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

 

EXHIBIT 10.46

 

AMENDMENT NUMBER 4 TO THE RESEARCH AND LICENSE AGREEMENT BY AND BETWEEN KOSAN
BIOSCIENCES, INC., AND J&J PHARMACEUTICAL RESEARCH AND DEVELOPMENT AND
ORTHO-MCNEIL PHARMACEUTICAL, INC.

 

This Amendment, dated as of December 12, 2002, is made to that certain RESEARCH
AND LICENSE AGREEMENT, made as of September 28, 1998, and amended pursuant to
those certain Amendment Nos. 1, 2, and 3, dated March 17, 2000, August 31, 2000,
and September 28, 2001, respectively (the RESEARCH AND LICENSE AGREEMENT as
amended March 17, 2000, August 31, 2000, and September 28, 2001, is hereinafter
called the “AGREEMENT”), by and between:

 

KOSAN BIOSCIENCES, INC., a corporation organized under Delaware law having its
principal office at 3832 Bay Center Place, Hayward, California, 94545
(hereinafter called “KOSAN”);

 

ON THE ONE HAND, AND:

 

ORTHO MCNEIL PHARMACEUTICAL, INCORPORATED (hereinafter called “ORTHO”), a
company organized under Delaware law, having its principal office at U.S. Route
202, Raritan, New Jersey, 08869; and

 

JOHNSON & JOHNSON PHARMACEUTICAL RESEARCH & DEVELOPMENT, L.L.C. (hereinafter
called “J&JPRD”), a division of ORTHO having its principal office at U.S. Route
202, Raritan, New Jersey 08869 (ORTHO and J&JPRD hereinafter collectively called
“LICENSEE”)

 

ON THE OTHER HAND.

 

WITNESSETH:

 

A.  WHEREAS, KOSAN and LICENSEE have entered into the AGREEMENT providing for a
collaborative research and drug discovery program as generally described in the
RESEARCH PLAN attached thereto as Appendix A;

 

B.  WHEREAS, LICENSEE has provided KOSAN prior to November 28, 2002, the written
notice required by the AGREEMENT that LICENSEE wishes to continue the RESEARCH
PROGRAM for a further three (3) months to March 28, 2003, and the AGREEMENT
contemplates the termination of the RESEARCH PROGRAM on March 28, 2003, in the
event that LICENSEE has [ * ]; and

 

C.  WHEREAS, KOSAN and LICENSEE desire to extend the RESEARCH PROGRAM at least
until December 28, 2003;

 

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

 

NOW, THEREFORE, in consideration of the premises and the performance of the
covenants herein contained, the parties agree to amend the AGREEMENT as follows.

 

1.  Defined Terms.    Unless otherwise defined herein, all capitalized terms
used herein shall have the same meaning as set forth in the AGREEMENT.

 

2.  Extension of RESEARCH PROGRAM.    The RESEARCH PROGRAM shall be continued
until at least December 28, 2003.

 

3.  Current FTE RESEARCH FUNDING.    In accordance with the AGREEMENT, LICENSEE
shall provide KOSAN RESEARCH FUNDING for the Optional FTEs for the period of
December 28, 2001, to March 28, 2003 [ * ] by payment in full on or before
December 20, 2002.

 

4.  Additional KOSAN FTE RESEARCH FUNDING.    In accordance with this Amendment,
LICENSEE shall provide, in addition to the current FTE RESEARCH FUNDING,
RESEARCH FUNDING for the following additional KOSAN FTEs (the “Additional KOSAN
FTEs”): [ * ] for the period of [ * ]; and [ * ] for the period of [ * ].
LICENSEE shall provide RESEARCH FUNDING for the Additional KOSAN FTEs on a
quarterly basis, in advance, beginning December 28, 2002.

 

5.  RESEARCH PROGRAM.    The RESEARCH PROGRAM shall be limited to efforts to
produce and test [ * ] (the “Selected Compounds”), and shall be deemed to be
terminated with respect to all other compounds. The KOSAN FTEs engaged in the
RESEARCH PROGRAM, unless otherwise agreed by the JRC, shall be devoted to the
following efforts relating to Selected Compounds: the preparation of [ * ].

