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Confidential treatment requested under 17 C.F.R. §§ 200.80(b)(4) and 240.24b-2.
The   confidential portions of this exhibit have been omitted and are marked
accordingly.

EXECUTION COPY

The confidential portions have been filed separately with the Securities and
Exchange   Commission pursuant to a confidential treatment request.            
                                                                               
                 

SETTLEMENT AGREEMENT

 This Settlement Agreement (this “Agreement”) is made as of the last date upon
which a Party hereto signs this Agreement (“Execution Date”), by and between
BioSpecifics Technologies Corp., a corporation organized and existing under the
laws of the State of Delaware and having its principal office at 35 Wilbur
Street, Lynbrook, New York 11563, and its affiliates (collectively, “BTC”), and
Auxilium Pharmaceuticals, Inc., a corporation organized and existing under the
laws of the State of Delaware and having its principal office at 40 Valley
Stream Parkway, Malvern, PA 19355 (“Auxilium”). BTC and Auxilium shall sometimes
be referred to herein individually as a “Party” and collectively as “Parties.”

RECITALS

WHEREAS, the Parties were engaged in a mediation to settle, inter alia, their
disagreements relating to the inventorship of U.S. Patent No. 7,811,560 (the
“’560 Patent”) and the Amended and Restated Development and License Agreement
between the Parties dated December 11, 2008 (the “License”), which mediation
terminated without resolution on December 31, 2010 (the “IP Mediation”);

WHEREAS, on February 15, 2011, Auxilium filed a complaint in the Court of Common
Pleas of the Commonwealth of Pennsylvania, Chester County (the “Court of Common
Pleas”), against BTC, captioned Auxilium Pharmaceuticals, Inc. v. BioSpecifics
Technologies Corp., No. 11-01620, alleging that BTC breached the License by its
commencement of clinical trials for the use of injectable collagenase to treat
canine lipomas without the prior knowledge and approval of the parties’ Joint
Development Committee (the “February Pennsylvania Litigation”);

WHEREAS, on May 2, 2011, BTC filed a complaint in the Supreme Court of the State
of New York, Nassau County, Commercial Division (the “Supreme Court”), against
RecipharmCobra Holdings Limited (“RCHL”), Recipharm AB, (“RAB” and together with
RCHL, “Recipharm”) and Auxilium, captioned BioSpecifics Technologies Corp. v.
Recipharm AB, RecipharmCobra Holdings Limited and Auxilium Pharmaceuticals,
Inc., No. 600341/2011, claiming Auxilium breached an oral contract with BTC,
converted BTC’s intellectual property, and interfered with a contract BTC has
with Recipharm (the “NY Litigation”);

WHEREAS, on June 28, 2011, Auxilium filed a complaint in the Court of Common
Pleas, against BTC, captioned RecipharmCobra Holdings Limited and Auxilium
Pharmaceuticals, Inc. v. BioSpecifics Technologies Corp., No. 11-07184,
requesting declaratory judgment with respect to BTC’s allegations set forth in
the NY Litigation (the “June Pennsylvania Litigation”);

WHEREAS, on April 28, 2011, pursuant to Section 13.2 of the License, BTC
demanded mediation of a dispute regarding the amount BTC owes Auxilium for BTC’s
share of lyophilization development costs under Section 6.2 of the License (the
“Lyophilization Dispute”);

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WHEREAS, the Parties have articulated or referred to various other disagreements
arising from or relating to the License (together with all foregoing
disagreements defined herein as the “Matters in Dispute”); and

WHEREAS, the Parties desire to settle the Matters in Dispute, and any other
dispute that each may now have against the other, on the terms and conditions
set forth below;

WHEREFORE, in consideration of the mutual covenants and undertakings set out
herein, as well as in the Second Amended and Restated Development and License
Agreement executed concurrently herewith (the “Second Amended and Restated DLA”)
and other good and valuable consideration the sufficiency of which is hereby
acknowledged, the Parties, intending to be bound, agree as follows:

Section 1. Releases, [**] Agreement and Dismissal of Litigations

1.1 Except as provided for in Section 1.3, as of the Effective Date, each Party,
on behalf of itself and its present and former affiliates, agents, directors,
officers, employees, attorneys, and the successors and assignees of each does
hereby release, waive, forever discharge, and hold harmless each other and their
present and former affiliates, agents, directors, officers, employees,
consultants, attorneys, and the successors and assignees of each, of, from, and
with respect to, any and all liabilities, losses, damages, charges, complaints,
claims, counterclaims, obligations, promises, agreements, controversies,
actions, causes of action, suits, rights, demands, costs, debts and expenses
(including attorneys fees and court costs) of any nature whatsoever, known or
unknown, suspected or unsuspected that may have arisen before the Effective
Date, which the Parties at any time hereafter may have, own or hold, or claim to
have, own or hold against each other, including but not limited to any claims or
counterclaims that were brought or could have been brought in the IP Mediation,
the February Pennsylvania Litigation, the NY Litigation, the June Pennsylvania
Litigation, the Lyophilization Dispute, or any other of the Matters in Dispute.

