Exhibit 10.25

 

Execution Copy

 

CONFIDENTIAL TREATMENT REQUESTED

Redacted Portions are indicated by [****]

 

LICENSE AGREEMENT

 

This License Agreement (hereinafter referred to as the “Agreement”) made and
entered into as of July 30, 2004 (hereinafter referred to as the “Effective
Date”) by and between DAIICHI SUNTORY PHARMA CO., LTD., a corporation organized
and existing under the laws of Japan and having its registered office at 7-2,
Kojimachi 5-chome, Chiyoda-ku, Tokyo 102-8530, Japan (hereinafter referred to as
“DSP”) and BIOMARIN PHARMACEUTICAL INC., a corporation organized and existing
under the laws of the State of Delaware, having its principal business office at
371 Bel Marin Keys Blvd., Suite 210, Novato, California 94949, U.S.A.
(hereinafter referred to as “BIOMARIN”). DSP and BIOMARIN are sometimes referred
to as the “Parties” collectively or as a “Party” individually.

 

WITNESSETH:

 

WHEREAS, DSP has developed the Drug Substance (hereinafter defined) to be
contained in finished pharmaceutical preparations for treatment of genetic
diseases including phenylketonuria (hereinafter referred to as “PKU”); and

 

WHEREAS, BIOMARIN has been developing the Drug Substance and the Drug Product
(hereinafter defined) in the U.S. for treatment of PKU; and

 

WHEREAS, BIOMARIN has expressed its interest to DSP to obtain the license to
certain scientific information and data relating to the Drug Substance and the
Drug Product; and

 

WHEREAS, DSP and BIOMARIN have executed the letter of intent (hereinafter
referred to as the “LOI”) dated April 23, 2004 which stipulates the procedure of
the due diligence and basic terms and conditions of the license of relative
patents and know-how to the Drug Substance and the Drug Product, and supply of
the Drug Substance; and

 

WHEREAS, following the execution of the LOI, BIOMARIN has carried out its due
diligence examination of the Informative Know-How (hereinafter defined) and the
DSP Drug Product Manufacturing Know-How (hereinafter defined); and

 

WHEREAS, as the result of such due diligence, BIOMARIN has expressed its desire
to DSP, to obtain an exclusive license under certain patents and know-how to
develop and commercialize the Drug Product in the Territory (hereinafter
defined) under the basic terms and conditions stipulated in the LOI;

 

WHEREAS, DSP and BIOMARIN have further discussed, negotiated, and agreed on
certain of the detailed terms and conditions of such license relating to the
Drug Substance and the Drug Product; and

 

WHEREAS, concurrent with the execution of this Agreement, BIOMARIN, DSP and
SHIRATORI (hereinafter defined) have entered into a Supply Agreement related to
the production of Drug Substance by DSP and SHIRATORI and the sale of such Drug
Substance to BIOMARIN.

 

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NOW, THEREFORE, for and in consideration of the premises and covenants contained
herein, DSP and BIOMARIN agree as follows:

 

ARTICLE 1. DEFINITIONS

 

The following terms shall have the following meanings, unless otherwise clearly
required by the context:

 

1) “Affiliate” means any entity that directly or indirectly controls, is
controlled by, or is under common control with a specified entity. An entity is
deemed to be in control of another entity if the former has the direct or
indirect power to control the management and policies of the latter.

 

2) “Applicable Law(s)” means all applicable laws, rules, regulations and
guidelines that apply to the import, export, development, manufacturing,
marketing, distribution or sale of Drug Substance and Drug Product as
contemplated in this Agreement or the performance of either Party’s obligations
under this Agreement, to the extent applicable and relevant, including without
limitation cGMP (as hereinafter defined) and current Good Clinical Practices
standards or similar guidelines promulgated by the Regulatory Authorities.

 

3) “BIOMARIN Improvement” means any and all developments, enhancements,
modifications, inventions or discoveries in the Field relating to Drug Product
and under the control of BIOMARIN that are developed or created by or on behalf
of BIOMARIN at any time during the term of this Agreement, whether patentable or
not, including, but not be limited to, developments, inventions or discoveries
intended to enhance the safety or efficacy of Drug Product, and all intellectual
property rights thereto which are necessary or useful for BIOMARIN to exercise
the rights licensed to it under Section 2.1 (License Grant) of this Agreement.

 

4) “cGMP” means current good manufacturing practices and standards as
promulgated under ICH Q7A - Good Manufacturing Practice Guidance for Active
Pharmaceutical Ingredients, US Federal Food Drug and Cosmetic Act at 21 CFR and
the EEC Guide to Good Manufacturing Practices for Medical Products (Vol. IV -
rules governing medical products in the European Community 1989) in the most
recent version.

 

5) “Commercially Reasonable Efforts” means those diligent efforts that an
ordinary pharmaceutical company would reasonably devote to a product of similar
market potential, profit potential or strategic value resulting from its own
research efforts, based on conditions then prevailing, consistent with the
exercise of prudent scientific and/or business judgment in accordance with
generally accepted practices in the pharmaceutical industry.

 

6) “Drug Master File” means the drug master file, as defined in 21 CFR Section
314.420, or successor provision, filed with the U.S. FDA with respect to the
Drug Substance, and other filings in other countries in the Territory similar to
such drug master file.

 

7) “Drug Substance” means the chemical substance identified as 6R-BH4 in its
code name (generic name “Sapropterin”) and
(6R)-2-amino-6-[(1R,2S)-1,2-dihydroxypropyl]-5,6,7,8-tetrahydro-4-(3H)-pteridinone
dihydrochloride in its chemical name and also known as
(6R)-L-erythro-5,6,7,8-tetrahydrobiopterin dihydrochloride, for use in the Drug
Product and to be manufactured in accordance with all applicable regulatory
requirements related to pharmaceutical products, including U.S. cGMP and
European EP requirements.

 

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8) “Drug Product” means finished pharmaceutical preparations for human use
containing the Drug Substance as an active ingredient.

 

9) “Drug Product Patent” means the patent applications relating to the
manufacturing of the Drug Product, as stipulated in Exhibit A, and any
continuations, continuations-in-part, provisionals, divisionals, reissues,
reexaminations, extensions, substitutions, or improvements thereon, and any
patents or patent applications subsequently issued or filed related to the Drug
Product, in each case that is in the possession of DSP and which DSP has the
right to disclose to BIOMARIN.

 

10) “Drug Substance Patent” means the patents relating to the manufacturing of
the Drug Substance, as stipulated in Exhibit B, and any continuations,
continuations-in-part, provisionals, divisionals, reissues, reexaminations,
extensions, substitutions, or improvements thereon, and any patents or patent
applications subsequently issued or filed related to the Drug Substance, in each
case which is in the possession of DSP and SHIRATORI and which DSP has the right
to disclose to BIOMARIN.

 

11) “DSP Drug Product Manufacturing Know-How” means all know-how and protocols
relating to manufacturing and formulation of the Drug Product now in the
possession of DSP and which DSP has the right to disclose and license to
BIOMARIN.

 

12) “DSP Drug Substance Manufacturing Know-How” means all know-how related to
the manufacturing of the Drug Substance now or hereafter in the possession of
DSP and SHIRATORI and which DSP has the right to disclose and license to
BIOMARIN including development, enhancements, modifications, inventions or
discoveries thereon.

 

13) “DSP Formulation” means the granule form of the Drug Product contemplated by
the DSP Drug Product Manufacturing Know-How and/or the Drug Product Patent.

