Exhibit 10.1

CONFIDENTIAL TREATMENT REQUESTED

 

 

 

EXECUTION VERSION

Confidential

 

 

 

 

 

License Agreement

 

 

This Agreement is entered into with effect as of the Effective Date (as defined
below)

by and between

F. Hoffmann-La Roche Ltd

with an office and place of business at Grenzacherstrasse 124, 4070 Basel,
Switzerland ("Roche Basel")

and

Genentech, Inc.

with an office and place of business at 1 DNA Way, South San Francisco, CA
94080, USA
("Roche US"; Roche Basel and Roche US together referred to as "Roche")

on the one hand

and

Dermira, Inc.

with an office and place of business at 275 Middlefield Road, Suite 150, Menlo
Park, California 94025, USA ("Dermira")

on the other hand.

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

 

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CONFIDENTIAL TREATMENT REQUESTED

 

Table of Contents

 

1.

Definitions7

 

1.1

Accounting Period7

 

1.2

Affiliate7

 

1.3

Agreement8

 

1.4

Agreement Term8

 

1.5

Antitrust Laws8

 

1.6

Applicable Law8

 

1.7

Biosimilar Product8

 

1.8

BLA8

 

1.9

Business Day8

 

1.10

Calendar Quarter9

 

1.11

Calendar Year9

 

1.12

CDx / Companion Diagnostic9

 

1.13

Change of Control9

 

1.14

Change of Control Group9

 

1.15

CMO9

 

1.16

Combination Product9

 

1.17

Commercially Reasonable Efforts10

 

1.18

Compound10

 

1.19

Confidential Information10

 

1.20

Continuation Election Notice11

 

1.21

Control11

 

1.22

Cover11

 

1.23

Dermira Know-How11

 

1.24

Dermira Patent Rights12

 

1.25

Development Plan12

 

1.26

Diagnostics Field12

 

1.27

Distribution12

 

1.28

Drug Product12

 

1.29

Drug Substance12

 

1.30

Effective Date13

 

1.31

EMA13

 

1.32

EU13

 

1.33

Execution Date13

 

1.34

Expert13

 

1.35

FDA13

 

1.36

FDCA13

 

1.37

Field13

 

1.38

First Commercial Sale13

 

1.39

Fully Burdened Manufacturing Costs13

 

1.40

GAAP14

 

1.41

Handle14

 

1.42

HSR14

 

1.43

HSR Approval14

 

1.44

Housemark14

 

1.45

IFRS14

 

1.46

IND15

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

1.47

Initiation15

 

1.48

Insolvency Event15

 

1.49

Invention15

 

1.50

IPF Study15

 

1.51

Joint Know-How15

 

1.52

IVD / in vitro diagnostic15

 

1.53

Joint Patent Rights16

 

1.54

JSC16

 

1.55

Know-How16

 

1.56

Licensed Intellectual Property16

 

1.57

Licensed Compound Patent Rights16

 

1.58

Licensed Know-how16

 

1.59

Manufacture16

 

1.60

Modified Compound17

 

1.61

Net Sales17

 

1.62

Non-Compound Patent Rights18

 

1.63

Outside Date18

 

1.64

Partner18

 

1.65

Partner Agreement18

 

1.66

Party18

 

1.67

Patent Rights18

 

1.68

Pharmacovigilance Agreement18

 

1.69

Phase II Dose-finding Study18

 

1.70

Phase III Study19

 

1.71

Product19

 

1.72

Regulatory Approval19

 

1.73

Regulatory Authority19

 

1.74

Regulatory Exclusivity19

 

1.75

Roche Know-How19

 

1.76

Roche Patent Rights20

 

1.77

Roche Retained Field20

 

1.78

Royalty Term20

 

1.79

Specifications20

 

1.80

Sublicensee20

 

1.81

Technology Transfer20

 

1.82

Technology Transfer Project Plan21

 

1.83

Territory21

 

1.84

Third Party21

 

1.85

US21

 

1.86

US$21

 

1.87

Valid Claim21

 

1.88

Additional Definitions21

2.

Grant of License22

 

2.1

License Grant22

 

2.1.1

Development and Commercialization Grant22

 

 

2.1.2

Manufacturing Rights23

 

 

2.1.3

Licensed Roche Modified Compound23

 

 

2.2

Right to Sublicense23

 

2.3

Sub-Contractors24

 

2.4

Know-How Transfer24

- ii –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

2.4.1

Licensed Know-how Transfer24

 

 

2.4.2

Transfer of INDs25

 

 

2.4.3

Cost26

 

 

2.5

Roche Retained Rights26

 

2.5.1

Roche Retained Rights for Research Purposes26

 

 

2.5.2

Roche Retained Manufacturing Right26

 

 

2.5.3

In General27

 

 

2.6

Roche Rights in the Roche Retained Field27

 

2.6.1

In General27

 

 

2.6.2

License Grant by Dermira27

 

 

2.6.3

Roche Option to Relinquish Rights in the Roche Retained Field; Expiration27

 

3.

Diligence27

4.

Alliance Management, Reporting and Governance28

 

4.1

Alliance Management28

 

4.2

Reporting28

 

4.2.1

Prior to First Commercial Sale28

 

 

4.2.2

After First Commercial Sale28

 

 

4.3

Governance29

 

4.3.1

Joint Steering Committee29

 

 

4.3.2

Members29

 

 

4.3.3

Responsibilities of the JSC29

 

 

4.3.4

Meetings; Committees30

 

 

4.3.5

Minutes30

 

 

4.3.6

Decisions30

 

 

4.3.7

Information Exchange31

 

 

4.3.8

Limitations of Authority31

 

 

4.3.9

Expenses31

 

 

4.3.10

Lifetime31

 

5.

Development31

 

5.1

Responsibility31

 

5.2

Development Plan31

 

5.3

Development by Roche in the Roche Retained Field32

6.

Manufacture and Supply32

 

6.1

Manufacture and Supply32

 

6.1.1

General32

 

 

6.1.2

Roche’s Supply Obligation Prior to Transfer32

 

 

6.1.3

Supply of Drug Substance32

 

 

6.1.4

Supply of Drug Product32

 

 

6.1.5

Supply Agreement33

 

 

6.1.6

Terms of Delivery33

 

 

6.2

Transfer of Manufacture and Supply Responsibility to Dermira33

 

6.2.1

Drug Substance33

 

 

6.2.2

Drug Product34

 

 

6.2.3

Responsibility after Transfer Completion Date; Manufacturing and Process
Improvements34

 

 

6.2.4

Restrictions of Use35

 

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

6.2.5

Support by Roche35

 

7.

Regulatory35

 

7.1

Roche Responsibility35

 

7.1.1

Roche Responsibilities in Roche Retained Field35

 

 

7.1.2

Other Roche Responsibilities35

 

 

7.2

Dermira Responsibility; Additional Studies in Roche Retained Field35

 

7.2.1

Dermira Responsibility35

 

 

7.2.2

Database Lock; Roche Retained IND; Additional Studies in the Roche Retained
Field36

 

 

7.3

IND and Other Regulatory Documentation37

 

7.4

Informed Consent Forms37

 

7.5

Pharmacovigilance Agreement37

8.

Commercialization38

 

8.1

Responsibility38

 

8.2

Updates to Roche38

 

8.3

Promotion by Roche in the Roche Retained Field38

 

8.4

Medical Affairs Activities by Roche in Roche Retained Field38

9.

Payment39

 

9.1

Initial Payment39

 

9.2

Development Event Payments39

 

9.3

Sales Based Events40

 

9.4

Royalty Payments on Net Sales in any indication outside of the Roche Retained
Field40

 

9.4.1

Royalty Term40

 

 

9.4.2

Royalty Rates for Product outside of the Roche Retained Field40

 

 

9.4.3

Royalty Adjustments41

 

 

9.5

Financial consideration to Roche for Dermira-sales in Roche Retained Field42

 

9.6

Costs43

10.

Accounting and Reporting43

 

10.1

Payment Terms43

 

10.2

Other Payments44

 

10.3

Late Payment44

 

10.4

Method of Payment44

 

10.5

Currency Conversion44

 

10.6

Royalty Reporting44

11.

Taxes45

12.

Auditing45

 

12.1

Roche Right to Audit45

 

12.2

Audit Reports46

 

12.3

Over-or Underpayment46

13.

Intellectual Property46

 

13.1

Ownership of Inventions and Know-How46

 

13.2

Trademarks and INN47

 

13.2.1

In General47

 

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

13.2.2

Separate Brands for the Roche Retained Field, including sales tracking47

 

 

13.3

Handling of Roche Patent Rights including Licensed Compound Patent Rights49

 

13.4

Roche Disclosure of New Compound Patents49

 

13.5

Handling of Patent Rights Claiming Dermira Inventions and Joint Patent Rights49

 

13.6

Infringement50

 

13.7

Defense51

 

13.8

Common Interest Disclosures52

 

13.9

Hatch-Waxman52

 

13.10

Biosimilar or interchangeable biological products52

 

13.11

Patent Term Extensions52

 

13.12

No Challenge53

14.

Representations and Warranties53

 

14.1

Mutual Representations and Warranties53

 

14.2

Roche Representations, Warranties and Covenants54

 

14.3

Dermira Representations and Warranties55

 

14.4

Limitations55

 

14.5

Disclaimer55

15.

Indemnification55

 

15.1

Roche Indemnification55

 

15.2

Dermira Indemnification56

 

15.3

Control of Defense56

16.

Liability56

 

16.1

Limitations56

 

16.2

Dermira Liability Insurance56

 

16.2.5

Additional Requirements57

 

17.

Obligation Not to Disclose Confidential Information57

 

17.1

Non-Use and Non-Disclosure57

 

17.2

Permitted Disclosure57

 

17.3

Press Releases58

 

17.4

Publications58

 

17.5

Commercial Considerations59

18.

Term and Termination59

 

18.1

Commencement and Term59

 

18.2

Termination60

 

18.2.1

Termination for Breach60

 

 

18.2.2

Termination in case of an Insolvency Event60

 

 

18.2.3

Termination by Dermira without a Cause60

 

 

18.2.4

Termination for Failure to Receive HSR Approval60

 

 

18.3

Consequences of Termination60

 

18.3.1

Termination by Dermira for Breach by Roche or Roche Insolvency60

 

 

18.3.2

Termination by Dermira without Cause, Termination by Roche for Breach by Dermira
or Dermira Insolvency61

 

 

18.3.3

Direct License61

 

 

18.3.4

Other Obligations62

 

 

18.4

Survival63

- v –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

19.

Effects of Change of Control63

20.

Bankruptcy64

21.

Miscellaneous64

 

21.1

Governing Law64

 

21.2

Disputes64

 

21.3

Arbitration64

 

21.3.1

Arbitrators64

 

 

21.3.2

Decisions; Timing of Decisions65

 

 

21.4

Assignment66

 

21.5

Debarment66

 

21.6

Independent Contractor66

 

21.7

Unenforceable Provisions and Severability66

 

21.8

Waiver67

 

21.9

Appendices67

 

21.10

Entire Understanding67

 

21.11

Amendments67

 

21.12

Invoices67

 

21.13

Notice67

22.

Covenants regarding HSR and Antitrust Laws68

 

 

 

 

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

License Agreement

WHEREAS, Roche has conducted certain research and development related to, and
possesses certain proprietary intellectual property rights with respect to the
bivalent, monospecific, monoclonal, monoepitopic, and humanized IgG4 antibody
that binds to interleukin 13 (IL-13), which is known as lebrikizumab covered by
the Licensed Intellectual Property; and

WHEREAS, Dermira has resources and expertise in the development and
commercialization of pharmaceutical products; and

WHEREAS, Dermira desires to obtain, and Roche is willing to grant to Dermira,
subject to certain retained rights, an exclusive, royalty-bearing license under
Roche’s Licensed Intellectual Property (as defined below), to research, develop,
use, sell, have sold, offer for sale and import the Compounds, Modified
Compounds, and Products in the Field in the Territory (terms as defined below),
subject to the terms and conditions hereof; and

WHEREAS, Roche is willing to manufacture and supply the Drug Substance and Drug
Product for further development and commercialization by Dermira until such
manufacturing and supply responsibility will be transferred to Dermira, subject
to the terms and conditions hereof.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained
in this Agreement and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto, intending to
be legally bound, do hereby agree as follows:

 

1.

Definitions

As used in this Agreement, the following terms, whether used in the singular or
plural, shall have the following meanings:

1.1

Accounting Period

The term “Accounting Period” shall mean the Calendar Quarter in which there is
an invoiced sale of the Product to a Third Party in any country by Dermira
following the receipt of any Regulatory Approval required for such sale of the
Product.

1.2

Affiliate

The term “Affiliate” shall mean any individual, corporation, association or
other business entity that directly or indirectly controls, is controlled by, or
is under common control with the Party in question. As used in this definition
of “Affiliate,” the term “control” shall mean the direct or indirect ownership
of more than fifty percent (>50%) of the stock having the right to vote for
directors thereof or the ability to otherwise control the management of the
corporation or other business entity whether through the ownership of voting
securities, by contract, resolution, regulation or otherwise. Anything to the
contrary in this paragraph notwithstanding, Chugai Pharmaceutical Co., Ltd
(“Chugai”) and its subsidiaries or Foundation Medicine Inc. (“FMI”) and its
subsidiaries, shall not be deemed Affiliates of Roche unless and until Roche
provides written notice to Dermira specifying Chugai, FMI and/or their
respective subsidiaries as an Affiliate of Roche.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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1.3

Agreement

The term “Agreement” shall mean this document including any and all appendices
and amendments to it as may be added and/or amended from time to time in
accordance with the provisions of this Agreement.

1.4

Agreement Term

The term “Agreement Term” shall mean the period of time commencing on the
Effective Date and, unless this Agreement is terminated sooner as provided in
Section 18, expiring on the date when no royalty or other payment obligations
under this Agreement are or may become due.

1.5

Antitrust Laws

The term “Antitrust Laws” shall mean all antitrust, competition or trade
regulation laws or laws that are otherwise designed or intended to prohibit,
restrict or regulate actions or transactions having the purpose or effect of
monopolization, restraint of trade or harm to competition.

1.6

Applicable Law

The term “Applicable Law” shall mean any law, statute, ordinance, code, rule or
regulation that has been enacted by a government authority (including without
limitation, any Regulatory Authority) and is in force as of the Effective Date
or comes into force during the term of this Agreement, in each case to the
extent that the same are applicable to the performance by the Parties of their
respective obligations under this Agreement.

1.7

Biosimilar Product

The term “Biosimilar Product” shall mean, with respect to the Product sold by
Dermira (or any of its Affiliates or Sublicensees) in a particular country, any
product that is (a) approved for sale in such country in reliance on or by
reference to the prior marketing approval of the Product as determined by the
applicable Regulatory Authority or (b) approved for sale in such country as
structurally similar to the Product as determined by the applicable Regulatory
Authority. For clarity, a Biosimilar Product includes any biosimilar, follow-on
biologic or generic biological product, as those terms are commonly understood
under Title VII of the United States Patient Protection and Affordable Care Act
(“Biologics Price Competition and Innovation Act” or “BPCIA”), the Hatch-Waxman
Act, EU Directive 2004/27/EC and any successor legislation or regulations
relating thereto, and all similar foreign legislation with regard to the
foregoing.

1.8

BLA

The term “BLA” shall mean, with respect to the Product, a Biologics License
Application (as more fully described in U.S. 21 C.F.R. Part 601.20 or its
successor regulation) or similar application for Regulatory Approval to market
the Product that is submitted to the FDA or a Regulatory Authority that is the
foreign equivalent of the FDA, and all amendments and supplements thereto.

1.9

Business Day

The term “Business Day” shall mean a day other than a Saturday, Sunday or bank
or other public or federal holiday in Switzerland or the US.  

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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1.10

Calendar Quarter

The term “Calendar Quarter” shall mean each period of three (3) consecutive
calendar months, ending March 31, June 30, September 30, and December 31.

1.11

Calendar Year

The term “Calendar Year” shall mean the period of time beginning on January 1
and ending December 31, except for the first year which shall begin on the
Effective Date and end on December 31.

1.12

CDx / Companion Diagnostic

The term "CDx" or "Companion Diagnostic" shall mean an IVD that is intended to
be commercialized or is commercialized for use in identifying patients who may
or may not be suitable for treatment with the Product, and/or is intended to be
used otherwise in conjunction with the treatment of patients with the Product.

1.13

Change of Control

The term “Change of Control” shall mean, with respect to a Party: (a) the
acquisition by any Third Party of beneficial ownership of voting securities
representing fifty percent (50%) or more of the combined voting power of
the-then outstanding securities entitled to vote of such Party, other than
acquisitions by employee benefit plans sponsored or maintained by such Party;
(b) the consummation of a business combination involving such Party, unless,
following such business combination, the holders of voting securities of such
Party immediately prior to such business combination beneficially own directly
or indirectly more than fifty percent (50%) of the then outstanding voting
securities of the entity resulting from such business combination; or (c) the
bona fide sale of all or substantially all the assets and business of a Party
and its subsidiaries, taken as a whole, provided, that, such assets include the
assets relating to the subject matter of this Agreement.

1.14

Change of Control Group

The term “Change of Control Group” shall mean with respect to a Party, the Third
Party, or group of Third Parties, that is the acquirer of, or a successor to, a
Party in connection with a Change of Control, together with affiliates of such
persons or entities, that are not Affiliates of such Party immediately prior to
the closing of such Change of Control transaction of such Party.

1.15

CMO

The term “CMO” shall mean contract manufacturing organization.

1.16

Combination Product

The term “Combination Product” shall mean:

a)

a single pharmaceutical formulation containing as its active pharmaceutical
ingredients [*****] and one or more other [*****] pharmaceutical ingredients;

b)

a combination therapy comprised of [*****] and one or more other [*****]
products that is (i) priced and sold in a single package containing such
multiple products or (ii) packaged separately but sold together for a single
price; or

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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c)

a product comprised of [*****], priced and sold in a single package containing
such multiple products or packaged separately but sold together for a single
price;

in each case, including all dosage forms, formulations, presentations, line
extensions, and package configurations. All references to Product in this
Agreement shall be deemed to include Combination Product.

1.17

Commercially Reasonable Efforts

The term “Commercially Reasonable Efforts” shall mean, with respect to Dermira’s
obligations under this Agreement, the level of efforts required to carry out
such obligation in a [*****] consistent with the efforts a similarly situated
biopharmaceutical company or pharmaceutical company, as the case may be,
[*****], taking into consideration [*****].

1.18

Compound

The term “Compound” shall mean Roche’s proprietary, bivalent, monospecific,
monoclonal, monoepitopic, and humanized IgG4 antibody that binds to interleukin
13 (IL-13), which is known as lebrikizumab (RG3637 / RO5490255), defined by an
amino acid sequence as specified in Appendix 1.18.

1.19

Confidential Information

The term “Confidential Information” shall mean any and all information, data or
know-how (including Know-How), whether technical or non-technical, oral or
written, that is disclosed by one Party or its Affiliates (“Disclosing Party”)
to the other Party or its Affiliates (“Receiving Party”) under this Agreement,
that particular Non-Disclosure Agreement entered into by the Parties effective
February 3, 2017, or that particular Non-Disclosure Agreement entered into by
the Parties effective March 20, 2017. Confidential Information shall not include
any information, data or know-how that:

a)

was generally available to the public at the time of disclosure, or information
that becomes available to the public after disclosure by the Disclosing Party,
through no fault (whether by action or inaction) of the Receiving Party or its
Affiliates

b)

can be evidenced by written records to have been already known to the Receiving
Party or its Affiliates prior to its first receipt from the Disclosing Party,

c)

is obtained by the Receiving Party at any time lawfully from a Third Party under
circumstances permitting its use or disclosure,

d)

is developed independently by the Receiving Party or its Affiliates without the
aid, application or use of the Disclosing Party’s Confidential Information as
evidenced by the Receiving Party’s written records,

e)

is approved in writing by the Disclosing Party for release by the Receiving
Party.

The terms of this Agreement shall be considered Confidential Information of the
Parties, subject to Section 17.5.

1.20

Continuation Election Notice

The term “Continuation Election Notice” shall mean the notice Roche provides to
Dermira under Section 18.2 describing (i) Roche’s bona fide intentions to
continue ongoing development and

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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commercialization of Product(s) after the occurrence of the termination events
described in Section 18.3.2, and (ii) Roche’s request for Dermira’s continuation
of activities described in Section 18.3 during the applicable termination period
and/or transfer of the data, material and information relating to the
Product(s), each in accordance with Section 18.3.

1.21

Control

The term “Control” shall mean (as an adjective or as a verb including
conjugations and variations such as “Controls” “Controlled” or “Controlling”)
(a) with respect to Patent Rights and/or Know-How or other intellectual property
rights, the possession by a Party of the right (whether by ownership or license,
other than licenses granted pursuant to this Agreement) to grant to the other
Party ownership of, or a license or sublicense under, such Patent Rights and/or
Know-How or other intellectual property rights in each case without violating
the terms of any agreement or arrangement between such Party and any person or
party, (b) with respect to tangible materials, the possession by a Party of the
right to provide such tangible materials to the other Party as provided herein
without violating the terms of any agreement or arrangement between such Party
and any person or party and (c) with respect to information, including clinical
data and manufacturing processes, the possession by a Party of the right to
disclose such information to the other Party as provided herein without
violating the terms of any agreement or arrangement between such Party and any
other person or party.

1.22

Cover

The term “Cover” shall mean (as an adjective or as a verb including conjugations
and variations such as “Covered,” “Coverage” or “Covering”) with respect to a
Valid Claim in any Patent Rights and a given compound, formulation or product,
that the developing, making, using, offering for sale, promoting, selling,
exporting or importing of such given compound, formulation or product would
infringe a Valid Claim of such Patent Right in the country in which the activity
occurred but for ownership of, or a license under, such Patent Rights. The
determination of whether a compound, formulation, process or product is Covered
by a particular Valid Claim shall be made on a country-by-country basis.

1.23

Dermira Know-How

The term “Dermira Know-How” shall mean the Know-How that (i) Dermira or its
Affiliates or Sublicensees generate, and/or (ii) is generated on behalf of
Dermira or its Affiliates or Sublicensees, for each of (i) and (ii) that arises
from the research, Manufacture, development or commercialization of the Compound
or Product ([*****]) and that Dermira or its Affiliates Controls (other than
pursuant to the license granted to Dermira under this Agreement) during the
Agreement Term.

1.24

Dermira Patent Rights

The term “Dermira Patent Rights” shall mean the Patent Rights that Dermira
Controls, (other than pursuant to the license granted to Dermira under this
Agreement) (i) arising from the research, Manufacture, development or
commercialization of the Compound or Product ([*****]), or (ii) Covering the
Compound or Product ([*****]).

1.25

Development Plan

The term “Development Plan” shall mean the plan for the development of the
Product as set forth in Section 5.2.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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1.26

Diagnostics Field

The term “Diagnostics Field” shall mean in-vitro testing for exploratory use or
as a clinical diagnostic solely for use in-vitro in the diagnosis and/or
on-going evaluation of a disease or medical condition, including the prediction
and/or monitoring of a response to a therapeutic agent, and also use as an IVD.

1.27

Distribution

The term “Distribution” includes, with respect to the Compound, Dermira Modified
Compound, Joint Modified Compound, or Product:

a)

warehousing;

b)

demand estimates, collection of orders, release, selling, invoicing and
collection

c)

shipping Products to customers

d)

customer support for Products, including handling customer complaints

e)

collection of funds and payment of any chargebacks or similar sales adjustment
payments;

f)

management and processing of returns;

g)

pharmacovigilance and regulatory services, including filings of PSURs and
similar documents.

1.28

Drug Product

The term “Drug Product” shall mean Drug Substance formulated, filled in [*****],
labelled and packaged that meets the Specifications.

