the Parties, or, if the Parties cannot agree within ***
after commencement of arbitration, then by the American Arbitration Association
(“AAA”) in accordance with the then existing Commercial Arbitration Rules of the
AAA (the “Rules”) and judgment upon the award rendered by the arbitrator may be
entered or enforced in any court having jurisdiction thereof. The arbitrator
shall have at least twenty (20) years’ experience in pharmaceutical patent
licensing. The arbitrator shall permit the Parties to have discovery to the
extent permitted by the Rules. The decision of the arbitrator shall be final and
binding on the Parties and shall be accompanied by a written opinion of the
arbitrator explaining the arbitrator’s rationale for its decision. Except as may
otherwise be determined by the arbitrator in its award to be just and
appropriate in light of the particular circumstances and outcome of the
arbitration, the Party losing the arbitration shall pay all fees and costs of
the arbitrator and the AAA and reimburse the prevailing Party for its reasonable
attorneys’ fees, costs, expenses, and disbursements (including, for example,
expert witness fees and expenses, photocopy charges and travel expenses). The
intent of the Parties is that, except for the entering of an arbitration order
in a court of competent jurisdiction or as set forth in Section 14.03(d),
disputes shall be resolved finally in arbitration as provided above, without
appeal, and without recourse to litigation in the courts.

(d) Notwithstanding the foregoing provisions of this Section 14.03, (i) each
Party shall be entitled to seek injunctive or equitable relief to enforce the
respective covenants and agreements of the Parties in this Agreement (including
with respect to any breach or threatened breach of confidentiality or to enforce
provisions of this Agreement relating to ownership rights in intellectual
property or the assignment of assets) and (ii) either Party may initiate an
action before any court having competent jurisdiction in order to obtain interim
or conservatory relief, such as an order to preserve the status quo and to avoid
incurring irreparable harm pending the resolution of any dispute that is
submitted to arbitration, to prevent or enjoin, without in either case complying
with the procedures set forth in Section 14.03(b) or 14.03(c).

 

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Section 14.04 Waiver. No waiver of any term or condition of this Agreement shall
be effective unless set forth in a written instrument duly executed by or on
behalf of the waiving Party. Except as specifically provided for herein, the
waiver from time to time by either of the Parties of any of their rights or
their failure to exercise any remedy shall not operate or be construed as a
continuing waiver of same or of any other of such Party’s rights or remedies
provided in this Agreement.

Section 14.05 Severability. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired
thereby. Any provision of this Agreement held invalid or unenforceable in part
or degree will remain in full force and effect to the extent not held invalid or
unenforceable.

Section 14.06 Notices. All notices and other communications provided for herein
shall be dated and in writing and shall be deemed to have been duly given (a) on
the date of delivery, if delivered personally, by e-mail or by facsimile
machine, receipt confirmed, (b) on the following business day, if delivered by a
nationally recognized overnight courier service, with receipt acknowledgement
requested, or (c) three (3) business days after mailing, if sent by registered
or certified mail, return receipt requested, postage prepaid, in each case, to
the Party to whom it is directed at the following address (or at such other
address as any Party hereto shall hereafter specify by notice in writing to the
other Parties hereto):

 

If to BDSI:        BioDelivery Sciences International, Inc.    4131 Parklake
Avenue, Suite #225    Raleigh, North Carolina 27612   

Attn: Mark Sirgo, Chief Executive Officer

   Telephone: 919-582-9050    Facsimile: 919-582-9051

Copies (which shall not constitute notice) to:        Wyrick Robbins Yates &
Ponton LLP    4101 Lake Boone Trail, Suite 300    Raleigh, North Carolina 27607
USA    Attn: Jason S. Wood    Telephone: (919) 781-4000    Facsimile: (919)
781-4865

 

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If to Collegium:    

  

Collegium Pharmaceutical, Inc.

780 Dedham Street, Suite 800

Canton, MA 02021

Attn: Paul Brannelly, Chief Financial Officer

Telephone: 781-713-3734

Facsimile: 781-828-4697

Copies (which shall not constitute notice) to:        Gunderson Dettmer LLP   
One Marina Park Drive, Suite 900    Boston, Massachusetts, 02210 USA   
Attn: Timothy H. Ehrlich    Telephone: (617) 648-9119    Facsimile: (617)
648-9120

Section 14.07 Independent Contractors. It is expressly agreed that BDSI and
Collegium shall be independent contractors and that the relationship between the
two Parties shall not constitute a partnership or agency of any kind. Neither
BDSI nor Collegium shall have the authority to make any statements,
representations or commitments of any kind, or to take any action, which shall
be binding on the other Party, without the prior written consent of the other
Party.