 

14) “DSP Improvement” means any and all developments, enhancements,
modifications, inventions or discoveries in the Field indirectly relating to the
Drug Product and under the control of DSP that are developed or created by or on
behalf of DSP at any time during the term of this Agreement, whether patentable
or not, including, but not be limited to, developments, inventions or
discoveries intended to enhance the safety or efficacy of Drug Product, and all
intellectual property rights thereto which are necessary or useful for BIOMARIN
to exercise the rights licensed to it under Section 2.1 (License Grant) of this
Agreement. It is expressly understood that the DSP Improvement does not include
the Drug Product Patent, the Drug Substance Patent, the DSP Drug Product
Manufacturing Know-How or the DSP Drug Substance Manufacturing Know-How.

 

15) “Field” means all indications for Genetic Disorders (hereinafter defined).

 

16) “Genetic Disorders” means all biochemical genetic disorders that are caused
by single gene defects, but only to the extent that such biochemical genetic
disorder also meets the Orphan Drug (hereinafter defined) regulation
requirements.

 

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17) “Informative Know-How” means non-clinical and clinical data, Drug Master
File, and CMC information needed for all regulatory filings related to the Drug
Substance or the Drug Product for the Field in possession of DSP and/or
SHIRATORI and which DSP has the right to disclose and license to BIOMARIN.

 

18) “Manufacturing Step” means the manufacturing steps of the Drug Substance as
stipulated in Exhibit C.

 

19) “Net Sales” means, with respect to Drug Product, gross sales by BIOMARIN or
its sub-licensees of the Drug Product to third parties in the applicable country
in the Territory, less:

 

(a) bad debts related to the Drug Product; and

 

(b) sales returns, rebates and allowances, including, without limitation, trade,
quantity and cash discounts; and

 

(c) any other adjustments, including, but not limited to, adjustments granted on
account of price adjustments, billing errors, rejected goods, damaged or
defective goods, recalls, returns, rebates, charge-back rebates, reimbursements
or similar payments granted or given to wholesalers or other distributors,
buying groups, health care insurance carriers or other institutions, adjustments
arising from consumer discount programs, freight, postage, transportation, and
insurance, customs or excise duties, sales tax, consumption tax, and other taxes
(except income taxes) or duties relating to sales, and any payment in respect of
sales to any governmental authority in respect of any government-subsidized
program.

 

20) “Non-DSP Formulation” means a form of the Drug Product other than the DSP
Formulation, such as a tablet or capsule. Notwithstanding the foregoing, simply
repackaging the DSP Formulation, such as dispensing the DSP Formulation in a
capsule as opposed to a sachet, shall be considered as the DSP Formulation.

 

21) “Orphan Drug” means pharmaceutical drug as set forth in the Orphan Drug Act
of 1983 in the USA or any corresponding laws or regulations in other countries
in the Territory.

 

22) “Regulatory Approval” means authorization granted by a Regulatory Authority
(hereinafter defined) to market and sell Drug Product in a country in the
Territory that is required before Drug Product may be commercially marketed and
sold in such country, including without limitation any pricing and/or
reimbursement approval(s) which must be obtained before placing a Drug Product
on the market in any country in the Territory in which such approval(s) is
required.

 

23) “Regulatory Authority(ies)” means any regulatory agency, department, bureau,
or other governmental entity, including without limitation the U.S. Food and
Drug Administration (“FDA”), which is responsible for issuing approvals,
licenses, registrations, clearances, or authorizations necessary for the
manufacture, use, storage, import, transport, marketing or sale of Drug
Substance and/or Drug Product in a country in the Territory.

 

24) “SHIRATORI” means Shiratori Pharmaceutical Co., Ltd., the manufacturer of
the Drug Substance.

 

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25) “Territory” shall mean all countries of the world other than Japan.

 

ARTICLE 2. LICENSE GRANT:

 

2.1 License Grant. DSP hereby grants to BIOMARIN an exclusive right, exclusive
even as to DSP, with the right to sub-license, under the Drug Product Patent,
Informative Know-How, and the DSP Drug Product Manufacturing Know-How:

 

(a) to develop the Drug Product in the Territory, including conducting any
development necessary to obtain Regulatory Approval in any of the countries in
the Territory for the Field,

 

(b) to manufacture and/or have manufactured the Drug Product from the Drug
Substance, and

 

(c) to use, promote, offer to sell, sell, have sold, distribute, import, and
export the Drug Product in the Territory for the Field.

 

Also, DSP hereby grants to BIOMARIN an exclusive right, exclusive even as to
DSP, with the right to sublicense, to purchase the Drug Substance from DSP for
the purpose of (a) and (b) above.

 

It is expressly understood that BIOMARIN is not granted any rights under the
Drug Product Patent, Informative Know-How, and the DSP Drug Product
Manufacturing Know-How except as expressly granted in the foregoing sentence or
as otherwise expressly provided elsewhere in this Agreement.

 

2.2 Sublicense. It is expressly understood that the right to sublicense as set
forth in Section 2.1 (License Grant) shall be subject to DSP’s prior written
consent, which consent shall not be withheld or delayed unreasonably, and no
additional license fees or royalties or other compensation shall be required in
connection with any such sublicense.

 

2.3 License to Manufacture the Drug Substance. DSP hereby grants BIOMARIN the
co-exclusive right with DSP and SHIRATORI, with the right to sublicense, for the
Field, under the Drug Substance Patent and the DSP Drug Substance Manufacturing
Know-How, to manufacture and/or have manufactured the Drug Substance for the
Drug Product necessary for the Field. Other than the limited amount of the Drug
Substance that may be produced in connection with validations lots to allow a
third party manufacturer of the Drug Substance to be approved by the Regulatory
Authorities, which is permitted hereunder, it is expressly understood that such
right is granted solely for the purpose of manufacturing the amount of the Drug
Substance that is not covered by the supply by DSP or which DSP (SHIRATORI) is
unable to produce as required by the Supply Agreement between BIOMARIN, DSP and
SHIRATORI. It is also expressly understood that, BIOMARIN, or its sublicensees,
may manufacture Drug Substance hereunder by utilizing all or a portion of the
DSP Drug Substance Manufacturing Know-How. Such right shall be subject to
royalty payments to DSP under subsections B)(1)-(4) or C), as applicable, of
Section 10.3 (Running Royalties) hereof.

 

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ARTICLE 3. DEVELOPMENT

 

3.1 Development for the Field. Other than those activities that are the
responsibility of DSP as provided herein, BIOMARIN shall use its Commercially
Reasonable Efforts to conduct the development activities set forth on Exhibit D
(hereinafter referred to as the “Development Plan”) and all other development
activities necessary for obtaining the NDA approval for the commercialization of
the Drug Product in the U.S. and E.U. for the treatment of PKU, (hereinafter
referred to as “Development”). All Development and all activities related to
commercialization of Drug Product in other countries in the Territory for the
treatment of PKU and for other indications for the Field shall be conducted by
BIOMARIN or its sublicensee(s) or commercial partners at its or their own
responsibilities, discretion, expenses, and costs.

 

3.2 Modification of the Development Plan. If BIOMARIN intends to substantially
modify the Development Plan, BIOMARIN shall notify DSP of such intention and the
Parties shall promptly discuss, in good faith, such modification; provided,
however, that if the Parties are unable to reach an agreement, BIOMARIN shall
have the right to make the final decision with respect to any such
modifications. The Parties acknowledge that the Development Plan represents a
best estimate of the activities associated with the development of a Drug
Product and the timing of those activities, but that such plan is subject to
substantial uncertainty and may need to be modified, as contemplated above for
many reasons.

 

3.3 Reports and Meetings on Development. Commencing three (3) months after the
date of this Agreement, and every three (3) months thereafter during the
Development, BIOMARIN shall furnish DSP with reports in English on the progress
and the results of the Development under the then-current Development Plan being
carried out by or on behalf of BIOMARIN, its Affiliates, or its third party
sub-licensees. Also, the Parties shall have a scientific meeting every six (6)
months to discuss the scientific matters related to the Development.
Additionally, the parties shall have monthly informal update meetings, either in
person in Japan or via teleconference.