1.29

Drug Substance

The term “Drug Substance” shall mean lebrikizumab (RG3637 / RO5490255) in bulk
form that meets the Specifications.

1.30

Effective Date

The term “Effective Date” shall mean the second Business Day immediately
following the date of HSR Approval.

1.31

EMA

The term “EMA” shall mean the European Medicines Agency or any successor agency
with responsibilities comparable to those of the European Medicines Agency.

1.32

EU

The term “EU” shall mean the European Union and all its then-current member
countries.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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1.33

Execution Date

The term “Execution Date” shall mean the date on which the last of the Parties
has executed this Agreement as set forth on the signature page hereto.

1.34

Expert

The term “Expert” shall mean a person with no less than ten (10) years of
pharmaceutical industry experience and expertise having occupied at least one
senior position within a large pharmaceutical company but excluding any current
or former employee or consultant of either Party. Such person shall be fluent in
written and spoken English.

1.35

FDA

The term “FDA” shall mean the Food and Drug Administration of the United States
of America or any successor agency with responsibilities comparable to those of
the Food and Drug Administration of the United States of America.

1.36

FDCA

The term “FDCA” shall mean the Food, Drug and Cosmetics Act, as amended.

1.37

Field

The term “Field” shall mean all indications and uses of the Product, excluding
the Diagnostics Field.

1.38

First Commercial Sale

The term “First Commercial Sale” shall mean, on a country-by-country basis, the
first invoiced sale of the Product to a Third Party by Dermira following the
receipt of any Regulatory Approval required for such sale of such Product
outside of the Roche Retained Field (except as expressly stated otherwise in the
Agreement), or if no such Regulatory Approval is required in such country, the
date of the first invoiced sale of the Product to a Third Party by Dermira in
such country.

1.39

Fully Burdened Manufacturing Costs

The term "Fully Burdened Manufacturing Costs" shall mean the sum of

a)

the costs incurred by the Manufacturing Party (or for the account of the
Manufacturing Party) with respect to [*****], including the costs of [*****];
and

b)

costs incurred by the Manufacturing Party (or for the account of the
Manufacturing Party) which are attributable to [*****];

each calculated in accordance with GAAP or IFRS (as applicable) and the
Manufacturing Party’s accounting policies and manuals as consistently applied.

1.40

GAAP

The term “GAAP” shall mean Generally Accepted Accounting Principles, as
established and administered by the American Institute of Certified Public
Accountants (AICPA) and the Financial Accounting Standards Board (FASB),
consistently applied.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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1.41

Handle

The term “Handle” shall mean with respect to Patent Rights, preparing, filing,
prosecuting (including interference and opposition proceedings) and maintaining
(including interferences, reissue, re-examination, post-grant reviews,
inter-parties reviews, derivation proceedings, applications for patent term
extensions and opposition proceedings) on a country-by-country basis, including
deciding territorial scope of Patent Rights and all appeals or petitions to any
agency, board or court related to any of the foregoing.

1.42

HSR

The term “HSR” shall mean the Hart Scott Rodino Antitrust Improvement Act.

1.43

HSR Approval

The term “HSR Approval” shall mean the earliest to occur of: (1) expiration of
the waiting period (and any extension thereof); and (2) early termination of the
waiting period under HSR.

1.44

Housemark

The term “Housemark” shall mean any logo, trade name, sign, design, or
expression that is protectable as an intellectual property right, including
trademarks.

1.45

IFRS

The term “IFRS” shall mean International Financial Reporting Standards.

1.46

IND

The term “IND” shall mean an investigational new drug application as defined in
the FDCA and applicable regulations promulgated by the FDA, including Part 312
of Title 21 of the U.S. Code of Federal Regulations, or the equivalent
application defined by the equivalent agency in any other country or group of
countries, the filing of which is required by the applicable Regulatory
Authority in such country prior to commencing clinical testing of the Product in
humans.

1.47

Initiation

The term “Initiation” shall mean the date that the first human is first dosed
with the Product or, for blinded trials, also with a placebo, in a Phase III
Study approved by the respective Regulatory Authority.

1.48

Insolvency Event

The term “Insolvency Event” shall mean circumstances under which a Party (i) has
a receiver or similar officer appointed by a court of competent jurisdiction or
governmental authority over all or a material part of its assets or undertaking;
(ii) passes a resolution for winding-up (other than a winding-up for the purpose
of, or in connection with, any solvent amalgamation or reconstruction) or a
court makes an order to that effect or a court makes an order for administration
(or any equivalent order in any jurisdiction); or (iii) ceases to carry on
business.

1.49

Invention

The term “Invention” shall mean an invention that is conceived or reduced to
practice by or on behalf of one or both of the Parties in connection with any
activity carried out in the research,

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Manufacture, development or commercialization of the Compound, Modified
Compound, or Product under this Agreement. Under this definition, an Invention
may be made by employees of Dermira or its Affiliates solely or jointly with a
Third Party, including a Sublicensee, or solely by a Sublicensee (a “Dermira
Invention”), by employees of Roche or its Affiliates solely or jointly with a
Third Party (a “Roche Invention”), or jointly by employees of Dermira and Roche
or Affiliates of either with or without a Third Party (a “Joint Invention”).

1.50

IPF Study

The term “IPF Study” shall mean the clinical study titled “A Phase II,
Randomized, Double-Blind, Placebo-Controlled, Study to Assess the Efficacy and
Safety of Lebrikizumab in Patients With Idiopathic Pulmonary Fibrosis”
(NCT01872689).

1.51

Joint Know-How

The term “Joint Know-How” shall mean Know-How that is made jointly by or on
behalf of (a) Dermira or its Affiliates or Sublicensees and (b) Roche or its
Affiliates, in connection with any activity carried out in the research,
Manufacture, development or commercialization of the Compound, Modified
Compound, or Product under this Agreement.

1.52

IVD / in vitro diagnostic

The term “IVD” shall mean: (i) in the US, an in-vitro assay intended for use in
the disease prognosis or treatment selection/prediction, including a
determination of the state of health, in order to cure, mitigate, treat or
prevent disease or sequelae, as more fully defined in 21 C.F.R. § 809, including
companion diagnostics for a pharmaceutical product as defined in FDA’s “Draft
Guidance for Industry and Food and Drug Administration Staff - In Vitro
Companion Diagnostic Devices”, (ii) in the EU, an in-vitro diagnostic medical
device as defined in the European directive 98/79/EC, and (iii) any equivalent
definitions set by Regulatory Authorities in countries other than the US and the
EU.

1.53

Joint Patent Rights

The term “Joint Patent Rights” shall mean all Patent Rights that claim or
disclose a Joint Invention.

1.54

JSC

The term “JSC” shall mean the joint steering committee described in Section 4.3.

1.55

Know-How

The term “Know-How” shall mean all data, know-how and information, including
materials, samples, chemical and large molecule manufacturing data,
toxicological data, pharmacological data, non-clinical and clinical data,
assays, platforms, formulations, specifications, quality control testing data,
for each that are necessary or useful for the discovery, research, Manufacture,
development or commercialization of the Compound, Modified Compound, or Product.

1.56

Licensed Intellectual Property

The term “Licensed Intellectual Property” shall mean the Licensed Compound
Patent Rights and the Licensed Know-how.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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1.57

Licensed Compound Patent Rights

The term “Licensed Compound Patent Rights” shall mean Patent Rights under the
patents and applications listed in Appendix 1.57, and all Patent Rights that are
added to Appendix 1.57 in accordance with Section 13.4.

1.58

Licensed Know-how

The term “Licensed Know-how” shall mean the Know-How [*****].

1.59

Manufacture

The terms “Manufacture”, “Manufacturing” or “Manufactured” shall mean, with
respect to the Compound, Modified Compound, or Product, the receipt, handling
and storage of active pharmaceutical ingredients, drug substance or drug
product, medical devices and other materials, the manufacturing, processing,
packaging and labeling (excluding the development of packaging and labeling
components for Regulatory Approval), holding (including storage of goods in
manufacturing but excluding Distribution), quality assurance and quality control
testing (including release) in all cases in accordance with current good
manufacturing practices (as applicable) for such Compound, Modified Compound or
Product and shipping of such Compound, Modified Compound or Product. For
clarity, “Manufacture” and “Manufacturing” exclude CMC development activities
and Distribution.

1.60

Modified Compound

The term “Modified Compound” shall mean any bivalent, monospecific, monoclonal,
and monoepitopic antibody derived from the Compound having [*****].

Under this Section, a Modified Compound may be made by employees of Dermira or
its Affiliates solely or jointly with a Third Party, including a Sublicensee, or
solely by a Sublicensee (a “Dermira Modified Compound”), by employees of Roche
or its Affiliates solely or jointly with a Third Party (a “Roche Modified
Compound”), or jointly by employees of Dermira and Roche or Affiliates of either
with or without a Third Party (a “Joint Modified Compound”).  

1.61

Net Sales

The term “Net Sales” shall mean, for the Product in a particular period, the sum
of (i) and (ii):

(i)

the amount stated in Dermira’s “Sales” line of its externally published audited
financial statements with respect to such Product for such period (excluding
sales to any permitted Sublicensees that are not Affiliates of Dermira). This
amount reflects the gross invoice price at which such Product was sold or
otherwise disposed of by Dermira and its Affiliates to such Third Parties
(excluding sales to any Sublicensees that are not Affiliates of Dermira)
recognized in such period reduced by gross-to-net deductions, if not previously
deducted from such invoiced amount, in accordance with the then currently used
GAAP.

By way of example, the gross-to-net deductions taken in accordance with GAAP as
of the Effective Date include the following:

 

(a)

credits, reserves or allowances accrued for (i) damaged, outdated, returned,
rejected, withdrawn or recalled Product, (ii) wastage replacement and
short-shipments; (iii) billing errors and (iv) indigent patient and similar
programs (e.g., price capitation);

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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(b)

governmental price reductions and government mandated rebates;

 

(c)

chargebacks, including those accrued for wholesalers, buying groups and
retailers;

 

(d)

customer rebates, including cash sales incentives for prompt payment, cash and
volume discounts; and

 

(e)

taxes, and any other governmental charges or levies imposed upon or measured by
the, use, Manufacture or sale of the Product (excluding income or franchise
taxes).

For purposes of clarity, sales by Dermira and its Affiliates to any permitted
Sublicensee shall be excluded from “Sales” unless the Sublicensee is the final
end-user.

(ii)

The amount of sales reported to Dermira and Affiliates by one or more
Sublicensees that are not Dermira Affiliates in accordance with this Agreement
and GAAP.

It is the intent of the Parties that Dermira records Net Sales in all
indications in the Field (including the Roche Retained Field).

1.62

Non-Compound Patent Rights

The term “Non-Compound Patent Rights” shall mean Patent Rights under the patents
and applications listed in Appendix 1.62.

1.63

Outside Date

The term “Outside Date” shall mean the date that is six (6) months after the
Execution Date.

1.64

Partner

The term “Partner” shall mean a Third Party with which Dermira will enter or has
entered a Partner Agreement.

1.65

Partner Agreement

The term “Partner Agreement” shall mean any agreement between Dermira and a
Third Party granting rights to develop and/or commercialize the Compound and/or
the Product (including but not limited to a sublicense agreement with a Third
Party), other than a sub-contract pursuant to Section 2.3.

1.66

Party

The term “Party” shall mean Dermira or Roche, as the case may be, and “Parties”
shall mean Dermira and Roche collectively.

1.67

Patent Rights

The term “Patent Rights” shall mean all rights under any issued patent or
pending patent application, in any country of the Territory, including any
patents issuing on such patent application, and further including any
substitution, extension or supplementary protection certificate, reissue,
reexamination, renewal, revalidation, divisional, continuation or
continuation-in-part of any of the foregoing.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

1.68

Pharmacovigilance Agreement

The term “Pharmacovigilance Agreement” shall mean an agreement entered into by
the Parties in accordance with Section 7.5 to set forth the protocols and
procedures for reporting adverse events and complying with reporting
requirements set forth by Regulatory Authorities.

1.69

Phase II Dose-finding Study

The term “Phase II Dose-finding Study” shall mean the human clinical trial, for
which the primary endpoints include a determination of dose ranges and/or a
preliminary determination of efficacy in patients being studied as described in
21 C.F.R. § 312.21(b) (FDCA), as amended from time to time, and the foreign
equivalent thereof, that will be conducted by Dermira as per the Development
Plan.

1.70

Phase III Study

The term “Phase III Study” shall mean a human clinical trial for the Product
that is prospectively designed to demonstrate statistically whether the Product
is safe and effective for use in humans in a manner sufficient to obtain
Regulatory Approval to market the Product in patients having the disease or
condition being studied as described in 21 C.F.R. § 312.21(c) (FDCA), as amended
from time to time, and the foreign equivalent thereof.

1.71

Product

The term “Product” shall mean any product, including without limitation any
Combination Product, containing the Compound, Dermira Modified Compound or Joint
Modified Compound as pharmaceutically active agent, regardless of their finished
forms or formulations or dosages. For clarity, different formulations or
finished forms or dosages containing the same Compound, Dermira Modified
Compound, or Joint Modified Compound, as the case may be, are considered the
same Product.

1.72

Regulatory Approval

The term “Regulatory Approval” shall mean any and all licenses, registrations or
authorizations by Regulatory Authority necessary for the Manufacture and sale of
the Product in the Field in a regulatory jurisdiction in the Territory.

1.73

Regulatory Authority

The term “Regulatory Authority” shall mean any national, supranational (e.g.,
the European Commission, the Council of the European Union, the European
Medicines Agency), regional, state or local regulatory agency, department,
bureau, commission, council or other governmental entity including the FDA and
EMA, in each country involved in the granting of Regulatory Approval for the
Product.

1.74

Regulatory Exclusivity

The term “Regulatory Exclusivity” means any exclusive marketing rights or data
exclusivity rights conferred by any Regulatory Authority under Applicable Law
with respect to the Product in a country or jurisdiction in the Territory to
prevent Third Parties from selling such Product in such country or jurisdiction
which provides the holder of such exclusive rights with the exclusive right to
market such Product in such country or jurisdiction, other than a Patent Right,
including orphan drug exclusivity, pediatric exclusivity, rights conferred in
the U.S. under the FDCA, in the EU under

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Directive 2001/83/EC, or rights similar thereto in other countries or regulatory
jurisdictions in the Territory.

1.75

Roche Know-How

The term “Roche Know-How” shall mean all Know-How Controlled by Roche as of the
Effective Date. Roche Know-How includes Licensed Know-how.

1.76

Roche Patent Rights

The term “Roche Patent Rights” shall mean all Patent Rights Controlled by Roche
as of the Effective Date, including Licensed Compound Patent Rights and
Non-Compound Patent Rights, but excluding the Patent Rights identified in
Appendix 1.76 (“Excluded Patent Rights”) and excluding Dermira Patent Rights
licensed to Roche under Section 2.6.2.

1.77

Roche Retained Field

The term “Roche Retained Field” shall mean all uses of the Compound, Modified
Compounds, and Product in lung diseases classified as ILD in adults and children
(interstitial lung disease), including but not limited to, IPF (idiopathic
pulmonary fibrosis) and NSIP (non-specific interstitial pneumonia).

1.78

Royalty Term

The term “Royalty Term” shall mean, with respect to the Product and for a given
country in the Territory, the period of time commencing on the date of the First
Commercial Sale of the Product in such country and ending on the later of the
date that is (a) ten (10) years after the date of the First Commercial Sale of
the Product in such country, or (b) the expiration of the last to expire Valid
Claim within the Licensed Compound Patent Rights, Dermira Patent Rights or Joint
Patent Rights in such country Covering the use, Manufacturing, import, offering
for sale, or sale of the Product in such country, (c) the expiration of the last
to expire Valid Claim within the Non-Compound Patent Rights in such country
Covering the use, import, offering for sale, or sale of the Product in such
country, or (d) expiration of the last to expire Regulatory Exclusivity
conferred by the applicable Regulatory Authority in such country for the
Product.  

1.79

Specifications

The term “Specifications” shall mean the specifications for the Manufacture
(including labeling, packaging, holding and release) of the Product as set forth
in an applicable regulatory filing and/or CTAs/INDs (e.g., a drug master file
(as defined in the Code of Federal Regulations) or Drug Approval Application) or
Regulatory Approval as amended from time to time and in accordance with
Applicable Law and the terms of this Agreement.

1.80

Sublicensee

The term “Sublicensee” shall mean a person or entity to which Dermira has
licensed rights pursuant to Section 2.2 of this Agreement (including Affiliates
and Partners).

1.81

Technology Transfer

The term “Technology Transfer” shall mean the transfer of the technology,
information, documentation, equipment, materials, tools, and technical
assistance between the Parties in order to transfer the manufacturing process
for the Drug Substance or Drug Product, as applicable, to an applicable
facility. Technology Transfer also includes such additional assistance Roche may

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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provide to Dermira pursuant to the terms of this Agreement.  Technology Transfer
will be considered to begin as of the effective date of the Drug Substance
Transfer Notice or the Drug Product Transfer Notice and to be complete as of the
date of: (a) for Drug Substance, the date on which the FDA approves the BLA or
supplemental BLA, as applicable, for commercial supply of Product by such
facility, or the date that is [*****] ([*****]) years after the Drug Substance
Transfer Notice, whichever is earlier; and (b) for Drug Product, the day on
which [*****] (the “Transfer Completion Date”).

1.82

Technology Transfer Project Plan

The term “Technology Transfer Project Plan” shall mean a written description of
the Technology Transfer prepared by Roche and submitted to Dermira as further
described in Section 6.2.1, as the same may be amended from time to time.

1.83

Territory

The term “Territory” shall mean all countries of the world.

1.84

Third Party

The term “Third Party” shall mean a person or entity other than (i) Dermira or
any of its Affiliates or (ii) Roche or any of its Affiliates.

1.85

US

The term “US” shall mean the United States of America and its territories and
possessions.

1.86

US$

The term “US$” shall mean US dollars.

1.87

Valid Claim

The term “Valid Claim” shall mean a claim contained in any (i) unexpired and
issued Patent Right that has not been disclaimed, revoked or held invalid by a
final non-appealable decision of a court of competent jurisdiction or government
agency or (ii) pending patent application that is on file with the applicable
office and has shown evidence of reasonably consistent activity to advance to
issuance of a patent (if such claim has been consistently on file with the
applicable patent office for more than ten (10) years from the earliest date to
which the patent application claims priority and has not issued, such claim
shall cease to constitute a Valid Claim unless and until a patent issues with
such claim).

1.88

Additional Definitions

Each of the following definitions is set forth in the Section of this Agreement
indicated below:

Definition

Section

[*****] Product Plan

6.2.5

[*****]

6.2.5

Additional Study

7.2.2.1

Bankruptcy Code

20

Breaching Party

18.2.1

Decision Period

13.6

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Deduction Cap

9.4.3.2

Dermira Invention

1.49

Disclosing Party

1.19

Drug Product Transfer Notice

6.2.2

Excluded Patent Rights

1.76

H-W Suit Notice

13.9

Initiating Party

13.6

Joint Invention

1.49

Licensed Roche Modified Compound

2.1.3

Medical Affairs Activities

8.4

Patent Term Extensions

13.11

Payment Currency

10.4

Peremptory Notice Period

18.2.1

Predefined Percentage

13.2.2

Switch

13.2.2

Product Trademark

13.2

Promote

8.3

Publishing Notice

17.4

Publishing Party

17.4

Receiving Party

1.19

Reference Product Sponsor

13.10

Relative Commercial Value

9.4.3.1

Roche Invention

1.49

Roche Reversion

2.6.3

Roche Retained Field Trademark(s)

13.2.2

Roche Retained IND

2.4.2

Settlement

13.6

SPCs

13.11

Suit Notice

13.6

Supply Agreement

6.1.5

Trademark(s) For Other Indications

13.2.2

Transfer Completion Date

1.81

 

2.

Grant of License

2.1

License Grant

2.1.1

Development and Commercialization Grant

Subject to Sections 2.5, 5.3 and 8.3, Roche hereby grants to Dermira:

(i)

an exclusive license under the Licensed Intellectual Property to research and
have researched, develop and have developed, register, have registered, use,
have used, import, have imported, export, have exported, market and have
marketed, distribute, have distributed, offer for sale, sell and have sold the
Compound, Dermira Modified Compounds, Joint Modified Compounds and Products in
the Field in the Territory; and

(ii)

a non-exclusive license under the Roche Patent Rights and all Roche Know-How
that is disclosed by Roche to Dermira under this Agreement solely as necessary
for the development or commercialization of the Compound, Dermira Modified
Compounds, Joint Modified Compounds or Products as conducted by Dermira, its
Affiliates or permitted Third

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Parties (including Sublicensees) in the Field in the Territory in accordance
with this Agreement, and

(iii)

a non-exclusive license under the Licensed Intellectual Property and all Roche
Know-How that is disclosed by Roche to Dermira under this Agreement solely as
necessary for the research, development, manufacture or commercialization of
Companion Diagnostic(s) as conducted by Dermira, its Affiliates or permitted
Third Parties (including Sublicensees) in the Diagnostics Field in the Territory
in accordance with this Agreement.

2.1.2

Manufacturing Rights

Also subject to Sections 2.5, 5.3 and 8.3, Roche (a) agrees to grant to Dermira,
upon Dermira’s receipt of the Drug Substance Transfer Notice in accordance with
Section 6.2.1, a co-exclusive license under the Roche Patent Rights and all
Roche Know-How that is disclosed by Roche to Dermira under this Agreement to
make, have made, and Manufacture the Compound, Dermira Modified Compounds, Joint
Modified Compounds or Products as conducted by Dermira in the Field in the
Territory in accordance with this Agreement, and (b) hereby grants to Dermira a
co-exclusive license under the Roche Patent Rights and all Roche Know-How that
is disclosed by Roche to Dermira under this Agreement solely to make, have made,
and Manufacture formulated, filled and finished Product (including Drug Product)
from Drug Substance that is Manufactured by or on behalf of Roche hereunder,
including to develop the [*****] pursuant to Section 6.2.5. Dermira shall not
have the right to sublicense such co-exclusive licenses to any Third Party other
than as permitted under Section 2.3.  

2.1.3

Licensed Roche Modified Compound

If a Roche Modified Compound becomes a Licensed Roche Modified Compound (defined
below), then: (a) any Roche-Controlled patent or patent application the claims
of which recite such Licensed Roche Modified Compound and do not recite any drug
substance other than the Licensed Roche Modified Compound or Compound shall be
added to Appendix 1.57 and the Patent Rights under such patent or patent
application, as applicable, shall be deemed Licensed Compound Patent Rights, (b)
any Roche-Controlled patent or patent application the claims of which recite
such Licensed Roche Modified Compound and also recite a drug substance other
than the Licensed Roche Modified Compound or Compound shall be added to Appendix
1.62 and the Patent Rights under such patent or patent application, as
applicable, shall be Non-Compound Patent Rights provided that Roche shall make
reasonable and good faith efforts to divide the claimed subject matter of such
patent or patent application so that a patent application becomes a Licensed
Compound Patent Right and added to Appendix 1.57 in a manner consistent with
Section 13.4; (c) the licenses granted to Dermira under Sections 2.1.1 and 2.1.2
shall apply to such Licensed Roche Modified Compound subject to the payment
obligations described in Article 9; and (d) all respective Sections of this
Agreement shall apply mutatis mutandis.

For purposes of this Section 2.1.3, the term “Licensed Roche Modified Compound”
shall mean each Roche Modified Compound that is administered to a human subject
between the period of time beginning on the Effective Date and ending [*****]
([*****]) years after the occurrence of the First Commercial Sale of the
Product.

