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Exhibit 10.17

CONFIDENTIAL TREATMENT REQUESTED
UNDER 17 C.F.R. §§ 200.80(B)(4), 240.24B-2

Research Collaboration, Option and License Agreement

Between

Ionis Pharmaceuticals, Inc.

And

Biogen MA Inc.
 

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TABLE OF CONTENTS

   
Page
     
ARTICLE 1. RESEARCH
1
     
1.1.
Collaboration Overview.
2
     
1.2.
Drug Discovery Term
2
     
1.3.
Collaboration Management
2
     
1.4.
Collaboration
5
     
1.5.
IND-Enabling Toxicology Studies
8
     
1.6.
Development Costs and Expenses
8
     
1.7.
Manufacturing and Supply
9
     
1.8.
Payment Mechanics for Additional Activities Approved by Biogen
9
     
1.9.
End of ASO Development Candidate Identification Term
10
     
1.10.
Carryover Development Candidates
10
     
ARTICLE 2. EXCLUSIVITY COVENANTS
11
     
2.1.
Exclusivity
11
     
2.2.
Effect of Exclusivity on Indications
13
     
2.3.
New SMA Compounds
13
     
2.4.
Exclusivity Under Original Agreement
14
     
ARTICLE 3. EXCLUSIVE OPTION
14
     
3.1.
IND-Enabling Toxicology Studies Completion Date
14
     
3.2.
Option and Option Deadline
15
     
3.3.
HSR Compliance
15
     
3.4.
Restrictions on Ionis’ Right to Grant Diagnostic Rights; Right to Negotiate
Diagnostic Rights
16

 
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ARTICLE 4. LICENSE GRANTS
16
     
4.1.
License Grants to Biogen
16
     
4.2.
Assignment of Ionis Product-Specific Patents; Grant Back to Ionis
19
     
4.3.
Data Licenses.
19
     
4.4.
Enabling Licenses
20
     
4.5.
Licenses to Ionis for Biogen Results.
22
     
4.6.
Right to Obtain Direct License from Biogen to Ionis Partner; Sublicensees of
Ionis
23
     
4.7.
Ownership of and Assistance with Regulatory Filings
23
     
4.8.
Subcontracting
24
     
4.9.
Technology Transfer
25
     
ARTICLE 5. DEVELOPMENT, MANUFACTURING AND COMMERCIALIZATION
28
     
5.1.
Biogen Diligence
28
     
5.2.
Regulatory Matters
28
     
5.3.
Pharmacovigilance Agreement; Global Safety Database
29
     
5.4.
Research and Manufacturing Records
30
     
ARTICLE 6. FINANCIAL PROVISIONS
31
     
6.1.
Up-Front Fee
31
     
6.2.
License Fee
31
     
6.3.
Development Milestone Payments
31
     
6.4.
Sales Milestone Payments
31
     
6.5.
Limitations on Milestone Payments; Exceptions; Notice.
32
     
6.6.
Royalty Payments to Ionis
32
     
6.7.
Reverse Royalty Payments to Biogen for a Discontinued Product
35
     
6.8.
Third Party Payment Obligations
36

 
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6.9.
Payments
38
     
6.10.
Audits
39
     
6.11.
Taxes
40
     
6.12.
Interest
40
     
6.13.
Exclusion of Products under Original Agreement
40
     
ARTICLE 7. INTELLECTUAL PROPERTY
41
     
7.1.
Ownership
41
     
7.2.
Prosecution and Maintenance of Patents
44
     
7.3.
Patent Costs
48
     
7.4.
Defense of Claims Brought by Third Parties
49
     
7.5.
Enforcement of Patents Against Competitive Infringement
51
     
7.6.
Other Infringement
54
     
7.7.
Patent Listing
54
     
7.8.
Joint Research Agreement under the Leahy-Smith America Invents Act
55
     
7.9.
Obligations to Third Parties
55
     
7.10.
Additional Right and Exceptions
55
     
7.11.
Patent Term Extension
55
     
ARTICLE 8. REPRESENTATIONS AND WARRANTIES
56
     
8.1.
Representations and Warranties of Both Parties
56
     
8.2.
Representations and Warranties of Ionis
56
     
8.3.
Ionis Covenants
58
     
8.4.
DISCLAIMER
59
     
ARTICLE 9. INDEMNIFICATION; INSURANCE
59
     
9.1.
Indemnification by Biogen
59
     
9.2.
Indemnification by Ionis
60

 
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9.3.
Procedure
61
     
9.4.
Insurance
61
     
9.5.
LIMITATION OF CONSEQUENTIAL DAMAGES
61
     
ARTICLE 10. TERM; TERMINATION
62
     
10.1.
Agreement Term; Expiration
62
     
10.2.
Termination of the Agreement
62
     
10.3.
Alternative Remedies to Termination Available to Biogen Prior to Option Exercise
66
     
10.4.
Consequences of Expiration or Termination of the Agreement
67
     
ARTICLE 11. CONFIDENTIALITY
77
     
11.1.
Confidentiality; Exceptions
77
     
11.2.
Authorized Disclosure
78
     
11.3.
Press Release; Publications; Disclosure of Agreement
78
     
ARTICLE 12. MISCELLANEOUS
82
     
12.1.
Dispute Resolution
82
     
12.2.
Governing Law; Jurisdiction; Venue; Service of Process
83
     
12.3.
Remedies
84
     
12.4.
Assignment and Successors
84
     
12.5.
Change of Control
84
     
12.6.
Force Majeure
86
     
12.7.
Notices
87
     
12.8.
Export Clause
88
     
12.9.
Waiver
88
     
12.10.
Severability
88
     
12.11.
Entire Agreement
88

 
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12.12.
Independent Contractors
88
     
12.13.
Interpretation
89
     
12.14.
Books and Records
89
     
12.15.
Further Actions
89
     
12.16.
Construction of Agreement
89
     
12.17.
Supremacy
89
     
12.18.
Counterparts
89
     
12.19.
Compliance with Laws
89

 
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RESEARCH COLLABORATION, OPTION AND LICENSE AGREEMENT

This RESEARCH COLLABORATION, OPTION AND LICENSE AGREEMENT (this “Agreement”) is
entered into as of the 19th day of December 2017 (the “Effective Date”) by and
between Ionis Pharmaceuticals, Inc., a Delaware corporation, having its
principal place of business at 2855 Gazelle Court, Carlsbad, CA 92010 (“Ionis”),
and Biogen MA Inc., a Massachusetts corporation, having its principal place of
business at 225 Binney Street, Cambridge, MA 02142 (“Biogen”). Biogen and Ionis
each may be referred to herein individually as a “Party” or collectively as the
“Parties.” Capitalized terms used in this Agreement, whether used in the
singular or the plural, have the meaning set forth in Appendix 1. All attached
appendices and schedules are a part of this Agreement.

RECITALS

WHEREAS, Biogen and Ionis are parties to that certain Development, Option and
License Agreement, as amended (the “Original Agreement”) dated January 3, 2012;

WHEREAS, the Parties desire to build upon their Spinraza® collaboration under
the Original Agreement by entering into this Agreement to support the goal of
delivering more benefit to patients; and

WHEREAS, the Parties now wish to enter this Agreement pursuant to which the
Parties will collaborate on a Collaboration Program to identify an [***]
Development Candidate and on a Collaboration Program to identify an [***]
Development Candidate, and Biogen will obtain an Option under each such
Collaboration Program to obtain an exclusive license to Develop, Manufacture and
Commercialize Products in the Field.

NOW, THEREFORE, in consideration of the respective covenants, representations,
warranties and agreements set forth herein, the Parties hereto agree as follows:

ARTICLE 1.
RESEARCH

1.1.
Collaboration Overview. The intent of the collaboration under this Agreement is
(i) for Ionis to perform drug discovery activities for two separate
Collaboration Programs under a mutually agreed drug discovery plan with the goal
of identifying an [***] Development Candidate and an [***] Development
Candidate, (ii) following Development Candidate designation for each
Collaboration Program, for Biogen to conduct the IND-Enabling Toxicology Studies
under such Collaboration Program, and (iii) to provide Biogen with an option
under each Collaboration Program to develop and ultimately commercialize
Compounds and Products under such Collaboration Program, under an exclusive
license from Ionis. The purpose of this Section 1.1 is to provide a high-level
overview of the roles, responsibilities, rights and obligations of each Party
under this Agreement, and therefore this Section 1.1 is qualified in its
entirety by the more detailed provisions of this Agreement set forth below.

 
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1.2.
Drug Discovery Term. The term for the conduct of the ASO Development Candidate
Identification Plan (the “ASO Development Candidate Identification Term”) will
begin on the Effective Date and will end, on a Collaboration
Program-by-Collaboration Program basis, upon the earliest [***], or (iv) a date
mutually agreed by the Parties. If Biogen disagrees with Ionis’ determination
that a Technical Failure has occurred, Section 12.1.4 will apply.

1.3.
Collaboration Management.

1.3.1.
Joint Steering Committee. The Parties will establish a joint steering committee
(the “JSC”) to provide advice and make recommendations on the conduct of
activities under each Collaboration Program, to govern the activities under this
Agreement with respect to the discovery of potential Development Candidates, the
designation of Development Candidates and the conduct of preclinical research
for each Development Candidate, and to facilitate information-sharing and
discussion between the Parties regarding the Development of each Development
Candidate [***] for such Development Candidate. The JSC will consist of up to
three representatives appointed by Ionis and up to three representatives
appointed by Biogen. Each Party’s JSC representatives shall be chosen by such
Party in its sole discretion and may be replaced by such Party in its sole
discretion upon written notice to the other Party, provided that each JSC member
will have experience and expertise appropriate for the stage of Development of
the Collaboration Programs. Each Party will designate one of its representatives
who is empowered by such Party to make decisions related to the performance of
such Party’s obligations under this Agreement to act as the co-chair of the JSC.
The co-chairs will be responsible for overseeing the activities of the JSC
consistent with the responsibilities set forth below in this Section 1.3.1.
Schedule 1.3.1 sets forth certain JSC governance matters agreed to as of the
Effective Date for the period ending upon Option exercise with respect to each
Collaboration Program. The JSC will determine the JSC operating procedures at
its first meeting, including the policies for participation by additional
representatives or consultants invited to attend JSC meetings, and the location
of meetings, which will be codified in the written minutes of the first JSC
meeting. Each Party will be responsible for the costs and expenses of its own
employees or consultants attending JSC meetings. Prior to Option exercise with
respect to a Collaboration Program, the JSC shall meet once per Calendar
Quarter, or as otherwise mutually agreed by the Parties, provided that Ionis and
Biogen will use reasonable efforts to schedule meetings of the JSC to take place
at the same location and on the same dates as meetings of the joint development
and steering committees under the Ionis/Biogen Additional Agreements, to
maximize the use of each Party’s time, increase information sharing efficiencies
and reduce the cost of additional travel, lodging and related expenses.