1.2 As of the Effective Date, BTC, on behalf of itself and its present and
former affiliates, agents, directors, officers, employees, attorneys, and the
successors and assignees does hereby release, waive, forever discharge, and hold
harmless Cobra Manufacturing Plc, RecipharmCobra Biologics Limited, Recipharm
(collectively referred to as “Cobra”) and their present and former affiliates,
agents, directors, officers, employees, consultants, attorneys, and the
successors and assignees, of, from, and with respect to any and all liabilities,
losses, damages, charges, complaints, claims, counterclaims, obligations,
promises, agreements, controversies, actions, causes of action, suits, rights,
demands, costs, debts and expenses (including attorneys fees and court costs) of
any nature whatsoever, known or unknown, suspected or unsuspected that may have
arisen before the Effective Date relating to the Materials Transfer Agreement
dated February 29, 2004 between BTC and Cobra (“MTA”), which BTC at any time
hereafter may have, own or hold, or claim to have, own or hold against Cobra,
including but not limited to, any claims that were brought or could have been
brought in the NY Litigation or the June Pennsylvania Litigation. For the
avoidance of doubt, BTC hereby waives and releases any claims that the MTA
conveys patent or inventorship rights from Cobra to BTC. BTC and Auxilium
warrant that the provisions of this paragraph are not subject to any actions of
either BTC or Auxilium other than those set forth in Section 4 herein.

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

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1.3 Auxilium [**], and the Parties shall execute a [**] agreement [**] in the
form attached as Exhibit A (the “[**] Agreement”), which [**] Agreement shall be
incorporated herein by reference.

1.4 Within one (1) business day after the Execution Date and the execution of
the Second Amended and Restated DLA, in connection with (a) the February
Pennsylvania Litigation, Auxilium agrees to execute and file with the Chester
County Court of Common Pleas the Praecipe to Settle, Discontinue and End the
February Pennsylvania Litigation with prejudice, in the form attached hereto as
Exhibit B, and (b) the June Pennsylvania Litigation, Auxilium agrees to, and
cause RCHL, to execute and file with the Chester County Court of Common Pleas
the Praecipe to Settle, Discontinue and End the June Pennsylvania Litigation
with prejudice, in the form attached hereto as Exhibit C (the “June Pennsylvania
Stipulation of Dismissal”).

1.5 Within one (1) business day after the Execution Date and execution of the
Second Amended and Restated DLA, in connection with the NY Litigation, BTC
agrees to execute and file with the Supreme Court the Stipulation of
Discontinuance of the NY Litigation with prejudice, in the form attached hereto
as Exhibit D.

Section 2. Patents

2.1 Within one (1) business day after the Execution Date and the execution of
the Second Amended and Restated DLA, Auxilium will cause the execution of
assignments of all patents and patent applications claiming priority to either
U.S. Application No. 60/763,470 or U.S. Application No. 60/784,135 in the two
(2) forms attached as Exhibit E to this Agreement, and BTC shall execute an
assignment of certain intellectual property rights in the form attached as
Exhibit F (with the foregoing assignments collectively referred to as the
“Assignments”).Upon the Effective Date, BTC acknowledges that it has a duty to
disclose material information to Auxilium regarding such patent applications.
The Parties acknowledge and agree that the Assignments are not effective or
legally binding until the Effective Date.

2.2 BTC will file with the U.S. Patent and Trademark Office (“USPTO”), a request
to expressly abandon in the form of USPTO’s Form PTO/SB/24 U.S. Application Nos.
12/759,065 and 12/837,933 within one (1) day after the Effective Date.

2.3 Auxilium, in the reasonable exercise of its commercial discretion and in
accord with Section 8.1 and Section 13.4 of the License (as amended and restated
in the Second Amended and Restated DLA) shall continue to make all decisions
regarding whether and how to file, prepare, prosecute, maintain, renew, and
defend any and all subsequent applications claiming priority to U.S. Application
No. 60/763,470 or U.S. Application No. 60/784,135, including any reissue,
reexamination, divisional, continuation-in-part, extension or continuation
thereof and all rights of priority under the International Convention arising
from said applications.

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

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Section 3. Credits Against Royalties; Waiver

3.1 BTC agrees that it owes Auxilium $[**] in full and final settlement for its
share of the Parties’ lyophilization costs under the License, with Auxilium to
credit this amount against Auxilium’s future royalty payments to BTC. The
Parties recognize that this resolves the Lyophilization Dispute, and BTC hereby
and accordingly cancels its April 2011 request to mediate the Lyophilization
Dispute.

3.2 BTC agrees that it owes Auxilium $[**] in full and final settlement of its
share of the Parties’ patent costs arising under § 8.1(c)(i)(A) of the License
through June 30, 2011, with Auxilium to credit this amount against Auxilium’s
future royalty payments to BTC.

3.3 The Parties agree that, as of June 30, 2011, Auxilium already has credited
$[**] against Auxilium’s past royalty payments to BTC, and thus shall credit
$[**] from future royalty payments to BTC to satisfy Sections 3.1 and 3.2
herein.

Section 4.Conditions

4.1 The Parties acknowledge and agree that this Agreement, and the Assignments,
shall neither be effective nor legally binding upon the Parties unless and until
all of the following occur (the date on which the last occurs shall be the
“Effective Date”):

(a) the Parties shall have executed the Second Amended and Restated DLA, in the
form attached as Exhibit G to this Agreement, to further amend the License, and
the other documents attached as Exhibits A-F;

(b) the Parties shall have (i) filed with the Pennsylvania Court of Common
Pleas, Chester County, signed Praecipes to Settle, Discontinue and End with
prejudice (in the form attached hereto as Exhibits B and C), so as to dismiss
the February Pennsylvania Litigation and the June Pennsylvania Litigation with
prejudice, and (ii) filed with the Supreme Court of the State of New York,
County of Nassau, a signed Stipulation of Discontinuance with prejudice (in the
form attached hereto as Exhibit D), so as to dismiss the NY Litigation with
prejudice; and

(c) The Parties shall have executed the Assignments.