2.2

Right to Sublicense

Dermira shall have the right to grant written sublicenses to its Affiliates and
to Third Parties, or to enter into a Partner Agreement, under its rights granted
under Section 2.1 solely to the extent necessary to develop, commercialize, use,
offer for sale, sell or import (and have others do the same) Compound and/or
Product in the Field and/or Companion Diagnostic in the Diagnostics

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Field, in the Territory; [*****], Dermira’s rights to sublicense to Third
Parties [*****] as described below.  [*****], Dermira intends to begin
negotiations for such a sublicense with a Third Party, then [*****] Dermira
entering into such a sublicense with such Third Party or its affiliates, [*****]
Dermira entering into such a sublicense with such Third Party or its
affiliates.  Notwithstanding the foregoing in this Section 2.2, [*****] Dermira
entering into such a sublicense with the applicable Third Party or its
affiliates.  [*****] Dermira to enter into such sublicense at any time [*****]
hereunder ([*****]).  Provided, however, [*****] prior to Dermira entering into
such sublicense, [*****].  For clarity, [*****] Dermira shall have the right to
sublicense on prior written notice to Roche, [*****].  If Dermira grants such a
sublicense, Dermira shall (i) inform Roche of the status of its sublicensing
activities and (ii) ensure that all of the applicable terms and conditions of
this Agreement shall apply to the Affiliate or the Third Party, as applicable,
to the same extent as they apply to Dermira for all purposes. Dermira assumes
full responsibility for the performance of all obligations and observance of all
terms so imposed on such Affiliate or Third Party, as applicable, and shall
itself account to Roche for all payments due under this Agreement by reason of
such sublicense.  

2.3

Sub-Contractors

Dermira has the right to sub-contract (on Dermira’s behalf) any of the work to
be performed by Dermira under this Agreement. Any sub-contract agreement shall
include (i) the right to disclose a copy of the sub-contract agreement and any
confidential information generated under such agreement that is necessary or
useful for the Manufacture, development or commercialization of the Compound or
Product to Roche, (ii) the right to assign the agreement, and all rights
thereunder, to Roche, and (iii) the right to transfer ownership of data and
information arising therefrom to Roche in a manner consistent with the terms of
this Agreement.

2.4

Know-How Transfer

2.4.1

Licensed Know-how Transfer

Roche will transfer the Licensed Know-how [*****] to Dermira [*****] within
[*****] ([*****]) days after the Effective Date. At Dermira’s written request at
any time prior to [*****] ([*****]) months after the Effective Date, the Parties
shall meet no more than [*****] to discuss the transfer of the Licensed
Know-how.  Further, Roche will transfer the additional documents or materials
listed in Appendix 2.4.1 to Dermira [*****] according to the timeline described
therein and the logistical procedures to be agreed to by the Parties.  All
information specifically directed to the Compound and contained in the documents
or materials listed in Appendix 2.4.1 shall be Licensed Know-How except to the
extent such information or materials is related to Manufacturing. All other
information contained in the documents or materials listed in Appendix 2.4.1
shall remain Roche Know-How.

Roche shall also transfer the documents that are listed in Appendix 2.4.1 that
are not in existence as of the Effective Date, which Roche shall use [*****]
efforts to complete and transfer within the timelines described therein.  

Thereafter, prior to the First Commercial Sale, Roche shall transfer to Dermira
Roche Know-How specifically directed to the Compound then in Roche’s Control (a)
[*****] any such Roche Know-How that Roche’s Alliance Manager becomes aware of
and that he or she reasonably expects to be necessary to develop or Manufacture
(to the extent permitted hereunder) Drug Substance or Drug Product, and (b) that
is requested by a Regulatory Authority in connection with the Compound or
Product, such transfer to be completed by Roche within [*****] ([*****])
Business Days after the request.  Any assistance provided pursuant to (b) shall
be provided at Roche’s [*****] rate applicable at the time plus a mark-up of
[*****] percent ([*****]%).

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Roche shall be responsible for providing [*****] ([*****]) [*****] of any
documents (which will be provided in electronic format, where they exist) that
Roche is obligated or consents to provide to Dermira under this Agreement. Roche
shall have no obligation to [*****], in order to provide them to Dermira.
Subject to Section 6.2, Roche shall have no obligation to transfer any Roche
Know-How, data, information or materials or to provide technical support other
than expressly stated in this Section 2.4.

2.4.2

Transfer of INDs

2.4.2.1

Roche shall take such actions as reasonably necessary to assign to Dermira, the
US IND 119866 (atopic dermatitis) and PIND 128527 (nasal polyposis) within
[*****] ([*****]) days after the Effective Date. For all non-US clinical trial
applications initiated by Roche outside the Roche Retained Field, Roche will
take reasonable actions required to close-out these applications.

2.4.2.2

Roche shall remain responsible for all regulatory activities with respect to all
US INDs for the Compound or Product that have not been transferred to Dermira
until such INDs are transferred to Dermira, provided that:  (i) both the COPD US
FDA IND and the non-Hodgkin lymphoma US FDA IND will be [*****] by Roche
following the respective submission of relevant outstanding study reports; (ii)
the Asthma US FDA IND will be maintained by Roche in order to fulfill submission
requirements for the Roche-sponsored asthma studies and to maintain necessary
CMC information for cross-reference by the Parties until the necessary
non-clinical and CMC information is transferred to a Dermira IND and the Asthma
US FDA IND is [*****]; and (iii) upon occurrence of a Roche Reversion, the IPF
IND will be [*****] by Roche as soon as possibly permitted under Applicable Law.

2.4.2.3

At Roche’s option Roche may establish a drug master file suitable for Dermira
and its Sublicensees to reference to obtain Regulatory Approvals.  If and when
such drug master file is established, Dermira shall only disclose to permitted
Third Parties (including, without limitation its Sublicensees) CMC information
to the extent Regulatory Approval requirements are not satisfied by reference to
such drug master file.

2.4.2.4

Dermira shall accept the transfer of the US IND 119866 (atopic dermatitis) and
PIND 128527 (nasal polyposis) immediately after receipt of written notice
approving such transfer from a Regulatory Authority if permissible under
Applicable Law, and if not permissible, at the earliest possible date
permissible under Applicable Law.  If required by a Regulatory Authority,
Dermira and Roche shall determine the effective date of the transfer and the
Parties shall coordinate the notification of such Transfer to the Regulatory
Authority.

2.4.2.5

If Dermira requires additional assistance with Regulatory Authorities outside
the Roche Retained Field after the completion of the IND transfers, upon request
of Dermira, Roche shall provide such assistance in the form of up to [*****]
([*****]) working hours [*****] during the period of [*****] ([*****]) days
following the effective date of the IND transfers. If Dermira requests
additional regulatory assistance, Roche will provide such technical assistance
for a period of [*****] ([*****]) days following the effective date of the IND

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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transfers, charged at Roche’s [*****] rate applicable at the time plus a mark-up
of [*****] percent ([*****]%).

2.4.3

Cost

Dermira will bear the cost of mapping Roche’s clinical trial master file (TMF)
structure to the Dermira’s TMF structure. Roche will transfer the ownership of
the non-clinical toxicity studies to Dermira and Dermira will bear the cost of
the handling of non-clinical archival raw data after ownership transfer.  

2.5

Roche Retained Rights

2.5.1

Roche Retained Rights for Research Purposes

All rights not expressly granted by Roche to Dermira under this Agreement are
reserved by Roche.  Subject to the terms and conditions of this Agreement,
including Section 17.4, and notwithstanding the license granted to Dermira under
Section 2.1, Roche and its Affiliates shall retain the right to research, make,
have made, use, have used, import or export the Compound, Modified Compound, and
Product and to use the Licensed Intellectual Property solely for any internal
research purposes on its own or with Third Parties working with or on behalf of
Roche in any field (including diagnostics), and to research and develop other
molecules for use with the Compound, Modified Compound, and Product. For the
avoidance of doubt, Roche and its Affiliates shall have the right to use all
data, results, analyses, conclusions, and other intellectual property arising
from such internal research for any and all business purposes that are not
specifically directed to the commercialization of the Compound. Notwithstanding
the foregoing and subject to Section 5.3, Roche shall not conduct any (i)
research in non-human animals using the Compound, or (ii) human clinical trials
using the Compound, in each case without prior written consent from Dermira.

2.5.2

Roche Retained Manufacturing Right

Roche also reserves the right to make, have made, use, import or export any
Compound, Modified Compound, or Product solely for use as an intermediate or
starting material in the manufacture of any product that is not the Compound or
Product.

2.5.3

In General

Subject to Section 17.4.2, nothing in this Agreement shall prevent Roche and its
Affiliates from using for any purpose any Roche Know-How that is not
Confidential Information on the Effective Date (or ceases to be Confidential
Information thereafter other than as a result of Roche’s breach under Section
17) and is not covered by a Valid Claim of a Roche Patent Right exclusively
licensed to Dermira hereunder.

2.6

Roche Rights in the Roche Retained Field

2.6.1

In General

Roche retains the sole development and promotion rights in the Roche Retained
Field as further detailed in  Sections 5.3 and 8.3.

2.6.2

License Grant by Dermira

Dermira hereby grants to Roche a non-exclusive, sublicensable (solely to Roche
Affiliates, Chugai, and Roche subcontractors exercising Roche’s rights under
this Section 2.6.2 on Roche’s

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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behalf) royalty-free license under Dermira Patent Rights and Dermira Know-How
solely for the purpose of (a) performing Roche’s rights and obligations under
this Agreement, and (b) exercising its rights under Sections 2.5, 5.3 and 8.3.

2.6.3

Roche Option to Relinquish Rights in the Roche Retained Field; Expiration

During the Agreement Term, Roche shall have the option, at any time, to
relinquish its retained rights under this Agreement in the Roche Retained Field
that are described in Sections 5.3 and 8.3 (“Roche Reversion”). Roche may
exercise such option by providing written notice to Dermira, such relinquishment
to take effect thirty (30) days after delivery of such notice. Notwithstanding
the foregoing, the Roche Reversion shall be deemed to have occurred if at any
time in a period of eighteen (18) consecutive months Roche is not conducting an
active clinical study of the Compound or recurring, bona fide activities aimed
at receiving Regulatory Approval of a BLA for the Compound in the Roche Retained
Field, provided that such automatic reversion may not occur within three (3)
years of the Effective Date or following Regulatory Approval of a BLA for the
Compound in the Roche Retained Field.  Upon the occurrence of the Roche
Reversion, all of Roche’s rights and all of Dermira’s obligations each with
respect to the Roche Retained Field shall automatically expire, and all
references to the Roche Retained Field in any Section of this Agreement shall no
longer apply (for example, after occurrence of the Roche Reversion, the
Development Event Payments under Section 9.2 will be triggered by any
indication, the Net Sales of Product in all indications will be subject to
royalty payments under Section 9.4 and the payments under Section 9.5 will no
longer apply, and the First Commercial Sale shall include all indications in the
Field). For clarity, any such Roche Reversion shall not affect Roche’s retained
rights in Sections 2.5, nor the license grant by Dermira under Section 2.6.2
with respect to Sections 2.5.

3.

Diligence

Dermira shall use Commercially Reasonable Efforts to fulfill all its obligations
under this Agreement. In particular, Dermira shall use Commercially Reasonable
Efforts:

 

(a)

to develop and commercialize the Compound and/or Product in the Field in the
Territory [*****] outside of the Roche Retained Field consistent with the
Development Plan;

 

(b)

to assess [*****] other value adding indications for the Compound and/or
Product;

 

(c)

to support Roche in its efforts to develop, to prepare for registration, and,
subject to Section 8.3, Promote the Compound and/or Product in the Roche
Retained Field;

 

(d)

to register, distribute and sell the Compound and/or Product in the Roche
Retained Field subject to Roche’s retained rights;

 

(e)

to establish sufficiently separate trademarks for the Roche Retained Field
versus all other indications in order to allow for the separate tracking of
sales.

4.

Alliance Management, Reporting and Governance

4.1

Alliance Management

Each Party shall designate an “Alliance Manager” within [*****] ([*****]) days
after the Effective Date to facilitate technology transfer and communication
between the Parties. The Roche Alliance Manager and his/her counterpart at
Dermira shall be the primary points of contact between the

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Parties with respect to all matters arising under this Agreement. Each Party may
change its Alliance Manager from time to time in its sole discretion. The
Alliance Managers shall be members of the JSC.

4.2

Reporting

4.2.1

Prior to First Commercial Sale

During the Agreement Term up to First Commercial Sale of the Product, Dermira
shall submit detailed annual reports to Roche describing in detail the
development progress of the Product, including any revisions proposed to be made
to the Development Plan for the then current Calendar Year, pursuant to Section
5.2.  Dermira shall send such annual report within [*****] ([*****]) days after
the end of December of each Calendar Year. Until [*****], Dermira shall provide
[*****] updates to Roche regarding recruitment progress for the Phase II
Dose-finding Study.

4.2.2

After First Commercial Sale

Following the First Commercial Sale of the Product, Dermira shall provide Roche
with a detailed report regarding the commercialization of the Product in the
Field in the Territory by Dermira, its Affiliates and Partners (if applicable).
Each such annual report shall be provided within [*****] ([*****]) days after
the end of December of each Calendar Year after the First Commercial Sale. Each
annual report shall include forecasted sales, [*****].

4.3

Governance

4.3.1

Joint Steering Committee

Within [*****] ([*****]) days after the Effective Date of this Agreement, the
Parties shall establish a JSC to oversee, coordinate, align and act as the forum
to exchange information related to activities of the Parties under this
Agreement. The JSC may create subcommittees as appropriate.

4.3.2

Members

The JSC shall be composed of [*****] ([*****]) persons (“Members”). Roche and
Dermira each shall be entitled to appoint [*****] ([*****]) Members with
appropriate seniority and functional expertise. Each Party may replace any of
its Members and appoint a person to fill the vacancy arising from each such
replacement. A Party that replaces a Member shall notify the other Party at
least [*****] ([*****]) days prior to the next scheduled meeting of the JSC.
Both Parties shall use [*****] efforts to keep an appropriate level of
continuity in representation. Both Parties may invite a [*****] number of
additional experts and/or advisors to attend part or the whole JSC meeting with
prior notification to the JSC. Members may be represented at any meeting by
another person designated by the absent Member. The JSC shall be chaired by a
Dermira Member (“Chairperson”).

4.3.3

Responsibilities of the JSC

The JSC shall have the responsibility and authority to:

 

(a)

monitor, coordinate and implement the know-how transfer to Dermira (Section
2.4);

 

(b)

oversee development strategies of the Parties and coordinate the activities of
the Parties for the development of the Compound and the Product (i.e. issue
resolution on development strategy, safety reporting, supply, issue management)
(Section 5);

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separately with the Securities and Exchange Commission. Confidential treatment
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(c)

oversee process and coordinate interactions of the Parties as it relates to data
access of the Parties for regulatory purposes;

 

(d)

monitor and coordinate preparation of filing submission of dossiers for the
Roche Retained Field;

 

(e)

coordinate matters related to Roche’s Medical Affairs Activities and Promotion
activities in the Roche Retained Field (Section 8.3);

 

(f)

coordinate efforts to establish sufficiently separate trademarks for the Roche
Retained Field versus all other indications (Section 13.2);

 

(g)

discuss value considerations of the Product and discuss, but not decide, pricing
in the Roche Retained Field (factoring in Dermira’s value considerations outside
of the Roche Retained Field);

 

(h)

monitor and oversee process and implementation of the method to determine sales
portion from Roche Retained Field; and

 

(i)

oversee the Manufacture of Drug Substance, Drug Product, and, if applicable,
[*****] under this Agreement.

The JSC shall have no responsibility and authority other than that expressly set
forth in this Section.

4.3.4

Meetings; Committees

The Chairperson or his/her delegate will be responsible for sending invitations
and agendas for all JSC meetings to all Members at least [*****] ([*****]) days
before the next scheduled meeting of the JSC. The venue for the meetings shall
be agreed by the JSC. The JSC shall hold meetings at least [*****] per Calendar
Year, either in person or by tele-/video-conference, and in any case as
frequently as the Members of the JSC may agree shall be necessary, but not more
than [*****] times a year.  

From time to time, the JSC may establish subcommittees to oversee particular
projects or activities, as such committee deems necessary or advisable including
a joint working group to coordinate the Parties’ activities under this
Agreement.  Such members shall be individuals with expertise and
responsibilities in the relevant areas in the Field.  

4.3.5

Minutes

The Chairperson will be responsible for designating a Member to record in
reasonable detail and circulate draft minutes of JSC meetings to all members of
the JSC for comment and review within [*****] ([*****]) days after the relevant
meeting. The Members of the JSC shall have [*****] ([*****]) days to provide
comments. The Party preparing the minutes shall incorporate timely received
comments and distribute finalized minutes to all Members of the JSC within
[*****] ([*****]) days of the relevant meeting. The Chairperson approves the
final version of the minutes before its distribution.

4.3.6

Decisions

4.3.6.1

Decision Making Authority

The JSC shall decide matters within its responsibilities set forth in
Section 4.3.3.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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4.3.6.2

Consensus; Good Faith

The Members of the JSC shall act in good faith to cooperate with one another and
seek agreement with respect to issues to be decided by the JSC. The Parties
shall endeavor to make decisions by consensus.

4.3.6.3

Failure to Reach Consensus

If the JSC is unable to decide a matter by consensus, then subject to Section
4.3.8, (a) Roche shall have the final decision making authority in the area of
(i) development and regulatory matters in the Roche Retained Field, unless
Dermira can [*****] demonstrate that a specific clinical study as contemplated
by Roche would be [*****] under this Agreement, (ii) Medical Affairs Activities
and Promotion in the Roche Retained Field, including the decision regarding the
trademark for the Roche Retained Field, and (iii) Manufacturing of Drug
Substance and Drug Product under this Agreement during any period of time during
which Roche remains responsible for such activity, and (b) Dermira shall have
the final decision making authority in all other areas, except that the
following decisions shall [*****]: (1) decisions regarding the Know-How Transfer
to Dermira (2.4.1), and (2) the implementation and process to determine sales
portion from Roche Retained Field. In addition, until the submission of the
first BLA, material changes to the Development Plan will require mutual
agreement of the Parties unless such change is required by a Regulatory
Authority.

4.3.7

Information Exchange

Dermira and Roche shall exchange the information in relation to its activities
under this Agreement through the JSC and both Parties may ask reasonable
questions in relation to the above information and offer advice in relation
thereto and shall give due consideration to the other Party’s input. The JSC may
determine other routes of information exchange.

4.3.8

Limitations of Authority

The JSC shall have no authority to amend or waive compliance with any terms of
this Agreement. The final decision-making authority under Section 4.3.6 shall
not authorize a Party to unilaterally modify, amend, or waive its own compliance
with any provisions of this Agreement.

4.3.9

Expenses

Each Party shall be responsible for its own expenses including travel and
accommodation costs incurred in connection with the JSC.

4.3.10

Lifetime

The JSC shall exist during the Agreement Term, but it shall end upon the
occurrence of the Roche Reversion.

5.

Development

5.1

Responsibility

Subject to Section 7.1, Dermira, at its sole cost, shall be solely responsible
for the development (including all regulatory interactions, conducting and
funding of any clinical trials) of the Compound and/or the Product in the
Territory in the Field, but excluding the Roche Retained Field until the
occurrence of the Roche Reversion using Commercially Reasonable Efforts.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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5.2

Development Plan

Dermira will conduct (or have conducted) the development of the Compound and
Product in the Field (but excluding the Roche Retained Field until the
occurrence of the Roche Reversion) in the Territory in accordance with the
written plan as attached as Appendix 5.2 (“Development Plan”). Dermira’s
obligation under this Section 5.2 shall be subject to Roche meeting its
obligation to manufacture and supply Drug Product and Drug Substance (if
required) to Dermira for the conduct of the Development Plan. Dermira shall send
a then current version of the Development Plan to Roche at the end of January
and July of each Calendar Year. Until the submission of the first BLA, any
material change to the Development Plan will be mutually agreed upon by the
Parties in accordance with Section 4.3.6.  

5.3

Development by Roche in the Roche Retained Field

Roche, at its sole cost and discretion, shall have the sole right but not the
obligation to conduct the development (including all regulatory interactions,
conducting and funding of any clinical trials) of Compounds, Modified Compounds,
and/or Product in the Territory in the Roche Retained Field, including the right
to use and reference any of the Licensed Know-how necessary to exercise such
right.

6.

Manufacture and Supply

6.1

Manufacture and Supply

6.1.1

General

The Parties anticipate and agree that to the extent possible the Parties’
requirements will be fulfilled from existing inventories of Drug Substance and
Drug Product (assembled or unassembled, i.e. without needle safety device, not
labelled and not packaged, as the case may be).  

Dermira’s first order will be sourced from existing Roche inventories pursuant
to Section 6.1.4.  Concurrently, at Dermira’s sole cost and as further described
in Section 6.2.5, the Parties may collaborate to develop a [*****] for use in
the Parties’ further development and commercialization.  Depending on the timing
and outcome of such effort, the Parties’ future requirements will be fulfilled
from existing Roche inventory of Drug Substance and Drug Product to the extent
possible and from new production if needed at Dermira’s cost as described in
Sections 6.1.3 and 6.1.4.

6.1.2

Roche’s Supply Obligation Prior to Transfer

Until such responsibility is transferred to Dermira according to Section 6.2,
Roche or its designees shall (a) Manufacture (if required) and supply to Dermira
the Drug Substance and Drug Product in accordance with this Section 6.1, and
(b), continue to manage clinical inventory and on-going stability studies to
support Drug Substance and Drug Product shelf-life claims.

6.1.3

Supply of Drug Substance

Until such responsibility is transferred to Dermira according to Section 6.2.1,
and subject to the terms of the Supply Agreement, Roche shall supply Dermira’s
[*****] forecasted requirements of Drug Substance (if any) to Dermira in
accordance with the [*****] Specifications at Roche’s Fully Burdened
Manufacturing Costs plus a mark-up of [*****] percent ([*****]%).  

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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6.1.4

Supply of Drug Product

Until such responsibility is transferred to Dermira according to Section 6.2.2,
and subject to the terms of the Supply Agreement, Roche shall supply Dermira’s
[*****] forecasted requirements of Drug Product to Dermira in accordance with
the [*****] Specifications at a price of [*****] per syringe (active and
placebo). The first order for such supply is set forth on Appendix 6.1.2. Other
than for the first order, Roche may supply Dermira with [*****] in accordance
with the [*****] Specifications at a price of [*****] per syringe (active and
placebo).  Each of the Parties shall execute and deliver any and all papers,
documents and other assurances, and shall do any and all acts and things [*****]
in connection with the transfer of responsibility from Roche to Dermira for the
assembly, labelling and packaging of such [*****] Drug Product by Roche’s
subcontractor with minimal disruption.  

6.1.5

Supply Agreement

The Parties shall enter into one (1) or more supply and quality agreement(s) (a
“Supply Agreement”) for the supply of Drug Substance (if required) and Drug
Product (at [*****] discretion either assembled or unassembled, i.e. without
needle safety device, not labelled and not packaged) by Roche to Dermira.  The
initial supply and quality agreement(s) for Drug Product shall be entered into
by the Parties within [*****] ([*****]) days of the Effective Date, and it shall
also incorporate the first order of Drug Product pursuant to Section 6.1.4.

6.1.6

Terms of Delivery

Supplies of Drug Substance (if required) and Drug Product shall be delivered
according to [*****]. Dermira will provide to Roche prior to shipment any import
documentation that might be necessary including but not limited to licenses and
other permissions.

6.2

Transfer of Manufacture and Supply Responsibility to Dermira

6.2.1

Drug Substance

At any time during the Agreement Term and subject to this Section 6.2.1, Roche
will have the right to transfer its Manufacture and supply responsibilities
under Section 6.1 to Dermira by providing written notice to Dermira, (“Drug
Substance Transfer Notice”) such notice to include at least [*****] ([*****])
CMOs to which Roche approves the Technology Transfer of the Manufacture of Drug
Substance and a draft of the Technology Transfer Project Plan for review and
comment by Dermira.  The Technology Transfer Project Plan may be amended from
time to time as appropriate. Roche shall remain responsible to supply Dermira
with Drug Substance (if required) in accordance with Section 6.1 and the Supply
Agreement until the Transfer Completion Date.