 
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(a)
Role of the JSC. Without limiting any of the foregoing, subject to Section
1.3.2, the JSC will perform the following functions, some or all of which may be
addressed directly at any given JSC meeting:

(i)
review and approve amendments to the ASO Development Candidate Identification
Plan proposed by either Party in accordance with Section 1.4.1(d);

(ii)
review the overall progress of Ionis’ efforts to discover, identify and optimize
potential Development Candidates for each Collaboration Program;

(iii)
establish teams and committees to oversee and manage activities under each
Collaboration Program up to Development Candidate designation as it deems
necessary;

(iv)
review the Development Candidate Data Package for each Collaboration Program
and, subject to Section 1.4.2(b), designate the Development Candidate for each
Collaboration Program;

(v)
establish a high-level preclinical toxicology strategy for each Development
Candidate under Section 1.5;

(vi)
review and discuss the initial development plan set forth in the Integrated
Development Plan under Section 5.1.1 for each Development Candidate until
Initiation of a Phase 3 Trial;

(vii)
review the overall progress of Biogen’s efforts to Develop the Development
Candidates for each Collaboration Program until Initiation of a Phase 3 Trial;

(viii)
establish teams and committees to oversee and manage activities under the
preclinical toxicology strategy for each Development Candidate as it deems
necessary;

(ix)
provide input to the JPC as appropriate;

(x)
assist with and participate in the resolution of disputes as contemplated in
Section 12.1; and

(xi)
such other review and advisory responsibilities as may be assigned to the JSC by
the Parties pursuant to this Agreement.

 
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1.3.2.
Decision Making.

(a)
Committee Decision Making. Except as expressly set forth in Sections 1.4.2(b),
1.4.3 and 1.5, decisions by the JSC will be made by unanimous consent with each
Party’s representatives having, collectively, one vote. At any given meeting of
any such committee, a quorum will be deemed to have been reached if a voting
representative of each Party is present or participating in such meeting. No
action taken at any meeting of any such committee will be effective unless there
is a quorum at such meeting. Unless otherwise specified in this Agreement, no
action will be taken with respect to a matter for which the JSC has not reached
unanimous consensus.

(b)
Implementation. Each Party will give due consideration to, and consider in good
faith, the recommendations and advice of the JSC regarding the activities within
the scope of its authority. Prior to Option exercise, (i) Ionis will have the
final decision-making authority regarding [***], as applicable) and [***] with
respect thereto and (ii) Biogen will have the final decision-making authority
regarding [***], as applicable) and [***] with respect thereto. After Option
exercise for a particular Collaboration Program, subject to and without limiting
Section 5.1, Biogen will have sole decision-making authority regarding the
Manufacture, Development and Commercialization of Products for such
Collaboration Program; provided, however, that Biogen shall not increase Ionis’
costs or obligations without Ionis’ consent. Except as otherwise expressly
stated in this Agreement, the JSC will have no decision-making authority and
will act as a forum for sharing information about the activities conducted by
the Parties hereunder and as an advisory body, in each case only on the matters
described in, and to the extent set forth in, this Agreement.

1.3.3.
JSC Activities Following Option Exercise.

(a)
JSC Meetings After Option Exercise. On a Collaboration Program-by-Collaboration
Program basis, following Option exercise with respect to a Collaboration Program
until the JSC is terminated in accordance with Section 1.3.3(c) below, the JSC
will meet no more than [***], in accordance with each Party’s scheduling
obligations set forth in Section 1.3.1, solely for the purpose of information
exchange and without any decision-making authority. Notwithstanding anything to
the contrary in this Section 1.3.3(a), if the Parties engage in discussions
regarding the Collaboration Programs in a meeting of any governing forum under
any of the Ionis/Biogen Additional Agreements, where such discussions (i) are
included in the agenda for such meeting or documented in the written minutes of
such meeting, or (ii) otherwise address topics other than procedure and
scheduling, such discussions shall be deemed to be in lieu of the JSC meeting
contemplated under this Section 1.3.3(a) for the [***] period in which such
discussions occurred.

 
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(b)
Ionis’ Obligation to Participate in the JSC. Ionis’ obligation to participate in
the JSC will terminate, on a Collaboration Program-by-Collaboration Program
basis, upon Biogen’s exercise (or expiration) of the Option for each
Collaboration Program. Thereafter, Ionis will have the right, but not the
obligation, to participate in such meetings with respect to such Collaboration
Program upon Ionis’ request, until the JSC is terminated in accordance with
Section 1.3.3(c) below. Notwithstanding the foregoing, Biogen’s obligations to
provide Ionis with information or reports with respect to a Product shall
continue in accordance with Section 5.1.1.

(c)
Termination of the JSC. The JSC and any other subcommittees or working groups
established pursuant to this Agreement will terminate, solely with respect to
this Agreement and not any Ionis/Biogen Additional Agreement, on a Collaboration
Program-by-Collaboration Program basis upon the earlier of (i) the Initiation of
a Phase 3 Trial with respect to such Collaboration Program, and (ii) the
termination of such Collaboration Program.

1.3.4.
Briefing the JSC. At each regularly scheduled meeting of the JSC prior to
exercise of the Option, each Party will provide to the JSC a progress update on
its activities under each Collaboration Program.

1.3.5.
Alliance Managers. Each Party will appoint a representative to act as its
alliance manager under this Agreement (each, an “Alliance Manager”). Each
Alliance Manager will be responsible for supporting the JSC and performing the
activities listed in Schedule 1.3.5.

1.4.
Collaboration.

1.4.1.
Responsibilities.

(a)
During the ASO Development Candidate Identification Term, Ionis will use its
Commercially Reasonable Efforts for each Collaboration Program to conduct drug
discovery activities according to the applicable ASO Development Candidate
Identification Plan, in a manner consistent with its internal practices for
other gene targets, to identify an [***] Development Candidate and an [***]
Development Candidate under the applicable Collaboration Program as soon as
practicable.

(b)
Following Development Candidate designation under a Collaboration Program,
Biogen will use its Commercially Reasonable Efforts to conduct IND-Enabling
Toxicology Studies for such Development Candidate, in accordance with the
preclinical toxicology strategy agreed to by the JSC.

(c)
The Parties may determine by mutual agreement to allocate additional Research or
Development activities under a Collaboration Program to Biogen prior to the
applicable Option exercise. To the extent any such Research or Development
activities are allocated to Biogen in accordance with the preceding sentence,
Biogen will use its Commercially Reasonable Efforts to conduct such Research or
Development activities in accordance with the ASO Development Candidate
Identification Plan.

 
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(d)
Either Party may propose updates to the ASO Development Candidate Identification
Plan and submit such proposed updates to the JSC for its review and approval.

(e)
Each Party will conduct its work under each Collaboration Program in a good
scientific manner, and in compliance with all applicable good laboratory
practices and cGMP, and all Applicable Laws.

1.4.2.
Development Candidates.

(a)
Development Candidate Data Package. Unless otherwise mutually agreed by the
Parties, Ionis’ RMC shall only approve a Compound as a potential Development
Candidate for a Collaboration Program if such Compound satisfies the [***] set
forth in the ASO Development Candidate Identification Plan with respect to such
Collaboration Program. In addition, unless otherwise mutually agreed by the
Parties, each Backup Compound set forth in the Development Candidate Data
Package for a Collaboration Program must satisfy the [***] set forth in the ASO
Development Candidate Identification Plan with respect to such Collaboration
Program. For each Collaboration Program, Ionis will provide Biogen, through the
JSC, with a complete Development Candidate Data Package promptly following the
date Ionis’ Research Management Committee approves a Compound as a potential
Development Candidate after Ionis’ completion of Ionis’ activities set forth in
the applicable ASO Development Candidate Identification Plan. Within [***] days
of receipt of a Development Candidate Data Package pursuant to this Section
1.4.2(a), Biogen or an Affiliate will notify Ionis of any omissions or
deficiencies that Biogen or its Affiliate believes in good faith cause the
Development Candidate Data Package to be incomplete with respect to the
potential Development Candidate or any Backup Compound described therein
(“Development Candidate Data Package Deficiency Notice”). Ionis will promptly,
and in any event within [***] days of receipt of the Development Candidate Data
Package Deficiency Notice, resubmit a complete Development Candidate Data
Package to Biogen or its designated Affiliate, including any information that
Biogen identified in the Development Candidate Data Package Deficiency Notice.
If the Parties do not agree as to whether the Development Candidate Data Package
is complete, the matter will be referred to the Executives for resolution. The
Executives will meet promptly and negotiate in good faith to resolve the dispute
and agree upon a complete Development Candidate Data Package.

 
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(b)
Development Candidate Designation. Within [***] days following Ionis’ delivery
of a Development Candidate Data Package with respect to a Collaboration Program
to Biogen pursuant to Section 1.4.2(a) (and resolution of any dispute regarding
omissions or deficiencies with respect to such Development Candidate Data
Package in accordance with Section 1.4.2(a)), the JSC will discuss whether to
designate the Compound that is recommended by Ionis’ RMC as the lead compound
under such Development Candidate Data Package (or any other Compound listed in
the Development Candidate Data Package as a potential backup Compound (such
Compound, a “Backup Compound”)) as the Development Candidate for such
Collaboration Program, taking into account the input of the JPC with respect to
its intellectual property assessment of such Compound(s). Any designation of a
Development Candidate for a Collaboration Program by the JSC will be documented
in the written minutes of the JSC. If the JSC mutually agrees to designate such
a Compound as a Development Candidate then, following the JSC’s agreement to a
high level preclinical toxicology strategy for such Development Candidate in
accordance with Section 1.5 below, Biogen will conduct the IND-Enabling
Toxicology Studies under such strategy under Section 1.5.