Section 5. Arbitration of Inventorship

5.1 Following the Effective Date, the Parties agree to arbitrate the following
issues: (1) whether Bo Yu and/or Thomas Wegman should be added as joint
inventors of the ‘560 Patent (and its foreign equivalents) under 35 U.S.C. §
256, and (2) whether Bo Yu and/or Thomas Wegman should be listed as joint
inventors for certain Proposed Claims (as defined below) (the “Arbitration”).
The Parties further agree that inventorship will be the only issue submitted in
the Arbitration.

5.2 For purposes of the Arbitration, each Party may propose an initial list of
up to five (5) claims (both lists together are referred to as the “Proposed
Claims”) that will be arbitrated to determine whether Bo Yu and/or Thomas Wegman
should be listed as joint inventors for each Proposed Claim. Each Party shall
have the right to add to or modify its initial list within ten (10) days after
receiving the other Party’s initial list, but in no event may a Party propose
more than five (5) claims.

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

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5.3 The Parties agree to use their reasonable commercial efforts to conclude the
Arbitration within nine (9) months of the Effective Date.

5.4 The Parties will select one arbitrator (the “Arbitrator”) having appropriate
expertise in U.S. Patent Law by mutual agreement no later than the date that is
ten (10) business days after the Effective Date, or such later date as the
Parties may mutually agree (the “Selection Date”). If the Parties fail to
mutually agree upon the Arbitrator by the Selection Date, the Arbitrator will be
chosen by the International Institute for Conflict Prevention and Resolution
(“CPR”). CPR will choose the Arbitrator by requiring the Parties to agree on a
list of no more than five (5) candidates for Arbitrator and for each Party then
to submit to CPR within ten (10) business days after the Selection Date its
ranking of the candidates on the list, in order of preference. CPR will compute
the candidates’ combined scores, break any ties at CPR’s discretion, and advise
the Parties of the chosen Arbitrator.

5.5 For the economy of the proceedings, each side will be limited to three (3)
hours combined for opening and closing statements and to twenty (20) hours of
testimony (including direct, cross, re-direct, etc., for the entirety of the
proceeding). Each Party is free to submit written materials to the Arbitrator in
addition to those materials submitted to Harrie Samaras in connection with the
Mediation. The Parties agree that the materials submitted to the Arbitrator will
be limited to the issue of inventorship.

5.6

The Parties will limit discovery and pre-arbitration proceedings as follows:

    (a)

Within sixty (60) days after selecting the Arbitrator, the Parties will exchange
documents that they intend to rely upon to prove or disprove that Bo Yu and/or
Thomas Wegman should be listed as joint inventors on the ‘560 Patent and the
Proposed Claims. The Parties agree to produce complete documents and not
excerpts thereof. Within thirty (30) days of such production, each Party may
request the production of additional documents pertaining to the documents
produced, or may produce additional documents.

    (b)

Within sixty (60) days after the Parties’ exchange of documents concludes, the
Parties shall exchange their lists of fact and expert witnesses, and BTC shall
submit to Auxilium any expert reports it intends to submit

    (c)

Sixty (60) days thereafter, Auxilium shall submit to BTC any expert reports it
intends to submit.

    (d)

The Parties shall determine with the Arbitrator the dates upon which they shall
(i) each submit a pre-arbitration brief of no more than forty (40) pages, (ii)
jointly submit a final pre-arbitration order setting forth the order of
witnesses and exhibit lists, and (iii) schedule the arbitration hearing.

        (e) The Parties agree that the Arbitrator shall have the power
throughout to resolve any disputes regarding the production of documents or
testimony of the Parties’ witnesses. The Parties agree to comply with any
discovery order of the Arbitrator.

  ** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

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5.7 The Parties stipulate to (1) the admissibility of documentary evidence over
hearsay objections and (2) the admissibility of documentary evidence in the
arbitration without the need for authentication.

5.8 The Arbitrator will produce a reasoned written decision of no more than ten
(10) pages concerning the inventorship issues submitted to Arbitration. Such
decision will be confidential except to the extent the Parties agree otherwise.
Within five (5) days after a final decision is rendered by the Arbitrator, the
Parties shall file a letter, substantially in the form provided in Exhibit H to
this Agreement, with the USPTO Board of Patent Appeals and Interferences
informing the Board of BTC’s request for the declaration of an interference and
of the Parties’ agreement settling all issues that could have been adjudicated
had such an interference been declared, and offering to file this Agreement and
the Second Amended and Restated DLA, under seal, in the USPTO. If requested or
authorized by the USPTO, the Parties shall file this Settlement Agreement and
the Second Amended and Restated DLA, in the USPTO within five (5) days after the
Board’s response to the letter.

5.9 If the Arbitrator decides that Bo Yu and/or Thomas Wegman are joint
inventors of the ‘560 Patent, Auxilium agrees to execute and file the necessary
documents to add him or them as inventors of the ‘560 Patent, and BTC shall
cause Bo Yu and/or Thomas Wegman to execute all documents reasonably necessary
in conjunction with this section.

5.10 If the Arbitrator decides that Bo Yu and/or Thomas Wegman are joint
inventors of any of the Proposed Claims, Auxilium agrees to list Bo Yu and/or
Thomas Wegman on any continuation, divisional, or continuation-in-part
application that includes any such Proposed Claim. Auxilium shall have the right
to designate any such Proposed Claim as being a BTC Patent subject to Section
8.1 of the Second Amended and Restated DLA and indicate whether Auxilium does or
does not intend to file for patent protection, or does or does not wish to
continue preparation, prosecution, or maintenance of an application that
contains any such Proposed Claim. If Auxilium does not intend to file or to
continue preparation, prosecution, or maintenance of such application, BTC shall
have the rights set forth in that Section 8.1(a) to elect at its sole discretion
to continue preparing, filing, prosecuting, or maintaining the discontinued BTC
Patent at its sole expense. BTC shall cause Bo Yu and/or Thomas Wegman to assign
all of their rights, title and interest in such applications and the inventions
claimed therein jointly to Auxilium and BTC.

