*** Confidential portions omitted and filed separately with the Commission.

 

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EXHIBIT 10.56

NOTE: Portions of this Exhibit are the subject of a Confidential Treatment
Request by the Registrant to the Securities and Exchange Commission (the
“Commission”). Such portions have been redacted and are marked with a “[***]” in
place of the redacted language. The redacted information has been filed
separately with the Commission.

AMENDMENT NO. 2 TO SECOND AMENDED AND RESTATED

COLLABORATION, LICENSE AND SUPPLY AGREEMENT

THIS AMENDMENT NO. 2 TO SECOND AMENDED AND RESTATED COLLABORATION, LICENSE AND
SUPPLY AGREEMENT (the “2nd Amendment”), is entered into as of December 31, 2005
(the “2nd Amendment Date”) by and between EPOCH BIOSCIENCES, INC., with offices
at 21720 23rd Drive S.E., Suite 150, Bothell, WA ( “Epoch”), a wholly owned
subsidiary of Nanogen, Inc., with offices at 10398 Pacific Center Ct., San
Diego, CA 92121 (“Nanogen”); and APPLERA CORPORATION, through its Applied
Biosystems group, with offices at 850 Lincoln Centre Drive, Foster City, CA
94404 (“ABG”). Each of Epoch and ABG is individually referred to as a “Party”
and, collectively, as “Parties”.

RECITALS

WHEREAS, Epoch and ABG are parties to that certain Second Amended and Restated
Collaboration, License and Supply Agreement (the “Collaboration Agreement”)
dated August 17, 2000 (the “Effective Date”), as amended by that certain First
Side Agreement dated October 31, 2001, and that certain Amendment No. 1 to
Second Amended and Restated Collaboration, License and Supply Agreement dated
July 26, 2002 (the “First Amendment, and collectively with the First Side
Agreement and the Collaboration Agreement, the “MGB Agreement”); and

WHEREAS, Epoch and ABG have entered into that certain Quencher License and
Supply Agreement dated September 2, 2003, as amended (the “Quencher Agreement”),
and

WHEREAS, the Parties now wish to amend the MGB Agreement pursuant to the terms
and conditions of this 2nd Amendment.

NOW, THEREFORE, in consideration of the foregoing and other good and valuable
considerations, the sufficiency of which is hereby acknowledged, the Parties
agree as follows.

AGREEMENT

 

1. Article II of the MGB Agreement is hereby amended to add the following
sections:

 

  A. 2.36 “Control” and its cognates means in-licensed with the ability to grant
sublicenses.

 

  B. 2.37 “MGB Intermediates Manufacturing Know-How” means all know-how,
technical information, trade secrets, data, technology, software and protocols
that are owned or Controlled by Epoch, as of the Effective Date or thereafter,
relating to the manufacture of MGB Intermediates including, but not limited to,
the information set forth in Exhibit D attached hereto and incorporated herein.

--------------------------------------------------------------------------------

  C. 2.38 “Modified Base Know-How” means all know-how, technical information,
trade secrets, data, technology, software and protocols owned or Controlled by
Epoch, as of the Effective Date or thereafter, relating to Modified Bases or the
manufacture of Modified Bases.

 

2. Each Section of Article II of the MGB Agreement set forth below is hereby
amended as follows:

 

  A. 2.05 “Licensed Patents” means (1) U.S. Patent No. 5,801,155 titled
Covalently Linked Oligonucleotide Minor Groove Binder Conjugates, issued
September 1, 1998; (2) U.S. Patent No. 6,084,102 titled Covalently Linked
Oligonucleotide Minor Groove Binder Conjugates, issued July 4, 2000; (3) any
patent covering Collaboration Intellectual Property; and (4) any patent which is
owned or Controlled by Epoch as of the Effective Date or thereafter covering the
making, using, or selling of one or more of the following (alone or in
combination): (a) a minor groove binding moiety, (b) an MGB Intermediate, (c) a
product comprising an oligonucleotide having a minor-groove binding moiety
covalently attached thereto, with or without a fluorescent label and/or a
fluorescence quencher, (d) a fluorescence quencher (with or without a
fluorescent label), (e) fluorescent label (with or without a fluorescence
quencher) and (f) Modified Bases (whether or not contained the products in
(a) through (e) are part of an oligonucleotide).