If the JSC cannot agree to designate the Compound that is recommended by Ionis’
RMC as the lead compound under such Development Candidate Data Package (or any
Backup Compound) as a Development Candidate for a given Collaboration Program
within [***] days after the JSC meets to discuss the applicable Development
Candidate Data Package (such [***]-day period, the “JSC Decision Period”), then
[***] will have final decision-making authority to determine whether or not to
designate the Compound that is recommended by Ionis’ RMC as the lead compound
under such Development Candidate Data Package (or any Backup Compound) as a
Development Candidate for such Collaboration Program and will notify the JSC in
writing of [***] determination within [***] days after the end of the JSC
Decision Period.

If the JSC (or [***] through the exercise of its final decision-making
authority) does not designate such a Compound as a Development Candidate for a
given Collaboration Program within [***] days after the date Biogen receives the
complete Development Candidate Data Package under Section 1.4.2(a), then, unless
the Parties mutually agree to amend the applicable ASO Development Candidate
Identification Plan to conduct additional Development activities (i) Biogen’s
Option with respect to such Collaboration Program will terminate, (ii) neither
Ionis nor Biogen will have an obligation to perform any further activities under
this ARTICLE 1 with respect to such Collaboration Program; (iii) such program
will no longer be a Collaboration Program; (iv) Ionis’ obligations and Biogen’s
rights under this Agreement with respect to any ASOs under such Collaboration
Program will then terminate except as expressly set forth in Section 1.10 and
ARTICLE 2; (iv) upon Ionis’ request, Biogen will provide to Ionis any data
generated under the Collaboration Program and licensed to Ionis under Section
4.3.2; and (v) upon Biogen’s request, Ionis will provide to Biogen any data
generated under the Collaboration Program and licensed to Biogen under Section
4.3.1.
 
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1.4.3.
Backup Development Candidates. If, after the JSC (or [***] through the exercise
of its final decision-making authority) designates a Compound as a Development
Candidate for a given Collaboration Program under Section 1.4.2(b), Biogen
determines that any further research, development, manufacture or
commercialization of such Compound is no longer commercially reasonable or
technically feasible under the then-current state of the art, then Biogen shall
so notify the JSC and the JSC may designate a Backup Compound (or any other
Compound) as the Development Candidate under such Collaboration Program. In the
case of any dispute at the JSC regarding which Backup Compound (or other
Compound), if any, to designate as the Development Candidate under such
Collaboration Program, if such dispute has not been resolved within [***] days
of such notice by Biogen to the JSC (or such longer period as may be mutually
agreed by the Parties), such dispute shall be subject to [***] final
decision-making authority as set forth in Section 1.4.2(b). Thereafter, the JSC
shall promptly update the high level preclinical toxicology strategy for such
Development Candidate in accordance with Section 1.5.

1.5.
IND-Enabling Toxicology Studies. For each Collaboration Program, the JSC will
agree upon a high level preclinical toxicology strategy (including the contract
research organization (CRO) to be used to conduct the IND-Enabling Toxicology
Studies) for each Development Candidate no later than [***] days following
designation of the Development Candidate under such Collaboration Program. In
addition, the JSC will approve any study protocols for the IND-Enabling
Toxicology Studies at least [***] prior to the anticipated commencement of such
IND-Enabling Toxicology Studies. If the JSC does not agree on such high level
preclinical toxicology strategy or study protocols for a particular
Collaboration Program within the applicable time period as set forth above in
this Section 1.5, then Biogen will have final decision-making authority with
respect thereto; provided, that, solely with respect to the categories of
IND-Enabling Toxicology Studies listed on Schedule 1.5, Biogen will not use a
[***] to conduct any such IND-Enabling Toxicology Study that is not [***] listed
on Schedule 1.5 with respect to the applicable category of IND-Enabling
Toxicology Studies, [***]

1.6.
Development Costs and Expenses.

1.6.1.
Development Costs Paid by Ionis. On a Collaboration Program-by-Collaboration
Program basis, prior to Option exercise with respect to the applicable
Collaboration Program, Ionis will be responsible for all its Research and
Development activities for each Development Candidate under the applicable
Collaboration Program as set forth in the applicable ASO Development Candidate
Identification Plan and, except as otherwise provided under Section 1.6.2 or
Section 1.8, all its costs and expenses associated therewith. For clarity, Ionis
shall not have the right to use, in any such activities, any resources or
funding provided to Ionis by Biogen under the Ionis/Biogen Additional
Agreements.

 
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1.6.2.
Development Costs Paid by Biogen. On a Collaboration Program-by-Collaboration
Program basis, (i) prior to Option exercise with respect to the applicable
Collaboration Program, Biogen will be responsible for all its Research and
Development activities for each Development Candidate under the applicable
Collaboration Program in accordance with the preclinical toxicology strategy for
such Collaboration Program, and all its costs and expenses associated therewith,
and (ii) after Option exercise with respect to the applicable Collaboration
Program, Biogen will be solely responsible for the costs and expenses related to
the Development, Manufacture and Commercialization of Products, including any
work performed by Ionis at Biogen’s written request, and all supply chain
planning and decision making.

1.7.
Manufacturing and Supply.

Before Option exercise with respect to a Collaboration Program, (a) Ionis, [***]
to support the Research and Development activities under each Collaboration
Program as set forth in the applicable ASO Development Candidate Identification
Plan, and (b) Biogen, [***], will be responsible for supplying the IND-Enabling
Toxicology Studies pursuant to the applicable high-level preclinical toxicology
strategy, provided that, if the Parties mutually agree, (i) Ionis will supply
API (on its own or through a CMO reasonably acceptable to Biogen) sufficient to
support the IND-Enabling Toxicology Studies to be conducted by Biogen in
accordance with such high-level preclinical toxicology strategy, and (ii) Biogen
will pay Ionis [***] for such API within [***] days of Biogen’s receipt of an
invoice therefor from Ionis.

1.7.1.
Following Option exercise with respect to a Collaboration Program, Biogen will
be responsible for Clinical Supply and Commercial supplies of API and Finished
Drug Product and may contract directly with CMOs with respect to such supply in
accordance with Section 4.1.2(b).

1.8.
Payment Mechanics for Additional Activities Approved by Biogen. If Biogen
desires that either Ionis or a Third Party perform additional activities under
this Agreement that are not otherwise required hereunder (“Other Activities”),
Biogen will pay the costs of conducting such work, including the cost of Ionis’
time incurred in performing such work at the then-applicable [***] Rate (“[***]
Costs”), plus any [***] incurred by Ionis in performing such work (such costs,
collectively “Biogen-Approved Costs”). Ionis will permit Biogen to review,
negotiate (with Ionis) and approve all Biogen-Approved Costs prior to conducting
any Other Activities. In advance of each [***], Ionis will provide Biogen with a
good faith estimate of the Biogen-Approved Costs anticipated to be incurred in
such [***]. Ionis will invoice Biogen directly for any such approved
Biogen-Approved Costs incurred by Ionis and Biogen will pay the invoices
submitted pursuant to this Section 1.8 for such approved Biogen-Approved Costs
within [***] days after receipt of the applicable invoice by Biogen. In the case
where Other Activities are performed by a Third Party, the Parties will arrange
for the Third Party to directly bill Biogen and for Biogen to pay such Third
Party directly.

 
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1.9.
End of ASO Development Candidate Identification Term. At the end of the ASO
Development Candidate Identification Term for a particular Collaboration Program
that did not reach the Development Candidate stage, subject to Section 1.10, (i)
Biogen’s Option with respect to such Collaboration Program will expire, (ii)
neither Ionis nor Biogen will have an obligation to perform any activities under
this ARTICLE 1 with respect to such Collaboration Program; (iii) such program
will no longer be a Collaboration Program; (iv) Ionis’ obligations and Biogen’s
rights under this Agreement with respect to any ASOs under such Collaboration
Program will then terminate except as expressly set forth in Section 1.10 and
ARTICLE 2; (v) upon Ionis’ request, Biogen will provide to Ionis any data
generated under the Collaboration Program and licensed to Ionis under Section
4.3.2; and (vi) upon Biogen’s request, Ionis will provide to Biogen any data
generated under the Collaboration Program and licensed to Biogen under Section
4.3.1.

1.10.
Carryover Development Candidates. If, by the end of the ASO Development
Candidate Identification Term for a particular Collaboration Program, Ionis’ RMC
has not designated a Compound as a Development Candidate under such
Collaboration Program, and at any time during the [***] period after the end of
the applicable ASO Development Candidate Identification Term (the “Carryover
Period”), Ionis’ RMC designates an ASO discovered by Ionis containing (i) [***]
that is designed to bind to the RNA that encodes SMN as a development candidate
ready to start IND-Enabling Toxicology Studies, or (ii) [***] that is designed
to bind to the RNA that encodes SMN (other than a Specified ASO Product) as a
development candidate ready to start IND-Enabling Toxicology Studies (each such
ASO, a “Carryover Development Candidate”), then Ionis will notify Biogen and
will provide Biogen with the data package presented to Ionis’ RMC to approve
such Carryover Development Candidate. Biogen will then have [***] days from its
receipt of such package to elect to enter into an amendment to this Agreement
under the same terms as set forth in this Agreement (except that [***] under
Section 6.1 will be due). If, within [***] days after Biogen’s receipt of such
notice from Ionis, Biogen provides Ionis with written notice that it accepts
such offer from Ionis for such Carryover Development Candidate, the Parties will
execute an amendment to this Agreement regarding such Carryover Development
Candidate on such terms. Otherwise, except for the obligation to comply with the
provisions of Section 2.1, Ionis will have no further obligations and Biogen
will have no further rights with respect to such Carryover Development
Candidate.

 
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ARTICLE 2.
EXCLUSIVITY COVENANTS

2.1.
Exclusivity.

2.1.1.
Exclusivity Covenants.

(a)
The Parties’ Exclusivity Covenants During the Option Period. Each Party agrees
that, except in the performance of its obligations or exercise of its rights
under this Agreement or the Original Agreement, and except as set forth in
Section 2.1.2 and Section 2.1.3, it will not work independently or for or with
any of its Affiliates or any Third Party (including the grant of any license to
any Third Party) with respect to discovery, research, development, manufacture
or commercialization of an ASO that is designed to bind to the RNA that encodes
SMN in the Field from the Effective Date through the expiration or earlier
termination of the Option (the “Option Period”) with respect to both
Collaboration Programs.