5.11 Irrespective of the decision of the Arbitrator, there will be no change to
(i) the Parties’ co-ownership of the ‘560 Patent as conferred herein and by the
Assignments, and (ii) the Parties’ rights and limitations as set forth in the
Second Amended and Restated DLA.

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

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Section 6.General

6.1 Governing Law The Parties agree that this Agreement will be governed by and
construed in accordance with the laws of the State of New York, without regard
to conflict of laws principles.

6.2 Fees and Costs The Parties agree to pay their own attorneys fees and costs
related to settlement of the Matters in Dispute, the Arbitration, and the
preparation of this Agreement. Auxilium and BTC will share equally the fees
charged by the Arbitrator.

6.3 Entire Agreement This Agreement, together with the Second Amended and
Restated DLA, the [**] Agreement and the Assignments, expresses the Parties’
entire understanding regarding the subject matter of this Agreement. This
Agreement is final and may not be amended, modified, or changed, and no waiver
of any provision of this Agreement shall be effective, except by an instrument
in writing signed by the Party(ies) against whom the amendment, modification,
change, or waiver is sought to be enforced.

6.4 Waiver No relaxation, forbearance, delay, or indulgence by any Party in
enforcing its rights hereunder or the granting of time by such Party shall
prejudice or affect its rights hereunder, and no waiver by any Party shall
operate as a waiver of any subsequent or continuing breach.

6.5 Severability If any provision of this Agreement is determined by a court of
competent jurisdiction to be invalid or unenforceable, such determination shall
not affect the validity or enforceability of any other provision of this
Agreement. Upon such determination that any such provision, or any portion
thereof, is invalid or unenforceable, the Parties shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner to the end that the transactions
contemplated hereby are consummated to the fullest extent possible.

6.6 Consultation with Counsel The Parties each acknowledge that they have had
the opportunity to consult with legal counsel of their choice prior to execution
of this Agreement, have in fact done so, and have been specifically advised by
counsel of the consequences of this Agreement and their respective rights and
obligations hereunder.

6.7 Construction The Parties each acknowledge that the terms of this Agreement
are the result of negotiations between them, and that this Agreement shall not
be construed in favor of, or against, any Party by reason of the extent to which
a Party or its counsel participated in its drafting, or by reason of the extent
to which this Agreement may be inconsistent with prior drafts thereof.

6.8 Confidentiality The Parties agree to keep the terms of this Agreement and
any documents or other information delivered pursuant to the terms of this
Agreement (collectively, “Information”) confidential for the term of Second
Amended and Restated DLA, except with regard to (i) the Assignments, (ii)
disclosures in accordance with Section 5.8 hereof, and/or (iii) as otherwise may
be required by law (including compliance with the requirements of United States
and foreign governmental authorities) or the rules of any United States or
foreign stock exchanges. If a Party is required by judicial or administrative
process to disclose any Information, it shall, to the extent possible, promptly
notify the other Party and allow the other Party a reasonable time to oppose
such process or seek a protective order from a court of competent jurisdiction.

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

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6.9 Counterparts This Agreement may be executed in counterparts, delivered by
fax or electronic mail, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument representing the
agreement of the Parties to this Agreement.

6.10 Authority Each person signing this Agreement in a representative capacity
expressly represents that the signatory has the subject Party’s authority to so
sign and that the subject Party will be bound by the signatory’s execution of
this Agreement. Each Party expressly represents that such Party does not require
any third party’s consent to enter into this Agreement, including, without
limitation, the consent of any spouse, insurer, assignee, licensee, secured
lender, or regulatory agency.

6.11 Headings and Captions Headings and captions used in this Agreement are for
ease of reference only, and do not constitute part of this Agreement, nor shall
they be used as an aid in the construction hereof.

 

 

 

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IN WITNESS WHEREOF, intending to be legally bound, the Parties hereto have
caused this Agreement to be executed by their duly authorized representatives as
of the date last written below.

AUXILIUM PHARMACEUTICALS, INC.         By: /s/ Armando
Anido                                                   Dated: August 31, 2011  
Name: Armando Anido     Title: Chief Executive Officer and President    
BIOSPECIFICS TECHNOLOGIES CORP.   on behalf of itself and its affiliates        
By: /s/ Thomas L. Wegman                                          Dated: August
31, 2011   Name: Thomas L. Wegman     Title: President  

9

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EXHIBIT A
[**]  Agreement

[**] AGREEMENT

This [**] Agreement is entered into between and among BioSpecifics Technologies
Corp., a corporation organized and existing under the laws of Delaware and
having its principal office at 35 Wilbur Street, Lynbrook, New York 11563, and
its affiliates (“BTC”), and Auxilium Pharmaceuticals, Inc., a corporation
organized and existing under the laws of the State of Delaware and having its
principal office at 40 Valley Stream Parkway, Malvern, PA 19355 and its
affiliates (“Auxilium”).

WHEREAS, [**]; and

WHEREAS, BTC and Auxilium (collectively “the Parties”) agree to [**].

NOW, THEREFORE, in consideration of the mutual covenants herein contained, and
intending to be legally bound hereby, the Parties hereto agree as follows: [**].

The Parties [**].

 

 

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

A-1

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This [**] Agreement may be modified, amended, or supplemented only by a written
instrument signed by all of the Parties.

IN WITNESS WHEREOF, and intending to be legally bound, the Parties hereto
execute this [**] Agreement.