 

  B. 2.06 “Related Patents” means all patents or patent applications owned,
held, or Controlled, in whole or in part by Epoch that: (a) disclose and/or
claim substantially the same subject matter as the Licensed Patents;
(b) disclose and/or claim improvements to inventions disclosed or claimed in a
Licensed Patent and require rights under the Licensed Patent to exploit such
improvements; (c) claim priority to any of the Licensed Patents, including but
not limited to continuation applications and patents, continuation-in-part
applications and patents, divisional applications and patents, reexamination
applications and patents, reissue applications and patents, and continuing
prosecution applications and patents; (d) are a parent or sibling of the
Licensed Patents, or (e) are foreign equivalents of a Licensed Patent or any
patent or patent application in (a) through (d) above.

 

  C. 2.13 “Valid Claim” means a claim of an issued and unexpired Licensed Patent
or Related Patent (or any pending patent application, that has not been held
unpatentable in a final decision by an appropriate administrative agency, which
patent application is within the Related Patents but limited to claims thereof
that claim minor groove binders or MGB Intermediates as compositions of matter
or methods of using such minor groove binders or MGB Intermediates) that has not
been held permanently invalid or otherwise unenforceable by a court or other
administrative agency of competent jurisdiction in an unappealable decision or a
decision not appealed within the time allowed for appeal.

 

  D. 2.17 “Non-Exclusive Licensed Field” means all fields outside of the
5’-Nuclease Assay Field and outside of the Human In Vitro Diagnostics Field
including, without limitation, the following: (1) use of MGB Oligonuclotides as
ligation probes in an

 

2

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oligonuclotide ligation assay, generally as described in U.S. Patent No.
4,883,750; (2) use of MGB Oligonuclotides in an assay employing a [***]; (3) use
of MGB Oligonuclotides as primers in a primer extension reaction, including but
not limited to a PCR reaction or a DNA sequencing reaction; and (4) use of MGB
Oligonuclotides in the Real-Time Nucleic Acid Monitoring Field, to the extent
that (1), (2), (3) and (4) are practiced outside of the Exclusive Licensed
Field.

 

  E. 2.32 “Modified Base” (or in the plural, “Modified Bases”) means any
modified nucleotide, including but not limited to pyrazolopyrimidine (ppn)
nucleotide analogs, e.g., ppA and ppG analogs and any other analogs of A, T, G,
or C nucleotides, including methods for making or using such modified
nucleotides.

 

3. Section 4.01 of the MGB Agreement is hereby amended to read in its entirety
as follows:

4.01 Exclusive License. As of the Effective Date, Epoch hereby grants to ABG a
world-wide, exclusive license under Licensed Patents, Related Patents, MGB
Intermediates Manufacturing Know-How, Modified Base Know-How, and Licensed
Know-How to make, have made, use, offer to sell, sell and import Licensed
Products in the Exclusive Licensed Field (but not the right to sell Modified
Bases or MGB Intermediates that are not incorporated into oligonucleotides).

 

4. Section 4.02 of the MGB Agreement is hereby amended to read in its entirety
as follows:

 

  4.02 Non-Exclusive Licenses.

(a) MGB Probe Non-Exclusive License. As of the Effective Date, Epoch hereby
grants to ABG a world-wide, non-exclusive license under Licensed Patents,
Related Patents, MGB Intermediates Manufacturing Know-How, Modified Base
Know-How and Licensed Know-How to make, have made, use, offer to sell, sell and
import Licensed Products in the Non-Exclusive Licensed Field (but not the right
to sell Modified Bases or MGB Intermediates that are not incorporated into
oligonucleotides).