Section 14.08 Rules of Construction. The Parties hereto agree that they have
been represented by counsel during the negotiation and execution of this
Agreement and, therefore, waive the application of any law, regulation, holding
or rule of construction providing that ambiguities in an agreement or other
document will be construed against the Party drafting such agreement or
document. Whenever the context hereof shall so require, the singular shall
include the plural, the male gender shall include the female gender and neuter,
and vice versa.

Section 14.09 Publicity. Collegium and BDSI shall consult with each other before
issuing any press release with respect to this Agreement or the transactions
contemplated hereby and neither shall issue any such press release or make any
such public statement without the prior consent of the other, which consent
shall not be unreasonably withheld; provided, however, that a Party may, without
the prior consent of the other Party, issue such press release or make such
public statement as may upon the advice of counsel be required by law or the
rules and regulations of the Nasdaq or any other stock exchange. No such consent
of the other Party shall be required to release information which has previously
been made public.

Section 14.10 Entire Agreement; Amendment. This Agreement (including the
Exhibits attached hereto) sets forth all of the covenants, promises, agreements,
warranties, representations, conditions and understandings between the Parties
hereto with respect to the subject matter hereof and supersedes and terminates
all prior agreements and understandings between the Parties. There are no
covenants, promises, agreements, warranties, representations conditions or
understandings, either oral or written, between the Parties other than as set
forth herein. No subsequent alteration, amendment, change or addition to this
Agreement shall be binding upon the Parties hereto unless reduced to writing and
signed by the respective authorized officers of the Parties.

 

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Section 14.11 Audit and Inspection Rights. Upon *** prior written notice from
either Party (the “Requesting Party”), the Party receiving such notice (the
“Audited Party”) shall permit an independent certified public accountant
selected by the Requesting Party (or any designee thereof, including with
respect to BDSI, Meda) and reasonably acceptable to the Audited Party (with
respect to inspections or audits directly concerning financial matters) or any
designee selected by the Requesting Party and reasonably acceptable to the
Audited Party (with respect to inspections or audits not directly concerning
financial matters) to audit and/or inspect only those Books and Records
(including but not limited to financial records) as may be necessary pursuant to
the terms of the applicable Section of this Agreement granting the applicable
audit and/or inspection rights to the Requesting Party pursuant to this Section
14.11; provided, however, that in no event may any audit and/or inspection right
granted under any Section of this Agreement be conducted more than once in any
Calendar Year, unless otherwise agreed by the Audited Party. Any such
independent accounting firm or designee shall be subject to the confidentiality
provisions of this Agreement. In the case of any audit and/or inspection
directly concerning financial matters, a copy of any report provided to a Party
by the accountant shall be given concurrently to the other Party and shall be
considered the Audited Party’s Confidential Information. Subject to the terms of
this paragraph, any such inspection or audit shall be conducted (a) at the sole
cost of the Requesting Party and (b) during the Audited Party’s normal business
hours. If the applicable audit involves payments made and/or to be made by one
Party to the other Party and such accounting firm concludes that there was an
overpayment or underpayment by one Party to the other Party with respect
thereto, within *** of the date of delivery of such accounting firm’s report
concluding that an overpayment or underpayment occurred, the amount overpaid
shall be promptly repaid by the overpaid Party or the amount underpaid shall be
promptly augmented by the underpaying Party as necessary to correct the
underpayment, and if there was an underpayment, the underpaying Party shall pay
interest on the unpaid amount at the rate set forth in Section 4.03(c). If the
amount of such underpayment for any particular Calendar Quarter was equal to or
greater than *** of the proper amount payable with respect to such Calendar
Quarter, the Audited Party shall promptly reimburse the Requesting Party for the
reasonable, documented costs associated with the audit. The Parties agree that
the rights granted to BDSI under this Section 14.11 may be exercised by CDC in a
manner consistent with similar rights established with respect to CDC in the CDC
Agreement.

Section 14.12 Headings. The captions contained in this Agreement are not a part
of this Agreement, but are merely guides or labels to assist in locating and
reading the several Articles hereof.

Section 14.13 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Signatures to this
Agreement may be transmitted via facsimile and such signatures shall be deemed
to be originals.