AUXILIUM PHARMACEUTICALS, INC.
on behalf of itself and its affiliates

By: /s/ Armando Anido                                                         
Dated: August 31, 2011   Name: Armando Anido     Title: Chief Executive Officer
and President     BIOSPECIFICS TECHNOLOGIES CORP.   on behalf of itself and its
affiliates       By: /s/ Thomas L.
Wegman                                                  Dated: August 31, 2011  
Name: Thomas L. Wegman     Title: President  

 

** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST.

A-2

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EXHIBIT B
Praecipe to Settle, Discontinue and End
for February Pennsylvania Litigation

                                                       FILINGS UNDER SEAL      
                                                 BY ORDER OF COURT              
                         DATED FEBRUARY 16, 2011 LAMB McERLANE PC        
 BALLARD SPAHR LLP Joel L. Frank (ID No. 46601)          Robert R. Baron, Jr.
(ID No. 67084) John J. Cunningham, IV (ID No. 70975)          Marc S. Segal (ID
No. 84474) 24 E. Market St., Box 565          Marcel S. Pratt (ID No. 307483)
West Chester, PA 19381          1735 Market Street, 51st Floor (610) 430-8000  
       Philadelphia, PA 19103            (215) 665-8500 Attorneys for Auxilium
Pharmaceuticals, Inc.              Attorneys for Auxilium Pharmaceuticals, Inc.
AUXILIUM PHARMACEUTICALS, INC. : 40 Valley Stream Parkway : Malvern, PA 19355, :
  : COURT OF COMMON PLEAS                                                      
                           Plaintiff, : CHESTER COUNTY

                        vs.

:   : BIOSPECIFICS TECHNOLOGIES CORP. : No. 11-01620 35 Wilbur Street :
Lynbrook, New York 11563, :   :                                                
                                 Defendant. :

PRAECIPE TO SETTLE, DISCONTINUE AND END WITH PREJUDICE

TO THE PROTHONOTARY:

Kindly mark the above-captioned action as settled, discontinued and ended, with
prejudice.

B-1

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Respectfully submitted,

By: _________________________

Joel L. Frank
John J. Cunningham, IV
LAMB McERLANE PC
24 East Market Street, P.O. Box 565
West Chester, PA 19381-0565
(610) 430-8000

Robert R. Baron, Jr.
Marc S. Segal
Marcel S. Pratt
BALLARD SPAHR LLP
1735 Market Street, 51st Floor
Philadelphia, PA 19103
(215) 665-8500

Attorneys for Plaintiff
Auxilium Pharmaceuticals, Inc.

 

 

B-2

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LAMB McERLANE PC          BALLARD SPAHR LLP Joel L. Frank (ID No. 46601)        
 Robert R. Baron, Jr. (ID No. 67084) John J. Cunningham, IV (ID No. 70975)      
   Marc S. Segal (ID No. 84474) 24 E. Market St., Box 565          Marcel S.
Pratt (ID No. 307483) West Chester, PA 19381          1735 Market Street, 51st
Floor (610) 430-8000          Philadelphia, PA 19103            (215) 665-8500
Attorneys for Auxilium Pharmaceuticals, Inc.              Attorneys for Auxilium
Pharmaceuticals, Inc. AUXILIUM PHARMACEUTICALS, INC. : 40 Valley Stream Parkway
: Malvern, PA 19355, :   : COURT OF COMMON PLEAS                                
                                                 Plaintiff, : CHESTER COUNTY

             vs.

:   : BIOSPECIFICS TECHNOLOGIES CORP. : No. 11-01620 35 Wilbur Street :
Lynbrook, New York 11563, :   :                                                
                                 Defendant. :

CERTIFICATION OF SERVICE

This is to certify that a complete copy of the foregoing Praecipe to Settle,
Discontinue and End With Prejudice has been served upon the following
individuals, by the following means

and on the date stated below:     Name: Means of Service: Date of Service:
Anthony R. Twardowski, Esq. via First Class Mail   Zarwin, Baum, DeVito, Kaplan
    Schaeer & Toddy, PC     1818 Market Street, 13th Floor     Philadelphia, PA
19103     artwardowski@zarwin.com     (Attorneys for BioSpecifics    
Technologies Corp.)    

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Gerald Zingone, Esquire
Carl A. Valenstein, Esquire
Bingham McCutchen LLP
2020 K Street, NW
Washington, D.C. 20006-1806
gerald.zingone@bingham.com
(Attorneys for BioSpecifics
Technologies Corp.) via First Class Mail        _____________________________  
    LAMB McERLANE PC    

By:

_______________________________
Joel L. Frank   John J. Cunningham, IV   24 East Market Street, P.O. Box 565  
West Chester,PA 19381-0565   (610) 430-8000       Attorneys for Plaintiff  
Auxilium Pharmaceuticals, Inc.

 

 

 

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EXHIBIT C
Praecipe to Settle, Discontinue and End
for June Pennsylvania Litigation

LAMB McERLANE PC VOLPE AND KOENIG PC Joel L. Frank (ID No. 46601) Anthony S.
Volpe (ID No. 24733) John J. Cunningham, IV (ID No. 70975) Ryan W. O’Donnell (ID
No. 89775) 24 East Market Street, P.O. Box 565 30 South 17th Street West
Chester, PA 19381-0565 Philadelphia, PA 19103 (610) 430-8000 (215) 568-6400
BALLARD SPAHR LLP Attorneys for Plaintiff Robert R. Baron, Jr. (ID No. 67084)
RecipharmCobra Holdings Limited Marc S. Segal (ID No. 84474)     Marcel S. Pratt
(ID No. 307483)     1735 Market Street, 51st Floor     Philadelphia, PA 19103  
  (215) 665-8500     Attorneys for Plaintiff Auxilium Pharmaceuticals, Inc.  
RECIPHARMCOBRA HOLDINGS LIMITED, : COURT OF COMMON PLEAS OF and AUXILIUM
PHARMACEUTICALS, INC. : CHESTER COUNTY   :                                      
                                             Plaintiffs, : NO. 11-07184   :   v.
:     :   BIOSPECIFICS TECHNOLOGIES CORP. :     :                              
                                                     Defendant.    