 

3.4 Development Outside the Field. In the event that either Party develops
(hereinafter referred to as the “Developing Party”) the Drug Product or the Drug
Substance for an indication(s) outside the Field and obtains new proprietary
knowledge or information (whether patentable or not) related to the use of Drug
Product or Drug Substance for an indication(s) outside the Field (hereinafter
referred to as “Outside-the-Field Know-How”), then the Developing Party shall
first notify the other Party of such indication and the Outside-the-Field
Know-How, and the Parties shall discuss a license or a collaborative development
to such indication and the Outside-the-Field Know-How.

 

In case the Parties fail to enter into such license agreement or a collaborative
development for such indication and the Outside-the-Field Know-How as a result
of such discussion:

 

(a) the Developing Party shall have the right to commercialize, in all of the
countries in the world, such indication; and

 

(b) in case the Developing Party plans to commercialize the Drug Product in a
certain country in the territory of the other Party for such indication(s), both
Parties shall discuss

 

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in good faith on the use of information and data for the NDA in possession of
the other Party for such country under terms and conditions to be separately
agreed upon, provided, however, that both Parties shall discuss in good faith,
if necessary and to the extent permitted by Applicable Laws, on the
countermeasures to avoid interference of the other Parties’ licensed Drug
Product business in the Field.

 

It is expressly understood that, without a further license grant from DSP,
BIOMARIN cannot use the Drug Substance supplied by DSP, the DSP Drug Product
Manufacturing Technology, the Drug Substance Manufacturing Know-How, the
Informative Know-How, the Drug Substance Patent, or Drug Product Patent in the
development of an indication outside the Field. It is further expressly
understood that neither Party will have any obligation of disclosure or
negotiation pursuant to this Section 3.4 (Development Outside the Field) to the
extent that such disclosure or negotiations would violate any obligation of the
Developing Party existing on the Effective Date or related to Outside the Field
Know-How brought to the attention of the Developing Party by a third party;
provided that, in such instance, the Developing Party will use Commercially
Reasonable efforts to permit disclosure to the other Party.

 

ARTICLE 4. FILING FOR REGULATORY APPROVALS

 

4.1 Regulatory Filings. Subject to the terms and conditions of this Agreement,
BIOMARIN shall use Commercially Reasonable Efforts to submit to the Regulatory
Authorities in such countries of the Territory as BIOMARIN deems appropriate,
application(s) to obtain Regulatory Approval for Drug Product in accordance with
the timelines set forth in the Development Plan as such timelines may be
amended. After submitting any such application, BIOMARIN shall use its
Commercially Reasonable Efforts to obtain such Regulatory Approval from the
applicable Regulatory Authorities within the time period set forth in the
applicable Development Plan. BIOMARIN shall have the right to incorporate all of
the intellectual property licensed hereunder in applications to obtain
Regulatory Approval for Drug Product. DSP, at its expense, shall provide
BIOMARIN with reasonable assistance in connection with the incorporation of such
intellectual property into the applications for Regulatory Approval, including,
without limitation, responding to correspondence related to the intellectual
property licensed hereunder and submitting to inspections and audits by
Regulatory Authorities.

 

4.2 Amendments or Supplements. Whenever BIOMARIN submits any application for the
Regulatory Approval of a Drug Product, or materially amends or supplements any
such application, BIOMARIN shall give notice to DSP of the date of such
application, amendment or supplement. Within one (1) month after any such
notice, BIOMARIN shall also furnish DSP with a copy of any such application,
amendment, or supplement submitted to the applicable Regulatory Authorities in
each country in the Territory. Such copies may be in hard copy or electronic
format and will be provided in English or the language submitted to the
applicable Regulatory Authority, each at BIOMARIN’s option. Any application,
amendment or supplement provided by BIOMARIN to DSP is for informational
purposes only, and may not be used by DSP for any purpose or provided by DSP to
a third party without the prior written consent of BIOMARIN.

 

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ARTICLE 5. LAUNCH

 

Within six (6) months after obtaining the Regulatory Approval of a Drug Product
for the treatment of PKU in the U.S. or E.U., BIOMARIN shall use Commercially
Reasonable Efforts to launch Drug Product in such jurisdiction for such
indication.

 

ARTICLE 6. OWNERSHIP OF APPROVALS

 

BIOMARIN shall own and control all Regulatory Approvals and applications,
amendments or supplements underlying any such Regulatory Approval. DSP shall
cause SHIRATORI to provide BIOMARIN with such reasonable assistance as BIOMARIN
may require in completing portions of applications for Regulatory Approval, or
amendments or supplements related thereto, related to the manufacture of Drug
Substance.

 

ARTICLE 7. DISCLOSURE OF KNOW-HOW

 

7.1 Disclosure of Know-How. DSP shall disclose to BIOMARIN the Informative
Know-How and DSP Drug Product Manufacturing Know-How which DSP possesses within
thirty (30) days after execution of this Agreement. Also, DSP shall promptly
disclose to BIOMARIN the Informative Know-How and DSP Drug Product Manufacturing
Know-How which comes into DSP’s possession during the term of this Agreement.

 

It is expressly understood that BIOMARIN has received from DSP a part of the
Informative Know-How and DSP Drug Product Manufacturing Know-How under the LOI.

 

7.2 Disclosure of DSP Drug Substance Manufacturing Know-How. Within forty-five
(45) days after the Effective Date, DSP shall also disclose to BIOMARIN the DSP
Drug Substance Manufacturing Know-How that DSP possesses (and shall cause
SHIRATORI to disclose such DSP Drug Substance Manufacturing Know-How that
SHIRATORI possesses) at the time of such disclosure. Also, DSP shall promptly
disclose to BIOMARIN the DSP Drug Substance Manufacturing Know-How that comes
into DSP’s possession during the term of this Agreement. In each case, the
documents related to the Drug Substance Manufacturing Know-How shall be
translated into English prior to the delivery thereof to BIOMARIN.

 

ARTICLE 8. MANUFACTURING OF THE DRUG PRODUCT

 

The Drug Product shall be manufactured, processed or made by BIOMARIN and/or its
designee at their own costs and responsibilities.

 

ARTICLE 9. SUPPLY OF DRUG SUBSTANCE FOR CLINICAL USE

 

9.1 Supply of Drug Substance for Clinical Use. DSP shall supply BIOMARIN and
BIOMARIN shall purchase from DSP the Drug Substance for clinical use in
accordance with the following schedule:

 

  (i) [****] of the Drug Substance to be delivered in [****]

 

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  (ii) [****] of the Drug Substance to be delivered in [****]

 

  (iii) [****] of the Drug Substance to be delivered in [****]

 

  (iv) [****] of the Drug Substance to be delivered in [****]

 

Upon execution of this Agreement, BIOMARIN shall place firm orders to DSP for
the aforementioned shipments, which firm orders to be irrevocable.

 

For additional amounts of the Drug Substance for clinical use, BIOMARIN shall be
required to place firm orders to DSP at least [****] prior to the desired
shipment date. Such additional purchase orders shall be made in units of [****].

 

9.2 Supply Price of the Drug Substance for Clinical Use. The price of Drug
Substance for clinical use shall be [****]. Payment shall be due within [****]
after the date of the bill of lading for such Drug Substance to BIOMARIN.

 

9.3 Specifications of the Drug Substance for Clinical Use. All Drug Substance
produced under this Article shall be manufactured according to mutually agreed
specifications. Further, all Drug Substance shall be manufactured in accordance
with all Applicable Laws based on the expectation that the Drug Substance will
be used to produce Drug Product in the Territory.