Section 14.14 Third Party Beneficiary. CDC shall be an intended third party
beneficiary to this Agreement for the sole purpose of enforcing Sections 7.01,
10.02, 11.01, 11.11, and 13.06(e) and enforcing BDSI’s rights under Sections
2.03, 2.04, 2.05, 3.02(a), 4.03, 6.03, 6.04, and 11.05.

 

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Section 14.15 CREATE Act. This Agreement includes a joint research agreement as
defined in 35 U.S.C. § 103(c)(3).

[Signature page to follow.]

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
in duplicate by their duly authorized officers as of the Effective Date.

 

ARIUS PHARMACEUTICALS, INC. By:  

 

Name:  

 

Title:  

 

BIODELIVERY SCIENCES INTERNATIONAL, INC. By:  

 

Name:  

 

Title:  

 

COLLEGIUM PHARMACEUTICAL, INC.

By:

 

 

Name:  

 

Title:  

 

Signature page to License and Development Agreement

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EXHIBIT A

LICENSED MARKS

 

Mark

  

Class

  

Registration Number

  

Registration Date

  

Register

ONSOLIS

   5    3723904    December 8, 2009    PRINCIPAL

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EXHIBIT B

LICENSED PATENTS

 

Title

  

Patent or
Application
No.

  

Expiration Date

  

Owner

Bioerodable Film For Delivery Of Pharmaceutical Compounds Of Mucosal Surfaces

   6,159,498    October 18, 2016    ARIUS TWO, INC.

Pharmaceutical Carrier Device Suitable For Delivery Of Pharmaceutical Compounds
To Mucosal Surfaces

   7,579,019    January 22, 2020    ARIUS TWO, INC.

Transmucosal Delivery Devices With Enhanced Uptake

   14/746,168    July 23, 2027    BIODELIVERY SCIENCES INTERNATIONAL, INC.

Mucoadhesive Devices For Treatment Of Pain And Opioid Dependence

   14/875,107   

August 20, 2032 or March 7, 2034,

if issued, depending on the priority claim

   BIODELIVERY SCIENCES INTERNATIONAL, INC

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EXHIBIT C

PERMITTED COLLEGIUM DEVELOPMENT/MANUFACTURING ACTIVITIES

 

  •   Investigator initiated studies involving ONSOLIS® with academic,
government, and private institutions.

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EXHIBIT D

MFG TRANSFER PLAN

***

Additional Terms & Conditions

 

  •   Changes in raw material prices will impact the quoted pricing

 

  •   Charges may be incurred if order is cancelled or postponed after placement
of purchase order.

 

  •   Warehousing and/or disposal fees may be incurred for material stored at
*** longer than 90 days without production activity.

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EXHIBIT E

LICENSED MARK GUIDELINES

Collegium shall indicate on any product package insert therefor, or promotional
material that bears or displays a Licensed Trademark that “The trademark ONSOLIS
is used under license.” Collegium shall comply with any additional reasonable
guidelines for usage of the Licensed Marks that BDSI may provide and that BDSI
may modify from time to time.

Guidelines for Use of Domain Names. Collegium shall post on all websites
associated with the ONSOLIS related domain names (a) a privacy policy that
complies with all applicable law; (b) a Terms of Use policy that complies with
all applicable laws, and contains commercially reasonable provisions that BDSI
may request from time to time; and (c) statements on the home page that (i) the
website and its content are intended for USA audiences; and (ii) “The trademark
ONSOLIS is used under license.” Collegium shall adopt and implement commercially
reasonable measures to protect and preserve the security of personal information
collected through websites associated with the ONSOLIS related domain
names. Collegium shall comply with any additional guidelines for usage of the
ONSOLIS related domain names that BDSI may provide and that BDSI may modify from
time to time.

Collegium shall not adopt, use, register or apply for registrations anywhere in
the world for the Licensed Marks and ONSOLIS related domain names or any other
Trademarks or domain names that (i) are likely to cause confusion with the
Licensed Marks or ONSOLIS related domain names; (ii) are variations of the
Licensed Marks or ONSOLIS related domain names; or (iii) incorporate the
Licensed Marks or ONSOLIS related domain names. In using the Licensed Marks and
ONSOLIS related domain names pursuant to this Agreement, Collegium shall in no
way represent that it has any rights, title or interest in the Licensed Marks
and ONSOLIS related domain names other than those expressly granted under this
Agreement.

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EXHIBIT F

BDSI LEGAL PROCEEDINGS

BioDelivery Sciences International, Inc. and Arius Two, Inc., v. Actavis
Laboratories UT, Inc., and Actavis, Inc., Civil Action No. 16-cv-175, United
States District Court for the District of Delaware