PRAECIPE TO SETTLE, DISCONTINUE AND END WITH PREJUDICE

TO THE PROTHONOTARY:

Kindly mark the above-captioned action as settled, discontinued and ended, with
prejudice.

 

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By:             _______________________________ By:            
_____________________________                    Anthony S. Volpe              
     Joel L. Frank                    Ryan W. O’Donnell                    John
J. Cunningham, IV                    VOLPE AND KOENIG PC                    LAMB
McERLANE PC                    30 South 17th Street                    24 East
Market Street, P.O. Box 565                    Philadelphia, PA 19103          
         West Chester, PA 19381-0565                    (215) 568-6400          
         (610) 430-8000                        Attorneys for Plaintiff
RecipharmCobra                    Robert R. Baron, Jr.                  
 Holdings Limited                    Marc S. Segal                      Marcel
S. Pratt                      BALLARD SPAHR LLP                      1735 Market
Street, 51st Floor                      Philadelphia, PA 19103                  
   (215) 665-8500                          Attorneys for Plaintiff              
       Auxilium Pharmaceuticals, Inc.

 

 

 

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LAMB McERLANE PC VOLPE AND KOENIG PC Joel L. Frank (ID No. 46601) Anthony S.
Volpe (ID No. 24733) John J. Cunningham, IV (ID No. 70975) Ryan W. O’Donnell (ID
No. 89775) 24 East Market Street, P.O. Box 565 30 South 17th Street West
Chester, PA 19381-0565 Philadelphia, PA 19103 (610) 430-8000 (215) 568-6400
BALLARD SPAHR LLP Attorneys for Plaintiff Robert R. Baron, Jr. (ID No. 67084)
RecipharmCobra Holdings Limited Marc S. Segal (ID No. 84474)     Marcel S. Pratt
(ID No. 307483)     1735 Market Street, 51st Floor     Philadelphia, PA 19103  
  (215) 665-8500     Attorneys for Plaintiff Auxilium Pharmaceuticals, Inc.  
RECIPHARMCOBRA HOLDINGS LIMITED, : COURT OF COMMON PLEAS OF and AUXILIUM
PHARMACEUTICALS, INC. : CHESTER COUNTY   :                                      
                                             Plaintiffs, : NO. 11-07184   :   v.
:     :   BIOSPECIFICS TECHNOLOGIES CORP. :     :                              
                                                     Defendant.    

CERTIFICATE OF SERVICE

This is to certify that a complete copy of the foregoing Praecipe to Settle,
Discontinue and End With Prejudice has been served upon the following
individuals, by the following means and on the date stated below:

Name: Means of Service: Date of Service: BioSpecifics Technologies Corporation
via First Class Mail   35 Wilbur Street     Lynbrook, New York 11563    

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    Anthony R. Twardowski, Esq.
Zarwin, Baum, DeVito, Kaplan
Schaeer & Toddy, PC
1818 Market Street, 13th Floor
Philadelphia, PA 19103
artwardowski@zarwin.com
(Attorneys for BioSpecifics
Technologies Corp.)   via First Class Mail        _____________________________
   

Gerald Zingone, Esquire
Carl A. Valenstein, Esquire
Bingham McCutchen LLP
2020 K Street, NW
Washington, D.C. 20006-1806
gerald.zingone@bingham.com
(Attorneys for BioSpecifics
Technologies Corp.)  

via First Class Mail        _____________________________

LAMB McERLANE PC

By:____________________________
       Joel L. Frank
       John J. Cunningham, IV
       24 East Market Street, P.O. Box 565
       West Chester, PA 19381-0565
      (610) 430-8000

      Attorneys for Plaintiff
      Auxilium Pharmaceuticals, Inc.

 

 

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EXHIBIT D
Stipulation of Discontinuance for NY Litigation

SUPREME COURT OF THE STATE OF NEW YORK   COUNTY OF NASSAU  
----------------------------------------------------------X   BIOSPECIFICS
TECHNOLOGIES CORP., Index No. 600341/2011                                      
                                           Plaintiff,   -against- STIPULATION  
OF DISCONTINUANCE RECIPHARM AB, RECIPHARMCOBRA   HOLDINGS LIMITED, and AUXILIUM
  PHARMACEUTICALS, INC.,                                                        
                           Defendants.  
----------------------------------------------------------X  

IT IS HEREBY STIPULATED AND AGREED, by and between the attorneys for the
undersigned parties that whereas no party hereto is an infant or incompetent
person for whom a committee has been appointed, and no person not a party has an
interest in the subject matter of the action, the above entitled action be, and
the same hereby is, discontinued as against the defendants with prejudice, and
without costs to any party. This stipulation may be filed with the Court without
further notice.

Dated: August __, 2011

BINGHAM McCUTCHEN LLP CULLEN AND DYKMAN LLP
    By: _________________________
         Daniel Gimmel
         Attorneys for Plaintiff
         399 Park Avenue
         New York, New York 10022

By: _________________________
       Douglas J. Bohn
       Attorneys for Defendant
      Auxilium Pharmaceuticals, Inc.
      100 Quentin Roosevelt Blvd.
      Garden City, New York 11530

 

FARRELL FRITZ, P.C.