 

ARTICLE 10. LICENSE FEES AND ROYALTIES

 

10.1 [****]

 

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10.2 [****]

 

10.3 Running Royalties. [****]

 

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[****]

 

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[****]

 

10.4 Example of Royalties. By way of illustration only, attached hereto as
Exhibit E is a table outlining the operation of the calculations in Section 10.3
(Running Royalties). Notwithstanding the inclusion of Exhibit E, the
determination of the running royalty shall be made by reference to Section 10.3
(Running Royalties) and the Parties agree that Exhibit E is not a complete
representation of Section 10.3 (Running Royalties) and shall not be binding.

 

ARTICLE 11. PAYMENT OF LICENSE FEES AND ROYALTIES

 

BIOMARIN shall pay the license fees and royalties to a bank account as
designated by DSP. BIOMARIN shall pay the total royalty during [****] during the
term of this Agreement. Payment of the license fees and royalties shall be made
in Japanese Yen. Any and all bank charges and similar fees incurred by BIOMARIN
in processing such payments shall be borne by BIOMARIN.

 

ARTICLE 12. WITHHOLDING TAX

 

If any of the payments made or to be made by BIOMARIN to DSP become subject to
withholding taxes under any Applicable Law, then BIOMARIN shall withhold the
amount of such taxes for the account of DSP to the extent required by law, and
shall pay the amounts of such taxes to the proper governmental authorities in a
timely manner and promptly transmit to DSP an official tax certificate or other
evidence of such tax obligations together with proof of payment from the
relevant governmental authorities of all amounts withheld sufficient to enable
DSP to claim such payment of taxes. BIOMARIN will provide DSP with reasonable
assistance to enable DSP to recover such taxes as permitted by law. Any other
taxes arising out of or in connection with BIOMARIN’s activities hereunder shall
be borne by BIOMARIN.

 

ARTICLE 13. RATE OF EXCHANGE FOR ROYALTIES

 

For the purpose of converting U.S. dollars or any other currency in the
Territory in which Net Sales are made to Japanese Yen in order to determine the
amount of the royalty payable by BIOMARIN to DSP under Section 10.3 (Running
Royalties), the rate of exchange to be applied shall be the rate published in
The Wall Street Journal, West Coast edition, on the last business day of the
applicable calendar quarter during the term of this Agreement.

 

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ARTICLE 14. ROYALTY REPORTS

 

Each royalty payment shall be accompanied by a report showing the total and the
detail of the Net Sales on a country-by-country basis by each indication, if
available, and broken down into each applicable royalty rate cases (e.g. each
case as described as in subsection A) through C) in Section 10.3 (Running
Royalties)), in a format to be agreed upon the Parties prior to the initial
royalty payment, during the [****] for which such royalty payment is being made
and the calculation of the total royalty payable for such [****], together with
such information as is reasonably necessary to determine how the amount of such
royalty payment was calculated.

 

ARTICLE 15. INSPECTION OF RECORDS

 

BIOMARIN shall keep and maintain accurate and complete records with respect to
Net Sales, royalties and the calculation thereof with respect to Drug Product
manufactured, distributed and sold by BIOMARIN or its sub-licensees in
sufficient detail to enable the determination of the royalties payable to DSP.
At DSP’s request, BIOMARIN shall make such records for preceding two (2) year
periods available for inspection and audit at a mutually convenient time within
normal business hours by an independent auditor appointed by DSP, subject to the
reasonable approval of BIOMARIN, and who shall enter into a confidentiality
agreement in favor of BIOMARIN, for the purpose of verifying the reports and
payments submitted to DSP. Said inspection and audit shall be limited to no more
than one (1) time during each twelve (12) month period. DSP shall bear the cost
of any such inspection and audit, provided that if the inspection and audit
shows an underpayment of royalties of more than five percent (5%) of the amount
paid for the applicable period, then BIOMARIN shall promptly reimburse DSP for
all costs incurred in connection with such inspection and audit and shall
promptly pay the amount of the underpayment.

 

ARTICLE 16. MARKETING PLAN

 

Following the first Regulatory Approval of the Drug Product in the Territory, by
the end of November of every calendar year during the term of this Agreement,
BIOMARIN shall submit to DSP, in written form, its marketing plan, on the Drug
Product for the following calendar year. Subject to BIOMARIN’s right to modify
such marketing plan as it deems appropriate, in its reasonable discretion,
BIOMARIN shall carry out its marketing activities in accordance with such
marketing plan and make Commercially Reasonable Efforts to achieve the sales
budget stipulated in such marketing plan.

 

ARTICLE 17. MAINTENANCE OF PATENTS

 

DSP shall, at its expense and on a timely basis in each country in the
Territory: (a) use Commercially Reasonable Efforts in all countries in the
Territory to file the Drug Product Patent; and (b) pay all fees and file all
documentation and other materials required by any governmental authority in each
applicable country to maintain and/or renew the Drug Product Patents and the
Drug Substance Patent. DSP and its attorneys or agents shall consult with
BIOMARIN in all aspects of the prosecution and maintenance of the Drug Product
Patents and the Drug Substance Patent in the Territory and shall provide
BIOMARIN sufficient opportunity to comment on any

 

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related document that DSP intends to file or to cause to be filed with the
relevant governmental authority in advance of such filing. Any actions
recommended by BIOMARIN for such purpose will not be unreasonably denied or
delayed by DSP.

 

ARTICLE 18. TRADEMARKS

 

All of the Trademarks to be used by BIOMARIN on Drug Product shall be selected
by BIOMARIN in consultation with DSP and shall be owned by BIOMARIN, and the
final decision on any such selection shall rest with BIOMARIN.

 

ARTICLE 19. INFRINGEMENT, ENFORCEMENT, AND DEFENSE

 

19.1 Notification of Infringement. Whenever either Party becomes aware of the
possible infringement of the Drug Product Patent or the Drug Substance Patent,
by a third party, such Party shall promptly notify the other Party of any such
infringement and shall provide such other Party with any available evidence of
such infringement.

 

19.2 Protection Act of DSP from Infringement. DSP shall have the first right,
but not the obligation, to bring any suit or action for infringement of the Drug
Product Patent or the Drug Substance Patent. Any infringement action brought by
DSP shall be solely at DSP’s expense, and BIOMARIN or its sublicensee(s) shall
provide reasonable assistance at DSP’s expense in the prosecution of such suit
or action. DSP shall not settle such action in any manner that includes the
grant of a sublicense or otherwise affects BIOMARIN’s rights in the Drug Product
Patent or the Dug Substance Patent, if applicable, without the prior written
consent of BIOMARIN, which consent may be granted or withheld in BIOMARIN’s sole
and absolute discretion.

 

19.3 Protection Act of BIOMARIN from Infringement. In the event that DSP fails
to or elects not to commence an infringement suit or action as set forth in
Section 19.2 within sixty (60) days, or begin settlement negotiations with the
alleged infringer within sixty (60) days, after: (a) receiving notification set
forth in Section 19.1 (Notification of Infringement) from BIOMARIN of any such
infringement; or (b) sending notice to BIOMARIN of such action, as applicable,
BIOMARIN shall have the right, but not the obligation, to bring an appropriate
suit or action against the Third Party infringer within the relevant
jurisdiction at BIOMARIN’s expense. It is expressly understood that BIOMARIN
shall not have the right to enforce the Drug Product Patent or the Dug Substance
Patent, if applicable, beyond the scope of its exclusive license hereunder. If
requested, DSP shall provide reasonable assistance in the prosecution of such
suit or action at BIOMARIN’s expense. BIOMARIN shall not settle such action in
any manner that conflicts with DSP’s rights in the Drug Product Patent and the
Drug Substance Patent without the prior written consent of DSP, which consent
may be granted or withheld in DSP’s sole and absolute discretion.