(b)
Ionis’ Exclusivity Covenant After the Option Period. Except in the performance
of its obligations or exercise of its rights under this Agreement or the
Original Agreement, and except as set forth in Section 2.1.2 and Section 2.1.3,
Ionis will not work independently or for or with any of its Affiliates or any
Third Party (including the grant of any license to any Third Party) with respect
to:

(i)
if Biogen timely exercises either Option (or both Options) in accordance with
this Agreement, discovery, research or development in the Field of an ASO that
is designed to bind to the RNA that encodes SMN until [***]; and

(ii)
on a country-by-country basis, commercializing in the Field an ASO that is
designed to bind to the RNA that encodes SMN until [***] in accordance with this
Agreement, [***].

(c)
Biogen’s Exclusivity Covenants After the Option Period. After the Option Period
with respect to a Collaboration Program, except as set forth in Section 2.1.2
and Section 2.1.3, Biogen’s exclusivity obligations under Section 2.1.1(a) will
be extended and will continue for so long as and to the extent of [***].

2.1.2.
Limitations and Exceptions to Exclusivity Covenants.

(a)
Notwithstanding anything to the contrary in this Agreement, Ionis’ practice of
the following will not violate Section 2.1.1:

(i)
any activities pursuant to the Prior Agreements as in effect on the Effective
Date;

(ii)
the granting of, or performance of obligations under, Permitted Licenses;

 
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(iii)
to the extent provided in the Original Agreement, Ionis’ right to commercialize
Spinraza® if the Original Agreement is terminated in accordance with ARTICLE 10
of the Original Agreement unless, at the time of such termination, Biogen or any
of its Affiliates, Sublicensees or distributors is Developing or Commercializing
a Product under this Agreement, in which case, Ionis’ right to commercialize
Spinraza® under the Original Agreement shall be subject to the provisions of
Section 2.1.1 so long as Biogen or any of its Affiliates, Sublicensees or
distributors is Developing or Commercializing a Product under this Agreement;

(iv)
the discovery, research or development of an ASO designed to bind to the RNA
that encodes SMN in the Field where such ASO is designed to (i) [***] to work
primarily in the [***] (a “[***] ASO Product”), (ii) be delivered [***] to work
primarily [***] (a “[***] ASO Product”), or (iii) use a [***] than the [***]
resulting in the [***] of that [***] that encodes a [***] protein (an “[***] ASO
Product”, and, each such [***] ASO Product, [***] ASO Product or [***] ASO
Product, a “Specified ASO Product”); provided, however, that any such Specified
ASO Product will be treated as a “New SMA Compound” under Section 2.3 and, for
the avoidance of doubt, Ionis shall have no right to commercialize such
Specified ASO Product under Section 2.1.2(a)(v) unless Ionis has complied with
its obligations under Section 2.3;

(v)
on a country-by-country basis, upon [***]; provided, however, that any such
Specified ASO Product will be treated as a “New SMA Compound” under Section 2.3
and, for the avoidance of doubt, Ionis shall have no right to commercialize such
Specified ASO Product under this Section 2.1.2(a)(v) unless Ionis has complied
with its obligations under Section 2.3; and

(vi)
the development or commercialization of a Pre-Existing Competitive Product in
accordance with Section 12.5.

(b)
Notwithstanding anything to the contrary in this Agreement, Biogen’s practice of
the following will not violate Section 2.1.1:

(i)
the discovery, research or development of a Specified ASO Product; and

(ii)
on a country-by-country basis, upon [***], commercialization in such country of
a Specified ASO Product;

provided that, [***] (x) if such Specified ASO Product is a [***] ASO Product,
solely with respect to any [***] ASO Product of Ionis, (y) if such Specified ASO
Product is a [***] ASO Product, solely with respect to any [***] ASO Product of
Ionis, and (z) if such Specified ASO Product is an [***] ASO Product, solely
with respect to any [***] ASO Product of Ionis.
 
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2.1.3.
Permitted Preclinical Research. Notwithstanding anything to the contrary in this
Section 2.1, Ionis and Biogen each acknowledge and agree that, during the
Agreement Term, each Party may, independently or for or with any of its
Affiliates or with any Third Party acting solely for the benefit of such Party
or its Affiliates (such as Third Party academic collaborators and
subcontractors), conduct, with respect to a product containing an ASO that is
designed to bind to the RNA that encodes SMN, preclinical research, including
gene function, gene expression, target validation research, and investigating
inhibition of a target in therapeutic models, but excluding drug discovery or
clinical development activities.

2.2.
Effect of Exclusivity on Indications. The Compounds are designed to bind to the
RNA that encodes SMN in the Field, which is known to play a role in Spinal
Muscular Atrophy. Ionis and Biogen are subject to exclusivity obligations under
Section 2.1; however, the Parties acknowledge and agree that each Party and its
Affiliates (on its own or with a Third Party) may continue to discover,
research, develop, manufacture and commercialize products that are designed to
bind to the RNA that encodes a gene that is not SMN for any indication, even if
such products are designed to treat Spinal Muscular Atrophy.

2.3.
New SMA Compounds. With respect to any New SMA Compound designated by Ionis’ RMC
as a development candidate ready to start IND-Enabling Toxicology Studies, which
determination shall be based on criteria substantially similar to the criteria
Ionis’ RMC uses to designate development candidates under other similar
programs, Ionis will notify Biogen of such determination and will provide Biogen
with the data package presented to Ionis’ RMC to approve such development
candidate (a “New SMA Compound Notice”). If, within [***] days after Biogen’s
receipt of a New SMA Compound Notice, Biogen delivers written notice to Ionis of
Biogen’s election to enter into an amendment to this Agreement to include such
New SMA Compound within the scope of this Agreement, then upon such election the
Parties will enter into an amendment to this Agreement to include such New SMA
Compound within the scope of this Agreement on the terms set forth in this
Agreement provided that (a) the Parties shall mutually agree on [***] New SMA
Compound ([***] New SMA Compound [***] New SMA Compound [***] New SMA Compound),
(b) if the scope of work to discover such New SMA Compound is materially larger
than under any of the Development Candidate Identification Plans attached to
this Agreement as of the Effective Date, then Biogen [***], (c) Biogen [***] New
SMA Compound, and (d) (A) if the New SMA Compound [***].

If Biogen does not provide Ionis with written notice within such [***]-day
period of Biogen’s election to enter into such an amendment, or provides written
notice to Ionis that it does not elect to enter into such an amendment, or if
the Parties fail to mutually agree on [***] within [***] days of Biogen’s
election with respect to any such New SMA Compound, Ionis may initiate
negotiations with a Third Party regarding a license to such New SMA Compound;
provided, however, that any such Third Party shall be subject to the
restrictions set forth in Section 2.1.1(b)(ii) with respect to any product
containing a New SMA Compound (provided that, with respect to any such product
that is a Specified ASO Product, such restrictions shall terminate on a
country-by-country basis, upon [***]; and provided, further, that Ionis will not
enter into any such license with any Third Party unless the terms and pricing of
such license, [***].
 
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Notwithstanding anything to the contrary in this Section 2.3, if, with respect
to any New SMA Compound that was the subject of the license previously discussed
between Biogen and Ionis, after the end of such [***]-day negotiation period and
prior to Ionis entering into a license with a Third Party, any [***] regarding
such New SMA Compound, then Ionis will provide Biogen with an additional New SMA
Compound Notice and, if Biogen or one of its Affiliates delivers written notice
to Ionis within [***] days after Biogen’s receipt of such New SMA Compound
Notice indicating that Biogen or one of its Affiliates desires to negotiate with
Ionis regarding a license to make, use or sell such New SMA Compound, Ionis and
Biogen or one of its Affiliates will negotiate in good faith with each other
until the [***]day following the date of the New SMA Compound Notice (or such
other period as mutually agreed by the Parties) regarding a mutually
satisfactory agreement with respect to such license, which may (but shall not be
required to) take the form of an amendment to this Agreement and may (but shall
not be required to) be on the terms set forth in this Agreement.

2.4.
Exclusivity Under Original Agreement. Notwithstanding anything to the contrary
in this Agreement or in the Original Agreement, this ARTICLE 2 supersedes and
replaces ARTICLE 2 of the Original Agreement as of the Effective Date.
Notwithstanding any expiration or termination of this Agreement, if the Original
Agreement remains in effect at the time of such expiration or termination, the
provisions of Section 2.1.1(b)(ii), Section 2.1.1(c), and the applicable
provisions of Section 2.1.2 shall survive such expiration or termination on a
country-by-country basis [***]in such country and the provisions of Section 2.3
shall survive such expiration or termination [***], at which time such
provisions shall terminate and be of no further force or effect.

ARTICLE 3.
EXCLUSIVE OPTION

3.1.
IND-Enabling Toxicology Studies Completion Date. On a Collaboration
Program-by-Collaboration Program basis, within [***] following the date the
Draft Reports from the IND-Enabling Toxicology Studies for a Collaboration
Program are available to Biogen (the “IND-Enabling Toxicology Studies Completion
Date”), Biogen will provide to Ionis or its designated Affiliate written notice
thereof together with a copy of each such Draft Report.

 
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3.2.
Option and Option Deadline. On a Collaboration Program-by-Collaboration Program
basis, Ionis hereby grants to Biogen and its Affiliates an exclusive option to
obtain the license set forth in Section 4.1.1 with respect to such Collaboration
Program (each, an “Option”). Each Option for a Collaboration Program will be
available to Biogen and its Affiliates until 5:00 pm (Eastern Time) on the [***]
(A) the [***] following the IND-Enabling Toxicology Studies Completion Date for
the applicable Collaboration Program, and (B) the [***] anniversary of the date
the Development Candidate was designated for such Collaboration Program under
Section 1.4.2(b) (the “Option Deadline”); provided, however, if Biogen
determines that an HSR Filing is required to be made under the HSR Act to
exercise the Option and notifies Ionis of such determination within [***] after
the IND-Enabling Toxicology Studies Completion Date, the Parties will promptly
file an HSR Filing in accordance with Section 3.3 and the Option Deadline will
be extended until 5:00 pm (Eastern Time) on the fifth Business Day after the HSR
Clearance Date. If, by the Option Deadline, Biogen or its designated Affiliate
(i) notifies Ionis in writing that it wishes to exercise the Option, and (ii)
pays to Ionis the license fee set forth in Section 6.2, Ionis will, and hereby
does, grant to Biogen or its designated Affiliate the license set forth in
Section 4.1.1. If, by the Option Deadline, Biogen or its designated Affiliate
has not both (y) provided Ionis a written notice stating that Biogen is
exercising its Option, and (z) paid Ionis the license fee in accordance with
Section 6.2, then Biogen’s Option for the applicable Collaboration Program will
expire and (a) upon Ionis’ request, Biogen will provide to Ionis any data
generated under the Collaboration Program and licensed to Ionis under Section
4.3.2, and (b) upon Biogen’s request, Ionis will provide to Biogen any data
generated under the Collaboration Program and licensed to Biogen under Section
4.3.1.