(b) HIVD Field Customer Licenses. Epoch shall grant to ABG’s customers, whether
referred by ABG, identified to Epoch by name, or otherwise presenting evidence
of having purchased Licensed Products from ABG (“Customers”) a non-exclusive,
world-wide, royalty-bearing license to use Licensed Products purchased from ABG
in the HIVD Field (each, an “HIVD Field Customer License”). Such royalty shall
be [***]percent ([***]%) of Customer Net Revenues from providing services in the
HIVD Field. “Net Revenues” shall mean all moneys received by a Customer, less
refunds, for or on account of laboratory services provided using Licensed
Products. Without limiting the foregoing, at ABG’s request, Epoch shall provide
to ABG a customer referral code that ABG may provide to Customers to allow such
Customers to present the same to Epoch so as to identify such Customers as
entitled to receive the foregoing HIVD Field Customer License on the foregoing
terms. Notwithstanding the foregoing, Epoch

*** Confidential portions omitted and filed separately with the Commission.

 

3

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shall not be obligated to provide such an HIVD Field Customer License on the
above terms to any Customer that (i) is demonstrably, as of the 2nd Amendment
Date, already in negotiations with Epoch for such a license; or (ii) prior to
being referred or identified by ABG, already signed a license agreement with
Epoch providing such rights in the HIVD Field.

 

5. Section 5.01 of the MGB Agreement is hereby amended to add:

In consideration of the grant of licenses under the Modified Base related
Licensed Patents, MGB Intermediates Manufacturing Know-How and Modified Base
Know-How set forth in this Agreement and in the Quencher Agreement (and without
limiting ABG’s royalty obligations set forth in Section 5.04(a) of this
Agreement and Section 3.1.2 of the Quencher Agreement), ABG shall pay to Epoch
four (4) nonrefundable payments of [***] Dollars ($[***]), each of which shall
be due and payable within thirty (30) days of the first day of each of the four
quarters commencing after the 2nd Amendment Date. Notwithstanding anything
herein to the contrary, all of ABG’s royalty obligations under this Agreement
and the Quencher Agreement shall continue only until the expiration date of the
last to expire of the Valid Claims (as defined respectively in this Agreement
and the Quencher Agreement) and shall be limited to paying royalties on Licensed
Products covered by a Valid Claim and to Licensed Products under this Agreement
that comprise software or algorithms within the Licensed Know-How definition
herein. Upon the last to expire of the Valid Claims, the licenses herein shall
be deemed fully paid-up.

 

6. Section 5.04(b) of the MGB Agreement is hereby amended so as (x) to add the
following Quarterly Minimum Royalties:

 

FOR THE CALENDAR QUARTER ENDING

  

QUARTERLY

MINIMUM

ROYALTY

December 31, 2005

   $ [***]

March 31, 2006

   $ [***]

June 30, 2006

   $ [***]

September 30, 2006

   $ [***]

December 31, 2006

   $ [***]       

TOTAL

   $ [***]       

and (y) to add a final paragraph as follows:

With respect to the period covering October 1, 2005 through December 31, 2006,
ABG’s royalties paid under the MGB Agreement and the Quencher Agreement (i) for
the calendar quarter ending December 31, 2005 shall be creditable against the
corresponding Quarterly Minimum Royalty; and (ii) for each calendar quarter
during calendar year 2006 shall be creditable against the corresponding
Quarterly Minimum Royalty obligation for such calendar quarter. Any deficit
between the

*** Confidential portions omitted and filed separately with the Commission.

 

4

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Quarterly Minimum Royalty due December 31, 2005 and the actual royalties paid
(under both the MGB Agreement and the Quencher Agreement) by ABG over the
calendar quarter ending December 31, 2005 shall be due and payable on
February 11, 2006. Any deficit between the Quarterly Minimum Royalty for
subsequent quarters during calendar year 2006 and the actual royalties paid
(under both the MGB Agreement and the Quencher Agreement) by ABG for the
corresponding quarter of calendar year 2006 will be paid in arrears within
thirty (30) days following the end of such quarter. For the avoidance of doubt,
no further quarterly minimum royalties shall be due beyond the calendar quarter
ending December 31, 2006.

 

7. Section 5.06 of the MGB Agreement is hereby modified to substitute thirty
(30) days instead of forty-five (45) days.

 

8. Section 6.01 of the MGB Agreement to read in its entirety as follows:

Purchase of MGB Intermediates. Subject to the terms and conditions of this
Agreement, Epoch will sell MGB Intermediates to ABG, and ABG will purchase such
MGB Intermediates from Epoch.