 

ARTICLE 20. ADVERSE EVENTS

 

The Parties shall promptly provide each other with necessary information and
data relating to adverse events, regardless of causality, associated with the
use of Drug Substance or Drug Product, received by or reported to the Parties
from any sources during the term of this Agreement, in accordance with
applicable law and the written reporting procedure to be separately agreed upon
by the Parties.

 

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ARTICLE 21. LICENSE MARKING.

 

Subject to any applicable laws and sufficient space, BIOMARIN shall indicate on
certain packaging and promotional materials related to the Drug Product that the
drug product is developed and manufactured in collaboration with DAIICHI SUNTORY
PHARMA CO., LTD., Tokyo, Japan.

 

ARTICLE 22. BIOMARIN INTELLECTUAL PROPERTY

 

22.1 BIOMARIN Intellectual Property. BIOMARIN shall own and reserve all rights
in and to the BIOMARIN Improvements. DSP acknowledges and agrees that it has no
rights to BIOMARIN Improvements except as provided in Section 22.2 hereof.

 

22.2 License to DSP on BIOMARIN Improvements. In case DSP desires to
commercialize or utilize BIOMARIN Improvements whether inside the Territory or
in Japan, either itself or through an Affiliate or a third party, DSP and
BIOMARIN shall, subject to any obligations of BIOMARIN existing on the Effective
Date or related to a BIOMARIN Improvement brought to the attention of BIOMARIN
by a third party; provided that, in such instance, BIOMARIN will use
Commercially Reasonable efforts to obtain the right to license to DSP, negotiate
in good faith the terms and conditions under which DSP may be granted a right to
use, or have its Affiliates or third party licensee use any BIOMARIN
Improvement.

 

22.3 Patent Application for BIOMARIN Improvements. If BIOMARIN files a patent
application on a BIOMARIN Improvement, then BIOMARIN shall, promptly after
receiving the filing certificate, provide DSP with a copy of said application,
subject to the requirements of Article 25. Within nine (9) months of filing an
original application on a BIOMARIN Improvement, BIOMARIN shall inform DSP of the
countries in which BIOMARIN intends to file counterpart applications. DSP, in
its sole discretion, may request that BIOMARIN file, in the name of BIOMARIN,
one or more patent applications, at DSP’s own expense, in any countries which
BIOMARIN does not intend to file a counterpart patent application.

 

22.4 Abandonment of Patent Application for BIOMARIN Improvement. BIOMARIN shall
provide timely notice to DSP before abandoning any patent or patent application
on a BIOMARIN Improvement. If requested by DSP and at DSP’s expense, BIOMARIN
shall continue the prosecution of such patent application or maintenance of such
patent.

 

ARTICLE 23. DSP IMPROVEMENTS

 

23.1 License to BIOMARIN on DSP Improvements. In case BIOMARIN desires to
commercialize or utilize DSP Improvements in the Territory, either itself or
through an Affiliate or a third party, DSP and BIOMARIN shall, subject to any
obligations of DSP existing on the Effective Date or related to a DSP
Improvement brought to the attention of DSP by a third party; provided that, in
such instance, DSP will use Commercially Reasonable efforts to obtain the right
to license to BIOMARIN, negotiate in good faith the terms and conditions under
which BIOMARIN may be granted a right to use, or have its Affiliates or third
party licensee use any DSP Improvement.

 

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23.2 Patent Application for DSP Improvements. If DSP files a patent application
on a DSP Improvement, DSP Drug Product Manufacturing Know-How or DSP Drug
Substance Manufacturing Know-How, then DSP shall, promptly after receiving the
filing certificate, provide BIOMARIN with a copy of said application, subject to
the requirements of Article 25. Within nine (9) months of filing an original
application described in the preceding sentence, DSP shall inform BIOMARIN of
the countries in which DSP intends to file counterpart applications. BIOMARIN in
its sole discretion may request that DSP file, in the name of DSP, one or more
patent applications, at BIOMARIN’s own expense, in any countries which DSP does
not intend to file a counterpart patent application.

 

23.3 Abandonment of Patent Application for DSP Improvement. DSP shall provide
timely notice to BIOMARIN before abandoning any patent or patent application on
a DSP Improvement, Product Manufacturing Know-How or DSP Drug Substance
Manufacturing Know-How. If requested by BIOMARIN and at BIOMARIN’s expense, DSP
shall continue the prosecution of such patent application or maintenance of such
patent.

 

ARTICLE 24. DSP’S RIGHT TO PURCHASE DRUG SUBSTANCE FROM OTHER SOURCE

 

If BIOMARIN or its designee develops a manufacturing process for Drug Substance
that is economically viable, then BIOMARIN will use Commercially Reasonable
Efforts to allow DSP to have the right to purchase such Drug Substance at
reasonable a price for indications in and outside the Field in Japan.

 

ARTICLE 25. SECRECY

 

25.1 Secrecy. Each Party shall keep secret and confidential any information and
data of the other Party received from the disclosing Party under this Agreement
or under the LOI (including the terms and conditions of this Agreement and the
LOI), (hereinafter referred to as “Confidential Information”) and shall not use
such Confidential Information for any purpose other than for the purposes
permitted in this Agreement, except as otherwise expressly authorized herein,
provided, however, that the obligations of confidentiality hereunder shall apply
only to information which has been disclosed, reduced to writing within thirty
(30) days from the date of disclosure and designated as “confidential”. Further,
a Party shall have no obligation to maintain the secrecy of Confidential
Information which:

 

  (i) at the time of disclosure by the disclosing Party is in the public domain;

 

  (ii) after disclosure by the disclosing Party enters the public domain through
no improper conduct of the receiving Party;

 

  (iii) prior to disclosure by the disclosing Party was already in the
possession of the receiving Party as evidenced by the receiving Party’s written
records;

 

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  (iv) subsequent to disclosure hereunder is obtained by the receiving Party
from third parties who are lawfully in possession of such information and data
and are not subject to an obligation to refrain from disclosing such information
and data to others; and

 

  (v) is required to be revealed under compulsion of law, provided that, to the
extent permitted by Applicable Law, the Party under a legal compulsion to
disclose the Confidential Information provides the other Party sufficient prior
notice of the disclosure, so that such other Party shall have an opportunity to
take whatever action it deems necessary or desirable to protect its Confidential
Information.

 

25.2 Exceptions. Notwithstanding the provisions of the preceding Section, a
Party shall be entitled to disclose Confidential Information for the purpose of
implementing this Agreement to any of the following:

 

  (i) with respect to a Party, its Affiliates, licensees, sub-licensees, and
their respective employees, agents, consultants, subcontractors and other
representatives who have a need to know, provided that the recipients have been
informed of and are bound to the secrecy obligations of this Agreement;

 

  (ii) Regulatory Authorities that have been advised of the confidential status
of the Confidential Information, provided that all necessary procedures are
followed to preserve confidentiality.

 

  (iii) with respect to DSP, SHIRATORI on the contents of the sections of this
Agreement related to SHIRATORI, provided that SHIRATORI is bound by the secrecy
obligation of this Agreement.

 

25.3 Survivorship. The obligations in this Article shall survive for a period of
ten (10) years after the expiration or termination of this Agreement.