As soon as practicable after the delivery of such Drug Substance Transfer
Notice, Dermira will establish any necessary legal agreements with Third
Parties.  Once the Parties have made any necessary adjustments to the Technology
Transfer Project Plan, Roche shall commence the Technology Transfer of the Drug
Substance to the single CMO selected by Dermira from the CMOs provided by Roche
in its Drug Substance Transfer Notice.  Each Party shall use [*****] to effect
the transfer of the Manufacture of Drug Substance (including the Technology
Transfer under the Technology Transfer Project Plan) in accordance with this
Section 6.2.1 and to achieve FDA approval of the BLA for commercial supply of
Product at the facility or facilities selected by Dermira and approved by Roche
as soon as practicable after the delivery of such Drug Substance Transfer
Notice, but in no event later than, the date that is [*****] ([*****]) years
after the delivery of the Drug Substance Transfer Notice.

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All internal costs and expenses incurred in performing the activities identified
in such Technology Transfer Project Plan shall be borne by [*****], provided
that [*****] shall provide assistance in the form of up to [*****] ([*****])
working hours [*****], and any additional assistance shall be paid for by
[*****]. [*****] shall bear all external costs incurred by either Party in
performing the activities identified in such Technology Transfer Project Plan.
Such transfer will be targeted to be completed within [*****] ([*****]) months
after the provision of the Drug Substance Transfer Notice by Roche, but will
only be effective on the Transfer Completion Date.

After the Transfer Completion Date, upon [*****] request of Dermira, further
technical support from Roche may be provided [*****] and, if such support is
provided by Roche, charged at Roche’s [*****]. Subsequent to the Transfer
Completion Date, Dermira will assume all responsibilities and costs for future
manufacturing and related activities pursuant to Section 6.

6.2.2

Drug Product

At any time during the Agreement Term and subject to this Section 6.2.2, Roche
will have the right to transfer its obligations to supply Drug Product to
Dermira under Section 6.1.4 after providing written notice to Dermira (the “Drug
Product Transfer Notice”). Within [*****] ([*****]) days thereafter Roche will,
(a) to the extent permitted under Third Party agreements, (i) provide to Dermira
a copy of all Third Party agreements related solely to the supply of such Drug
Product, and (ii) use [*****] efforts to assign to Dermira any such Third Party
agreements described in (i) above which relate solely to such Drug Product and
facilitate introductions to all Third Parties that are Manufacturing Drug
Product on Roche’s behalf, and (b) to the extent Controlled by Roche and not
previously provided to Dermira, provide Dermira with the Know-How necessary for
the Manufacture of Drug Product, including applicable Drug Product release
assays and protocols. Roche’s obligation to supply Drug Product (but not Drug
Substance) under this Agreement shall expire [*****] ([*****]) [*****] after the
completion of the activities described in the foregoing sentence. All internal
costs and expenses incurred by Roche in performing the activities under this
Section shall be borne by [*****], and [*****] will be solely responsible for
any Third Party costs incurred by either Party. Notwithstanding the foregoing,
for as long as Roche has available inventory of Drug Product, Dermira shall have
the right to purchase its Drug Product requirements from such inventory.

6.2.3

Responsibility after Transfer Completion Date; Manufacturing and Process
Improvements

After (a) the Transfer Completion Date, and (b) the transfer of Roche’s
obligations to supply Drug Product to Dermira in accordance with Section 6.2.2,
for each of (a) and (b), as between the Parties Dermira shall be solely
responsible at its own expense for the Manufacture and supply of clinical and
commercial supplies of Drug Substance and Drug Product, as applicable, to fulfil
all Dermira’s requirements and Roche’s requirements for Roche’s development or
commercial activities in the Roche Retained Field. Any Drug Substance or Drug
Product supplied by Dermira to Roche will be Manufactured in accordance with the
[*****] Specifications at Dermira’s Fully Burdened Manufacturing Costs plus a
mark-up of [*****] percent ([*****]%), such mark-up to be [*****] percent
([*****]%) to the extent that Dermira has outsourced the Manufacturing of either
Drug Substance or Drug Product to a CMO.

Notwithstanding any transfer under this Section 6.2, Roche shall retain the
right to Manufacture the Compound and Product to exercise its retained rights
described in and subject to Sections 2.5, 5.3 and 8.3, including for its own
development purposes in the Roche Retained Field; provided that Roche shall not
(i) enable or license any Roche Know-How to a Third Party to Manufacture the
Compound other than subcontractors performing such Manufacturing for use by
Roche or Dermira under this Agreement, (ii) Manufacture a Biosimilar Product for
sale or use in any country until, the earlier of four (4) years after the
expiration of the Royalty Term in the country

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of First Commercial Sale or the end of the Agreement Term, or (iii) license any
Roche Know-How that is disclosed by Roche to Dermira under this Agreement to a
Third Party to Manufacture a Biosimilar Product in any country until, the
earlier of five (5) years after the expiration of the Royalty Term in the
country of First Commercial Sale or the end of the Agreement Term. If Dermira,
after Roche has exercised its option to transfer the Manufacturing
responsibility to Dermira according to this Section 6.2, wishes to materially
improve the Manufacturing process of the Compound or the Product, for example
resulting in a change of the cell bank expressing the Compound, then Dermira
shall provide written notice to Roche of the nature of such intended work and
Roche shall have the right to approve such work, [*****].

6.2.4

Restrictions of Use

Neither Party shall administer to any patient Product that is supplied by the
other Party under this Agreement that has exceeded the shelf life supported by
stability data within specification (“Supported Shelf Age”). Supported Shelf Age
will be stated in the Supply Agreement entered into by the Parties as further
described in Section 6.1.5.

6.2.5

Support by Roche

The Parties may collaborate under a separate written agreement to design,
develop and produce a [*****] for administration of the Drug Substance in
accordance with the Agreement (“[*****]”), including the procurement of the
[*****] and the use of a CMO for [*****] (“[*****] Product Plan”).

The Parties may separately negotiate an agreement with regard to the development
of [*****], and the use by Dermira of the Roche [*****].

7.

Regulatory

7.1

Roche Responsibility

7.1.1

Roche Responsibilities in Roche Retained Field

Within the Roche Retained Field with respect to the Compound and Product and
until the occurrence of the Roche Reversion, Roche will retain at its sole cost
all rights to seek authorization to conduct clinical trials, to obtain
applicable regulatory designations (including but not limited to orphan drug
designation, breakthrough therapy designation, fast-track designation) and seek
regulatory advice following reasonable notification and consultation with
Dermira. Roche will retain all decision-making rights over non-safety related
prescribing information proposals to Regulatory Authorities, and Dermira will
make reasonable accommodations with respect to Roche’s registration strategy in
the Roche Retained Field. For clarity, as further described in Section 7.2,
Dermira shall have the sole right to file all BLAs for the Product including in
the Roche Retained Field.

7.1.2

Other Roche Responsibilities

Roche shall maintain, transfer to Dermira, and/or withdraw, as applicable, the
INDs in existence as of the Effective Date for the Compound as further described
in Section 2.4.2.

7.2

Dermira Responsibility; Additional Studies in Roche Retained Field

7.2.1

Dermira Responsibility

Subject to Sections 2.4.2, 7.1 and 7.2.2:

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(a)

Dermira, at its sole cost, shall have the sole right to pursue all regulatory
affairs related to Compound and Product in the Field in the Territory including
the preparation, filing and maintenance of applications for Regulatory Approval
(including all BLAs), as well as any or all governmental approvals required to
develop and have developed, to make and have made (after the transfer of CMC
information to a Dermira IND as described in Section 2.4.2.2), use, have used,
import, have imported, offer for sale, sell and have sold the Compound and
Product;

 

(b)

Dermira shall be responsible for pursuing, compiling and submitting all
regulatory filing documentation, and for interacting with regulatory agencies,
for Compound and Product in the Field in all countries in the Territory;

 

(c)

Dermira shall own and file in its discretion (subject to Section 7.2.2.2) all
regulatory filings and Regulatory Approvals for the Compound and Product in all
countries of the Territory;

 

(d)

For so long as Roche is conducting any regulatory activities with respect to the
Compound, Modified Compound or Product, (i) each Party shall supply the other
Party with a copy of all material communications with Regulatory Authorities
within [*****] ([*****]) Business Days of receipt, (ii) if a Party has
time-sensitive inquiries regarding a regulatory matter, the other Party shall
answer such inquiries within [*****] ([*****]) Business Days, and (iii) each
Party shall have the right to participate in the other Party’s preparation for
meetings with Regulatory Authorities and to attend such meetings; and

 

(e)

With respect to all Roche activities in connection with the Compound or Product,
Roche shall provide all necessary information specifically directed to the
Compound to enable Dermira to perform all applicable reporting obligations that
are required under Applicable Law, and, if applicable, perform any actions
required by any applicable Regulatory Authority.  Until the occurrence of the
applicable Transfer Completion Date, Roche shall use [*****] to enable Dermira
to perform all applicable CMC reporting obligations that are required under
Applicable Law for the Product that is Manufactured by or on behalf of Roche
under this Agreement.

7.2.2

Database Lock; Roche Retained IND; Additional Studies in the Roche Retained
Field

7.2.2.1

Roche shall notify Dermira in writing of the occurrence of database lock for the
IPF Study within [*****] ([*****]) Business Days of such occurrence.  If, after
the occurrence of the database lock for the IPF Study, Roche decides to perform
additional clinical studies of the Compound or Product in the Roche Retained
Field (“Additional Studies”), then Roche shall notify Dermira of such decision
within [*****] ([*****]) months after such database lock.

7.2.2.2

In the Roche Retained Field with respect to the Compound and Product, the
Parties will collaborate [*****] to prepare for and undertake interactions with
applicable Regulatory Authorities, including with respect to developing strategy
for meetings with such Regulatory Authorities and attendance of and
participating in meetings with such Regulatory Authorities.  With respect to a
BLA that is submitted to a Regulatory Authority in the Roche Retained Field,
Roche shall prepare the content of such BLA and the Parties shall collaborate
[*****] to review and finalize such BLA for submission by Dermira, such
submission to occur within [*****] ([*****]) Business Days after finalization

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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of the BLA. All costs incurred by the Parties in preparing, submitting and
obtaining Regulatory Approval for such BLA shall be [*****].

7.3

IND and Other Regulatory Documentation

7.3.1Each Party grants to the other Party a non-exclusive, non-transferable
(except to permitted Third Parties, including Sublicensees, and in connection
with a permitted assignment of this Agreement) “right of reference” (as defined
in US FDA 21 CFR 314.3(b)), or similar “right of reference” as defined in
applicable regulations in the relevant jurisdiction with respect to all
information (including raw data) and results generated by such Party related to
the Product as necessary for the other Party to exercise its rights under this
Agreement. Upon written instruction, each Party shall provide to the other a
cross-reference letter or similar communication to the applicable Regulatory
Authority to effectuate such right of reference.

7.3.2Until occurrence of the Roche Reversion, each Party shall submit draft
clinical study protocols for the Compound, Modified Compounds or the Product to
the other Party for review as long as patients are still being treated in Roche
trials sponsored or supported by Roche for the Compound, Modified Compounds or
the Product in the Roche Retained Field. Such other Party shall have the right
to provide the submitting Party with its comments no later than [*****]
([*****]) Business Days after such protocol is delivered to such other Party,
and such other Party shall consider such comments [*****].

7.4

Informed Consent Forms

Each Party shall use [*****] to include in its Informed Consent forms with
patients under any clinical study for the Product conducted by a Party under
this Agreement the right to transfer samples, data and information to the other
Party and to any entity designated by such other Party to the extent feasible
under Applicable Laws and under a clinical site’s internal policies.

7.5

Pharmacovigilance Agreement

[*****] after the Effective Date, Dermira and Roche shall negotiate [*****] and
enter into a Pharmacovigilance Agreement in accordance with all Applicable Laws
which sets forth, among other things, the responsibilities and obligations of
the Parties with respect to the procedures and timeframes for compliance with
all Applicable Laws (and each of the Party’s policies) pertaining to safety
reporting and their related activities, with respect to activities related to
the Product under this Agreement. The transfer of historical safety data
together with the responsibility for pharmacovigilance activities will be part
of the Pharmacovigilance Agreement.

The Parties agree that they shall execute the Pharmacovigilance Agreement within
[*****] after the Effective Date but in any event prior to the date [*****]
after the Effective Date.

8.

Commercialization

8.1

Responsibility

Subject to Section 8.3, Dermira, at its own expense, shall have sole right and
responsibility for the commercialization, including marketing, Medical Affairs
Activities, Promotion, sale, and Distribution, of the Product in the
Territory.  For clarity, Dermira will be responsible for pricing, discounting
and contracting (including with payors, wholesalers and distributors and the
like) with regard to the Product in the Field, including in the Roche Retained
Field.

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8.2

Updates to Roche

In addition to its updates pursuant to Section 4.2, upon request of Roche,
Dermira shall update Roche regarding the commercialization of the Product in the
Territory in the Field by Dermira, its permitted Affiliates and Sublicensees. If
Roche requests an update, Dermira shall provide a detailed update, in writing
and/or through a meeting (face to face/tele-presence/videoconference or
telephone). Roche shall not request an update more frequently than [*****] per
Calendar Year.

8.3

Promotion by Roche in the Roche Retained Field

Roche shall have the sole right to Promote (as defined below) the Product in the
Roche Retained Field in the Territory, by itself or through its Affiliates,
sublicensees or subcontractors subject to the occurrence of a Roche Reversion,
after which Dermira shall have the sole right to Promote the Product.  For
purposes of this Agreement, “Promote” and “Promotion” shall mean with respect to
the Product and the Roche Retained Field, market research, detailing, medical
provider field support, training for product administration, sales analytics,
initiation and facilitation of the distribution of free samples, physician and
consumer/patient brochures, marketing materials, advertising, patient assistance
programs, vouchers, co-pay cards, and personnel and training for the foregoing.

In addition Roche will be responsible for all market access, reimbursement,
funding and listing activities in the Roche Retained Field as needed to generate
the required landscaping, value proposition development, payer evidence and
support to ensure that patient have access to Product. This includes the
following activities: insights generation via payer advisory boards, payer
market research, evidence generation to ensure market access (e.g. payer
evidence studies, systematic literature reviews, indirect treatment comparison,
health economic modelling, publication, and the like) dossier and payer
detailing, development of aid and objection handling, and field-based
reimbursement support including stakeholder engagement and required market
access solutions.

8.4

Medical Affairs Activities by Roche in Roche Retained Field

Roche shall have the sole right to perform Medical Affairs Activities for the
Product in the Roche Retained Field in the Territory, by itself or through its
Affiliates, sublicensees or subcontractors subject to the occurrence of a Roche
Reversion, after which Dermira shall have the sole right to perform Medical
Affairs Activities for the Product.  For purposes of this Agreement, “Medical
Affairs Activities” shall mean with respect to the Product and the Roche
Retained Field, activities related to medical affairs and disease state
awareness, hiring and oversight of medical science liaisons, educational grants
and sponsorships, speaker training, and professional and patient society
activities and personnel and training for the foregoing.

9.

Payment

9.1

Initial Payment

Within thirty (30) days after the Effective Date and receipt of an invoice from
Roche, Dermira shall pay to Roche US$ 80,000,000 (US$ eighty million) in
consideration of Roche’s development costs incurred for the Compound, including
the development costs that Roche plans to incur subsequent to the Effective Date
for the completion of Roche’s ongoing studies outside the Roche Retained Field.
This payment is non-refundable and non-creditable.

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9.2

Development Event Payments

Dermira shall pay to Roche up to a total of US$ 305,000,000 (US$ three hundred
and five million) in relation to the achievements of events with respect to the
Product as applicable in any indication outside of the Roche Retained Field.

Upon reaching development events, Dermira shall timely notify Roche and
development event payments shall be paid by Dermira to Roche within [*****]
([*****]) days from occurrence of the applicable event.

Payments shall be made by Dermira according to the following schedule of
development events for the Product:

Development Event

US$ (in millions)

At the earlier of (i) achievement of 50% recruitment of patients in the Phase II
Dose-finding Study or (ii) September 15, 2018

25

At the earlier of (i) achievement of 100% recruitment of patients in the Phase
II Dose-finding Study or (ii) December 15, 2018

30

Initiation of first Phase III Study*

40

Submission of first BLA for [*****]

[*****]

Submission of first BLA for [*****]

[*****]

Submission of first BLA for [*****]

[*****]

First Commercial Sale in [*****]

[*****]

First Commercial Sale in [*****]

[*****]

First Commercial Sale in [*****]

[*****]

Total

305

 

* In the event that a Phase III Study will not be needed to receive marketing
authorization for the Product this milestone will be payable with submission of
the first BLA in the first country.

 

9.3

Sales Based Events

Dermira shall pay to Roche up to a total of US$ 1,025,000,000 (US$ one billion
and twenty five million) based on aggregate Calendar Year Net Sales of the
Product (in any indication but excluding the Net Sales in the Roche Retained
Field) in the Territory:

Net Sales Threshold

Payment

US$ (in millions)

 

 

Total Calendar Year Net Sales of the Product in the Territory exceed US$
250,000,000 (US$ two hundred and fifty million)

[*****]

Total Calendar Year Net Sales of the Product in the Territory exceed US$ [*****]
(US$ [*****])

[*****]

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separately with the Securities and Exchange Commission. Confidential treatment
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Total Calendar Year Net Sales of the Product in the Territory exceed US$ [*****]
(US$ [*****])

[*****]

Total Calendar Year Net Sales of the Product in the Territory exceed US$ [*****]
(US$ [*****])

[*****]

Total Calendar Year Net Sales of the Product in the Territory exceed US$
3,000,000,000 (US$ three billion)

[*****]

 

 

TOTAL

1,025

 

Each of the sales based event payments shall be paid no more than once during
the Agreement Term, at first occurrence of the event in the Territory, and shall
be non-refundable and non-creditable. For clarity, if aggregate Calendar Year
Net Sales of the Product achieve two or more milestones under this Section in
the same Calendar Year, then each applicable milestone shall be payable in such
Calendar Year.

9.4

Royalty Payments on Net Sales in any indication outside of the Roche Retained
Field

9.4.1

Royalty Term

Royalties shall be payable by Dermira on Net Sales of the Product in any
indication outside of the Roche Retained Field on a country-by-country basis
until the expiry of the Royalty Term. Upon the expiration of the Royalty Term in
a country, the license shall be fully paid up, perpetual and non-exclusive in
such country.  

9.4.2

Royalty Rates for Product outside of the Roche Retained Field

The following royalty rates shall apply to the respective tiers of aggregate
Calendar Year Net Sales of the Product (in any indication outside of the Roche
Retained Field) in the Territory, on an incremental basis, as follows:

Tier of Calendar Year

Net Sales in million US$

Percent (%) of Net Sales

0 – [*****]

[*****]

> [*****] – [*****]

[*****]

> [*****] – [*****]

[*****]

> [*****] – 3,000

[*****]

> 3,000

[*****]

 

 

For example, if Net Sales in all indications outside the Roche Retained Field,
for a given Calendar Year, are US$ [*****], then the royalty applicable on such
Net Sales of such Product for that year shall be calculated as follows:

([*****] %*[*****] US$)+([*****] %*[*****] US$) = US$ [*****].

9.4.3

Royalty Adjustments

For the purpose of calculating royalties under Section 9.4.2, Net Sales of the
Product and the royalty rates shall be subject to the following adjustments, as
applicable:

9.4.3.1

Combination Product. If Dermira or its Affiliates intend to sell a Combination
Product, then the Parties shall meet approximately [*****] prior to the
anticipated First Commercial Sale of such Combination Product in the Territory
to negotiate [*****] and agree to an

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appropriate adjustment to Net Sales to reflect the relative commercial value
contributed by the components of the Combination Product (the “Relative
Commercial Value”). If, after such [*****] negotiations not to exceed [*****]
([*****]) days, the Parties cannot agree to an appropriate adjustment, the
dispute shall be initially referred to the executive officers of the Parties in
accordance with Section 21.2. Should the Parties fail to agree within [*****]
([*****]) days of such referral, then the Relative Commercial Value shall be
determined by an Expert Committee under the procedures of Section 9.4.  If the
Parties are unable to agree on the Relative Commercial Value under this Section,
then Roche will select [*****] who would qualify as an Expert, Dermira will
select [*****] who would qualify as an Expert, and those [*****] ([*****])
individuals shall select [*****] who would qualify as an Expert and who shall be
chairman of a committee of the [*****] Experts (the “Expert Committee”), each
with a single deciding vote. The Expert Committee will promptly hold a meeting
to review the issue under review, at which it will consider memoranda submitted
by each Party at least [*****] ([*****]) days before the meeting, as well as
reasonable presentations that each Party may present at the meeting. The
determination of the Expert Committee as to the issue under review will be
binding on both Parties. The Parties will share equally in the costs of the
Expert Committee. Unless otherwise agreed to by the Parties, the Expert
Committee may not decide on issues outside the scope mandated under terms of
this Agreement.

9.4.3.2

Third Party Payments.  Dermira shall be responsible for and pay or have paid the
entire consideration owed to any Third Party in relation to Third Party
intellectual property rights necessary for the development or commercialization
of Products in the Field in the Territory or for the Manufacture of the Products
as of the Effective Date. Dermira shall have the right to deduct a maximum of
(i) [*****] percent ([*****] %) of any royalty incurred by Dermira to a Third
Party with respect to such arrangement held by Roche at the Effective Date
necessary to avoid infringement of such Third Party’s Patent Rights arising from
the practice of the license granted in Section 2.1 and (ii) [*****] percent
([*****] %) of any royalty incurred by Dermira or its Affiliates to a Third
Party with respect to such arrangement entered into after the Effective Date, in
each case (i) and (ii) from royalty payments otherwise due and payable by
Dermira to Roche under Section 9.4.2. Any such deduction shall be permitted on a
country-by-country basis. Notwithstanding the foregoing, in no event shall the
amount of royalties payable to Roche for a given Calendar Year become reduced to
lower than [*****] percent ([*****]%) of the royalties otherwise payable for the
applicable Calendar Year on a country-by-country basis as a result of deductions
made under clause (ii) of this Section (“Deduction Cap”).  For clarity, the
Deduction Cap shall not apply to deductions made under clause (i) of this
Section. Notwithstanding the foregoing in this Section, Roche shall pay the
entire consideration owed under that particular agreement effective November 29,
2010, as amended, between Roche and American Type Culture Collection (“ATCC
Agreement”).  Roche shall maintain the ATCC Agreement in full force and effect
and shall not amend that ATCC Agreement in any manner that would reduce or
impair Dermira’s rights under this Agreement absent Dermira’s written consent.

9.4.3.3

No Valid Claim.  If in a given country within the Territory there is no Valid
Claim of a Licensed Compound Patent Right Covering the Product in such country,
then the royalty

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payments due to Roche for such Product in such country shall be reduced by
[*****] percent ([*****]%).

9.4.3.4

Biosimilar Product.  Upon the first entry in a given country of a Biosimilar
Product by any entity that is not authorized by Dermira or its Affiliates or by
a Sublicensee of Dermira or its Affiliates, the royalties in such country for
the Product shall be reduced as follows:

 

(a)

If the average Net Sales in any [*****] subsequent Calendar Quarters at any time
after entry of a Biosimilar Product decline by more than [*****] percent
([*****]%) of the average level of the Net Sales of such Product achieved in the
[*****] Calendar Quarters immediately prior to such entry, then the royalty
payments due to Roche for such Product in such country shall be reduced by
[*****] percent ([*****]%);

 

(b)

If the average Net Sales in any [*****] subsequent Calendar Quarters at any time
after entry of a Biosimilar Product decline by more than [*****] percent
([*****] %) of the average level of the Net Sales of the Product achieved in the
[*****] Calendar Quarters immediately prior to such entry, then the royalty
payments due to Roche for the Product in such country shall end and no royalties
shall be due by Dermira in such country for such Product.