3.3.
HSR Compliance.

3.3.1.
HSR Filing. If Biogen notifies Ionis pursuant to Section 3.2 that an HSR Filing
is required to exercise an Option under this Agreement, each of Biogen and Ionis
will, within five Business Days after such notice from Biogen (or such later
time as may be agreed to in writing by the Parties), file with the United States
Federal Trade Commission (“FTC”) and the Antitrust Division of the United States
Department of Justice (“DOJ”), any HSR Filing required with respect to the
transactions contemplated hereby. The Parties will cooperate with one another to
the extent necessary in the preparation of any such HSR Filing. Each Party will
be responsible for its own costs and expenses (other than filing fees, which
Biogen will pay) associated with any HSR Filing.

3.3.2.
HSR Clearance. In furtherance of obtaining HSR Clearance for an HSR Filing filed
under Section 3.3.1, Ionis and Biogen will use their respective commercially
reasonable efforts to resolve as promptly as practicable any objections that may
be asserted with respect to this Agreement or the transactions contemplated by
this Agreement under any antitrust, competition or trade regulatory law. In
connection with obtaining such HSR Clearance from the FTC, the DOJ or any other
governmental authority, Biogen and its Affiliates will not be required to (i)
sell, divest (including through a license or a reversion of licensed or assigned
rights), hold separate, transfer or dispose of any assets, operations, rights,
product lines, businesses or interest therein of Biogen or any of its Affiliates
(or consent to any of the foregoing actions); or (ii) litigate or otherwise
formally oppose any determination (whether judicial or administrative in nature)
by a governmental authority seeking to impose any of the restrictions referenced
in clause (i) above.

 
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3.4.
Restrictions on Ionis’ Right to Grant Diagnostic Rights; Right to Negotiate
Diagnostic Rights.

3.4.1.
Ionis hereby grants to Biogen and its Affiliates an option (the “Diagnostic
Option”) to negotiate during the Full Royalty Period the terms of an agreement
under which [***]. The Diagnostic Option will be available to Biogen and its
Affiliates until the expiration of the [***].

3.4.2.
During the [***], Ionis (i) has the right to [***], and (ii) will not [***].

3.4.3.
If, during the [***], Ionis grants any Third Party a [***], then Ionis will
promptly notify Biogen of such [***] and will offer Biogen a [***].

ARTICLE 4.
LICENSE GRANTS

4.1.
License Grants to Biogen.

4.1.1.
Development and Commercialization License. Subject to the terms and conditions
of this Agreement, on a Collaboration Program-by-Collaboration Program basis,
effective upon Biogen’s exercise of the Option for a particular Collaboration
Program in accordance with this Agreement, Ionis grants to Biogen a worldwide,
exclusive, royalty-bearing, sublicensable (in accordance with Section 4.1.2
below) license under the Licensed Technology to research, Develop, Manufacture,
have Manufactured (in accordance with Section 4.1.2 below), register, market and
Commercialize Products under such Collaboration Program in the Field.

4.1.2.
Sublicense Rights; CMO Licenses.

(a)
Subject to the terms and conditions of this Agreement, Biogen will have the
right to grant sublicenses under the licenses granted under Section 4.1.1 above
and Section 4.4.1(b) below:

(i)
under the Ionis Core Technology Patents, Ionis Product-Specific Patents (to the
extent not assigned under Section 4.2.1) and Ionis Know-How, to an Affiliate of
Biogen or a Third Party; and

(ii)
under the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and
Analytical Know-How, solely to (x) [***] or (y) [***];

 
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provided that each such sublicense will be subject to, and consistent with, the
terms and conditions of this Agreement. If, within [***] days of first learning
of any breach of such sublicense terms, Biogen fails to take any action to
enforce the sublicense terms of a sublicense granted pursuant to this Section
4.1.2, which failure would cause an adverse effect on Ionis, Biogen hereby
grants Ionis the right to enforce such sublicense terms on Biogen’s behalf and
will cooperate with Ionis (which cooperation will be at Biogen’s sole expense,
and will include Biogen joining any action before a court or administrative body
filed by Ionis against such Sublicensee if and to the extent necessary for Ionis
to have legal standing before such court or administrative body) in connection
with enforcing such terms. Biogen will provide Ionis with a true and complete
copy of any sublicense granted pursuant to this Section 4.1.2 within [***] days
after the execution thereof.

(b)
In connection with Biogen’s selecting and engaging one or more CMOs to supply
Clinical Supplies or supply API and Finished Drug Product for Development or
Commercialization, Ionis will, at Biogen’s option, either (1) grant a license
from Ionis [***] under the [***] to the extent necessary for [***], which Ionis
agrees it will grant to [***], or (2) permit Biogen to grant a sublicense from
Biogen to [***]. For the Products, each such manufacturing agreement between
Biogen and a CMO will contain [***]. Biogen will provide Ionis with a true and
complete copy of any manufacturing agreement entered into with a CMO within
[***] days after the execution thereof. Notwithstanding the foregoing, if Ionis
fails to comply with the terms of this Section 4.1.2(b) and does not cure such
failure within 90 days after written notice from Biogen specifying the details
of any such failure, Biogen will have the right to [***].

4.1.3.
Effect of Termination on Sublicenses.

(a)
If this Agreement terminates for any reason, any Sublicensee of Biogen will,
from the effective date of such termination, automatically become a direct
licensee of Ionis with respect to the rights sublicensed to the Sublicensee by
Biogen; so long as (i) such Sublicensee is not in breach of its sublicense
agreement, (ii) such Sublicensee agrees in writing to comply with all of the
terms of this Agreement to the extent applicable to the rights originally
sublicensed to it by Biogen, and (iii) such Sublicensee agrees to pay directly
to Ionis such Sublicensee’s payments under this Agreement to the extent
applicable to the rights sublicensed to it by Biogen. Biogen agrees that it will
confirm clause (i) of the foregoing in writing at the request and for the
benefit of Ionis and if requested, the Sublicensee.

 
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(b)
If this Agreement terminates for any reason, any Sublicensee of Biogen under
Section 4.4.2 and any Sublicensee of Ionis under Section 4.6.2 will, from the
effective date of such termination, automatically become a direct licensee with
respect to the rights sublicensed to the Sublicensee by the applicable Party
hereunder; so long as (i) such Sublicensee is not in breach of its sublicense
agreement, (ii) such Sublicensee agrees in writing to comply with all of the
terms of this Agreement to the extent applicable to the rights originally
sublicensed to such Sublicensee, and (iii) with respect to Sublicensees of
Ionis, such Sublicensee agrees to pay directly to Biogen such Sublicensee’s
payments under Section 4.5.2 to the extent applicable to the rights sublicensed
to it by Ionis. Each Party agrees that it will confirm clause (i) of the
foregoing in writing at the request and for the benefit of the other Party and
if requested, the Sublicensee.

4.1.4.
No Implied Licenses. All rights in and to Licensed Technology not expressly
licensed to Biogen under this Agreement are hereby retained by Ionis or its
Affiliates. All rights in and to Biogen Technology not expressly licensed or
assigned to Ionis under this Agreement, are hereby retained by Biogen or its
Affiliates. Except as expressly provided in this Agreement, no Party will be
deemed by estoppel or implication to have granted the other Party any license or
other right with respect to any intellectual property.

4.1.5.
License Conditions; Limitations. Subject to Section 6.8, any license granted
under Section 4.1.1 and the sublicense rights under Section 4.1.2 are subject to
and limited by (i) any applicable Third Party Obligations, (ii) the Prior
Agreements, and (iii) the Ionis In-License Agreements, in each case to the
extent the provisions of such obligations or agreements have been specifically
disclosed to Biogen in writing (or via electronic data room) prior to Biogen’s
exercise of an Option. With respect to each Product, Ionis will promptly
disclose to Biogen any Third Party Obligations Ionis believes apply to such
Product during the Agreement Term, and Biogen will have the right to elect to
exclude any Third Party Patent Rights and Know-How to which such Third Party
Obligations apply by providing Ionis written notice prior to Option exercise.
If, prior to Option exercise, Biogen provides Ionis with such a written notice
to exclude certain Third Party Patent Rights and Know-How from such license,
such Third Party Patent Rights and Know-How will not be included in the Licensed
Technology licensed with respect to the applicable Product under this Agreement.
If Biogen does not provide Ionis with such a written notice to exclude such
Third Party Patent Rights and Know-How prior to Option exercise, such Third
Party Patent Rights and Know-How (and any Third Party Obligations to the extent
applicable to the applicable Product) will be included in the Licensed
Technology licensed with respect to the applicable Product under this Agreement.

4.1.6.
Trademarks for Products. Biogen or its designated Affiliate will be solely
responsible for developing, selecting, searching, registering and maintaining
and will be the exclusive owner of, all trademarks, trade dress, logos, slogans,
designs, copyrights and domain names used on or in connection with Products.

 
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4.2.
Assignment of Ionis Product-Specific Patents; Grant Back to Ionis.

4.2.1.
Assignment to Biogen. Within [***] after Biogen has paid Ionis [***] under
Section 6.3 and following review and consideration by the JPC, Ionis will assign
to Biogen or one or more of its designated Affiliates, Ionis’ ownership interest
in (i) all Ionis Product-Specific Patents related to such Collaboration Program
that are owned by Ionis (whether solely owned or jointly owned with one or more
Third Parties), and (ii) any Jointly-Owned Program Patents Covering Products
related to such Collaboration Program.

4.2.2.
Grant Back to Ionis. Biogen grants to Ionis a worldwide, sublicensable license
under any Ionis Product-Specific Patents and Jointly-Owned Program Patents
assigned to Biogen under Section 4.2.1, which license shall be exclusive with
respect to such Ionis Product-Specific Patents and non-exclusive with respect to
such Jointly-Owned Program Patents, (i) for all [***], and (ii) to [***] to the
extent permitted by this Agreement.