 

ARTICLE 26. DURATION AND TERMINATION

 

26.1 Duration. This Agreement shall become effective on the Effective Date and
shall, unless sooner terminated as hereinafter provided in this Agreement,
continue in full force and effect until BIOMARIN ceases its development or
commercial activities related to the Drug Product in the Territory.
Notwithstanding the foregoing, this Agreement shall not be terminated for at
least five (5) years from the Effective Date

 

26.2 Termination due to Material Breach. In the event of any material breach of
this Agreement by either Party, in any country in the Territory, the Party not
in breach shall be entitled to dispatch to the Party in material breach a demand
for correction of such material breach within a stipulated period, which period
shall not be less than (60) days following the date of receipt of the written
demand. If the Party in material breach as aforesaid fails to correct the
material breach within the period stipulated in such written notice of demand
for correction or

 

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such longer period of time mutually agreed to by the Parties, the Party not in
breach shall have the unconditional right and option to terminate this Agreement
in its entirety, or in part with respect to such country in the Territory only,
immediately upon giving to the Party in material breach written notice of such
termination. Notwithstanding the foregoing, the cure period shall be extended so
long as is reasonably necessary to cure such breach conditioned on the breaching
Party continuing to use its best efforts to pursue such cure.

 

26.3 Other Cases for Termination. Either Party shall have the right and option
to terminate this Agreement immediately at any time, by notice in writing to the
other Party in the event that such other Party:

 

(a) passes any resolution for or permits any proceedings for its winding up; or

 

(b) makes a general assignment for the benefit of creditors; or

 

(c) has filed against it or files a petition in bankruptcy or insolvency or is
declared bankrupt or insolvent or declares that it is bankrupt or insolvent; or

 

(d) has filed against it or files any petition or answer seeking reorganization,
readjustment, or arrangement of its business or debts and such action remains
undismissed or unstayed for a period of more than sixty (60) days.

 

ARTICLE 27. EFFECT OF TERMINATION

 

27.1 DSP Rights Upon Termination. If this Agreement is terminated in its
entirety by DSP pursuant to Sections 26.2 (Termination due to Material Breach)
or 26.3 (Other Cases for Termination) or Article 28 (Guarantee on Mergers and
Acquisitions):

 

(a) all of the rights and licenses granted to BIOMARIN hereunder, including
without limitation, the license granted under Sections 2.1 (License Grant) or
2.3 (License to Manufacture the Drug Substance) shall automatically revert to
DSP, without any assignment or other act on the part of BIOMARIN, and BIOMARIN
shall cease immediately any business activities that would, but for the license
granted pursuant to Article 2 (License Grant), infringe on DSP’s enforceable
intellectual property rights; provided that BIOMARIN may continue to manufacture
Drug Product from any Drug Substance then in its possession and to sell any such
Drug Product or other Drug Product then in its possession; provided further that
BIOMARIN will pay the royalties set forth in Article 10 (License Fees and
Royalties) on all such sales.

 

(b) BIOMARIN shall return to DSP within thirty (30) days any information and
data, including the DSP Drug Product Manufacturing Know-How and DSP Drug
Substance Manufacturing Know-How transmitted to BIOMARIN by DSP under this
Agreement, and all copies thereof (except for any copies BIOMARIN is required to
retain under applicable laws, in which event any such copies shall be kept
confidential in accordance with Article 25 (Secrecy) hereof), and BIOMARIN shall
not use directly or indirectly all said information and data for the benefit of
itself or of any third party in any way whatsoever, without DSP’s prior written
consent.

 

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(c) Upon DSP’s request, DSP shall have the perpetual license to use, or have its
Affiliates or third party licensee use the data and results generated by
BIOMARIN from the Development conducted under this Agreement and any BIOMARIN
Improvement as of the date of termination of this Agreement, subject to DSP’s
obligation to pay royalties to BIOMARIN described in Section 22.2 (License to
DSP on BIOMARIN Improvements).

 

27.2 BIOMARIN Rights Upon Termination. If this Agreement is terminated in its
entirety by BIOMARIN pursuant to Sections 26.2 (Termination due to Material
Breach) or 26.3 (Other Cases for Termination) or Article 28 (Guarantee on
Mergers and Acquisitions):

 

(a) the rights and licenses granted to BIOMARIN under Article 2 (License Grant)
shall become perpetual, subject to BIOMARIN’s continuing obligation to pay the
royalties described in Article 10 (License Fees and Royalties), without any
assignment or other act on the part of DSP; and

 

(b) For a period of six (6) months after termination, DSP shall provide BIOMARIN
with reasonable access to all files and documents related to the Informative
Know-How, the DSP Drug Product Manufacturing Know How, and the Drug Substance
Manufacturing Know How to the extent not previously disclosed to BIOMARIN under
Article 7 (Disclosure of Know-How), provided, however, that DSP shall not have
the obligation to disclose to BIOMARIN any such know how which comes into
possession of DSP after such termination.

 

ARTICLE 28. GUARANTEE ON MERGERS AND ACQUISITIONS

 

In case either Party (the “Merged Party”) is merged into or acquired by a third
party, the Merged Party shall require such surviving or acquiring party
(hereinafter referred to as the “Acquiring Party”) to agree with the other Party
to perform and comply with all of the rights and obligations of the Merged Party
under this Agreement. In case such agreement is not obtained, the other party
shall have the right and option to terminate this Agreement immediately at any
time within sixty (60) days after such merger or acquisition becomes effective,
by notice in writing to the Merged Party.

 

ARTICLE 29. HOLD HARMLESS AND INSURANCE

 

29.1 Hold Harmless by BIOMARIN. BIOMARIN shall indemnify, defend and hold DSP,
DSP’s Affiliates, SHIRATORI, and their respective officers, directors,
employees, partners and agents (hereinafter referred to as “DSP Indemnitees”)
harmless from and against any and all liability, damages, cost or expenses
(including reasonable attorneys’ fees and disbursements) (hereinafter referred
to as “Damages”) incurred as a result of any claim made or suit brought by a
third party against a DSP Indemnitee arising out of (i) the Development,
manufacture of the Drug Substance by BIOMARIN, and manufacture, sale, or use of
Drug Product by BIOMARIN or (ii) a breach of this Agreement by BIOMARIN, in each
case except to the extent that such liability, damages, costs or expenses are
caused by (a) DSP Indemnitees’ failure to supply Drug Substance that conforms
with the specifications or that is made in compliance with cGMP or (b) the
negligence or intentional misconduct or breach of this Agreement by the DSP
Indemnitee. Upon receipt of any such claim or suit by any of the DSP
Indemnitees, DSP or such DSP Indemnitees shall promptly notify BIOMARIN in
writing of such claim or suit and shall permit

 

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BIOMARIN to defend against and control the defense of such claim or suit,
provided that BIOMARIN shall not compromise or settle such claim or suit without
the written approval of DSP or such DSP Indemnitees, and DSP or any such DSP
Indemnitee shall have the right to participate in the defense of such claim or
suit at its own expense. DSP or any such DSP Indemnitee shall not compromise or
settle such claim or suit without the prior written approval of BIOMARIN.

 

29.2 Hold Harmless by DSP. DSP shall indemnify, defend and hold BIOMARIN and
BIOMARIN’s Affiliates and their respective officers, directors, employees,
partners and agents (hereinafter referred to as “BIOMARIN Indemnitees”) harmless
from and against any Damages incurred as a result of any claim made or suit
brought by a Third Party against BIOMARIN Indemnitee arising out of (i) DSP’s or
SHIRATORI’s manufacture and/or sale of Drug Substance supplied to BIOMARIN that
does not conform to its mutually agreed specifications or that was not made in
compliance with cGMP or (ii) a breach of this Agreement by DSP, in each case
except to the extent that such liability, damages, costs or expenses are caused
by the negligence or intentional misconduct or breach of covenant in this
Agreement by the BIOMARIN Indemnitee. Upon receipt of any such claim or suit by
any of the BIOMARIN Indemnitees, BIOMARIN or such BIOMARIN Indemnitees shall
promptly notify DSP in writing of such claim or suit and shall permit DSP to
defend against and control the defense of such claim or suit, provided that DSP
shall not compromise or settle such claim or suit without the written approval
of BIOMARIN or such BIOMARIN Indemnitees, and BIOMARIN or any such BIOMARIN
Indemnitee shall have the right to participate in the defense of such claim or
suit at its own expense. BIOMARIN or any such BIOMARIN Indemnitee shall not
compromise or settle such claim or suit without the prior written approval of
DSP.