9.5

Financial consideration to Roche for Dermira-sales in Roche Retained Field

As from the date of the first Regulatory Approval for the first country in the
Roche Retained Field and for each following Accounting Period Dermira shall pay
Roche the following amount:

Net Sales in the Roche Retained Field, minus (i) [*****] percent ([*****]%) of
the Net Sales in the Roche Retained Field to account for the Distribution of the
Product and other unreimbursed costs; (ii) to the extent Roche supplied Drug
Substance or Drug Product under this Agreement or the supply agreement described
in Section 6.1.5 for use in the Roche Retained Field, then all amounts paid to
Roche for such supply of Drug Substance and Drug Product, as applicable, plus
[*****] percent ([*****]%) of such amounts, (iii) to the extent Roche did not
supply Drug Substance or Drug Product under this Agreement or the Supply
Agreement for use in the Roche Retained Field, then the Fully Burdened
Manufacturing Costs of Dermira that are allocable to the Net Sales in the Roche
Retained Field plus [*****] percent ([*****]%) of such Fully Burdened
Manufacturing Costs, such mark-up to be [*****] percent ([*****]%) if Dermira
has outsourced the entire Manufacturing of the Product to a CMO, and (iv)
amounts Dermira incurs for any Third Party intellectual property rights under
Section 9.4.3.2 that are allocable to Net Sales in the Roche Retained Field,
which amounts shall not apply to the Deduction Cap under Section 9.4.3.2.  If
Dermira demonstrates that its costs for the Distribution of the Product and
other unreimbursed costs exceed the [*****] percent ([*****]%) described in (i)
above for any given Calendar Year, then upon Dermira’s written request the
Parties shall negotiate [*****] an [*****] to account for the Distribution of
the Product and other unreimbursed costs. Such amounts shall be payable in
accordance with Section 10.  

9.6

Costs

Other than as explicitly set forth in this Agreement, each Party shall bear all
costs such Party incurs in exercising its rights and performing its obligations
under this Agreement.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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10.

Accounting and Reporting

10.1

Payment Terms

Dermira shall pay amounts owed to Roche under Sections 9.3, 9.4 and 9.5 within
[*****] ([*****]) days after the end of each Accounting Period in which the
applicable Net Sales occur; provided, however that no later than [*****]
([*****]) years after the First Commercial Sale in any country (in any
indication in the Field, including the Roche Retained Field) the Parties shall
reduce such time period to [*****] ([*****]) days. For the purpose of
determining any amounts payable to Roche in an Accounting Period under Section
9.5, Dermira shall calculate Net Sales in the Roche Retained Field and resulting
payments to Roche as follows:

 

(a)

for any country in which the Roche Retained Field Trademark(s) and the
Trademark(s) for Other Indications have been established in accordance with
Section 13.2.2 and the Switch (as defined in Section 13.2.2) has not occurred or
has occurred during such Accounting Period, (i) Net Sales in the Roche Retained
Field in an Accounting Period shall be equal to Net Sales of the Product that
was sold under the Roche Retained Field Trademark(s), and (ii) Dermira shall
calculate amounts payable to Roche for Net Sales in accordance with Sections
9.3, 9.4, and 9.5;

 

(b)

for any country in which the Roche Retained Field Trademark(s) and the
Trademark(s) for Other Indications have not been established in accordance with
Section 13.2.2 or in which the Switch has occurred prior to such Accounting
Period, Dermira shall calculate (i) Net Sales in the Roche Retained Field in
such Accounting Period by multiplying total Net Sales in such Accounting Period
by the fraction obtained by dividing (A) the number of units of Product used in
the Roche Retained Field as determined for the previous Accounting Period, or if
no such previous Accounting Period exists, the Parties best estimate, by (B)
total number of units of Product used in the Field for the previous Accounting
Period, or if no such previous Accounting Period exists, the Parties best
estimate, and (ii) amounts payable to Roche for Net Sales in accordance with
Sections 9.3, 9.4, and 9.5 (the “Preliminary Calculation”); provided that within
[*****] ([*****]) days after complete prescription data are available (or, for
countries where prescription data are not available, the final extrapolation has
been made) for such Accounting Period (as determined in accordance with Section
13.2.2), Dermira shall perform a reconciliation based upon such complete
prescription data (or final extrapolation, if applicable) (a “Reconciliation”),
and if the amount paid by Dermira to Roche for Net Sales in the Roche Retained
Field for such Accounting Period is greater or less than the amount due to Roche
as determined by the Reconciliation for such Accounting Period, then Dermira
shall deduct such excess from or add such shortfall to, as applicable, amounts
paid to Roche in the next Accounting Period.  For the purposes of the
Preliminary Calculation, if such Accounting Period is the first Accounting
Period following the Switch, the number of units of Product used in the Roche
Retained Field and in the Field will be based on the Roche Retained Field
Trademark(s) and the Trademark(s) for Other Indications.

10.2

Other Payments

Other than for payments due under Section 9, for any payments owed by a Party to
the other Party under this Agreement, the other Party shall within [*****]
([*****]) days after the end of each Accounting Period prepare an invoice
itemizing such amounts incurred by or on account of such Party during such
Accounting Period and submit such invoice to the other Party.  Each Party shall

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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pay the undisputed portion of the invoice received from the other Party within
[*****] ([*****]) days after the date of receipt of such invoice.

10.3

Late Payment

Any payment under this Agreement that is not paid on or before the date such
payment is due shall bear interest, to the extent permitted by Applicable Law,
at [*****] ([*****]) percentage points above the average [*****], as reported by
Reuters from time to time, calculated on the number of days such payment is
overdue.

10.4

Method of Payment

Royalties on Net Sales outside of the Roche Retained Field and the financial
consideration to Roche for Dermira sales in the Roche Retained Field and all
other amounts payable by one Party to the other Party hereunder shall be paid in
US Dollars (the “Payment Currency”) to account(s) designated by such other
Party.

10.5

Currency Conversion

When calculating Net Sales that occur in currencies other than the Payment
Currency, Dermira shall convert the amount of such sales into the Payment
Currency using Dermira’s then-current foreign currency translation rates
actually used on a consistent basis in preparing its audited financial
statements.

10.6

Royalty Reporting

With each royalty payment Dermira shall provide Roche in writing for the
relevant Calendar Quarter the following information:

a)

recognized sales in local currency on a country-by-country basis;

b)

Net Sales in local currency on a country-by-country and Housemark-by-Housemark
basis;

c)

Net Sales in payment currency on a country-by-country basis;

d)

adjustments made pursuant to Section 9.4.3 on a country-by-country basis;

e)

Net Sales in payment currency after adjustments made pursuant to Section 10.5 in
reporting currency;

f)

royalty rate pursuant to Section 9.4.2;

g)

adjustments made pursuant to Section 9.4.3, and

h)

total royalty payable in the payment currency.

11.

Taxes

Each Party shall be solely responsible for the payment of all taxes imposed on
its share of income arising from the efforts of the Parties under this Agreement
and each Party shall pay all sales, turnover, value added, and similar taxes
levied on account of any payment accruing or made to the other Party under this
Agreement.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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If provision is made in law or regulation of any country for withholding of
taxes of any type, levies or other charges with respect to any royalty or other
amounts payable under this Agreement, then the paying Party shall promptly pay
such tax, levy or charge for and on behalf of the other Party to the proper
governmental authority, and shall promptly furnish the other Party with receipt
of payment. The paying Party shall be entitled to deduct any such tax, levy or
charge actually paid from royalty or other payment due to the other Party or be
promptly reimbursed by the other Party if no further payments are due to the
other Party. Each Party agrees to reasonably assist the other Party in claiming
exemption from such deductions or withholdings under double taxation or similar
agreement or treaty from time to time in force and in minimizing the amount
required to be so withheld or deducted.

Except where otherwise specified all amounts stated in this Agreement are
exclusive of sales, turnover, value added or equivalent taxes. If and to the
extent supplies or services rendered under this Agreement are subject to sales,
turnover, value added or equivalent taxes, the Party receiving the invoice for
such supplies or services shall pay such tax in addition to the amounts agreed
under this Agreement.

12.

Auditing

12.1

Roche Right to Audit

Dermira shall keep, and shall require its Affiliates and Sublicensees to keep,
full, true and accurate books of account containing all particulars that may be
necessary for the purpose of calculating all payment obligations of Dermira
under this Agreement. Such books of accounts shall be kept at their principal
place of business.

At the expense of Roche, Roche has the right to appoint one of the major public
accountant firms to perform, on behalf of Roche an audit of such books and
records of Dermira and its Affiliates, and Sublicensees, that are deemed
necessary by the appointed major public accountant firm to report on the
correctness of Net Sales of Product, royalty calculations, the calculation of
the financial consideration for Dermira sales in the Roche Retained Field and
any other financial report or payment obligations under this Agreement for the
period or periods requested by Roche.

Upon timely request and at least [*****] ([*****]) Business Days prior written
notice from Roche, such audit shall be conducted in the countries specifically
requested by Roche, during regular business hours in such a manner as to not
unnecessarily interfere with Dermira's normal business activities, and shall be
limited to results in the [*****] ([*****]) full Calendar Years prior to audit
notification.

Such audit shall not be performed more frequently than [*****] per [*****] nor
more frequently than [*****] with respect to records or countries covering any
specific period of time.

All information, data documents and abstracts herein referred to shall be used
only for the purpose of verifying financial reports or payment obligations under
this Agreement, shall be treated as Dermira’s Confidential Information subject
to the obligations of this Agreement and need neither be retained more than
[*****] after completion of an audit hereof, if an audit has been requested; nor
more than [*****] from the end of the Calendar Year to which each shall pertain;
nor more than [*****] after the date of termination of this Agreement.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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12.2

Audit Reports

The auditors shall only state factual findings in the audit reports and shall
not interpret the agreement. The final audit report shall be shared with Dermira
at the same time it is shared with Roche.

12.3

Over-or Underpayment

If the audit reveals an overpayment, Roche shall reimburse Dermira for the
amount of the overpayment within [*****] ([*****]) days. If the audit reveals an
underpayment, Dermira shall reimburse Roche for the amount of the underpayment
within [*****] ([*****]) days. Dermira shall pay for the audit costs if the
underpayment of Dermira exceeds [*****] percent ([*****]%) of the aggregate
amount owed subject of the audit. Section 10.3 shall apply to this Section 12.3.

13.

Intellectual Property

13.1

Ownership of Inventions and Know-How

Dermira shall solely own all Dermira Inventions and all Dermira Know-How. Roche
shall solely own all Roche Inventions and all Roche Know-How including Licensed
Know-how. The Parties shall jointly own any Joint Inventions and Joint Know-How.
Such ownership rights of each Party in Joint Inventions and Joint Know-How
include the right to license and sublicense, and to freely exploit, transfer or
encumber its ownership interest, without the consent of, payment to, or
obligation to account to, the other Party.  Each Party hereby waives any right
it may have under the laws of any jurisdiction to require such payment,
accounting, or consent with respect to Joint Invention(s) and Patent Rights in
Joint Invention(s). Dermira and Roche each shall require all of its employees
and contractors to assign all Inventions related to Compounds, Modified
Compounds, or Products made by them to Roche and Dermira, as the case may
be.  The determination of inventorship for Inventions shall be in accordance
with US inventorship laws.

Except as specifically set forth herein, this Agreement shall not be construed
as (i) giving any of the Parties any license, right, title, interest in or
ownership to the Confidential Information; (ii) granting any license or right
under any intellectual property rights; or (iii) representing any commitment by
either Party to enter into any additional agreement, by implication or
otherwise.

13.2

Trademarks and INN

13.2.1

In General

Subject to the terms and conditions of this Agreement, Dermira shall have the
right to determine the trademark(s) for the Product outside of the Roche
Retailed Field, Roche shall have the same right with regard to Product in the
Roche Retained Field, and Dermira shall own all trademarks used on or in
connection with Product in the Territory, and shall, at its sole cost, be
responsible for procurement, maintenance, enforcement and defense of all
trademarks used on or in connection with Product in the Territory; provided,
however, that all external costs incurred by or on behalf of Dermira or its
Affiliates or Sublicensees with respect to trademarks for the Product in the
Roche Retained Field shall be reimbursed by Roche with a mark-up of [*****]
percent ([*****]%).

Each Party shall use the respective Product trademarks in accordance with sound
trademark and trade name usage principles and in accordance with all applicable
laws and regulations as reasonably necessary to maintain the validity and
enforceability of the Product trademarks.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Neither Party shall use the Housemark(s) of the other Party for any purposes,
absent express, written agreement from the other Party.

13.2.2

Separate Brands for the Roche Retained Field, including sales tracking

Within [*****] ([*****]) months after the database lock of the ongoing IPF
Study, the Parties shall convene and establish a robust concept that allows
tracking of Net Sales during the Agreement Term apportioned by (i) Net Sales of
Product used in the Roche Retained Field and (ii) Net Sales of Product used in
all other indications. The Parties shall then also define the content of the
quarterly reporting from Dermira to Roche regarding Net Sales of Product used in
the Roche Retained Field. The concept shall be based on the following
principles:

Dermira shall [*****] establish one or more trademarks for the sale of Product
in the Roche Retained Field (the “Roche Retained Field Trademark(s)”) and one or
more separate trademarks for sale in all other indications (the “Trademark(s)
For Other Indications”). Dermira shall ensure that the Roche Retained Field
Trademark(s) are sufficiently separate from the Trademark(s) For Other
Indications.

In countries in which a Roche Retained Field Trademark has been established, the
calculation of Net Sales shall be based on the following principles:

 

(a)

Net Sales in the Roche Retained Field shall be equal to the Net Sales of the
Product that was sold under the Roche Retained Field Trademark(s);

 

(b)

Net Sales outside the Roche Retained Field shall be equal to the Net Sales of
the Product that was sold under the Trademark(s) For Other Indications; and

 

(c)

Notwithstanding the above, if in a certain country (i) the net price in the
Roche Retained Field is higher than the net price outside the Roche Retained
Field or (ii) other indicators demonstrate a potential misallocation of sales,
then Roche can complete a plausibility check based on prescription data. If the
plausibility check indicates that Net Sales in the Roche Retained Field based on
prescription data are higher than the Net Sales in the Roche Retained Field
based on brand data by a certain percentage (the “Predefined Percentage”), then,
[*****] Roche is entitled to switch the calculation basis for that country to
prescription data (the “Switch”). Within the [*****] ([*****]) months after the
database lock of the ongoing IPF Study, the Parties shall agree on the
percentage-amount to be used as Predefined Percentage and can agree on
additional mechanisms for corrective actions or compensation. For the countries
listed in the “Country”-column of Appendix 13.2.2, the plausibility check shall
be performed by using the respective data as listed in the “Prescription
Data”-column of Appendix 13.2.2.

In countries in which, [*****], a sufficiently separate trademark for the Roche
Retained Field has not yet been established or cannot be established for reasons
outside of Dermira’s control, the calculation of Net Sales shall be based on the
following principles:

 

(a)

On a country-by-country basis the Parties shall assess whether reliable
prescription data are available for such country. For each country for which
reliable prescription data are available, the Parties shall then agree upon a
method for tracking the use of the Product in the Roche Retained Field on the
one hand and in all other indications on the other hand using prescription data.
In particular, such method will consider (i) the time from Dermira recognizing
Net Sales for Product until such Product is prescribed and the prescription data
for such Product get

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published, (ii) adjustments to account for biases in the sample of prescription
data (iii) whether a different method is warranted during the first three
Calendar Quarters after First Commercial Sale (in any indication in the Field,
including the Roche Retained Field), and (iv) how to deal with unallocated
prescriptions;

 

(b)

Should the Parties not be able to agree upon the prescription data to be used
for one of the countries listed in the “Country”-column of Appendix 13.2.2, the
use of the Product shall be tracked using the respective data as listed in the
“Prescription Data”-column of Appendix 13.2.2;

 

(c)

Net Sales in the Roche Retained Field shall be calculated as Net Sales of the
Product multiplied with the proportion of (i) units of Product used in the Roche
Retained Field to (ii) the overall units of Product used, as per the
prescription data and the method agreed for such country and

 

(d)

Net Sales outside the Roche Retained Field shall be calculated as Net Sales of
the Product multiplied with the proportion of (i) units of Product used outside
the Roche Retained Field to (ii) the overall units of Product used, as per the
prescription data and the method agreed for such country.

For countries in which, [*****], a sufficiently separate trademark for the Roche
Retained Field has not yet been established or cannot be established for reasons
outside of Dermira’s control, and reliable prescription data are not available
on reasonable terms, the Parties shall agree upon an extrapolation method for
calculating the Net Sales of the Product in the Roche Retained Field. Such
extrapolation method shall be based on the proportion of (i) Net Sales in the
Roche Retained Field to (ii) total Net Sales of selected countries in which a
Roche Retained Field Trademark has been established or Net Sales are calculated
based on reliable prescription data.

The [*****] shall [*****] the external costs of applying the above processes (in
particular, costs for obtaining prescription data from Third Parties).

13.3

Handling of Roche Patent Rights including Licensed Compound Patent Rights

 

(a)

Roche shall, at its own expense and discretion, (i) Handle all Roche Patent
Rights including Licensed Compound Patent Rights and, (ii) inform Dermira as to
the Handling of Licensed Compound Patent Rights, and Roche shall [*****] and in
view of applicable national patent laws and practice divide the claimed subject
matter of the Non-Compound Patent Right disclosed by [*****] during national
phase prosecution so that a corresponding national phase patent application
becomes a Licensed Compound Patent Right and added to Appendix 1.57 in
accordance with Section 13.4 and will use [*****] to divide the claimed subject
matter of New Compound Patents (defined below) such that they are Handled in the
same manner.

 

(b)

Transfer of Handling. If Roche elects not to Handle any Patents within the
Licensed Compound Patent Rights, in any country, Roche shall provide at least
[*****] ([*****]) days written notice to Dermira. Thereafter, Dermira may
undertake at its sole expense and in its sole discretion, the Handling of such
patents. Dermira shall inform Roche as to the Handling of such Licensed Compound
Patent Rights, and if Dermira elects to discontinue Handling of any such
Licensed Compound Patent Rights, Dermira shall provide at least [*****]
([*****]) days written notice to Roche and Roche may undertake at its sole
expense and its sole discretion, the Handling

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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of such Licensed Compound Patent Rights. For purposes of this Agreement, such
Patents continue to be included in the Licensed Compound Patent Rights.

13.4

Roche Disclosure of New Compound Patents

If, after the Effective Date and during the Agreement Term, an invention is
conceived of or reduced to practice by or on behalf of Roche that arises from
the research, Manufacture, development or commercialization of the Compound,
whether under this Agreement or otherwise, and Roche Controls and intends to
pursue Patent Rights which include at least one claim that recites the Compound
with respect to such invention (“New Compound Patent”), then Roche shall notify
Dermira of such New Compound Patent in writing.  If the claims in such New
Compound Patent [*****], then such New Compound Patent shall [*****] be included
in the Licensed Compound Patent Rights and added to Appendix 1.57.  If the
claims in such New Compound Patent [*****], then the Parties shall discuss
[*****] whether such New Compound Patent should be included as a Licensed
Compound Patent Right, provided that if such New Compound Patent is not included
as a Licensed Compound Patent Right, then it shall be included as a Non-Compound
Patent Right and added to Appendix 1.62.  

13.5

Handling of Patent Rights Claiming Dermira Inventions and Joint Patent Rights

Dermira shall, at its own expense and discretion, Handle all Dermira Patent
Rights and Joint Patent Rights. Dermira shall inform Roche as to the Handling of
all Joint Patent Rights.

Should Dermira decide that it does not desire to Handle a patent or patent
application that claims a Dermira Invention or Joint Invention that is conceived
or reduced to practice as a result of its activities under the Agreement, it
shall provide at least [*****] ([*****]) days written notice to
Roche.  Thereafter, Roche may undertake at its sole expense and its sole
discretion, the Handling of such Patent Rights.

13.6

Infringement

Each Party shall promptly provide written notice to the other Party during the
term of this Agreement of any (i) known infringement or suspected infringement
by a Third Party of any Licensed Compound Patent Rights, or (ii) known or
suspected unauthorized use or misappropriation by a Third Party of any Licensed
Know-how, and shall provide the other Party with all evidence in its possession
supporting such infringement or unauthorized use or misappropriation.

Within [*****] ([*****]) days after Dermira provides or receives such written
notice (“Decision Period”), Dermira, [*****], shall decide whether or not to
initiate such suit or action in the Territory and shall notify Roche in writing
of its decision in writing (“Suit Notice”).

If Dermira decides to bring a suit or take action, once Dermira provides Suit
Notice, Dermira may immediately commence such suit or take such action. In the
event that Dermira (i) does not in writing advise Roche within the Decision
Period that Dermira will commence suit or take action, or (ii) fails to commence
suit or take action within [*****] after providing Suit Notice, Roche shall
thereafter have the right to commence suit or take action in the Territory and
shall provide written notice to Dermira of any such suit commenced or action
taken by Roche.

Upon written request, the Party bringing suit or taking action (“Initiating
Party”) shall keep the other Party informed of the status of any such suit or
action and shall provide the other Party with copies, to the extent the
Initiating Party is lawfully permitted to do so, of all substantive documents

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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or communications filed in such suit or action. The Initiating Party shall
[*****] to select counsel for any such suit or action.

The Initiating Party shall, except as provided below, pay all expenses of the
suit or action, including the Initiating Party’s attorneys’ fees and court
costs. Any damages, settlement fees or other consideration received as a result
of such suit or action shall be allocated as follows:

 

(a)

First, to reimburse the Initiating Party for its costs and, if any remains, to
the other Party for any advisory counsel fees and costs; and

 

(b)

Second, the balance, if any, shall be allocated [*****] percent ([*****]%) to
the Initiating Party, and [*****] percent ([*****]%) to the other Party.

If the Initiating Party believes it is [*****] to obtain an effective remedy,
upon written request the other Party agrees to be joined as a party to the suit
or action but shall be under no obligation to participate except to the extent
that such participation is required as the result of its being a named party to
the suit or action. At the Initiating Party’s written request, the other Party
shall offer [*****] assistance to the Initiating Party in connection therewith
[*****] to the Initiating Party [*****]. The other Party shall have the right to
participate and be represented in any such suit or action by its own counsel at
its own expense.

The Initiating Party may settle, consent judgment or otherwise voluntarily
dispose of the suit or action (“Settlement”) without the written consent of the
other Party but only if such Settlement can be achieved without adversely
affecting the other Party (including any of its Patent Rights). If a Settlement
[*****] adversely affect the other Party, then the written consent of the other
Party would be required, [*****].

For any Patent Right within the Roche Patent Rights that is not a Licensed
Compound Patent Right, Roche, [*****], shall decide whether or not to initiate
such suit or action in the Territory. Roche shall have [*****] discretion as to
how it wishes to handle such suit and may reach Settlement and retain all
damages, settlement fees or other consideration under any terms and conditions
it desires and retain whatever. Only if a Settlement [*****] adversely affect
Dermira shall the written consent of Dermira be required, [*****].

13.7

Defense

If an action for infringement is commenced against either Party, its licensees
or its sublicensees related to the discovery, development, Manufacture, use or
sale of the Product, then: (a) to the extent such alleged infringement arises
from activity outside the Roche Retained Field (or, after the occurrence of the
Roche Reversion, in any field), then Dermira shall defend such action at [*****]
expense, and Roche shall assist and cooperate with Dermira, at [*****] expense,
to the extent necessary in the defense of such suit; and (b) to the extent such
alleged infringement arises from activity related to the Roche Retained Field,
including sales by or on behalf of Dermira, its Affiliates or Sublicensees in
the Roche Retained Field, then Roche shall defend such action at [*****]
expense, and Dermira shall assist and cooperate with Roche, at [*****] expense,
to the extent necessary in the defense of such suit. The Party defending such
suit in accordance with the previous sentence (the “Defending Party”) shall have
the right to settle the suit or consent to an adverse judgment thereto, [*****]
so long as such settlement or adverse judgment does not adversely affect the
rights of the other Party and its Affiliates (including any Patent Rights
Controlled by any of them). The payment of any award for damages or any amount
due pursuant to any settlement entered into with such Third Party shall be paid
by each Party to the extent the underlying suit arose from such Party’s
activities subject to any applicable obligations under Section 15.