 

6.  Reversion of Rights to KOSAN.    Except for the Selected Compounds that are
the subject of the RESEARCH PROGRAM and the CLOSE STRUCTURAL ANALOGS thereof,
LICENSEE hereby releases and reverts to KOSAN in accordance with §19.3.4 of the
AGREEMENT any and all of LICENSEE’s rights to all other MACROLIDES, AROMATIC
POLYKETIDES, NCEs, LICENSED COMPOUNDS, CLOSE STRUCTURAL ANALOGS, and RESERVED
COMPOUNDS (the “Released Compounds”). The AGREEMENT shall be deemed to be
terminated pursuant to §19.2.1(ii) with respect to all PRODUCTS containing a
Released Compound, and all licenses relating to Released Compounds shall be
deemed to be terminated pursuant to §19.3.3 of the AGREEMENT.

 

7.  Testing of [ * ] and additional Reversion of Rights to KOSAN.    LICENSEE
will be testing of [ * ] to determine whether that Selected Compound possesses
at least a comparable in vitro anti-bacterial profile and superior oral efficacy
to the compound [ * ]. Effective January 31, 2003, LICENSEE hereby releases and
reverts to KOSAN in accordance with §19.3.4 of the AGREEMENT any and all of
LICENSEE’s rights to [ * ] unless [ * ] has been shown to have at least a
comparable in vitro anti-bacterial profile and superior oral efficacy to [ * ]
and such compounds shall be included within the Released Compounds as provided
in Paragraph 6 above. If [ * ] has been shown to have at least a comparable in
vitro anti-bacterial profile and superior oral efficacy to [ * ], the parties
will discuss further research and development of this compound or a Close
Structural Analog.

 

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

 

8.  Non-Acceptance of [ * ] by December 28, 2003.    In the event that LICENSEE
has not accepted [ * ] as of December 28, 2003, then the AGREEMENT shall, unless
otherwise agreed, terminate pursuant to §19.2.1(i), and such termination shall
constitute a release and reversion to KOSAN in accordance with §19.3.4 of the
AGREEMENT of any and all of LICENSEE’s rights to [ * ], and a termination of all
licenses relating thereto pursuant to §19.3.3 of the AGREEMENT. Termination
pursuant to this Section 8 shall not obligate LICENSEE to any wind-down or other
payment to KOSAN, whether pursuant to §19.1.2(c) of the AGREEMENT or otherwise.

 

9.  Acceptance of [ * ] by December 28, 2003.    In the event that LICENSEE has
selected [ * ] on or before December 28, 2003, then LICENSEE shall have the
right to continue development and commercialization of such [ * ] as provided by
the AGREEMENT.

 

10.  Termination.    After [ * ], KOSAN may, at KOSAN’s option, terminate the
AGREEMENT upon thirty (30) days’ written notice as provided in Section 22.2 if
LICENSEE has not agreed to provide KOSAN with RESEARCH FUNDING to support [ * ];
provided, however, that if during the thirty (30) day notice period LICENSEE
agrees to provide such RESEARCH FUNDING, then KOSAN’s notice shall be of no
effect and the Agreement shall not be terminated. For purposes of the Paragraph
“sufficient RESEARCH FUNDING” means funding for [ * ] over the period [ * ].

 

11.  AGREEMENT.    Except as amended herein, all of the terms and conditions of
the AGREEMENT shall remain in full force and effect.

 

SIGNATURES ON FOLLOWING PAGE

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have hereunto set their hands and duly
executed this Amendment to the AGREEMENT on the date(s) indicated below, to be
effective the day and year first above written.

 

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

 

For and on Behalf of KOSAN

 

/s/    DANIEL V. SANTI, MD, PHD

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

Daniel V. Santi, MD, PhD

Chief Executive Officer

 

Date: December 20, 2002

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

 

 

For and on Behalf of LICENSEE

 

/s/    GEOFFREY G. DELLENBAUGH

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

Geoffrey G. Dellenbaugh

Executive Director, External Relations

 

Date: December 20, 2002

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

 

 

 

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