 

29.3 Insurance. Each Party shall, at its sole cost and expense, obtain and keep
in force during the term of this Agreement the following insurance:

 

(a) with respect to DSP: general liability insurance, including product
liability insurance, with bodily injury, death and property damage limits of
$10,000,000 per occurrence and $10,000,000 in the aggregate; and

 

(b) with respect to BIOMARIN: (i) general liability insurance, including product
liability insurance, with bodily injury, death and property damage limits of
$10,000,000 per occurrence and $10,000,000 in the aggregate; and (ii) clinical
studies and product liability insurance with bodily injury, death and property
damage limits of not less than $10,000,000 per occurrence and $10,000,000 in the
aggregate.

 

After execution of this Agreement, and upon the other Party’s request
thereafter, each Party shall furnish the other with a certificate of insurance
signed by an authorized representative of such Party’s insurance underwriter
evidencing the insurance coverage required by this Agreement and providing for
at least thirty (30) days prior written notice to the other Party of any
cancellation, termination, or reduction of such insurance coverage. Each Party
shall use its Commercially Reasonable Efforts to cause Third Parties engaged by
a Party to perform its obligations under this Agreement to maintain such types
of insurance coverage and for such period of time as are customary for such
Third Parties given the nature of the services to be provided.

 

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ARTICLE 30. REPRESENTATIONS, WARRANTIES, AND COVENANTS

 

30.1 Corporate Power. Each Party hereby represents, warrants and covenants that,
as of the Effective Date, such Party is duly organized, validly existing under
the laws of its state or country of incorporation and has full corporate power
and authority to enter into this Agreement and carry out the provisions hereof.

 

30.2 Due Authorization. Each Party hereby represents and warrants that, as of
the Effective Date, such Party is duly authorized to execute and deliver this
Agreement and to perform its obligations hereunder.

 

30.3 Binding Obligations/No Conflict. Each Party hereby represents, warrants and
covenants that, as of the Effective Date: (a) this Agreement is legal and valid
obligation binding upon it and is enforceable in accordance with its terms,
subject to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws now or hereinafter in effect relating to creditors’
rights generally or to general principles of equity; and (b) the execution,
delivery and performance of this Agreement by such Party does not, and will not
during the term of this Agreement, conflict with any agreement, instrument or
understanding to which it is a party or by which it is bound, nor to the best
knowledge of each Party as of the Effective Date will such execution, delivery
and performance violate any Applicable Laws.

 

30.4 Rights to Intellectual Property. Each Party (hereinafter referred to as the
“Licensing Party”) hereby represents and warrants that, as of the Effective
Date, the intellectual property that may be licensed to the other Party
(hereinafter referred to as the “Licensee Party”) as contemplated herein,
including without limitation the rights to the BIOMARIN Improvements, Drug
Product Patent, Drug Substance Patent, DSP Drug Product Manufacturing Know-How,
DSP Drug Substance Manufacturing Know-How and DSP Improvement, is validly owned
by the Licensing Party or is licensed to the Licensing Party with full rights to
grant the license to the Licensee Party, and that such intellectual property
does not infringe on the enforceable intellectual property rights of any third
party.

 

ARTICLE 31. DEBARMENT

 

During the term of this Agreement, neither of the Parties shall knowingly use
any employee, representative, agent, assistant or associate who has been
debarred by the FDA pursuant to 21 U.S.C. Section 335 (a) or (b) of the Act in
connection with any of the activities to be carried out under this Agreement.
DSP further represents and warrants that, as of the Effective Date, to the best
of its knowledge, none of the entities, laboratories or clinical sites
participating in any pre-clinical or clinical studies prior to the Effective
Date has been disbarred.

 

ARTICLE 32. DUE DILIGENCE MATERIALS

 

DSP represents and warrants, to the best of its knowledge, to BIOMARIN that the
due diligence information provided to BIOMARIN under the LOI is true and correct
in all material respects and does not fail to include information in the
possession of or known to DSP and its Affiliates which would cause the due
diligence information provided to BIOMARIN to not be misleading.

 

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ARTICLE 33. FORCE MAJEURE

 

Neither Party hereto shall be liable to the other Party for any losses or
damages attributable to a default in or breach of this Agreement which is the
result of war (whether declared or undeclared), acts of terrorism, acts of God,
revolution, strike, fire, earthquake, flood, pestilence, other natural
disasters, riot, enactment or change of laws and regulations, accident(s), labor
trouble, or shortage of or any other cause beyond reasonable control of such
Party. The performance of obligations hereunder shall be suspended during, but
no longer than, the existence of such cause mentioned in this Article. In the
event that a cause mentioned in this Article prevents or will prevent
implementation of this Agreement for more than six (6) months, the Parties shall
renegotiate the terms and conditions of this Agreement.

 

ARTICLE 34. NON-WAIVER

 

A Party’s failure to exercise and or delay in exercising, any right, remedy,
power or privilege hereunder, shall not operate as a waiver thereof; nor shall
any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege.

 

ARTICLE 35. MODIFICATION

 

No modification, extension, or waiver of any provision of this Agreement shall
be valid unless the same is in writing signed by the duly authorized officers of
both Parties hereto.

 

ARTICLE 36. MISCELLANEOUS

 

36.1 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF ANY KIND,
EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT.

 

36.2 Consequential Damages. Except with regard to each Party’s obligation to
indemnify the other Party for indemnification liability to a third party under
Sections 29.1 (Hold Harmless by BIOMARIN) and 29.2 (Hold Harmless by DSP)
neither Party will be liable for any special, consequential, indirect,
incidental or punitive damages, under any cause of action, whether under any
contract, negligence, strict liability or other legal or equitable theory, with
respect to any subject matter of this Agreement and whether or not such Party or
its agents have been advised of the possibility of such damage. This limitation
shall apply notwithstanding any failure of essential purpose of any limited
remedy provided herein.

 

36.3 Severability. In the event that any one or more of the provisions of this
Agreement should for any reason be held by the competent authorities to be
invalid, illegal or unenforceable, to the extent practicable such provision or
provisions shall be reformed or renegotiated to as nearly approximate the
original reasonable intent of the Parties as possible and the validity, legality
or enforceability of the remaining provisions shall in no way be affected or
impaired thereby.

 

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36.4 Accrued Obligation. Termination of this Agreement for any reason shall not
release any Party hereto from any liability which at the time of such
termination has already accrued to the other Party or which is attributable to a
period prior to such termination, nor preclude either Party from pursuing all
rights and remedies it may have hereunder or at law or in equity with respect to
any breach of this Agreement.

 

36.5 Independent Contractor. The relationship between DSP and BIOMARIN is that
of independent contractors. DSP and BIOMARIN are not joint ventureers, partners,
principal and agent, employer and employee, and have no other relationship other
than independent contracting Parties. Neither Party 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.

 

36.6 Assignment. Any right and obligation hereunder is personal to the Parties
hereto, and, other than as contemplated in Article 28, shall not be assigned or
otherwise transferred to a third party by either Party without the prior written
consent of the other Party, which shall not be unreasonably withheld.

 

36.7 Governing Law. This License Agreement shall be governed by and construed in
accordance with the laws of Japan.

 

36.8 Dispute Resolution. The Parties shall endeavor to resolve all conflicts and
disputes arising out of or in any way in connection with this License Agreement
amicably between themselves. In the event the Parties are unable to resolve any
such conflict or dispute between themselves, any such conflict or dispute shall
be finally settled by arbitration in accordance with the Commercial Arbitration
Rules of Japan Commercial Arbitration Association. The arbitration shall take
place in Tokyo, Japan. Notwithstanding the foregoing, either Party may file suit
in any court of competent jurisdiction solely for the purpose of seeking
injunctive or other equitable relief during the pendency of any arbitration
proceeding.