 

9. Section 6.05 of the MGB Agreement is hereby amended in its entirety to read
as follows:

(a) Epoch will transfer Licensed Know-How to ABG to the extent necessary for ABG
to make full use of MGB Intermediates, MGB Oligonucleotides, and algorithms and
related software for determining the melting temperature of MGB
Oligonucleotides. Such Licensed Know-How will include, but not be limited to,
that information specified in Exhibit B. All Licensed Know-How is considered
Confidential Information and will only be used by ABG in connection with the
exploitation of the license rights granted in Article IV. All Licensed Know-How
will remain owned by Epoch. Similarly, ABG will transfer certain know-how to
Epoch to the extent necessary for Epoch to make Bare Probes for ABG. Such
know-how will include, but not be limited to, information relating to the
synthesis, purification, and characterization of oligonuclotide compounds, and
automated systems for configuring orders of custom sequence oligonucleotides.
All such know-how is considered to be ABG’s Confidential Information and will
only be used by Epoch in connection with Epoch’s obligations under this
Agreement, and not for any other purpose. All such know-how will remain owned by
ABG.

(b) Within sixty (60) days following the 2nd Amendment Date, Epoch shall
transfer to ABG all MGB Intermediates Manufacturing Know-How (in existence now
or through February 28, 2006) necessary for ABG to make and have made MGB
Intermediates owned or Controlled by Epoch as of the Effective Date or
thereafter including, but not limited to, the information set forth on Exhibit D
attached hereto and incorporated herein. Epoch will provide ABG such MGB
Intermediates Manufacturing Know-How on CD-ROM or other medium reasonably
acceptable to ABG. Without limiting the foregoing, Epoch will

 

5

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provide ABG with instruction and assistance at ABG’s facilities (and provide
ongoing cooperation and responses to ABG’s inquiries) with respect to such MGB
Intermediates Manufacturing Know-How to ensure that ABG is fully able to exploit
and utilize such MGB Intermediates Manufacturing Know-How under this Agreement
and the Quencher Agreement. For the avoidance of doubt, ABG will not have the
right to sell or otherwise incorporate into a Licensed Product such MGB
Intermediates made by ABG or by a contractor of ABG unless Epoch fails to supply
at least ninety-five percent (95%) of ABG’s forecast requirements of MGB
Intermediates for more than two (2) months after receipt of written notice from
ABG of Epoch’s failure to so supply.

(c) Within sixty (60) days following the 2nd Amendment Date, Epoch shall
transfer to ABG all Modified Base Know-How (in existence now or through
February 28, 2006) necessary for ABG to make and have made MGB Intermediates
owned or Controlled by Epoch as of the Effective Date or thereafter. Epoch will
provide ABG such Modified Base Know-How on CD-ROM or other medium reasonably
acceptable to ABG. Without limiting the foregoing, Epoch will provide ABG with
instruction and assistance at ABG’s facilities (and provide ongoing cooperation
and responses to ABG’s inquiries) with respect to such Modified Base Know-How to
ensure that ABG is fully able to exploit and utilize such Modified Base Know-How
under this Agreement and the Quencher Agreement.

 

10. Section 7.05 of the MGB Agreement is hereby amended to add the following
Section:

(f) Epoch and Nanogen hereby represent and warrant that Nanogen does not own or
Control any patents, patent applications or know-how that, if owned or
Controlled by Epoch would be within the definition of Licensed Patents, Related
Patents, MGB Intermediates Manufacturing Know-How or Modified Base Know-How. To
the extent that the foregoing representation and warranty in this part (f) is
inaccurate, then Epoch and Nanogen hereby agree that any such patents, patent
applications or know-how shall be deemed to be, as of the Effective Date, within
the definition of Licensed Patents, Related Patents, MGB Intermediates
Manufacturing Know-How and Modified Base Know-How, respectively.