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separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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If the Manufacture, use, importation, offer for sale or sale of any Product
pursuant to this Agreement results in any claim, suit or proceeding alleging
patent infringement or trade secret misappropriation against Roche, then such
Party shall promptly notify the other Party hereto. The Parties shall cooperate
with each other in connection with any such claim, suit or proceeding and shall
keep each other reasonably informed of all material developments in connection
with any such claim, suit or proceeding.

If a Third Party asserts that Patent Rights owned by or licensed to it are
infringed by the development, Manufacture, use, importation, offer for sale or
sale of Product, or that its trade secrets were misappropriated in connection
with such activity, then Dermira shall have the [*****] right and responsibility
to resolve any such claim, whether by obtaining a license from such Third Party,
by defending against such Third Party’s claims or otherwise, and shall be
[*****] responsible for the defense of any such action, [*****] costs incurred
in connection with such action (including, without limitation, attorneys’ and
expert fees) and [*****] liabilities incurred in connection therewith; provided,
however, that if any such costs are incurred in connection with the Roche
Retained Field, then such costs shall be deemed [*****] allocable to sales of
Products in the Roche Retained Field for purposes of determining amounts owed to
Roche for such sales in accordance with Section 9.5. Notwithstanding the above,
Dermira shall not enter into any settlement of any such claim without the prior
written consent of Roche if such settlement would require Roche to be subject to
an injunction or to make any monetary payment to Dermira or any Third Party, or
admit any wrongful conduct by Roche or its Affiliates, or would limit or
restrict the claims of or admit any invalidity and/or unenforceability of any of
the Patent Rights Controlled by Roche, or have any impact on activities outside
the Field.

13.8

Common Interest Disclosures

With regard to any information or opinions disclosed pursuant to this Agreement
by one Party to each other regarding intellectual property and/or technology
owned by Third Parties, the Parties agree that they have a common legal interest
in determining whether, and to what extent, Third Party intellectual property
rights may affect the conduct of the Development Program and/or Compounds and/or
Product, and have a further common legal interest in defending against any
actual or prospective Third Party claims based on allegations of misuse or
infringement of intellectual property rights relating to the conduct of the
Development Program and/or Compounds and/or Product. Accordingly, the Parties
agree that all such information and materials obtained by Dermira and Roche from
each other will be used by the receiving Party solely for purposes of the
Parties’ common legal interests with respect to the conduct of the Agreement.
All information and materials will be treated as protected by the
attorney-client privilege, the work product privilege, and any other privilege
or immunity that may otherwise be applicable. By sharing any such information
and materials, neither Party intends to waive or limit any privilege or immunity
that may apply to the shared information and materials. Neither Party shall have
the authority to waive any privilege or immunity on behalf of the other Party
without such other Party’s prior written consent, nor shall the waiver of
privilege or immunity resulting from the conduct of one Party be deemed to apply
against any other Party.

13.9

Hatch-Waxman

Notwithstanding anything herein to the contrary, should a Party receive a
certification for the Product pursuant to the Drug Price Competition and Patent
Term Restoration Act of 1984 (Public Law 98-417, known as the Hatch-Waxman Act),
as amended, or its equivalent in a country other than the US, then such Party
shall immediately provide the other Party with a copy of such certification.
Roche shall have [*****] ([*****]) days from date on which it receives or
provides a copy of such certification to provide written notice to Dermira (“H-W
Suit Notice”) whether Roche will bring suit, at its expense, within a [*****]
([*****]) day period from the date of such certification.

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Should such [*****] ([*****]) day period expire without Roche bringing suit or
providing such H-W Suit Notice, then Dermira shall be free to immediately bring
suit in its name.

13.10

Biosimilar or interchangeable biological products

Notwithstanding anything herein to the contrary, within [*****] ([*****]) years
after the approval of the Product that has been licensed in the US as a
biological product under 42 USC §262(a), and as may be needed from time to time
thereafter, the Parties shall consult as to potential strategies with respect to
unexpired US Patent Rights that Cover the Product.  Specifically, in
anticipation of a receipt by the Product’s reference product sponsor (“Reference
Product Sponsor”) of a biosimilar or interchangeable product application
pursuant to the Biologics Price Competition and Innovation Act of 2009 (Public
Law 111-148), the Parties will discuss the Reference Product Sponsor’s likely
course of action with regard to each such US Patent Right in the procedural
steps set forth under 42 USC §262(l), including a general plan for timely
communication between the Parties in light of the statutory response deadlines.

13.11

Patent Term Extensions

The Parties shall use Commercially Reasonable Efforts to obtain all available
patent term extensions, adjustments or restorations, or supplementary protection
certificates (“SPCs”, and together with patent term extensions, adjustments and
restorations, “Patent Term Extensions”).  If Dermira decides to file a BLA
before the date of the occurrence of the Roche Reversion, then Dermira shall
notify Roche in writing, and regardless of whether a BLA is first filed in the
U.S. within or outside of the Roche Retained Field, patent term extension shall
be sought for U.S. Patent No. [*****], provided that if a Party desires
otherwise, the Parties shall discuss in good faith an appropriate strategy for
seeking Patent Term Extensions, including the likely impact of such Patent Term
Extension on the profits arising from sales of Products within and outside the
Roche Retained Field.  After the date of the occurrence of the Roche Reversion,
Dermira shall have the sole right to determine which patent(s) should be the
subject of Patent Term Extensions. Subject to the foregoing, each Party shall
execute such authorizations and other documents and take such other actions as
may be reasonably requested by the other Party to obtain such Patent Term
Extensions, including, as applicable, designating the other Party as its agent
for such purpose as provided in 35 U.S.C. Section 156. All filings for such
Patent Term Extensions shall be made by the owner of the patent in question;
provided, that in the event that a Party elects not to file for a Patent Term
Extension, such Party shall (a) promptly inform the other Party of its intention
not to file and (b) grant the other Party the right to file for such Patent Term
Extension. Each Party shall execute such authorizations and other documents and
take such other actions as may be reasonably requested by the other Party to
obtain such extensions. The Parties shall cooperate with each other in gaining
patent term restorations, extensions and/or SPCs wherever applicable to such
Licensed Compound Patent Rights.

13.12

No Challenge

The Parties acknowledge and agree that Roche may terminate the Agreement at
Roche’s discretion (but taking into account Dermira’s fulfillment of its
obligations under this Agreement), in the event Dermira, its Affiliate or a
Sublicensee challenges, or knowingly participates with or assists a Third Party
(except as required by Applicable Law) to challenge the validity,
enforceability, patentability and/or scope of any claim within the Licensed
Compound Patent Rights in a court or patent office or other governmental agency;
provided that, if Dermira acquires (or otherwise becomes an Affiliate of) a
company that has challenged, directly or indirectly, individually or in
association with another person or entity, the validity, enforceability or scope
of any Licensed Compound Patent Rights, Dermira shall have [*****] ([*****])
days from the date of such acquisition to terminate such challenge to such
Licensed Compound Patent Rights before

- 50 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

Roche’s rights under this Section 13.12 become effective. In the event of
termination by Roche pursuant to this section, any royalty or other payment owed
to Roche prior to such termination shall be [*****].

14.

Representations and Warranties

14.1

Mutual Representations and Warranties

Each Party represents and warrants to the other that, as of the Effective Date:
(a) it is duly organized and validly existing under the laws of its jurisdiction
of incorporation or formation, and has full corporate or other power and
authority to enter into this Agreement and to carry out the provisions hereof;
(b) it is duly authorized to execute and deliver this Agreement and to perform
its obligations hereunder, and the person or persons executing this Agreement on
its behalf has been duly authorized to do so by all requisite corporate or
partnership action; and (c) this Agreement is legally binding upon it,
enforceable in accordance with its terms, and does not conflict with any
agreement, instrument or understanding, oral or written, to which it is a party
or by which it may be bound, nor violate any material law or regulation of any
court, governmental body or administrative or other agency having jurisdiction
over it.

14.2

Roche Representations, Warranties and Covenants

Roche represents and warrants as of the Effective Date and covenants to Dermira
(only where applicable) that:

 

(a)

Roche has not received written notice from any Third Party claiming that the use
or sale of Compound or Product infringes any Patent Right of any Third Party;

 

(b)

Roche is not a party to any legal action, suit or proceeding in a court of law
relating to Compound or Product;

 

(c)

Roche has the full right, power and authority to grant all of the right, title
and interest in the licenses, sub-licenses and other rights granted to Dermira
under this Agreement;

 

(d)

all of Roche’s activities related to its use of the Licensed Compound Patent
Rights and Licensed Know-how, and the research, development, Manufacturing and
Promotion of the Compound and/or Product, pursuant to Sections 2.5, 5.3 and 8.3
of this Agreement, shall comply with all Applicable Laws;

 

(e)

Roche has Control of all the Licensed Compound Patent Rights listed on Appendix
1.57 and the Non-Compound Patent Rights listed on Appendix 1.62 and the filings
and correspondence with any Regulatory Authority with respect to the Compound or
Product that are set forth in the Appendices 1.58 and 2.4.1;

 

(f)

[*****] Roche has Control of all the Licensed Know-how [*****];

 

(g)

[*****] Appendices 1.57 and 1.62 list all Patent Rights that Roche Controls as
of the Effective Date that claim the composition, formulation, or use of Drug
Substance or Drug Product as they exist on the Effective Date;

 

(h)

[*****] the Appendices 1.55 and 2.4.1 list all the material Know-How
specifically directed to the Compound that is Controlled by Roche and that is
reasonably necessary for Dermira to exercise its rights under this Agreement;

- 51 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

 

(i)

[*****] Roche has the capacity to Manufacture the Drug Substance and Drug
Product in accordance with Section 6, and there is no reason that the
Manufacturing process for the Drug Substance will not be approved by the FDA for
commercial use;

 

(j)

it shall not at any time after the Execution Date or during the Agreement Term,
(a) take any action, or fail to take any action, that would result in it losing
Control of any Licensed Compound Patent Rights without Dermira’s prior written
permission or any Licensed Know-how, (b) engage in any activities using the
Compound, Roche Modified Compound, Joint Modified Compound or Product that to
the knowledge of Roche use any Dermira Patent Rights or Dermira Know-How for any
purposes other than those purposes expressly permitted under this Agreement,
including in Sections 2.5.1, 2.6.2, 5.3, 8.3 and 18.3; or (c) grant any license
under the Roche Patent Rights or Roche Know-How to sell, or offer for sale the
Compound.  

14.3

Dermira Representations and Warranties

Dermira represents and warrants as of the Effective Date and covenants that:

 

(a)

it shall not engage in any activities using the Compound, Dermira Modified
Compound, Joint Modified Compound or Product that [*****] use the Roche Patent
Rights and/or Roche Know-How in a manner that is outside the scope of the
license rights granted to it hereunder, and

 

(b)

all of its activities related to its use of the Roche Patent Rights and Roche
Know-How, and the research, development and commercialization of the Compound,
Dermira Modified Compound, Joint Modified Compound and/or Product, pursuant to
this Agreement shall comply with all Applicable Laws.

14.4

Limitations

Except as provided in Section 14.2, Roche makes no representation or warranty
that all intellectual property rights necessary for Dermira to make, have made,
use, sell, offer for sale and import the Compound or the Product in the
Territory have been granted to Dermira under Section 2. Roche did not perform an
exhaustive and final search for Third Party Patent Rights or an evaluation
thereof for Compounds and/or technologies relevant under this Agreement. Roche
will not keep Dermira updated about further searches or analyses of Third Party
Patent Rights nor will it keep Dermira updated about any further developments of
any Third Party rights or steps taken or intended to be taken by Roche with
regard to such Third Party rights.

14.5

Disclaimer

Except as expressly set forth herein and elsewhere in this Agreement, EACH PARTY
EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION THE WARRANTIES OF DESIGN, MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS
OF THIRD PARTIES, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICES.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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15.

Indemnification

15.1

Roche Indemnification

Roche shall indemnify, hold harmless Dermira, Dermira’s Affiliates and its and
their officers, directors, employees, consultants and agents ("Dermira
Indemnitees") from and against any and all losses, damages, liabilities,
expenses and costs, including reasonable legal expense and attorneys’ fees
(“Indemnified Losses”), to which any such Dermira Indemnitee may become subject
as a result of any claim, demand, action or other proceeding by any Third Party
to the extent such Indemnified Losses arise out of (i) the breach by Roche of
any obligation, representation, warranty, covenant or agreement made by it under
this Agreement, (ii) the development, manufacture, promotion, of the Product in
or for the Roche Retained Field, including sale of Product by or on behalf of
Dermira, its Affiliates or Sublicensees for use in the Roche Retained Field,
(iii) Roche’s exercise of its retained rights under Sections 2.5, 5.3 and 8.3,
or (iv) the Manufacture of Compound or Product by or on behalf of Roche, except
in each case to the extent such Indemnified Losses result from the negligence or
willful misconduct of any Dermira Indemnitee (including without limitation any
item subject to indemnification by Dermira under Section 15.2).

15.2

Dermira Indemnification

Dermira shall indemnify, hold harmless Roche, Roche’s Affiliates and its and
their officers, directors, employees, consultants and agents ("Roche
Indemnitees") from and against any and all Indemnified Losses, to which any such
Roche Indemnitee may become subject as a result of any claim, demand, action or
other proceeding by any Third Party to the extent such Indemnified Losses arise
out of (i) the breach by Dermira of any representation, warranty, covenant or
agreement made by it under this Agreement, or (ii) the development, Manufacture,
use, handling, storage, sale or other disposition of the Compound and/or any
Product by Dermira or any of its Affiliates or Partners (including but not
limited to (1) Product liability claims and (2) infringement of Third Party
patents, except to the extent such Indemnified Losses result from the negligence
or willful misconduct of any Roche Indemnitee (including without limitation any
item subject to indemnification by Roche under Section 15.1).

15.3

Control of Defense

In the event an Dermira Indemnitee or Roche Indemnitee (as the case may be)
seeks indemnification under Section 15.1 or 15.2, it shall inform the other
party (the “Indemnifying Party”) of a claim [*****] after it receives notice of
the claim, shall permit the Indemnifying Party to assume direction and control
of the defense of the claim (including the right to settle the claim solely for
monetary consideration), and shall cooperate as requested (at the expense of the
Indemnifying Party) in the defense of the claim, provided that the Indemnifying
Party shall not settle any such claim without the prior written consent of any
affected Roche Indemnitee or Dermira Indemnitee (as the case may be), if such
settlement contains any admission of fault of such Dermira Indemnitee or Roche
Indemnitee (as the case may be).

16.

Liability

16.1

Limitations

In no event shall either Dermira or Roche be liable for indirect damages
(indirekte Schäden/mittelbare Schäden/weitere Schäden als Schäden mit langem
Kausalzusammenhang) or consequential damages (Mangelfolgeschäden und Schäden,
die sich aus einem direkten Schaden ergeben) including lost profit (entgangener
Gewinn) arising out of this Agreement based

- 53 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

on contract, tort or any other legal theory, except to the extent such damages
or lost profit are due to the gross negligence or willful misconduct of the
other Party. The foregoing limitations shall not limit the indemnification
obligation of such Party under the provisions of Sections 15.1 and 15.2 for such
damages claimed by a Third Party.

16.2

Dermira Liability Insurance

Dermira shall maintain, at its own cost, the following insurance coverages:

16.2.1

Commencing as of the Effective Date, and during the Agreement Term, Dermira
shall obtain and maintain on an ongoing basis, commercial general liability
insurance, including contractual liability and products liability insurance, in
the minimum amount of US$ [*****] (US $[*****]) per occurrence, combined single
limit for bodily injury and property damage liability, to increasing to US$
[*****] (US$ [*****]) per occurrence, combined single limit for bodily injury
and property damage liability upon the First Commercial Sale.

16.2.2

Dermira shall maintain statutory workers’ compensation limits and employers
liability limits shall be at a minimum amount of US$ [*****] (US$ [*****]).

16.2.3

Dermira shall have and maintain clinical trial liability insurance covering the
development (including for Dermira’s development in the Roche Retained Field
after occurrence of the Roche Reversion), Manufacture (after receipt by Dermira
of the Drug Substance Transfer Notice or the Drug Product Transfer Notice, as
the case may be), use and sale (including for Dermira’s promotion in the Roche
Retained Field after occurrence of the Roche Reversion) of Products with a
minimum combined single limit per occurrence of US$ [*****] (US$ [*****]) for
any period during which Dermira (or any Sublicensees) is conducting a clinical
trial.  This insurance shall be primary insurance.

16.2.4

Policy limits set forth in the first paragraph of this Section above may be met
with a combination of primary, umbrella or excess insurance.

16.2.5

Additional Requirements

All such insurance coverage shall be primary insurance with respect to Dermira’s
own participation under this Agreement, and shall be maintained with an
insurance company or companies having an A.M. Best’s rating of [*****] or
better.

Dermira shall name Roche as an additional insured by endorsement under its
commercial general liability and products liability insurance policies.

The insurance policies shall be under an occurrence form, but if only a
claims-made form is reasonably available to Dermira, then in such a case,
Dermira shall maintain the insurance coverage for at least [*****] ([*****])
years following completing performance of its obligations under this Agreement.

Upon [*****] ([*****]) days after the Effective Date, Dermira shall provide to
Roche its certificates of insurance evidencing the insurance coverage set forth
in this Section.  Dermira shall provide to Roche at least [*****] ([*****]) days
prior written notice of any cancellation, nonrenewal or material change in any
of the insurance coverage.  Dermira shall, upon receipt of written request from
Roche, provide renewal certificates to Roche for as long as Dermira is required
to maintain insurance coverage hereunder.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

17.

Obligation Not to Disclose Confidential Information

17.1

Non-Use and Non-Disclosure

During the Agreement Term and for [*****] ([*****]) years thereafter, a party
receiving Confidential Information (“Receiving Party”) shall (i) treat
Confidential Information provided by Disclosing Party as it would treat its own
information of a similar nature, (ii) take all reasonable precautions not to
disclose such Confidential Information to Third Parties, unless permitted to do
so by the Disclosing Party with the Disclosing Party’s prior written consent,
and (iii) not use such Confidential Information other than for fulfilling its
obligations under this Agreement.

17.2

Permitted Disclosure

Notwithstanding the obligation of non-use and non-disclosure set forth in
Section 17.1, the Parties recognize the need for certain exceptions to this
obligation, specifically set forth below, with respect to press releases, patent
rights, publications, and certain commercial considerations.

17.3

Press Releases

Dermira may issue a press release announcing the existence and selected key
terms of this Agreement, in a form substantially similar to the template
attached as Appendix 17.3.

For other press releases related to the activities concerning this Agreement
that disclose information other than set forth on Appendix 17.3 by Dermira
during the Agreement Term, Dermira shall provide Roche with a copy of any draft
press release at least [*****] prior to its intended publication for Roche's
review. Roche may provide Dermira with suggested modification to the draft press
release. Dermira shall consider Roche’s suggestions prior to issuing its press
release.

Roche shall only issue press releases related to the activities contemplated by
this Agreement that have either (i) been approved by Dermira or (ii) are
required to be issued by Roche as a matter of law and Roche has a competent
legal opinion to that effect. In all circumstances, Roche shall provide Dermira
with a draft press release at least [*****] prior to its intended publication
for Dermira's review. During such period, Dermira shall (i) approve the draft
press release and permit Roche to issue the press release, (ii) contact Roche to
discuss modification to the draft press release, or (iii) contact Roche and
disapprove the press release. If Dermira asks for modification, then Roche shall
either make such modification or work with Dermira to arrive at a press release
that Dermira approves. If Roche issues a press release without Dermira's
approval, then Roche must obtain a competent legal opinion that the release was
required to be issued by Roche as a matter of law.

17.4

Publications

17.4.1

During the Term of this Agreement, the following restrictions shall apply with
respect to disclosure by a Party of the other Party’s Confidential Information
relating to the Product in any publication or presentation:

 

(a)

A Party ("Publishing Party") shall provide the other Party with a copy of any
proposed publication or presentation that contains such other Party’s
Confidential Information at least [*****] ([*****]) days (or at least [*****]
days in the case of oral presentations or conference abstracts) prior to
submission for publication so as to provide such other Party with an opportunity
to [*****] any changes [*****] are necessary to continue to maintain the
confidentiality of such other Party’s Confidential Information in accordance
with the requirements of this Agreement.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

 

The incorporation of such recommended changes shall not be [*****] refused by
such Publishing Party; and if such other Party notifies ("Publishing Notice")
the Publishing Party in writing, within [*****] ([*****]) days after receipt of
the copy of the proposed publication or presentation (or at least [*****]
([*****]) days in the case of oral presentations), that such publication or
presentation in its [*****] judgment (i) contains an invention, solely or
jointly conceived and/or reduced to practice by the other Party, for which the
other Party [*****] desires to obtain patent protection or (ii) [*****] to have
a [*****] effect on the commercial value of any Confidential Information
disclosed by the other Party to the Publishing Party, the Publishing Party shall
prevent such publication or delay such publication for a [*****] period of time.
In the case of inventions, a delay shall be for a period [*****] to permit the
timely preparation and filing of a patent application(s) on such invention, and
in no event less than [*****] ([*****]) days from the date of the Publishing
Notice.

 

(b)

Until the occurrence of the Roche Reversion, Dermira shall not make any public
disclosure of any data or information specifically directed to the Compound in
the Roche Retained Field until Roche provides its written consent, [*****].

17.4.2

Roche shall not make any public disclosure of any data or information
specifically directed to the Compound, alone or in comparison with another
compound, outside the Roche Retained Rights in Section 2.5, other than the
research or human clinical trials for which Dermira has provided written consent
in accordance with the terms of Section 2.5.1, or outside the Roche Retained
Field until Dermira provides its written consent, [*****]. For clarity, subject
to Section 17.4.2(a), no such written consent shall be required for any public
disclosure of data or information in the Roche Retained Rights in Section 2.5,
other than the research or human clinical trials for which Dermira has provided
written consent in accordance with the terms of Section 2.5.1 or in the Roche
Retained Field.

17.5

Commercial Considerations

Nothing in this Agreement shall prevent Dermira or its Affiliates from
disclosing Confidential Information of Roche to (i) governmental agencies to the
extent required or desirable to secure government approval for the development,
Manufacture or sale of Product in the Territory, (ii) Third Parties acting on
behalf of Dermira, to the extent [*****] for the development, Manufacture or
sale of Product in the Territory, (iii) Third Parties to the extent [*****] to
market the Product in the Territory, (iv) Third Parties with which Dermira is
considering a potential transaction related to this Agreement who have a need to
see the Agreement (including each of Dermira’s and such Third Party’s
accounting, financial, legal or tax advisors associated with such potential
transaction) provided that such disclosure shall be limited to the terms such
Third Party has requested to review in order to proceed with the potential
transaction and that are [*****] for the purposes of proceeding with such
potential transaction and is under terms of confidentiality that are consistent
with those contained in this Agreement, (v) consultants and advisors subject to
terms of confidentiality that are consistent with those contained in this
Agreement, or (vi) Dermira’s  employees, officers, members of its board of
directors, and its accounting, legal or tax advisors.