4.2.3.
Original Agreement. Notwithstanding anything to the contrary in the Original
Agreement, with respect to Isis Product-Specific Patents and Jointly-Owned
Program Patents (each as defined in the Original Agreement) assigned to Biogen
under Section 4.2.1 of the Original Agreement, Biogen shall retain (i) the
non-exclusive right under such Isis Product-Specific Patents and Jointly-Owned
Program Patents to the extent necessary for Biogen to conduct any Biogen
Activities that are Development activities with respect to any Development
Candidate during the Option Period in accordance with this Agreement, (ii)
effective upon Biogen’s exercise of the Option for a particular Collaboration
Program in accordance with this Agreement, and without limiting the provisions
of Section 6.6.1(b), the [***] and (iii) the [***] to the extent permitted by
this Agreement. This Section 4.2.3 amends and supersedes Section 4.2.2 of the
Original Agreement to the extent of any conflict.

4.3.
Data Licenses.

4.3.1.
Data License to Biogen. Ionis hereby grants Biogen a worldwide, non-exclusive,
royalty-free, sublicenseable license under any data included in the Ionis
Program Know-How for (a) any use other than in connection with the development,
manufacture or commercialization of an Oligonucleotide and (b) use in connection
with the development, manufacture or commercialization of any Oligonucleotide
that is being developed or commercialized by the Parties under any Ionis/Biogen
Additional Agreement.

4.3.2.
Data License to Ionis. Biogen hereby grants Ionis a worldwide, non-exclusive,
royalty-free, sublicenseable license under any data included in the Biogen
Program Know-How solely for use in connection with the development, manufacture
or commercialization of Oligonucleotides to the extent permitted by this
Agreement and any Ionis/Biogen Additional Agreement.

 
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4.4.
Enabling Licenses.

4.4.1.
Licenses During the Option Period.

(a)
Subject to the terms and conditions of this Agreement, Ionis hereby grants
Biogen a worldwide, non-exclusive, sublicensable (but only as permitted in
Section 4.4.2 below), royalty-free license under the Ionis Manufacturing and
Analytical Know-How and Ionis Manufacturing and Analytical Patents solely to
conduct Manufacturing and drug substance process and formulation development
activities with respect to any Compound or Product under any Collaboration
Program during the Option Period for such Collaboration Program; provided that
the grant of rights pursuant to this Section 4.4.1(a) shall not include the
right to Manufacture any Compound or Product for Commercialization.

(b)
Subject to the terms and conditions of this Agreement (including Biogen’s
exclusivity covenants under Section 2.1.1), solely to the extent necessary for
Biogen to conduct any Biogen Activities that are Development activities with
respect to any Development Candidate during the Option Period in accordance with
this Agreement, Ionis hereby grants Biogen a worldwide, non-exclusive,
sublicensable (but only as permitted in Section 4.1.2 above), royalty-free
license under the Licensed Technology. Biogen will pay Ionis [***] within [***]
days after Biogen’s receipt of the applicable invoice. For clarity, the grant of
rights pursuant to this Section 4.4.1(b) shall not include the right to
Commercialize any such Product or to Manufacture any such Product for
Commercialization.

4.4.2.
Biogen’s Right to Sublicense. Biogen will have the right to grant sublicenses
under the license granted under Section 4.4.1(a) above (a) in the case of a
sublicense of Biogen’s right to conduct Manufacturing of Compounds or Products,
other than any sublicense to conduct manufacturing in support of drug substance
process and formulation development activities, solely to (i) [***] or (ii) a
[***] and (b) in the case of a sublicense of Biogen’s right to conduct drug
substance process and formulation development activities, including
manufacturing in support thereof, to [***], provided that each such sublicense
will be subject to, and consistent with, the Manufacturing Process Development
Terms. If, within [***] days of first learning of any breach of such sublicense
terms by any such Sublicensee, Biogen fails to take any action to enforce the
sublicense terms of a sublicense granted pursuant to this Section 4.4.2, which
failure would cause an adverse effect on Ionis, Biogen hereby grants Ionis the
right to enforce such sublicense terms on Biogen’s behalf and will cooperate
with Ionis (which cooperation will be [***], and will include Biogen joining any
action before a court or administrative body filed by Ionis against such
Sublicensee if and to the extent necessary to have legal standing before such
court or administrative body) in connection with enforcing such terms. Biogen
will provide Ionis with a true and complete copy of any sublicense granted
pursuant to this Section 4.4.2 within 30 days after the execution thereof. For
the avoidance of doubt, Section 4.1.3(b) shall apply to sublicenses granted
under this Section 4.4.2.

 
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4.4.3.
Enabling License to Biogen. Subject to the terms and conditions of this
Agreement (including Biogen’s exclusivity covenants under Section 2.1.1), Ionis
hereby grants Biogen an irrevocable, worldwide, non-exclusive, sublicenseable
license under any Ionis Program Technology Controlled by Ionis or its Affiliates
at any time during the Agreement Term to research, develop, manufacture, have
manufactured and commercialize (a) a product that is being developed or
commercialized by Biogen, its Affiliates or its Sublicensee under any
Ionis/Biogen Additional Agreement other than this Agreement, (b) products that
do not include an Oligonucleotide as an active pharmaceutical ingredient, (c)
Gene-Editing Products and (d) Duplex Products. Such license in clause (b),
clause (c) and clause (d) above is royalty-free; except that if a product being
sold by Biogen, its Affiliates or Sublicensees is Covered by a Target Related
Ionis Program Claim, then on a country-by-country basis Biogen will pay Ionis a
royalty equal to [***]% of Net Sales of any product sold by Biogen, its
Affiliates or Sublicensees so long as such product is Covered by such Target
Related Ionis Program Claim in such country. A “Target Related Ionis Program
Claim” means a Valid Claim that (i) is within an Ionis Program Patent that is
solely owned by Ionis, (ii) Covers a product being sold by Biogen, its
Affiliates or Sublicensee, and (iii) claims a gene target, or a method of
modulating such gene target to achieve a prophylactic or therapeutic
effect/benefit.

4.4.4.
Enabling License to Ionis. Subject to the terms and conditions of this Agreement
(including Ionis’ exclusivity covenants under Section 2.1.1), Biogen hereby
grants Ionis an irrevocable, worldwide, non-exclusive, sublicenseable license
under any Biogen Program Technology Controlled by Biogen or its Affiliates at
any time during the Agreement Term, other than any Biogen Results licensed to
Ionis under Section 4.5.1, to research, develop, manufacture, have manufactured
and commercialize (a) products that include an Oligonucleotide as an active
pharmaceutical ingredient (other than products that include an Oligonucleotide
that is designed to bind to the RNA that encodes the same target as a product
that is being developed or commercialized by Biogen, its Affiliates or
Sublicensee under this Agreement or any other Ionis/Biogen Additional
Agreement), (b) Gene-Editing Products and (c) Duplex Products. Such licenses are
royalty-free; except that if a product being sold by Ionis, its Affiliates or
Sublicensee is Covered by a Target Related Biogen Program Claim, then on a
country-by-country basis Ionis will pay Biogen a royalty equal to [***]% of net
sales of any product sold by Ionis, its Affiliates or Sublicensees, for so long
as such product is Covered by such Target Related Biogen Program Claim in such
country. For the purpose of the foregoing royalty calculation, “net sales” will
be calculated in accordance with the definition of “Net Sales” as set forth in
Appendix 1, applied mutatis mutandis to such calculation. The provisions of
Sections 6.8.3(b) through 6.12 shall apply, mutatis mutandis, to any royalty
payments by Ionis to Biogen under this Section 4.4.4. A “Target Related Biogen
Program Claim” means a Valid Claim that (i) is within a Biogen Program Patent
that is solely owned by Biogen, (ii) Covers a product being sold by Ionis, its
Affiliates or Sublicensee, and (iii) claims a gene target, or a method of
modulating such gene target to achieve a prophylactic or therapeutic
effect/benefit.

 
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4.5.
Licenses to Ionis for Biogen Results.

4.5.1.
Subject to the terms and conditions of this Agreement, Biogen hereby grants
Ionis an irrevocable, worldwide, non-exclusive, sublicensable license under the
Biogen Results Controlled by Biogen or its Affiliate at any time during the
Agreement Term, to research, develop, make, have made, import, export, use and
sell (a) products that include an Oligonucleotide as an active pharmaceutical
ingredient (other than products that include an Oligonucleotide that is designed
to bind to the RNA that encodes the same target as a product that is being
developed or commercialized by the Parties pursuant to an Option or exclusive
license granted from Ionis to Biogen under the Ionis/Biogen Additional
Agreements), (b) Gene-Editing Products and (c) Duplex Products.

4.5.2.
The licenses granted in Section 4.5.1 shall be royalty-free with respect to any
unpatented Know-How within the Biogen Results and with respect to any Biogen
Manufacturing Program Patent that Ionis or its Affiliates exploits solely in
connection with Ionis’ or its Affiliates’ internal programs. Such licenses will
be royalty-bearing with respect to any Biogen Manufacturing Program Patent,
including any Biogen Manufacturing Program Patent with respect to which Biogen
files a patent application at any time after such Biogen Results arose, that
Ionis sublicenses to a sublicensee (other than Third Party sublicensees acting
on Ionis’ or its Affiliates’ behalf in connection with Ionis’ or its Affiliates’
internal programs) as follows: on a country-by-country, product-by-product and
Biogen Manufacturing Program Patent-by-Biogen Manufacturing Program Patent
basis, Ionis will pay Biogen a royalty on net sales of each such product equal
to (a) [***]% if the product sold by or on behalf of Ionis’ Third Party
sublicensees is Covered by one Biogen Manufacturing Program Patent, for so long
as such product is Covered by such Biogen Manufacturing Program Patent in such
country; (b) [***]% if the product sold by or on behalf of Ionis’ Third Party
sublicensees is Covered by two Biogen Manufacturing Program Patents, for so long
as such product is Covered by such Biogen Manufacturing Program Patents in such
country; (c) [***]% if the product sold by or on behalf of Ionis’ Third Party
sublicensees is Covered by three Biogen Manufacturing Program Patents, for so
long as such product is Covered by such Biogen Manufacturing Program Patents in
such country; and (d) [***]% if the product sold by or on behalf of Ionis’ Third
Party sublicensees is Covered by four or more Biogen Manufacturing Program
Patents, for so long as such product is Covered by such Biogen Manufacturing
Program Patents in such country. The foregoing royalties shall not be
cumulative, and in no event shall the royalty payable by Ionis under this
Section 4.5.2 exceed [***]% of net sales of any such product. If one or more
Biogen Manufacturing Program Patents expires, is invalidated or otherwise ceases
to Cover a product bearing royalties as set forth above, the applicable royalty
rate under this Section 4.5.2 shall be recalculated to reflect the number of
Biogen Manufacturing Program Patents then-Covering such product. For the purpose
of the foregoing royalty calculation, “net sales” will be calculated as follows:
(i) in the case where the applicable sublicense agreement contains a definition
of net sales that is customarily used in pharmaceutical industry technology
licensing or collaboration contracts and was negotiated in good faith at
arms-length, the definition of net sales under such sublicense agreement will be
used in calculating the royalty payment to Biogen under this letter agreement,
or (ii) in the case where (i) does not apply, the definition of “Net Sales” as
set forth in Appendix 1 of this Agreement will be used mutatis mutandis. If
Ionis grants a sublicense under this Section 4.5 to an entity that is an Ionis
Affiliate at the time Ionis grants such sublicense, such applicable sublicense
will [***], except that any sublicense Ionis grants to [***] under this Section
4.5.2 will [***]. The provisions of Sections 6.8.3(b) through 6.12 shall apply,
mutatis mutandis, to any royalty payments by Ionis to Biogen under this Section
4.5.2.

