[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

EXHIBIT 10.38

AMENDMENT #3 TO THE AMENDED AND RESTATED RESEARCH, DEVELOPMENT AND MARKETING
COLLABORATION AGREEMENT

BETWEEN

ONYX PHARMACEUTICALS, INC.

AND WARNER-LAMBERT COMPANY

THIS AMENDMENT #3 to the Amended and Restated Research, Development and
Marketing Collaboration Agreement dated as of May 2, 1995 (“Third Amendment”) is
made and entered into on August 6, 2001 (the “Amendment Date”), by and between
Onyx Pharmaceuticals, Inc., a Delaware corporation having its principal place of
business at 3031 Research Drive, Richmond, California 94806 (“Onyx”), and the
Warner-Lambert Company, a Delaware corporation and a wholly-owned subsidiary of
Pfizer Inc, having a place of business at 2800 Plymouth Road, Ann Arbor, MI 
48105 ("Warner").

RECITALS

WHEREAS, Onyx and Warner entered into an Amended and Restated Research,
Development and Marketing Collaboration Agreement dated May 2, 1995
(“Agreement”); and

 

WHEREAS, the parties subsequently amended the Agreement on December 15, 1997 and
March 1, 2000; and

 

WHEREAS, the parties wish to further amend some of the terms and conditions
under which they will proceed with the collaboration as a result of the
acquisition by Pfizer Inc. (“Pfizer”) of Warner;

 

NOW THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the parties hereby agree as follows:

 

1.             Except as expressly provided herein, defined terms will have the
meanings set forth in the Agreement.

2.             The definition of Field in Article 1 of the Agreement is deleted
and replaced in its entirety with the following:

“Field shall mean research, drug discovery and development collaboration aimed
at [ * ].

The Collaboration will seek to identify agents that modulate biological targets
within the Field.

 

The Field will consist of [ * ].

 

For the avoidance of doubt intellectual property, including patents, developed
by Pfizer against targets in the Field prior to and subsequent to the
acquisition of Warner including, but not limited to, compounds, assays, cell
lines, reagents, clinical data, etc., shall be contributed to the Collaboration;
provided, however, that there will be no obligation to contribute intellectual
property regarding targets outside the Field.”

 

3.             The following definitions are deleted from the Agreement:

“Generation 1 Collaboration Compounds” and “Generation 2 Collaboration
Compounds”

 

4.             Article 2.0 is amended.  The following sentence is added to
Section 2.1:

 “Warner will provide Onyx with a list of all Collaboration Compounds within
sixty (60) days after the end of the Term of the Research Collaboration and a
list of all Collaboration Compounds within sixty (60) days after the one (1)
year anniversary of the Term of the Research Collaboration.  The Research
Management Committee may elect to meet to discuss these lists.”

5.             Section 9.3 (Generation 2 Collaboration Products) is deleted from
the Agreement.

6.             Section 2.4 is deleted from the Agreement and Article 6.0
(Licenses and Royalties) is  amended as follows:

A.                New Sections 6.3 and 6.4 are added and inserted after Section
6.2:

“6.3  (a) Grant of Research Licenses within the Field. Onyx and Warner each
grant to the other a nonexclusive, irrevocable, worldwide, royalty-free,
perpetual license, including the right to grant sub-licenses to Affiliates, to
make and use the other’s Confidential Information, Know-How and Patents for all
research purposes other than the sale or manufacture for sale of products or
processes;

(b) Grant of Research Licenses outside the Field. Onyx and Warner each grant to
the other a nonexclusive, irrevocable, worldwide, royalty-free, perpetual
license, including the right to grant sub-licenses to Affiliates, to make and
use the other’s confidential information, know-how and patents covering the
target [ * ], developed during the Term of the Research Collaboration pursuant
to the Research Plan, for all research purposes other than the sale or
manufacture for sale of products or processes.”

“6.4 Materials.  Onyx and Warner shall, upon each other’s written request [ * ]
which are  licensed under this Article 6.0.”

B.                All other Sections within Article 6.0 will be renumbered to
reflect these insertions, i.e. “Royalties Payable by Warner” will become Section
6.5.