The Receiving Party may disclose Confidential Information of the Disclosing
Party to the extent that such Confidential Information is required to be
disclosed by the Receiving Party to comply with Applicable Law, IFRS or GAAP, to
defend or prosecute litigation or to comply with governmental regulations or
applicable regulations of a stock exchange, provided that the Receiving Party
provides prior written notice of such disclosure to the Disclosing Party and,
[*****], takes [*****] actions to minimize the degree of such disclosure. No
notice shall be required under Section 17 if and to the extent that the specific
information contained in the proposed disclosure

- 56 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

has previously been included in any previous disclosure made by either Party
hereunder pursuant to Section 17, or is otherwise approved in advance in writing
by the other Party.

18.

Term and Termination

18.1

Commencement and Term

Other than with respect to Sections 17, 21.1, 21.2, 21.3 and 22, which shall
commence on the Execution Date, this Agreement shall commence on the Effective
Date and continue for the Agreement Term.

18.2

Termination

18.2.1

Termination for Breach

A Party (“Non-Breaching Party”) shall have the right to terminate this Agreement
in its entirety or on a country-by-country basis in the event the other Party
(“Breaching Party”) is in breach of any of its material obligations under this
Agreement. The non-Breaching Party shall provide written notice to the Breaching
Party, which notice shall identify the breach and the countries in which the
Non-Breaching Party intends to have this Agreement terminate. The Breaching
Party shall have a period of [*****] ([*****]) days after such written notice is
provided (“Peremptory Notice Period”) to cure such breach. If the Breaching
Party has a bona fide dispute as to whether such breach occurred or has been
cured, it will so notify the Non-Breaching Party and after delivery of such
notification the expiration of the Peremptory Notice Period shall be tolled
until such dispute is resolved pursuant to Section 21.2. Upon a determination of
breach or failure to cure, the Breaching Party shall have the remainder of the
Peremptory Notice Period to cure such breach. If such breach is not cured within
the Peremptory Notice Period, then the Non-Breaching Party shall either withdraw
its request for termination or within [*****] ([*****]) days after the
expiration of the Peremptory Notice Period terminate this Agreement with
immediate effect.

18.2.2

Termination in case of an Insolvency Event

A Party shall have the right to terminate this Agreement in its entirety, if the
other Party incurs or undergoes an Insolvency Event; provided, however, in the
case of any involuntary bankruptcy proceeding, such right to terminate shall
only become effective if the Party that incurs the Insolvency Event consents to
such involuntary bankruptcy or such proceeding is not dismissed within [*****]
([*****]) days after the filing thereof. Upon an Insolvency Event the Party not
incurring the Insolvency Event shall have the right to terminate this Agreement
within [*****] ([*****]) days of the Insolvency Event of the other Party.

18.2.3

Termination by Dermira without a Cause

Dermira shall have the right to terminate this Agreement at any time, on a
country-by-country basis upon six (6) months prior written notice before First
Commercial Sale of the Product or upon nine (9) months prior written notice
after the First Commercial Sale of the Product. The effective date of
termination under this Section shall be the date six (6) months (or nine (9)
months as the case may be) after Dermira provides such written notice to Roche.

18.2.4

Termination for Failure to Receive HSR Approval

If HSR Approval is not received by the Outside Date, then either Party shall
have the right to terminate this Agreement upon written notice to the other
Party.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

18.3

Consequences of Termination

18.3.1

Termination by Dermira for Breach by Roche or Roche Insolvency

Upon breach by Roche or Roche’s Insolvency, Dermira shall have the right to
terminate this Agreement in accordance with Section 18.2.1 or Section 18.2.2, as
applicable. If Dermira does not practice its aforementioned right to terminate,
then Dermira may retain the rights and licenses granted by Roche under this
Agreement; provided, however, that Dermira shall have the right to offset
amounts that are mutually agreed to by the Parties (including as a result of a
settlement of such breach of Insolvency) or any amounts for judgments awarded to
Dermira in accordance with Section 21.3 against amounts otherwise payable to
Roche under this Agreement.

18.3.2

Termination by Dermira without Cause, Termination by Roche for Breach by Dermira
or Dermira Insolvency

Upon termination by Dermira without cause in accordance with Section 18.2.3,
Termination by Roche for breach by Dermira in accordance with Section 18.2.1 or
Roche’s termination due to Dermira incurring an Insolvency Event in accordance
with Section 18.2.2, the rights and licenses granted by Roche to Dermira under
this Agreement shall terminate in their entirety or on a country-by-country
basis, as applicable, on the effective date of such termination.

If Roche desires to continue development and/or commercialization of Product(s),
Roche shall deliver a Continuation Election Notice (in accordance with the
definition described therein) to Dermira within [*****] ([*****]) days of
receipt of Dermira’s notice of termination without cause under Section 18.2.3.
If Dermira receives such a timely Continuation Election Notice, and to the
extent reasonably requested by Roche:

 

(a)

After the date of notice of termination Dermira shall, to the extent Dermira has
the right to do so and Controlled by Dermira, transfer to Roche all regulatory
filings and approvals, all final nonclinical and clinical study reports and
clinical study protocols, Trademarks, Know-How, including Dermira Know-How, and
a copy of all clinical data generated under this Agreement, including materials
and information, in Dermira’s possession and Control related to Compound(s),
Modified Compound(s), or Product(s) ([*****]) in the country necessary for Roche
to continue to develop and commercialize the Product(s);

 

(b)

Dermira shall assign all clinical trial, manufacturing and supply agreements
that are assignable to Roche by Dermira, [*****];

 

(c)

Roche shall, upon transfer, have the right to disclose such filings, approvals
and data to (i) governmental agencies of the country to the extent required or
desirable to secure government approval for the development, Manufacture or sale
of Product(s) in the country; (ii) Third Parties acting on behalf of Roche, its
Affiliates or licensees for the development, Manufacture, or sale of Product(s)
in the country, or (iii) Third Parties to the extent reasonably necessary to
market Product(s) in the country; and

 

(d)

Roche shall have a fully paid-up, royalty-free, worldwide, non-exclusive,
sublicensable, transferable license under the Dermira Patent Rights and Dermira
Know-How, including Dermira’s interest in the Joint Know-How to allow Roche, its
Affiliates or licensees to research, develop, Manufacture, have Manufactured,
use, offer to sell, sell, promote, export and import the applicable Compounds,
Modified Compounds, and Product(s) in the applicable country(ies).

- 58 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

18.3.3

Direct License

Irrespective of anything to the contrary in this Agreement, any then-existing
sublicense granted by Dermira to a Partner under Section 2.2 of this Agreement
(and any further sublicenses thereunder) shall, upon the written request of
Dermira within [*****] ([*****]) days following the effective of termination,
remain in full force and effect, provided that (i) such Partner is not then in
breach of its Partner Agreement (and, in the case of termination by Roche for
breach by Dermira, that such Partner did not cause the breach that gave rise to
the termination by Roche); and (ii) and such Partner agrees to be bound to Roche
under the terms and conditions of such sublicense agreement.  

18.3.4

Other Obligations

18.3.4.1

Obligations Related to Ongoing Activities

If Roche does not provide timely Continuation Election Notice, then Dermira (a)
shall have the right to cancel all cancellable ongoing obligations and (b) shall
complete all non-cancellable obligations at [*****] expense.

If Roche provides such timely Continuation Election Notice, then from the date
of notice of termination until the effective date of termination, Dermira shall
continue activities, including preparatory activities, ongoing as of the date of
notice of termination. However, Dermira shall not be obliged to initiate any new
activities not ongoing at the date of notice of termination.

After the effective date of termination, Dermira shall not have any obligation
to perform and/or complete any activities or to make any payments for performing
or completing any activities under this Agreement, except as expressly stated
herein.

Notwithstanding the foregoing, in case of termination by Roche under Section
18.2.1 or Section 18.2.2 or by Dermira under Section 18.2.3, upon the request of
Roche, Dermira shall complete any studies related to the Product(s) that are
being conducted under its IND for the Product(s) and are ongoing as of the
effective date of termination; provided, however, that

(i)

both Dermira and Roche [*****] have concluded that completing any such Clinical
Studies does not present an unreasonable risk to patient safety;

(ii)

Dermira shall have no obligation to recruit or enroll any additional patients
after the date of termination; and

(iii)

Roche agrees to reimburse Dermira for [*****] its development costs that arise
after the effective date of termination in completing such studies.

18.3.4.2

Obligations Related to Manufacturing

a)

Clinical Supplies

In the case of termination by Roche according to Section 18.2.1 or Section
18.2.2 or by Dermira under Section 18.2.3, in each case after Manufacture and
supply responsibility has been transferred to Dermira according to Section 6.2,
if Roche elects to develop the Product(s), upon the request of Roche, Dermira
shall transfer all existing and available clinical material to Roche at
Dermira’s Fully Burdened Manufacturing Cost, provided however that Dermira shall
procure the supply for the ongoing study(ies) until the transfer of the
respective study and/or supply has been completed.

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[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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(i)

Commercial Supplies

In the case of termination by Roche according to Section 18.2.1 or Section
18.2.2 or by Dermira under Section 18.2.3, in each case after Manufacture and
supply responsibility has been transferred to Dermira according to Section 6.2,
if the Product is marketed or filed in any country of Territory on the date of
the notice of termination of this Agreement, upon the request of Roche, Dermira
shall manufacture and supply such Product to Roche after the effective date of
the termination of this Agreement at Fully Burdened Manufacturing Costs plus a
markup of [*****]%, such mark-up to be [*****] percent ([*****]%) if Dermira has
outsourced the entire Manufacturing of the Product to a CMO. Dermira shall use
Commercially Reasonable Efforts to transfer the manufacturing and supply [*****]
after the effective date of termination.

18.3.4.3

Ancillary Agreements

Unless otherwise agreed by the Parties, the termination of this Agreement shall
cause the automatic termination of all ancillary agreements related hereto,
including but not limited to the Supply Agreement, if any.

18.3.4.4

Royalty and Payment Obligations

Termination of this Agreement by a Party, for any reason, shall not release
either Party from any obligation to pay royalties or make any payments to the
other Party that are incurred by such Party as of the effective date of
termination. Termination of this Agreement by a Party, for any reason, will
release the other Party from any obligation to pay royalties or make any
payments to the terminating Party that relate to a period or point in time after
the effective date of termination.

18.4

Survival

Section 1 (Definitions), Section 13.1 (Ownership of Inventions); Section 15
(Indemnification), Section 17 (Confidential Information), Section 18 (Term and
Termination), Section 21.1 (Governing Law and Jurisdiction) and Section 21.3
(Arbitration) shall survive any expiration or termination of this Agreement for
any reason.

19.

Effects of Change of Control

If there is a Change of Control, then the Party experiencing such Change of
Control (“Acquired Party”) shall provide written notice to the other Party
(“Non-Acquired Party”) at least [*****] ([*****]) days prior to completion of
such Change of Control, subject to any confidentiality obligations of the
Acquired Party then in effect (but in any event shall notify the Non-Acquired
Party within [*****] ([*****]) days after completion of such Change of Control).

Following consummation of the Change of Control, the Non-Acquired Party and the
Change of Control Group shall adopt in writing [*****] procedures to prevent the
disclosure of any of the Non-Acquired Party’s Know-How, Patent Rights,
Inventions, materials or Confidential Information or Joint Know-How, Joint
Patent Rights or Joint Inventions (collectively, “Sensitive Information”) beyond
the Acquired Party’s personnel who need to know the Sensitive Information solely
for the purpose of fulfilling the Acquired Party’s obligations and exercising
its rights under this Agreement. The Non-Acquired Party may restrict the
Acquired Party’s participation in the JSC and any other committee in effect at
the time of the Change of Control only to the extent necessary for the purposes
of protecting Sensitive Information.

- 60 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

20.

Bankruptcy

All licenses (and to the extent applicable rights) granted under or pursuant to
this Agreement by Roche to Dermira are, and shall otherwise be deemed to be, for
purposes of Section 365(n) of Title 11, US Code (the “Bankruptcy Code”) licenses
of rights to “intellectual property” as defined under Section 101(60) of the
Bankruptcy Code and any similar laws in any other applicable country. Unless
Dermira elects to terminate this Agreement, the Parties agree that Dermira, as a
licensee or sublicensee of such rights under this Agreement, shall retain and
may fully exercise all of its rights and elections under the Bankruptcy Code,
subject to the continued performance of its obligations under this Agreement.

21.

Miscellaneous

21.1

Governing Law

This Agreement shall be governed by and construed in accordance with the laws of
[*****], without reference to its conflict of laws principles, and without
applicability of the [*****].

21.2

Disputes

Unless otherwise set forth in this Agreement, in the event of any dispute in
connection with this Agreement, such dispute shall, by written notice
(“Escalation Notice”) be referred to the respective executive officers of the
Parties designated below or their designees, for good faith negotiations
attempting to resolve the dispute. The designated executive officers are as
follows:

For Dermira:CEO

For Roche:Head of Roche Partnering

 

21.3

Arbitration

Should the Parties fail to agree within [*****] after such dispute has first
arisen, it shall be finally settled by arbitration in accordance with the
commercial arbitration rules of [*****] as in force at the time when initiating
the arbitration. The tribunal shall consist of three arbitrators. The place of
arbitration shall be [*****], [*****]. The language to be used shall be English.

21.3.1

Arbitrators

Each Party shall nominate one arbitrator. Should the claimant fail to appoint an
arbitrator in the request for arbitration within [*****] ([*****]) days of being
requested to do so, or if the respondent should fail to appoint an arbitrator in
its answer to the request for arbitration within [*****] ([*****]) days of being
requested to do so, the other Party shall request the [*****] to make such
appointment.

The arbitrators nominated by the Parties shall, within [*****] ([*****]) days
from the appointment of the arbitrator nominated in the answer to the request
for arbitration, and after consultation with the Parties, agree and appoint a
third arbitrator, who will act as a chairman of the Arbitral Tribunal. Should
such procedure not result in an appointment within the [*****] ([*****]) day
time limit, either Party shall be free to request the [*****] to appoint the
third arbitrator.

Where there is more than one claimant and/or more than one respondent, the
multiple claimants or respondents shall jointly appoint one arbitrator.

Any Party-appointed arbitrator or the third arbitrator resigns or ceases to be
able to act, a replacement shall be appointed in accordance with the
arrangements provided for in this clause.

- 61 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

The arbitrators shall, in rendering any decision hereunder, apply the
substantive law set forth in Section 21.1 without regard to conflict of laws
provisions. The Parties have agreed that [*****], and in particular [*****],
shall not apply to any arbitration under this clause. A request to produce
documents by the Parties shall be considered by the Arbitral Tribunal according
to [*****].  

The language of the arbitration shall be English. Documents submitted in the
arbitration (the originals of which are not in English) shall be submitted
together with an English translation.

21.3.2

Decisions; Timing of Decisions

The arbitrators shall render a written opinion setting forth findings of fact
and conclusions of law with the reason therefor stated, within no later than
[*****] ([*****]) months from the date on which the arbitrators were appointed
to the dispute.  A transcript of the evidence adduced at the arbitration hearing
shall be made and, upon request, shall be made available to each Party.

Notwithstanding the above, in the case of JSC disputes that are not amicably
resolved, the arbitrators shall render a written opinion setting forth findings
of fact and conclusions of law with the reason therefor stated, within no later
than [*****] ([*****]) months from the date on which the arbitrators were
appointed to the dispute.

The time periods set forth in the [*****] Arbitration Rules shall be followed;
provided however that the arbitrators may modify such time periods as reasonably
necessary to render a written opinion in accordance with this Section.

The Arbitrator is empowered to award any remedy allowed by law, including money
damages, prejudgment interest and attorneys’ fees, and to grant final, complete,
interim, or interlocutory relief, including injunctive relief.

This arbitration agreement does not preclude either Party seeking conservatory
or interim measures from any court of competent jurisdiction including, without
limitation, the courts having jurisdiction by reason of either Party's domicile.
Conservatory or interim measures sought by either Party in any one or more
jurisdictions shall not preclude the Arbitral Tribunal granting conservatory or
interim measures. Conservatory or interim measures sought by either Party before
the Arbitral Tribunal shall not preclude any court of competent jurisdiction
granting conservatory or interim measures.

In the event that any issue shall arise which is not clearly provided for in
this Section 21.3, the matter shall be resolved in accordance with the [*****]
Arbitration Rules.

Any arbitration proceeding hereunder shall be confidential and the arbitrators
shall issue appropriate protective orders to safeguard each Party’s Confidential
Information.  Except as required by law, neither Party shall make (or instruct
the arbitrators to make) any public announcement with respect to the proceedings
or decision of the arbitrators without prior written consent of the other
Party.  The existence of any dispute submitted to arbitration, and the award,
shall be kept in confidence by the Parties and the arbitrators, except as
required in connection with the enforcement of such award or as otherwise
required by Applicable Law.

Notwithstanding anything to the contrary in this Agreement, any and all issues
regarding the scope, construction, validity and/or enforceability of any Patent
Rights shall be determined in a court of competent jurisdiction under the local
patent laws of the jurisdictions having issued the Patent Rights in question.

- 62 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

Notwithstanding anything to the contrary in this Agreement, any and all issues
regarding a breach or alleged breach of a Party’s obligations under Section 17
(Obligation Not to Disclose Confidential Information) shall be determined in a
court of competent jurisdiction under the laws of [*****], with express
exclusion of its conflict of laws principles.

21.4

Assignment

Neither Party shall have the right to assign the present Agreement or any part
thereof to any Third Party other than Affiliates without the prior written
approval of the other Party (such approval not to be unreasonably withheld,
conditioned or delayed); provided, that, after both the Roche Reversion and
First Commercial Sale have occurred, Dermira shall have the right to assign this
Agreement without Roche’s prior consent in the context of a merger, acquisition,
sale or other transaction involving all or substantially all of Dermira’s
assets.  

21.5

Debarment

Each Party represents and warrants to the other that such representing and
warranting Party and its Affiliates have never been debarred under 21 U.S.C.
§335a, disqualified under 21 C.F.R. §312.70 or §812.119, sanctioned by a Federal
Health Care Program (as defined in 42 U.S.C §1320 a-7b(f)), including without
limitation the federal Medicare or a state Medicaid program, or debarred,
suspended, excluded or otherwise declared ineligible from any other similar
Federal or state agency or program. In the event a Party or any of its
Affiliates receives notice of debarment, suspension, sanction, exclusion,
ineligibility or disqualification under the above-referenced statutes, then such
Party shall immediately notify the other Party in writing and such other Party
shall have the right, but not the obligation, to terminate this Agreement,
effective, at such other Party’s option, immediately or at a specified future
date.

21.6

Independent Contractor

No employee or representative of either Party shall have any authority to bind
or obligate the other Party to this Agreement for any sum or in any manner
whatsoever or to create or impose any contractual or other liability on the
other Party without said Party's prior written approval. For all purposes, and
notwithstanding any other provision of this Agreement to the contrary, Xxx legal
relationship to Roche under this Agreement shall be that of independent
contractor.

21.7

Unenforceable Provisions and Severability

If any of the provisions of this Agreement are held to be void or unenforceable,
then such void or unenforceable provisions shall be replaced by valid and
enforceable provisions that will achieve as far as possible the economic
business intentions of the Parties. However the remainder of this Agreement will
remain in full force and effect, provided that the material interests of the
Parties are not affected, i.e. the Parties would presumably have concluded this
Agreement without the unenforceable provisions.

21.8

Waiver

The failure by either Party to require strict performance and/or observance of
any obligation, term, provision or condition under this Agreement will neither
constitute a waiver thereof nor affect in any way the right of the respective
Party to require such performance and/or observance. The waiver by either Party
of a breach of any obligation, term, provision or condition hereunder shall not
constitute a waiver of any subsequent breach thereof or of any other obligation,
term, provision or condition.

- 63 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

21.9

Appendices

All Appendices to this Agreement shall form an integral part to this Agreement.

21.10

Entire Understanding

This Agreement contains the entire understanding between the Parties hereto with
respect to the within subject matter and supersedes any and all prior
agreements, understandings and arrangements, whether written or oral.

21.11

Amendments

No amendments of the terms and conditions of this Agreement shall be binding
upon either Party hereto unless in writing and signed by both Parties.

21.12

Invoices

All invoices that are required or permitted hereunder shall be in writing and
sent by one Party to the other at the following address or other address as such
Party may later provide:

If to Dermira:

Attn:  Dermira Finance

275 Middlefield Road

Suite 150

Menlo Park, California 94025

USA

 

With a copy to: apinvoice@dermira.com

 

If to Roche:

F. Hoffmann-La Roche Ltd

Kreditorenbuchhaltung

Grenzacherstrasse 124

4070 Basel

Switzerland

 

If Dermira sends invoices to Roche, Dermira shall include the name of a Roche
contact person on the invoice.

 

21.13

Notice

All notices that are required or permitted hereunder shall be in writing and
sufficient if delivered personally, sent by facsimile (and promptly confirmed by
personal delivery, registered or certified mail or overnight courier), sent by
nationally recognized overnight courier or sent by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:

- 64 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

if to Dermira, to:

 

Dermira, Inc.

Attn:  Legal Department

275 Middlefield Road

Suite 150

Menlo Park, California 94025

USA

Facsimile No.: +1 650-365-3410

 

 

and:

King & Spalding, LLP

Attn:  Tom Duley, Partner

101 Second Street

Suite 2300

San Francisco, California 94105

USA

Facsimile No.: +1 415-318-1300  

 

 

if to Roche, to:

F. Hoffmann-La Roche Ltd

Grenzacherstrasse 124

4070 Basel

Switzerland

Attn:  Legal Department

Facsimile No.:  +41 61 688 13 96

 

and:

Genentech, Inc.

1 DNA Way

Mail Stop 49 (Building 33)

South San Francisco, CA 94080

USA

Attn.  Corporate Secretary

Facsimile No.: +1 650 952 9881

 

or to such other address as the Party to whom notice is to be given may have
furnished to the other Party in writing in accordance herewith

22.

Covenants regarding HSR and Antitrust Laws

22.1

Each of the Parties shall within [*****] ([*****]) Business Days following the
Execution Date make all initial filings required under HSR.  In addition, each
of the Parties agree to cooperate and to use their respective [*****] efforts to
take all actions necessary to cause the waiting period under the HSR to expire
or be terminated [*****], including to respond [*****] to any requests for
information under HSR from any governmental authority, and to contest and resist
any action, and to have vacated, lifted, reversed or overturned any decree,
judgment, injunction or other order (whether temporary, preliminary or permanent
that would restrict, prevent or prohibit the consummation of the transactions
contemplated by this Agreement under HSR or any other Antitrust Law. Each Party
shall furnish to the other Parties such necessary information and assistance as
the other Parties may reasonably request in connection with the preparation of
any necessary filings or submissions by it to any such governmental authority.
No Party shall consent to any voluntary extension of any statutory deadline or
withdraw its notification and report form pursuant to HSR with respect to the
transactions contemplated by this Agreement unless the other Party has given its
prior written consent to such extension or delay (which consent shall not be
unreasonably withheld, conditioned or delayed).

- 65 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

22.2

The Parties agree, except as prohibited or restricted by Applicable Law, to
(a) give each other [*****] advance notice of all meetings with any governmental
authority relating to HSR or any other Antitrust Laws, (b) give each other an
opportunity to participate in each of such meetings, (c) give each other [*****]
advance notice of all substantive oral communications with any governmental
authority relating to HSR or any other Antitrust Laws, (d) if any governmental
authority initiates a substantive oral communication regarding HSR any Antitrust
Laws, promptly notify the other Parties of the substance of such communication,
(e) provide each other with a [*****] advance opportunity to review and comment
upon all written communications (including any analyses, presentations,
memoranda, briefs, arguments, opinions and proposals) with a governmental
authority regarding HSR or any other Antitrust Laws and (f) provide each other
with copies of all written communications from any governmental authority
relating to HSR or any other Antitrust Laws. Any disclosures or provision of
copies by one Party to another may be made on an outside counsel basis, if
appropriate.