 

11. Section 12.08 of the MGB Agreement is hereby amended in its entirety to read
as follows:

Assignment. This Agreement and the licenses herein granted will be binding upon
and inure to the benefit of the successors in interest of the respective
Parties. Neither Party will have the power to assign this Agreement nor any
interest hereunder without the written consent of the other, such consent not to
be unreasonably withheld, provided, however, that ABG or Epoch may assign this
Agreement or any of its rights or obligations hereunder to any Affiliate or to
any third party with which it may merge or consolidate, or to which it may
transfer all or substantially all of its assets or business to which this
Agreement relates, without obtaining the consent of the other Party, subject to
such assignee assuming all liabilities and obligations under the Agreement.

 

6

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12. This 2nd Amendment will be deemed to have been made in the State of
California and its form, execution, validity, construction and effect will be
determined in accordance with the laws of the State of California, without
reference to conflicts of law principles.

 

13. Except as amended by this 2nd Amendment, the terms and conditions of the MGB
Agreement shall remain in full force and effect. This 2nd Amendment, together
with the MGB Agreement as amended herein, constitutes the entire agreement
between the Parties relating to the subject matter hereof and supersedes all
previous writings and understandings. The terms and conditions of this 2nd
Amendment shall control and take precedence in the event of any conflict between
the terms and conditions of this 2nd Amendment and the MGB Agreement. Neither
this 2nd Amendment nor the MGB Agreement may be further amended or modified,
except by a written agreement executed by the duly authorized representatives of
the Parties hereto.

 

14. Except where the context otherwise requires, wherever used, the singular
shall include the plural, the plural the singular and the word “or” is used in
the inclusive sense. The captions and headings of this 2nd Amendment are for
convenience of reference only and in no way define, describe, extend or limit
the scope or intent of this 2nd Amendment or the intent of any provision
contained in this 2nd Amendment. Each Party hereto and its respective counsel
have participated fully in the review, negotiation and formation of this 2nd
Amendment. The language of this 2nd Amendment shall not be presumptively
construed against either Party.

 

15. This 2nd Amendment may be executed in any number of counterparts (including,
via facsimile or other electronic means of transmitting signed copies), and each
such counterpart will be deemed an original instrument, but all such
counterparts together will constitute but one agreement.

 

7

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IN WITNESS WHEREOF, the Parties, through their authorized officers, have
executed this 2nd Amendment as of the 2nd Amendment Date.

 

EPOCH BIOSCIENCES, INC.  

APPLERA CORPORATION, through its

APPLIED BIOSYSTEMS GROUP

By:  

 

  By:  

 

Name:  

 

  Name:  

 

Title:  

 

  Title:  

 

Date:  

 

  Date:  

 

 

Acknowledged and Agreed by Nanogen, Inc.

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

 

Approved for signature

By: Ilan Feuchtwang

Date: January 13, 2006

Applied Biosystems Legal Department

 

8

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EXHIBIT D

MGB Intermediates Manufacturing Know-How

The specific documentation shall include, without limitation:

 

1. Chemical structures for all chemical raw materials, intermediate bulk
materials, final product, and undesired side-products associated with each of
the synthetic steps.

 

2. Complete manufacturing batch records for the last three batches of each
synthetic intermediate from the complete (approximately [***] step) synthesis of
MGB / Dark Quencher Polystyrene and Dark Quencher Polystyrene, including all
synthetic steps from readily available commercial raw materials to the final
bulk material that we purchase. These batch records would include, for example:
the commercial source, and catalog number of all chemical raw materials used,
details of all processing conducted (quantities of materials used, reaction
conditions, product isolation and purification methods, yields of the desired
product from each synthetic step, etc.).

 

3. Complete, detailed descriptions of the analytical methods and specifications
used for incoming raw material qualification, in-process analysis, and final
product QC testing, and all of the associated data from the last three batches
of each synthetic intermediate from the complete (approximately [***] step)
synthesis of MGB / Dark Quencher Polystyrene and Dark Quencher Polystyrene,
including all synthetic steps from readily available commercial raw materials to
the final bulk material that we purchase. This would include, for example,
methods, specs, and data obtained using NMR, HPLC, TLC, MS, and any other method
used to assess the purity of chemical components or to monitor the progress of
reactions, and all available information regarding the identities and quantities
of all reaction side-products associated with each synthetic step.

*** Confidential portions omitted and filed separately with the Commission.