 
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4.6.
Right to Obtain Direct License from Biogen to Ionis Partner; Sublicensees of
Ionis.

4.6.1.
If requested by Ionis, Biogen shall grant a direct, royalty-bearing license
under the Biogen Results to a bona fide Third Party licensee or Affiliate of
Ionis designated by Ionis on the same terms as set forth in Section 4.5 with
respect to sublicenses of Ionis. Biogen shall endeavor in good faith to grant
such license within thirty (30) days of any such request by Ionis.

4.6.2.
Ionis will have the right to grant sublicenses under the licenses granted under
Section 4.5, provided that each such sublicense will be subject to, and
consistent with, the terms and conditions of this Agreement. If, within [***] of
first learning of any breach of such sublicense terms, Ionis fails to take any
action to enforce the sublicense terms of a sublicense granted pursuant to this
Section 4.6.2, which failure would cause an adverse effect on Biogen, Ionis
hereby grants Biogen the right to enforce such sublicense terms on Ionis’ behalf
and will cooperate with Biogen (which cooperation will [***], and will include
Ionis joining any action before a court or administrative body filed by Biogen
against such Sublicensee if and to the extent necessary for Biogen to have legal
standing before such court or administrative body) in connection with enforcing
such terms. Ionis will provide Biogen with a true and complete copy of any
sublicense granted pursuant to this Section 4.6.2 within 30 days after the
execution thereof.

4.7.
Ownership of and Assistance with Regulatory Filings.

4.7.1.
In General. After exercising the Option for a particular Collaboration Program,
Biogen will have sole ownership of all INDs, NDAs, MAAs, orphan drug
designations and other regulatory filings and documentation with respect to the
Products under such Collaboration Program. If Biogen requests, Ionis will assist
Biogen in preparing regulatory filings for the Products, under terms negotiated
in good faith between Ionis and Biogen, including payment for Ionis’ time at
Ionis’ then applicable FTE Rate plus any reasonable out-of-pocket expenses
incurred by Ionis in providing such assistance, utilizing the payment mechanism
set forth in Section 1.8.

 
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4.7.2.
Priority Review Vouchers. After exercising the Option for a particular
Collaboration Program, if Biogen receives a Priority Review Voucher from the FDA
for the applicable Development Candidate or Product, the following provisions
will apply:

(a)
Biogen will be the sole and exclusive owner of such Priority Review Voucher;

(b)
if Biogen [***] or [***] such Priority Review Voucher [***], then [***] such
Priority Review Voucher will [***] for the applicable [***] in the [***] which
[***] is [***], subject to all applicable [***]; and

(c)
Biogen will determine, in its sole discretion, whether to [***] the Priority
Review Voucher [***] or [***] the Priority Review Voucher [***]. If Biogen
determines to [***] the Priority Review Voucher [***], then Biogen will consider
in good faith [***], to the [***] the Priority Review Voucher [***] or any of
the [***].

4.8.
Subcontracting.

4.8.1.
Subject to the terms of this Section 4.8, each Party will have the right to
engage Third Party subcontractors to perform certain of its obligations under
this Agreement. Any subcontractor to be engaged by a Party to perform a Party’s
obligations set forth in the Agreement will meet the qualifications typically
required by such Party for the performance of work similar in scope and
complexity to the subcontracted activity and will enter into such Party’s
standard nondisclosure agreement consistent with such Party’s standard
practices. Any Party engaging a subcontractor hereunder will remain responsible
and obligated for such activities and will not grant rights to such
subcontractor that interfere with the rights of the other Party under this
Agreement. Each Party will be responsible for any income or non-income taxes
that arise as a result of such Party’s use of any Third Party subcontractors
hereunder, including payroll, income, withholding, sales and use, VAT, customs,
duties excise or property taxes, and such taxes will not be reimbursable
expenditures.

 
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4.8.2.
Ionis agrees that, where Biogen wishes to (sub)contract with a Third Party with
respect to any of the rights granted under Section 4.4.1(a), Ionis shall, within
[***] of any request by Biogen, provide Biogen with a letter of authorization as
necessary for Biogen to be able to contract with such Third Party in accordance
with the terms of this Agreement. Biogen will ensure that any Third Party
(sub)contractors Biogen uses to conduct the process development or manufacturing
activities contemplated by Section 4.4.1(a) will be obligated to assign to
Biogen all right, title and interest in and to any inventions developed by such
(sub)contractors in the performance of such activities. Biogen will not enter
into any new agreement or other obligation with any Third Party, or amend an
existing agreement with a Third Party, in each case that restricts, limits,
diminishes or encumbers the rights granted to Ionis under the Manufacturing
Process Development Terms. In addition, after the Effective Date, Biogen will
use reasonable efforts to include, in any agreement with a (sub)contractor that
has substantial material obligations related to the Development, Manufacture or
Commercialization of a Product, provisions requiring that, in the event the
applicable Option is terminated, expires unexercised or this Agreement is
terminated, such (sub)contractor would enter into an agreement with Ionis with
respect to such Product that is substantially similar to such (sub)contractor’s
agreement with Biogen and would reasonably cooperate with Ionis to facilitate
the transition of such Product to Ionis following such termination or Option
expiration, including the transfer to Ionis of data and information in such
(sub)contractor’s possession related to the Product.

4.9.
Technology Transfer.

4.9.1.
Technology Transfer to Biogen during the Option Period. Within [***] after the
Effective Date, Ionis will deliver to Biogen or one or more designated
Affiliates, solely for use by Biogen, its Affiliates or a Third Party acting on
Biogen’s behalf to conduct any Biogen Activities that are Development activities
and any Manufacturing activities permitted under Section 4.4.1(a) in accordance
with this Agreement, all Ionis Know-How and Ionis Manufacturing and Analytical
Know-How in Ionis’ Control that is necessary to conduct such Biogen Activities.
If requested by Biogen, Ionis will provide Biogen with a reasonable level of
assistance in connection with such transfer, which Biogen will reimburse Ionis
for its time incurred in providing such assistance at the then-applicable FTE
Rate, plus any reasonable out-of-pocket expenses incurred by Ionis in providing
such assistance, using the payment mechanism set forth in Section 1.8.

4.9.2.
Technology Transfer to Biogen after Option Exercise. On a Collaboration
Program-by-Collaboration Program basis, Ionis will promptly, but no later than
[***] after Biogen exercises its Option for such Collaboration Program
hereunder, deliver to Biogen or one or more designated Affiliates:

 
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(a)
Ionis Know-How. All Ionis Know-How in Ionis’ possession that has not previously
been provided hereunder, for use solely in accordance with the licenses granted
under Section 4.1.1 and Section 10.4.2, and Ionis will and does hereby assign to
Biogen all of Ionis’ right, title and interest in and to all Regulatory
Materials (including drafts) that relate to the applicable Development
Candidate; provided that, (x) notwithstanding the foregoing, and subject to the
provisions of Section 2.1, the Parties acknowledge that Ionis shall be permitted
to use excerpts or portions of any such assigned Regulatory Materials in any
other regulatory submissions, notifications, registrations, approvals and/or
other filings and correspondence made to or with a Regulatory Authority in any
country or jurisdiction related to products other than the Development
Candidate, provided, further that such excerpts or portions shall not include
(i) any non-public data or information, in each case, related solely to the
applicable Development Candidate, or (ii) any Confidential Information of
Biogen, and (y) for clarity, such assignment of Ionis’ right, title and interest
in and to such Regulatory Materials shall not include the assignment of any
Know-How (including any data) contained therein. If Ionis intends to use any
excerpt or portion of any such assigned Regulatory Materials in accordance with
clause (x) of the preceding sentence that are not in the public domain and do
not relate to Ionis’ antisense oligonucleotide platform, Ionis shall, at least
30 days in advance of the anticipated submission of such excerpt or portion to a
Regulatory Authority, notify Biogen of such intent and provide to Biogen a copy
of such proposed excerpt or portion for review and comment. The Parties shall
discuss in good faith any comments of Biogen with respect to such proposed
excerpt or portion prior to submission thereof. To assist with the transfer and
assignment of such Ionis Know-How, Ionis will make its personnel reasonably
available to Biogen during normal business hours for up to [***] ([***]) of
Ionis’ time for each Collaboration Program to transfer such Ionis Know-How under
this Section 4.9.2(a). Thereafter, if requested by Biogen, Ionis will provide
Biogen with a reasonable level of assistance in connection with such transfer,
which Biogen will reimburse Ionis for its time incurred in providing such
assistance at the then-applicable FTE Rate, plus any reasonable out-of-pocket
expenses incurred by Ionis in providing such assistance, using the payment
mechanism set forth in Section 1.8.