22.3

Each of the Parties shall use [*****] efforts to resolve any objections or
challenges a governmental authority or private party may have to the
transactions contemplated by this Agreement as violating any Antitrust Law so as
to permit the Effective Date as soon as practicable and in any event prior to
the Outside Date.

22.4

Notwithstanding anything to the contrary in the foregoing, in no event shall (A)
Dermira or any of its subsidiaries be required or expected to take any action to
effect the sale, divestiture or disposition of Dermira assets or be required to
grant rights of any kind to any third party or pay any amount, grant any
guarantee or provide any other consideration to any third party or incur
additional costs or expenses in order to obtain HSR Approval or any other
approval under any Antitrust Law, or (B) Roche be required to or expected to
take any action to sell, divest or cause a third party to acquire, or otherwise
dispose of, any of the operations, businesses, product lines, customers or
assets if such sale or disposition would have a material adverse effect on
Roche.

 

[Signature Page Follows]

 

- 66 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the
Effective Date.

 

 

Dermira, Inc.

 

 

 

/s/ Tom Wiggans

Name: Tom Wiggans

Title:  Chairman and CEO

Date: 08-Aug-2017

 

 

 

 

 

 

 

 

 

F. Hoffmann-La Roche Ltd

 

 

 

/s/ Vikas Kabra

Name:  Vikas Kabra

Title:  Head of Transactions Excellence

Date: July 25, 2017

 

 

 

 

/s/ Dr. Christof Burri

Name:  Christof Burri

Title:  Legal Counsel

 

 

 

 

Genentech, Inc.

 

 

 

/s/ Ed Harrington

Name:  Ed Harrington

Title:  CFO and Head of Pharma Finance NA

Date: July 26, 2017

 

 

 

- 67 –

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

Appendix 1.18

 

Compound

 

Amino acid sequence of lebrikizumab heavy chains:

 

1       10        20        30        40        50        60

 

 

   |    |    |    |    |    |    |

    |    |    |    |    |

 

Q

VTLRESGPALVKPTQTLTLTCTVSGFSLS

AYSVN

WIRQPPGKALEWLA

MIWGDGKIVYN

 

        70        80        90       100       110       120

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

SALKS

RLTISKDTSKNQVVLTMTNMDPVDTATYYCAG

DGYYPYAMDN

WGQGSLVTVS

S

AS

 

       130       140       150       160       170       180

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

TKGPSVFPLAPCSRSTSESTAALGCLVKDYFPEPVTVSWNSGALTSGVHTFPAVLQSSGL

 

       190       200       210       220       230       24

0

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

YSLSSVVTVPSSSLGTKTYTCNVDHKPSNTKVDKRVESKYGPPCP

P

CPAPEFLGGPSVFL

 

       250       260       270       280       290       300

 

    |    |    |    |    |    |    |    |    |    |        |

 

FPPKPKDTLM

ISRTPEVTCVVVDVSQEDPEVQFNWYVDGVEVHNAKTKPREEQF

N

STYRV

 

       310       320       330       340       350       360

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

VSVLTVLHQDWLNGKEYKCKVSNKGLPSSIEKTISKAKGQPREPQVYTLPPSQEEMTKNQ

 

       370       380  

     390       400       410       420

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

VSLTCLVKGFYPSDIAVEWESNGQPENNYKTTPPVLDSDGSFFLYSRLTVDKSRWQEGNV

 

       430       440       450

 

    |    |    |    |    |    |

 

FSCSVMHEALHNHYTQKSLSLSLG

K

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

1       10        20        30        40        50        60

 

 

   |    |    |    |    |    |    |

    |    |    |    |    |

 

Q

VTLRESGPALVKPTQTLTLTCTVSGFSLS

AYSVN

WIRQPPGKALEWLA

MIWGDGKIVYN

 

        70        80        90       100       110       120

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

SALKS

RLTISKDTSKNQVVLTMTNMDPVDTATYYCAG

DGYYPYAMDN

WGQGSLVTVS

S

AS

 

       130       140       150       160       170       180

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

TKGPSVFPLAPCSRSTSESTAALGCLVKDYFPEPVTVSWNSGALTSGVHTFPAVLQSSGL

 

       190       200       210       220       230       24

0

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

YSLSSVVTVPSSSLGTKTYTCNVDHKPSNTKVDKRVESKYGPPCP

P

CPAPEFLGGPSVFL

 

       250       260       270       280       290       300

 

    |    |    |    |    |    |    |    |    |    |        |

 

FPPKPKDTLM

ISRTPEVTCVVVDVSQEDPEVQFNWYVDGVEVHNAKTKPREEQF

N

STYRV

 

       310       320       330       340       350       360

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

VSVLTVLHQDWLNGKEYKCKVSNKGLPSSIEKTISKAKGQPREPQVYTLPPSQEEMTKNQ

 

       370       380  

     390       400       410       420

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

VSLTCLVKGFYPSDIAVEWESNGQPENNYKTTPPVLDSDGSFFLYSRLTVDKSRWQEGNV

 

       430       440       450

 

    |    |    |    |    |    |

 

FSCSVMHEALHNHYTQKSLSLSLG

K

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amino acid sequence of lebrikizumab light chains:

 

1       10        20        30        40        50        60

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

DIVMTQSPDSLSVSLGERATINC

RASKSVDSYGNSFMH

WYQQKPGQPPKLLIY

LASNLES

 

        70        80        90       100       110       120

 

    |    |  

  |    |    |    |    |    |    |    |    |    |

 

GVPDRFSGSGSGTDFTLTISSLQAEDVAVYYC

QQNNEDPRT

FGGGTKVEIKRTVAAPSVF

 

       130       140       150       160       170       180

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

IFPPSDEQLKSGTASVVCLLNNFY

PREAKVQWKVDNALQSGNSQESVTEQDSKDSTYSLS

 

       190       200       210       220

 

    |    |    |    |    |    |    |    |

 

STLTLSKADYEKHKVYACEVTHQGLSSPVTKSFNRGEC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

1       10        20        30        40        50        60

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

DIVMTQSPDSLSVSLGERATINC

RASKSVDSYGNSFMH

WYQQKPGQPPKLLIY

LASNLES

 

        70        80        90       100       110       120

 

    |    |  

  |    |    |    |    |    |    |    |    |    |

 

GVPDRFSGSGSGTDFTLTISSLQAEDVAVYYC

QQNNEDPRT

FGGGTKVEIKRTVAAPSVF

 

       130       140       150       160       170       180

 

    |    |    |    |    |    |    |    |    |    |    |    |

 

IFPPSDEQLKSGTASVVCLLNNFY

PREAKVQWKVDNALQSGNSQESVTEQDSKDSTYSLS

 

       190       200       210       220

 

    |    |    |    |    |    |    |    |

 

STLTLSKADYEKHKVYACEVTHQGLSSPVTKSFNRGEC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Appendix 1.57

 

Licensed Compound Patent Rights

 

Full list will be provided by Roche.

 

Patent Families:

 

[*****]

 

 

U.S. Provisional Application Nos. [*****] and all subsequently filed utility
application(s) that claim the benefit of priority of at least one of the
foregoing provisional applications.

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

Appendix 1.62

 

Non-Compound Patent Rights

 

Full list will be provided by Roche.

 

Patent Families:

 

[*****]

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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Appendix 1.58

 

[*****]

 

[*****]

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

 

Appendix 1.76

 

Excluded Patent Rights

[*****], which means (a) U.S. Patent No. [*****], issued [*****], and any and
all patents issuing from divisionals, continuations, or continuations-in part of
any application from which U.S. Patent No. [*****] claims priority, as well as
reissues, reexaminations, extensions, and foreign patent counterparts, including
inventors certificates, of any of the foregoing, and including any related
supplemental protection certificates; and (b) U.S. Patent No. [*****], issued
[*****], and any and all patents issuing from divisionals, continuations, or
continuations-in-part of any application from which U.S. Patent No. [*****]
claims priority, as well as reissues, reexaminations, extensions, and foreign
patent counterparts, including inventors certificates, of any of the foregoing,
and including any related supplemental protection certificates.

[*****], which means any of the U.S. patents listed below and any and all
patents issuing from divisionals, continuations or continuations-in-part, and
any reissues, reexaminations or extensions, of these patents or of any
application from which these U.S. patents claim priority, as well as foreign
counterparts, including inventors certificates, of the foregoing, and including
any related supplemental protection certificates:

[*****]

[*****], which means any of the U.S. patents/patent application listed below and
any and all patents issuing from divisionals, continuations or
continuations-in-part, and any reissues, reexaminations or extensions, of these
patents or of any application from which these U.S. patents claim priority, as
well as foreign counterparts, including inventors certificates, of the
foregoing, and including any related supplemental protection certificates:

[*****]

[*****], which means the following U.S. patent and any and all divisionals,
continuations, continuations-in-part of any application from which these U.S
patents claim priority, including reissues, reexaminations or extensions of
these patents and foreign counterparts and supplementary protection certificates
of the foregoing:

[*****]

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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CONFIDENTIAL TREATMENT REQUESTED

 

 

Appendix 2.4.1

 

Except where noted in the “Delivery Date” column, the documents and materials
relating to the Compound or Product and listed in the table below will be
transferred electronically or physically to Dermira.

 

The Parties agree to initiate a transfer tracking plan which clarifies the
logistics of the transfer and serves as confirmation of receipt by Dermira. The
Parties will follow up after each key delivery date to assess the progress and
transfer any documents necessary to complete the transfer of Know-How [*****]
herein and requested by Dermira within [*****] ([*****]) months of the Effective
Date.  The Know-How contained in such documents transferred to Dermira that is
specifically directed to the Compound, except to the extent such Know-How is
related to Manufacturing, shall be Licensed Know-How and all other Know-How
shall remain Roche Know-How. [*****]

 

Documents

Delivery Date

[*****]

Within [*****] ([*****]) days after the Effective Date

[*****]

By [*****]

[*****]

Within [*****] ([*****]) days after the Effective Date

[*****]

Within [*****] ([*****]) days upon the availability of raw data

[*****]

Within [*****] ([*****]) days after the Effective Date (to be made available for
Dermira review on site)

[*****]

Within [*****] after the Effective Date but no later than [*****] (to be
transferred to Dermira or Third Parties)

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

[*****]

Within [*****] ([*****]) days after Dermira’s request for such

 

[*****]

Within [*****] ([*****]) days after the Effective Date

[*****]

Within [*****] ([*****]) days after Dermira’s request for such

[*****]

Within [*****] ([*****]) days after execution of [*****]

[*****]

Within [*****] ([*****]) days of the [*****] but no later than [*****]

[*****]

Within the earlier of (a) [*****] ([*****]) days after the completion of the
[*****] or (b) [*****] ([*****]) days after availability to Roche

[*****]

As described in Pharmacovigilance Agreement

[*****]

Within [*****] ([*****]) days after [*****]

[*****]

Within [*****] ([*****]) Business Days after Dermira’s request for up to [*****]
studies, and within [*****] ([*****]) days for more than [*****] studies

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

[*****]

Within [*****] ([*****]) days after Dermira’s request for such

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

Appendix 5.2

 

Development Plan

 

 

[*****]

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

Appendix 6.1.2

Drug Product and Placebo First Order

 

 

Product

Price

Quantity of Active (Syringes)

Quantity of Placebo (Syringes)

Estimated Delivery Date

Drug Product and Placebo

[*****] CHF/syringe

[*****]

[*****]

[*****]

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

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Appendix 13.2.2

 

 

 

 

Country

Prescription Data

[*****]

anonymized patient longitudinal claims data provided by Symphony Health
(commonly referred to as SHA claims data)

 

[*****]

IMS LRx

 

[*****]

IMS LPD

 

[*****]

For retail-use: IMS LRx; for hospital-use: IMS MDV; for other use: tbd by the
Parties

 

[*****]

For hospital-use: IMS ward-level data; for other use: tbd by the Parties

 

[*****]

For hospital-use: IMS ward-level data; for other use: tbd by the Parties

 

[*****]

For hospital-use: IMS ward-level data; for other use: tbd by the Parties

 

 

 

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

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Appendix 17.3

 

Press Release

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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[g20171106201707525297.jpg]

 

Dermira Enters into Agreement to License Exclusive, Worldwide Rights to
Lebrikizumab

 

-

Dermira plans to develop and commercialize lebrikizumab, a monoclonal antibody
targeting IL-13, for moderate-to-severe atopic dermatitis

-

Initiation of a Phase 2b clinical study is expected in the first quarter of 2018

-

Management will host webcast and conference call today at 5:30 a.m. PT / 8:30
a.m. ET

 

MENLO PARK, Calif., August 8, 2017 – Dermira, Inc. (NASDAQ: DERM), a
biopharmaceutical company dedicated to bringing biotech ingenuity to medical
dermatology by delivering differentiated, new therapies to the millions of
patients living with chronic skin conditions, today announced that it has
entered into a licensing agreement with F. Hoffmann-La Roche Ltd and Genentech,
Inc., a member of the Roche Group (together Roche). Pursuant to the agreement,
Dermira will obtain exclusive, worldwide rights to develop and commercialize
lebrikizumab, a monoclonal antibody targeting interleukin 13 (IL-13), for atopic
dermatitis and all other indications, except Roche will retain certain rights,
including exclusive rights to develop and promote lebrikizumab for interstitial
lung diseases, such as idiopathic pulmonary fibrosis.

 

Under the terms of the agreement, Dermira will make an initial payment of $80
million to Roche and payments totaling $55 million in 2018. Dermira will also be
obligated to make additional payments upon the achievement of certain
milestones, comprising $40 million upon the initiation of Dermira’s first Phase
3 clinical study, up to $210 million upon the achievement of regulatory and
first commercial sale milestones in certain territories and up to $1.025 billion
based on the achievement of certain thresholds for net sales of lebrikizumab for
indications other than interstitial lung disease. Upon potential regulatory
approval, Dermira will make royalty payments representing percentages of net
sales that range from the high single-digits to the high teens. The
effectiveness of the agreement is subject to expiration or termination of the
waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, as
amended (HSR).

 

“Atopic dermatitis is one of the most common skin diseases in the world,
affecting millions of adults and children, and moderate to severe forms of this
condition present a tremendous burden for patients,” said Tom Wiggans, chairman
and chief executive officer of Dermira. “We believe atopic dermatitis is one of
the greatest unmet needs in dermatology, and lebrikizumab, if successfully
developed and approved, could represent a meaningful advancement in the
treatment of this disease. The addition of this program to our development
portfolio represents an important step toward our goal of building a leading
medical dermatology company dedicated to delivering differentiated, new
therapies to the millions of patients living with chronic skin conditions.”

 

Dermira plans to initiate a Phase 2b dose-ranging study assessing lebrikizumab
in adult patients with moderate-to-severe atopic dermatitis in the first quarter
of 2018. The objective of the Phase 2b dose-ranging study will be to optimize
the dose of lebrikizumab for the design of a Phase 3 program. Preliminary design
elements of the Phase 2b dose-ranging study include evaluating a

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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loading dose and higher dose regimens of lebrikizumab than were explored in
previous atopic dermatitis studies.

 

“Lebrikizumab is a potent and specific inhibitor of IL-13 with a differentiated
mechanism of action and attractive pharmacokinetic properties,” said Eugene
Bauer, M.D., chief medical officer of Dermira. “Data from preclinical and
clinical studies, including pharmacokinetic and pharmacodynamic results from
early clinical experience in atopic dermatitis, are encouraging and suggest
higher doses of lebrikizumab could lead to greater efficacy in atopic
dermatitis, while potentially offering a less frequent and therefore more
convenient dosing regimen relative to existing therapies. If successfully
developed, we believe that lebrikizumab could be a best-in-class IL-13 inhibitor
and could have a best-in-disease profile.”

 

The transaction is expected to close in the third quarter of 2017 subject to the
expiration or termination of the waiting period under HSR. Upon the close,
Dermira expects to record a charge related to the acquisition of in-process
research and development for a total of $135 million, consisting of the $80
million initial payment and $55 million of payments due in 2018. In addition,
Dermira estimates it will incur up to $10 million in operating expenses in 2017
for costs related to transferring the lebrikizumab program to Dermira and
preparing for the initiation of the Phase 2b dose-ranging study. Including the
payments to Roche and costs related to the program, Dermira anticipates that it
will spend approximately $200 million to obtain the topline results for the
Phase 2b study. Assuming the close of the transaction, Dermira anticipates that
its cash and cash equivalents and investments would be sufficient to meet its
anticipated cash requirements into the first half of 2019, consistent with
previously issued financial guidance.

 

Leerink Partners, LLC acted as financial advisor, and King & Spalding LLP and
Fenwick & West LLP acted as legal counsel to Dermira, Inc.

 

Webcast and Conference Call Information
Dermira will host a webcast and conference call today to review details of the
agreement beginning at 5:30 a.m. Pacific Time / 8:30 a.m. Eastern Time. Analysts
and investors can participate in the conference call by dialing (877) 359-9508
for domestic callers and +1 (224) 357-2393 for international callers using the
conference ID# 67835410. The webcast can be accessed live on the Investor
Relations page of Dermira’s website, http://investor.dermira.com, and will be
available for replay for 30 days following the call. A telephone replay of the
call will be available by dialing (855) 859-2056 for domestic callers or +1
(404)-537-3406 for international callers and entering the conference code:
67835410.

 

About Lebrikizumab and Phase 2 Exploratory Clinical Studies

Lebrikizumab is a novel, humanized monoclonal antibody designed to specifically
block the action of IL-13, a cytokine that is a central pathogenic mediator in
atopic dermatitis. Two exploratory Phase 2 clinical studies, TREBLE and ARBAN,
evaluated the safety and efficacy of lebrikizumab in adult patients with
moderate-to-severe atopic dermatitis. TREBLE was a double-blind,
placebo-controlled study that evaluated the safety and efficacy of lebrikizumab
in combination with topical corticosteroids. ARBAN was an open-label study
designed to assess the safety of lebrikizumab as a monotherapy, with an
exploratory assessment of efficacy. In both studies, clinical improvements were
observed in patients treated with lebrikizumab. Adverse event rates were
generally similar between treatment groups in each trial and most were mild or
moderate in severity. Additional studies are needed to fully assess the
potential benefits and risks of lebrikizumab.

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

 

About Atopic Dermatitis

Atopic dermatitis is the most common and severe form of eczema, a chronic
inflammatory condition that can present as early as childhood and continue into
adulthood. A moderate-to-severe form of the disease is characterized by rashes
on the skin that often cover much of the body and can include redness, cracking,
dryness and intense, persistent itching. Moderate-to-severe atopic dermatitis
has a profound negative impact on patients’ mental and physical functioning,
limiting their activities and health-related quality of life. Patients with
moderate-to-severe atopic dermatitis have reported a larger impact on quality of
life than patients with psoriasis.

 

About Dermira

Dermira is a biopharmaceutical company dedicated to bringing biotech ingenuity
to medical dermatology by delivering differentiated, new therapies to the
millions of patients living with chronic skin conditions. Dermira is committed
to understanding the needs of both patients and physicians and using its insight
to identify and develop leading-edge medical dermatology programs. Dermira’s
pipeline includes three late-stage product candidates that could have a profound
impact on the lives of patients: CIMZIA® (certolizumab pegol), for which
marketing applications have been submitted for potential approval for the
treatment of moderate-to-severe chronic plaque psoriasis, in collaboration with
UCB Pharma S.A.; glycopyrronium tosylate (formerly DRM04), which has completed a
Phase 3 program for the treatment of primary axillary hyperhidrosis (excessive
underarm sweating); and olumacostat glasaretil (formerly DRM01), in Phase 3
development for the treatment of acne vulgaris. Dermira is headquartered
in Menlo Park, Calif. For more information, please visit http://www.dermira.com.

 

In addition to filings with the Securities and Exchange Commission (SEC), press
releases, public conference calls and webcasts, Dermira uses its website
(www.dermira.com) and LinkedIn page
(https://www.linkedin.com/company/Dermira-inc) as channels of distribution of
information about its company, product candidates, planned financial and other
announcements, attendance at upcoming investor and industry conferences and
other matters. Such information may be deemed material information
and Dermira may use these channels to comply with its disclosure obligations
under Regulation FD. Therefore, investors should monitor Dermira’s website and
LinkedIn page in addition to following its SEC filings, press releases, public
conference calls and webcasts.

 

Dermira® is a registered trademark owned by Dermira, Inc.

 

Forward-Looking Statements

The information in this press release contains forward-looking statements and
information within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
which are subject to the “safe harbor” created by those sections. This press
release contains forward-looking statements that involve substantial risks and
uncertainties, including statements with respect to: effectiveness of the
agreement and expiration or termination of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act, as amended; Dermira’s plan to
develop and commercialize lebrikizumab for moderate-to-severe atopic dermatitis;
the expected timing for initiation of a Phase 2b dose-ranging study of
lebrikizumab for moderate-to-severe atopic dermatitis; the potential payments by
Dermira to Roche, including the initial payment, payments in 2018, payment upon
initiation of Dermira’s first Phase 3 clinical study of lebrikizumab, payments
based on achievement of regulatory and first

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

commercial sale milestones, milestone payments based on the achievement of
certain thresholds for net sales and royalty payments representing percentages
of net sales; lebrikizumab potentially representing a meaningful advancement in
the treatment of atopic dermatitis if successfully developed and approved;
Dermira’s goal of building a leading medical dermatology company dedicated to
delivering differentiated, new therapies to the millions of patients living with
chronic skin conditions; the objective and design elements of the planned Phase
2b dose-ranging study; the potential that higher doses of lebrikizumab could
lead to greater efficacy in atopic dermatitis while potentially offering a less
frequent and therefore more convenient dosing regimen relative to existing
therapies; the possibility of lebrikizumab becoming a best-in-class IL-13
antibody and having a best-in-disease profile if successfully developed;
lebrikizumab potentially playing an important role in addressing the unmet need
for certain conditions, including atopic dermatitis; the anticipated timing for
closing of the transaction; the charge related to the acquisition of in-process
research and development expected to be recorded upon the closing; estimated
operating expenses in 2017 for costs related to transferring the lebrikizumab
program to Dermira and preparing for the initiation of the Phase 2b dose-ranging
study; estimated spend to obtain the topline results for the Phase 2b study; and
the expectation that Dermira’s cash and cash equivalents and investments will be
sufficient to meet its anticipated cash requirements into the first half of
2019. These statements deal with future events and involve known and unknown
risks, uncertainties and other factors that may cause actual results,
performance or achievements to be materially different from the information
expressed or implied by these forward-looking statements. Factors that could
cause actual results to differ materially include risks and uncertainties such
as those relating to the design, implementation and outcomes of Dermira’s
clinical trials; Dermira’s dependence on third-party clinical research
organizations, manufacturers and suppliers; the outcomes of future meetings with
regulatory agencies; and Dermira’s ability to continue to stay in compliance
with applicable laws and regulations. You should refer to the section entitled
“Risk Factors” set forth in Dermira’s Annual Report on Form 10-K, Dermira’s
Quarterly Reports on Form 10-Q and other filings Dermira makes with the SEC from
time to time for a discussion of important factors that may cause actual results
to differ materially from those expressed or implied by Dermira’s
forward-looking statements. Furthermore, such forward-looking statements speak
only as of the date of this press release. Dermira undertakes no obligation to
publicly update any forward-looking statements or reasons why actual results
might differ, whether as a result of new information, future events or
otherwise, except as required by law.

 

 

Contacts:

 

Media:

Erica Jefferson

Senior Director, Head of Corporate Communications

650-421-7216

media@dermira.com

 

Investors:

Ian Clements, Ph.D.

Vice President, Investor Relations

650-422-7753

investor@dermira.com

 

Robert H. Uhl

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

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

CONFIDENTIAL TREATMENT REQUESTED

 

 

Westwicke Partners

Managing Director

858-356-5932

robert.uhl@westwicke.com

 

[*****] Certain portions denoted with an asterisk have been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.