By:                    John P. McEntee                    Attorneys for
Defendants                    RecipharmCobra Holding                    Limited
and Recipharm AB

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1320 RXR Plaza
Uniondale, New York 11556

 

 

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EXHIBIT E
Assignments from Auxilium to Auxilium and BTC

ASSIGNMENT

WHEREAS, Auxilium US Holdings, LLC, a limited liability company organized and
existing under the laws of the State of Delaware and having its principal office
at 1105 N. Market Street, Suite 1300, Wilmington, DE 19801 (“Auxilium”), a
wholly owned subsidiary of Auxilium Pharmaceuticals, Inc., is owner of the
entire right, title and interest in the invention entitled “Compositions and
Methods for Treating Collagen-Mediated Diseases” for which a United States
Patent Application was filed on January 29, 2007, and assigned Application No.
11/699,302, which issued as U.S. Patent No. 7,811,560 on October 12, 2010 (the
“’560 Patent”), and is also the owner of the right to claim priority to U.S.
Application No. 60/763,470 and U.S. Application No. 60/784,135 (“Provisional
Applications”); and

WHEREAS, BioSpecifics Technologies Corp., a corporation organized and existing
under the laws of Delaware and having its principal office at 35 Wilbur Street,
Lynbrook, New York 11563 (“BTC”), desires to acquire an undivided interest in
the ‘560 Patent along with Auxilium (Auxilium and BTC are collectively referred
to as the “Assignees”);

NOW, THEREFORE, for good and valuable consideration as set forth in separate
agreements between Auxilium Pharmaceuticals, Inc. and BTC, the receipt of which
is hereby acknowledged, Auxilium and BTC agree as follows:

1. Auxilium does hereby sell, assign and transfer unto said Assignees, the
entire right, title and interest in and to said invention and application
throughout the world, including, without limitation, the ‘560 Patent, the right
to claim priority to the Provisional Applications, and any subsequent
application claiming priority to the Provisional Applications, reissue,
reexamination, divisional, continuation-in-part, extension or continuation
thereof.

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2. Auxilium hereby binds itself, its legal representatives and assigns properly
to execute without further consideration any and all applications, petitions,
oaths and assignments or other papers and instruments that may be necessary in
order to carry into full force and effect, the sale, assignment, transfer and
conveyance hereby made or intended to be made.

3. Nothing in this assignment shall change the limitations on the rights of BTC
as set forth in Auxilium Pharmaceuticals, Inc.’s and BTC’s contemporaneous
Second Amended and Restated Development and License Agreement.

IN WITNESS WHEREOF, I have executed this Assignment this ____day of,
____________________20___.

Assignor, Auxilium US Holdings, LLC   By: ____________________________________-
(L.S.)   Title: __________________________________

State of  _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this ____day of,
____________________20___.

Assignee, Auxilium US Holdings, LLC

By: ____________________________________(L.S.)

Title: __________________________________

 

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State of  _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this ____day of,
____________________20___.

Assignee, BioSpecifics Technologies Corp.

By:__________________________(L.S.)

Title: _________________________

State of  _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

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ASSIGNMENT

WHEREAS, Auxilium International Holdings, Inc., a corporation organized and
existing under the laws of the State of Delaware and having its principal office
at 1105 N. Market Street, Suite 1300, Wilmington, DE 19801 (“Auxilium”), a
wholly owned subsidiary of Auxilium Pharmaceuticals, Inc., is owner of the
entire right, title and interest in the invention entitled “Compositions and
Methods for Treating Collagen-Mediated Diseases” for which a International
Patent Application was filed on January 29, 2007, and assigned Application No.
PCT/US07/02654 (the “PCT Application”), and is also the owner of the right to
claim priority to U.S. Application No. 60/763,470 and U.S. Application No.
60/784,135 (“Provisional Applications”); and

WHEREAS, BioSpecifics Technologies Corp., a corporation organized and existing
under the laws of Delaware and having its principal office at 35 Wilbur Street,
Lynbrook, New York 11563 (“BTC”), desires to acquire an undivided interest in
the PCT Application along with Auxilium (Auxilium and BTC are collectively
referred to as the “Assignees”);

NOW, THEREFORE, for good and valuable consideration as set forth in separate
agreements between Auxilium Pharmaceuticals, Inc. and BTC, the receipt of which
is hereby acknowledged, Auxilium and BTC agree as follows:

1. Auxilium does hereby sell, assign and transfer unto said Assignees, the
entire right, title and interest in and to said invention and the PCT
Application throughout the world, the right to claim priority to the Provisional
Applications, and any subsequent application claiming priority to the
Provisional Applications, including the applications listed on the Attached
Exhibit A.

2. Auxilium hereby binds itself, its legal representatives and assigns properly
to execute without further consideration any and all applications, petitions,
oaths and assignments or other papers and instruments that may be necessary in
order to carry into full force and effect, the sale, assignment, transfer and
conveyance hereby made or intended to be made.

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3. Nothing in this assignment shall change the limitations on the rights of BTC
as set forth in Auxilium Pharmaceuticals, Inc.’s and BTC’s contemporaneous
Second Amended and Restated Development and License Agreement.

IN WITNESS WHEREOF, I have executed this Assignment this day of , 20___.

Assignor, Auxilium International Holdings, Inc.

By: ____________________________  (L.S.)

Title: ___________________________

State of  _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this ____day of,
____________________20___.

Assignee, Auxilium International Holdings, Inc. By: (L.S.) Title:

State of  _________________________

County of _______________________

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On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this ____day of,
____________________20___.

Assignee, BioSpecifics Technologies Corp.

By: _____________________________(L.S.)