 

36.9 Captions. The captions of Articles and Sections in this Agreement are for
convenience only, and this Agreement shall not be construed or interpreted by
reference to such captions.

 

36.10 Survivorship.

 

(a) In the event of expiration or any termination of this Agreement, the
following articles and sections shall survive: Articles 25 (Secrecy); Article 27
(Effect of Termination); 29 (Hold Harmless and Insurance); Sections 36.2
(Consequential Damages); 36.8 (Dispute Resolution); and 36.10 (Survivorship).

 

(b) In the event of termination of this Agreement by BIOMARIN pursuant to
section 26.2 (Termination due to Material Breach), 26.3 (Other Cases for
Termination), or Article 28 (Guarantee on Mergers and Acquisitions), the Parties
shall enter into a new agreement which contains substantially the same
provisions as the following provisions: Articles 1 (Definitions); 2 (License
Grant); 8 (Manufacturing of the Drug Product); 10 (License Fees and Royalties)
but excluding Section 10.3(A); 11 (Payment of License Fees and Royalties); 12
(Withholding Tax); 13 (Rate of Exchange for Royalties); 14 (Royalty Reports); 15
(Inspection of

 

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Records); 19 (Infringement, Enforcement, and Defense); 20 (Adverse Events), 21
(License Marking); 25 (Secrecy); 28 (Guarantee on Mergers and Acquisitions); 29
(Hold Harmless and Insurance); 30 (Representations, Warranties and Covenants);
36 (Miscellaneous); Sections 26.2 (Termination Due to Material Breach); 26.3
(Other Cases for Termination); and 27.2 (BIOMARIN’s Rights Upon Termination)

 

36.11 Notice. All notices, given by one Party hereto to the other hereunder
shall be in writing and made by registered or certified air mail, facsimile,
express overnight courier or delivered personally to the following addresses of
the respective Parties:

 

If to DSP:

   Daiichi Suntory Pharma Co., Ltd.      General Manager,      Business Planning
& Development Dept.      7-2, Kojimachi 5-chome, Chiyoda-ku      Tokyo 102-8530,
Japan      Facsimile Number: +81-3-5210-5068

If to BIOMARIN:

   Biomarin Pharmaceutical Inc.      371 Bel Marin Keys Blvd., Suite 210     
Novato, CA 94949      ATTN: Emil Kakkis, Senior Vice President      Facsimile
Number: (415) 382-7889

 

The notice under the preceding Article, unless otherwise provided, shall be
deemed to be effective: (a) upon receipt if personally delivered or by facsimile
with evidence of transmission; (b) on the tenth (10th) business day following
the date of mailing if sent by registered or certified air mail; or (c) on the
second business day following the date of transmission or delivery to the
overnight courier if sent overnight courier. A Party may change its address
listed above by sending notice to the other Party.

 

36.12 Publicity. Neither Party, without the prior written approval of the other
Party, shall originate any publicity, news release or public announcement,
written or oral, whether to the public press, stockholders or otherwise,
relating to this Agreement, including its existence, the subject matter to which
it relates, performance under it or any of its terms, to any amendment hereto or
performance hereunder, (herein referred to as an “Announcement”) except for such
an Announcement which is required by law to be made, as determined by counsel
for the Party making such Announcement. A Party will give the other Party at
least ten (10) business days’ advance written notice of the text of any proposed
Announcement, unless circumstances require that the Announcement be released
sooner, so that the other Party will have an opportunity to comment upon the
Announcement.

 

36.13 Execution in Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
by their duly authorized officers upon the date first above written in duplicate
original, one (1) original to be retained by DSP and BIOMARIN.

 

DAIICHI SUNTORY PHARMA CO., LTD.   BIOMARIN PHARMACEUTICAL INC.

Signature:

 

/s/ George Nakayama

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

 

Signature:

 

/s/ Fredric D. Price

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

Name:

 

George Nakayama

 

Name:

 

Fredric D. Price

Title:

 

President

 

Title:

 

Chairman and Chief Executive Officer

Date:

 

8/17/2004

 

Date:

 

8/10/04

 

 

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EXHIBIT A

 

DRUG PRODUCT PATENT

 

All patents, or similar filings, in any country in the Territory based on the
application made by DSP in Japan under title Manufacture of Drug Product, 10%
Formulation, Application No. 2004-141615, Application date May 12, 2004. As of
the Effective Date, there are no other patents or patent applications owned or
controlled by DSP related to the Drug Product.

 

 

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EXHIBIT B

 

DRUG SUBSTANCE PATENT

 

Manufacture of 6R-BH4 (Drug Substance):

 

Country

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

   Application Date

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

   Patent No.

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

   Registration Date

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

U.S.A

   1986.01.23    4713454    1987.12.15

Australia

   1986.01.24    581052    1989.05.24

Canada

   1986.01.23    1262347    1989.10.17

Austria

   1986.01.24    E66229    1991.08.14

Belgium

   1986.01.24    0191335    1991.08.14

Switzerland

   1986.01.24    0191335    1991.08.14

Germany

   1986.01.24    P3680800.8    1991.08.14

France

   1986.01.24    0191335    1991.08.14

England

   1986.01.24    0191335    1991.08.14

Italy

   1986.01.24    0191335    1991.08.14

Luxemburg

   1986.01.24    0191335    1991.08.14

Netherlands

   1986.01.24    0191335    1991.08.14

Sweden

   1986.01.24    0191335    1991.08.14

 

Exhibit B is a true, complete and current listing of the patents owned or
controlled by DSP that relate to the Drug Substance.

 

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EXHIBIT C

 

MANUFACTURING STEPS

 

28

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EXHIBIT D

 

DEVELOPMENT PLAN

 

[****]

 

29

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EXHIBIT E

 

[****]

 

30

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AMENDMENT NO. 1

TO LICENSE AGREEMENT

 

This AMENDMENT NO. 1 TO LICENSE AGREEMENT (“Amendment”) is made and entered into
as of this 19th day of November 2004 (the “Effective Date”), by and between
BioMarin Pharmaceutical Inc. (herein referred to as “BioMarin”) a Delaware
corporation and Daiichi Suntory Pharma Co., Ltd., a corporation organized and
existing under the laws of Japan (herein referred to as “DSP”) (each herein
referred to as “Party” and collectively as “Parties”)

 

1. This Agreement shall serve as an amendment to that certain License Agreement
(the “License Agreement”), dated July 30, 2004, by and between DSP and BioMarin.
Except as expressly modified hereby, the License Agreement shall continue in
full force according to its terms. Capitalized terms not otherwise defined in
this Amendment shall have the meaning ascribed to such term in the License
Agreement.

 

2. [****]

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Execution Copy

 

[****]

 

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[****]

 

4. This Amendment shall inure to the benefit of and be binding upon the parties
hereto and their respective heirs, successors, trustees, transferees and
assigns.

 

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5. This Amendment may be executed in any number of counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

 

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby,
have caused this Amendment to be executed and delivered by their proper and duly
authorized officers effective as of the day and year first above written.

 

ACCEPTED AND AGREED TO:

 

DAIICHI SUNTORY PHARMA CO. LTD.

 

BIOMARIN PHARMACEUTICAL INC.

/s/ George Nakayama

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

 

/s/ Louis Drapeau

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

By:

 

George Nakayama

 

By:

 

Louis Drapeau

Title:

 

President

 

Title:

 

Acting CEO

 

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