7.             New Section 6.14 is added and inserted after the renumbered
Section  “Restrictions on Payment” as follows:

“6.14 Acquisition and Assignment.  In the event that either Onyx or Warner is
acquired or assigns the Agreement to a third party, such third party’s
confidential information, know-how and patents shall not be subject to the
licenses granted under this Agreement.”

 

8.             Article 3.0 is amended. A sentence is added to the end of Section
3.1 as follows:

 “During the one year after the Term of the Research Collaboration the Research
Management Committee will provide each other with reports, quarterly after the
Effective Date of this Third Amendment.  The Research Management Committee may
also agree to convene by teleconference or other media to discuss the results
disclosed in the reports.

9.             Section 3.2 is deleted from the Agreement as well as all
additional references to the Marketing Committee.

10.          Section 5.4 (Warner’s Re-engagement Option) is deleted from the
Agreement.

11.          Article 7 (Co-Promotion of Collaboration Products) is deleted from
the Agreement.

12.          Article 10.0 is amended.  A new Section 10.1 (c) is added as
follows:

“(c)  Notwithstanding the foregoing, Onyx will have the right to disclose
Confidential Information of Warner’s to third parties in connection with a
potential assignment of Onyx’s rights under the Agreement, in addition to a
potential equity investment, merger or acquisition or collaboration, provided,
however, that the third party will be required to sign a confidentiality
agreement with Onyx, prior to such disclosure and also provided that Warner
receives a copy of such agreement prior to disclosure.”

 

13.          Article 14.0 is amended. A sentence is added within Section 14.2
(Assignment) so that Section 12.2 reads in its entirety as follows:

“This Agreement shall not be assignable by either party without the prior
written consent of the other party, such consent not to be unreasonably
withheld.  In no event will any assignment relieve the assigning party of its
obligations hereunder.  This Agreement shall be binding upon and, subject to the
terms of the foregoing sentence, inure to the benefit of the parties’
successors, legal representatives and assigns.

If either party wishes to assign this Agreement, they will so notify the other
party in writing.  The party receiving the notice of intention to assign will
have 30 days in which to object to such assignment by the assigning party. 
Notwithstanding the foregoing, Warner may assign this Agreement to any of its
wholly-owned subsidiaries or any entity succeeding to a majority of its
Parke-Davis business, and either party may assign this Agreement to its
successor in connection with any merger, consolidation or sale of all or
substantially all of its assets.”

 

14.          Section 14.7 is amended as follows regarding notices to Warner:

“…To Warner:

 

If to Warner to:

 

George M. Milne, Jr., Ph.D.
President, Strategic & Operations Management,
Pfizer Inc,
50 Pequot Avenue
New London, CT 06320

 

With copy to:

 

Joshua A. Kalkstein
        Assistant General Counsel, PGRD
        Pfizer Inc,
        50 Pequot Avenue
        New London, CT 06320

 

 

15.          A new Section 14.17 is added as follows:

“Diligence.  Warner shall use reasonably diligent efforts to exploit
Collaboration Compounds, Collaboration Lead Compounds and Collaboration
Products, commercially employing similar efforts applied to other products
similarly situated.”

 

 

Except as specifically stated in this Third Amendment all terms and conditions
of the amended Agreement remain in full force and effect.

 

IN WITNESS WHEREOF, each of the parties has caused its duly authorized
representative to execute and deliver this Third Amendment as of the date set
forth above.

 

WARNER LAMBERT COMPANY

 

ONYX PHARMACEUTICALS, INC.

 

 

 

 

 

By

/s/ Peter B. Corr

 

By

/s/ Hollings C. Renton

 

(Signature)

 

(Signature)

 

Peter B. Corr, Ph.D.

 

Hollings C. Renton

 

Sr. Vice President, Pfizer Inc.

 

Chairman and Chief Executive Officer

 

Executive Vice President, Pfizer Global R&D

 

 

 

And President, Worldwide Development

 

 

 

Name and Title

 

Name and Title

 

 

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.