Title: ___________________________

State of  _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

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EXHIBIT F
Assignment from BTC to Auxilium and BTC

ASSIGNMENT

WHEREAS, BioSpecifics Technologies Corp., a corporation organized and existing
under the laws of Delaware and having its principal office at 35 Wilbur Street,
Lynbrook, New York 11563, and its affiliates (“BTC”) may have certain rights to
inventions disclosed in United States Application No. 11/699,302, which issued
as U.S. Patent No. 7,811,560, and applications claiming priority thereto
including U.S. Application Nos. 12/759,065 and 12/837,933 (collectively the
“’560 Patent”) and International Application No. PCT/US07/02654 (the “PCT
Application”), both of which claim priority to U.S. Application No. 60/763,470
and U.S. Application No. 60/784,135 (“Provisional Applications”); and

WHEREAS, Auxilium US Holdings, LLC, a limited liability company organized and
existing under the laws of the State of Delaware and having its principal office
at 1105 N. Market Street, Suite 1300, Wilmington, DE 19801 (“Auxilium US”), and
Auxilium International Holdings, Inc., a corporation organized and existing
under the laws of the State of Delaware and having its principal office at 1105
N. Market Street, Suite 1300, Wilmington, DE 19801 (“Auxilium International”)
desire to acquire an undivided interest in any such inventions along with BTC;

NOW, THEREFORE, for good and valuable consideration as set forth in separate
agreements between Auxilium Pharmaceuticals, Inc. and BTC, the receipt of which
is hereby acknowledged, BTC, Auxilium US, and Auxilium International agree as
follows:

1. BTC does hereby sell, assign and transfer unto Auxilium US and BTC, BTC’s
rights in the United States to said inventions, including, without limitation,
the ‘560 Patent, the right to claim priority to the Provisional Applications,
and any subsequent application claiming priority to the Provisional
Applications, reissue, reexamination, divisional, continuation-in-part,
extension or continuation thereof.

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2. BTC does hereby sell, assign and transfer unto Auxilium International and
BTC, BTC’s rights outside the United States to said inventions, including,
without limitation, the PCT Application, the right to claim priority to the
Provisional Applications, and any subsequent application claiming priority to
the Provisional Applications, reissue, reexamination, divisional,
continuation-in-part, extension or continuation thereof.

3. BTC hereby binds itself, its legal representatives and assigns properly to
execute without further consideration any and all applications, petitions, oaths
and assignments or other papers and instruments that may be necessary in order
to carry into full force and effect, the sale, assignment, transfer and
conveyance hereby made or intended to be made.

4. Nothing in this assignment shall change the limitations on the rights of BTC
as set forth in Auxilium Pharmaceuticals, Inc.’s and BTC’s contemporaneous
Second Amended and Restated Development and License Agreement.

IN WITNESS WHEREOF, I have executed this Assignment this _______________day of
__________, 20___.
 

Assignor, BioSpecifics Technologies Corp.   By: ________________________(L.S.)  
Title: _______________________

State of _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

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__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this _______________day of
__________, 20___.

Assignee, Auxilium US Holdings, LLC
  By: ________________________(L.S.)   Title: _______________________

State of _________________________

County of _______________________

On this _______day of____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this _______________day of
__________, 20___.

Assignee, Auxilium US Holdings, LLC
  By: ________________________(L.S.)   Title: _______________________

State of _________________________

County of _______________________

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On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

IN WITNESS WHEREOF, I have executed this Assignment this _______________day of
__________, 20___.

Assignor, BioSpecifics Technologies Corp.   By: ________________________(L.S.)  
Title: _______________________

State of _________________________

County of _______________________

On this _______day of ____________________, 20___, before me, a Notary Public
came , to me known and known to be the individual described in and who executed
the foregoing assignment, and he/she duly acknowledged the same to be his/her
free act and deed.

__________________________________
Notary Public

My Commission Expires: _________________

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EXHIBIT G
Second Amended and Restated Development and License Agreement

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EXHIBIT H
Letter to USPTO Requesting Filing of this Agreement and the Second Amended and
Restated DLA

__________(Name)___________________________
Chief Administrative Patent Judge
Board of Patent Appeals and Interferences
U.S. Patent and Trademark Office
P.O. Box 1450
Alexandria, VA 22313-1450

Dear ____________________________:

This request is jointly submitted by Auxilium Pharmaceuticals, Inc. (“Auxilium”)
and BioSpecifics Technologies Corp. (“BTC”).

During prosecution of one of its patent applications, BTC copied the claims of a
now issued patent owned by Auxilium and requested that an interference be
declared. In addition, Auxilium copied claims from a related BTC application
into an application filed by Auxilium. Before the declaration of an
interference, Auxilium and BTC entered into agreements settling all issues that
could have been adjudicated had such an interference been declared, including
common ownership of the subject matter of the applications, such that an
interference would not normally be declared pursuant to 37 CFR 41.206.

Section 135(c) of the Patent Statute specifies that any agreement or
understanding between parties to an interference, including any collateral
agreements referred to therein, made in connection with or in contemplation of
the termination of an interference, must be in writing and a copy filed in the
PTO. While an interference was not declared in response to BTC’s request and
Auxilium having copied other claims in a BTC application, Auxilium and BTC seek
to comply with Section 135(c) and the implementing PTO rules. Accordingly,
Auxilium and BTC are willing to file, under seal, copies of the agreements
settling their dispute. The agreements would be accompanied by a request that
the agreements be kept separate from application and patent files and that they
be made available only to Government agencies on written request or to any
person on a showing of good cause.

Auxilium and BTC respectfully request that they be informed whether the PTO
authorizes the filing of such settlement agreements when an interference has
been requested, but not declared.

 

 

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