(b)
Ionis Manufacturing and Analytical Know-How. Solely for use by Biogen, its
Affiliates or a Third Party acting on Biogen’s behalf to Manufacture API in
Biogen’s own or an Affiliate’s manufacturing facility, all Ionis Manufacturing
and Analytical Know-How in Ionis’ Control relating to Products, which is
necessary for the exercise by Biogen, its Affiliates or a Third Party of the
Manufacturing rights granted under Sections 4.1.1. Upon Biogen’s request,
subject to Section 4.1.2, Ionis will provide up to [***] for [***] ([***]) of
its time for each Collaboration Program to transfer such Ionis Manufacturing and
Analytical Know-How under this Section 4.9.2(b) to any Third Party Manufacturing
API or Finished Drug Product on Biogen’s behalf solely to Manufacture API or
Finished Drug Product in accordance with the terms of this Agreement.
Thereafter, if requested by Biogen, Ionis will provide Biogen with a reasonable
level of assistance in connection with such transfer, which Biogen will
reimburse Ionis for its time incurred in providing such assistance at the
then-applicable FTE Rate, plus any reasonable out-of-pocket expenses incurred by
Ionis in providing such assistance, using the payment mechanism set forth in
Section 1.8.

 
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(c)
API and Product. Upon Biogen’s written request, Ionis will sell to Biogen any
bulk API, Clinical Supplies and Finished Drug Product, and any intermediates,
impurity markers and reference standards relating to a Product in Ionis’
possession at the time of the applicable Option exercise, at a price equal to
[***].

4.9.3.
Results.

(a)
Each Party shall share with the other Party on an Annual basis (preferably at
in-person meetings) the results of such Party’s manufacturing process
development activities, including all data, the identity and location of
vendors, information and results received from vendors, and planned additional
work, (a) in the case of Biogen, to the extent arising under the Manufacturing
Process Development Terms (all Know-How and Patent Rights within the foregoing,
the “Biogen Results”) and (b) in the case of Ionis, to the extent arising under
or otherwise subject to a disclosure obligation of Ionis under this Agreement,
(all Know-How and Patent Rights within the foregoing, the “Ionis Results” and,
collectively with the Biogen Results, the “Results”). All intellectual property
matters with respect to the Results, including any Patent Rights therein, will
be governed by the intellectual property provisions of this Agreement, and the
Know-How and Patent Rights included in the Ionis Results shall constitute Ionis
Manufacturing and Analytical Know-How and Ionis Manufacturing and Analytical
Patents, respectively, under this Agreement. If requested by either Party,
Biogen and Ionis will establish a manufacturing committee to facilitate the
exchange of Results between the Parties. For clarity, Biogen shall have the
right, in its sole discretion, to determine whether to seek patent protection
for any Biogen Results that are not jointly owned with Ionis, and Biogen shall
control and be responsible for all aspects of the Prosecution and Maintenance of
any Patent Right within such Biogen Results (each, a “Biogen Manufacturing
Program Patent”) in accordance with Section 7.2.2(c) of this Agreement. Biogen
shall notify Ionis within 30 days if Biogen files a patent application
Controlled by Biogen or its Affiliates that claims any Biogen Results and shall
provide Ionis with a copy of such patent application. Ionis will have no
obligation to incorporate any Biogen Results into Ionis’ manufacturing
processes.

(b)
For clarity, the Manufacturing Process Development Terms, and not the enabling
licenses set forth in Section 4.4.3 and Section 4.4.4, shall govern with respect
to all Results.

 
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ARTICLE 5.
DEVELOPMENT, MANUFACTURING AND COMMERCIALIZATION

5.1.
Biogen Diligence. Following Option exercise for a Collaboration Program, Biogen
will be solely responsible for all Development, Manufacturing and
Commercialization activities, and for all costs and expenses associated
therewith, with respect to the Development, Manufacture and Commercialization of
Products under such Collaboration Program. If Biogen exercises one or more
Options under this Agreement, Biogen will use Commercially Reasonable Efforts to
Develop, Manufacture and Commercialize at least one Product under this
Agreement.

5.1.1.
Integrated Development Plan for Products. On a Product-by-Product basis, Biogen
will prepare a Development and global integrated Product plan outlining key
aspects of the Development of each Product through Approval as well as key
aspects of worldwide regulatory strategy, market launch, and Commercialization,
including Product sales forecasts (each, an “Integrated Development Plan” or
“IDP”). Biogen will prepare the IDP for each Product no later than [***] after
Option exercise for the Collaboration Program to which such Product relates. The
IDP will include [***]. Schedule 5.1.1 sets forth examples of the types of
information Biogen expects will be available to include in the IDP at different
stages of development and commercialization. Once Biogen has prepared such
plans, Biogen will update the IDP consistent with Biogen’s standard practice and
provide such updates to Ionis [***] ([***]) [***]. Biogen and Ionis will meet
[***] to discuss the draft of the IDP and Biogen will consider, in good faith,
any proposals and comments made by Ionis for incorporation in the final IDP.
Notwithstanding the foregoing, Biogen’s obligations to provide Ionis with
information or reports with respect to a Product under this Section 5.1.1 will
terminate if [***].

5.1.2.
Investigator’s Brochure. Following Option exercise for a Collaboration Program,
Biogen will keep Ionis reasonably informed with respect to the status,
activities and progress of Development of Products under such Collaboration
Program by providing a copy of the Investigator’s Brochure and any updates
thereto to Ionis. Biogen’s obligations under this Section 5.1.2 will terminate
if [***].

5.2.
Regulatory Matters. Consistent with Section 4.7 and Section 4.9.2, if Biogen
exercises an Option with respect to a Collaboration Program, Biogen shall have
ownership of all INDs, NDAs, MAAs, Priority Review Vouchers, orphan drug
designations and other regulatory filings and documentation with respect to
Products under such Collaboration Program, and will be responsible for all
communications with Regulatory Authorities regarding such Products. Subject to
Section 5.2.2 and Section 5.2.3, Biogen will have sole decision-making authority
with respect to the matters set forth in this Section 5.2.

5.2.1.
Participation in Regulatory Meetings. On a Collaboration
Program-by-Collaboration Program basis, following Option exercise for a
particular Collaboration Program, Biogen will provide Ionis with as much advance
written notice as practicable of any meetings that Biogen has or plans to have
with a Regulatory Authority regarding pre-approval or Approval matters for such
Product or that directly relate to Ionis’ antisense oligonucleotide chemistry
platform, and will allow [***] of Ionis to participate in any such meetings at
the direction of Biogen; provided, however, that Biogen may exclude Ionis from
any portion of such meeting that does not pertain to such Product or to Ionis’
antisense oligonucleotide chemistry platform.

 
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5.2.2.
Regulatory Communications. On a Collaboration Program-by-Collaboration Program
basis, following Option exercise for a particular Collaboration Program, Biogen
will promptly provide Ionis with copies of documents and communications
submitted to (including drafts thereof) and received from Regulatory Authorities
[***] that materially impact the Development or Commercialization of such
Product for Ionis’ review and comment, and Biogen will consider in good faith
including any comments provided by Ionis to such documents and communications.
During such period, Biogen will promptly notify Ionis upon receipt of any such
documents or communications from any Regulatory Authority [***].

5.2.3.
Class Generic Claims. To the extent Biogen intends to make any claims in a
Product label or regulatory filing that are class generic to ASOs, Biogen will
provide such claims and regulatory filings to Ionis in advance and will consider
in good faith any proposals and comments made by Ionis, provided, however, that
Biogen is not obligated to incorporate such proposals and comments in any such
claims and regulatory filings.

5.2.4.
Applicable Laws. Biogen will perform its activities pursuant to this Agreement
in compliance with good laboratory and clinical practices and cGMP, in each case
as applicable under the laws and regulations of the country and the state and
local government wherein such activities are conducted.

5.3.
Pharmacovigilance Agreement; Global Safety Database.

5.3.1.
Pharmacovigilance Agreement. No later than [***] prior to the date on which
Biogen reasonably anticipates that it will exercise an Option, the Parties shall
enter into a written pharmacovigilance agreement governing each Party’s
respective obligations with respect to safety-related matters, including matters
relating to the collection, review, assessment, tracking, exchange and filing of
information related to adverse events associated with such Product, on terms
substantially the same as the terms of the safety data exchange agreements
entered into by the Parties with respect to the ALS Collaboration Programs and
Biogen Conducted Non-ALS Collaboration Programs (each as defined in the Amended
and Restated Strategic Neurology Drug Discovery and Development Collaboration,
Option and License Agreement between the Parties dated October 20, 2017).

 
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5.3.2.
Ionis’ Antisense Safety Database.

(a)
Ionis maintains an internal database that includes information regarding the
tolerability of its drug compounds, individually and as a class, including
information discovered during preclinical and clinical development (the “Ionis
Internal ASO Safety Database”). In an effort to maximize understanding of the
safety profile and pharmacokinetics of Ionis compounds, Biogen will cooperate in
connection with populating the Ionis Internal ASO Safety Database. To the extent
collected by Biogen and in the form in which Biogen uses/stores such information
for its own purposes, Biogen will provide Ionis with information concerning
toxicology, pharmacokinetics, safety pharmacology study(ies), serious adverse
events and other safety information related to Products as soon as practicable
following the date such information is available to Biogen (but not later than
[***] after Biogen’s receipt of such information). In connection with any
reported serious adverse event, Biogen will provide Ionis all serious adverse
event reports, including initial, interim, follow-up, amended, and final
reports. In addition, with respect to Products, Biogen will provide Ionis with
copies of Annual safety updates filed with each IND and the safety sections of
any final Clinical Study reports within [***] following the date such
information is filed or is available to Biogen, as applicable. Furthermore,
Biogen will promptly provide Ionis with any supporting data and answer any
follow-up questions reasonably requested by Ionis. All such information
disclosed by Biogen to Ionis will be Biogen Confidential Information; provided,
however, that Ionis may disclose any such Biogen Confidential Information to (i)
Ionis’ other partners pursuant to Section 5.3.2(b) below if such information is
regarding class generic properties of ASOs, or (ii) any Third Party, in each
case, so long as Ionis does not disclose the identity of a Product or Biogen.
Biogen will deliver all such information to Ionis for the Ionis Internal ASO
Safety Database to Ionis Pharmaceuticals, Inc., 2855 Gazelle Court, Carlsbad,
California 92010, Attention: Chief Medical Officer (or to such other
address/contact designated in writing by Ionis). Biogen will also cause its
Affiliates and Sublicensees to comply with this Section 5.3.2(a).

(b)
From time to time, Ionis utilizes the information in the Ionis Internal ASO
Safety Database to conduct analyses to keep Ionis and its partners informed
regarding class generic properties of ASOs, including with respect to safety. As
such, if and when Ionis identifies safety or other related issues that may be
relevant to a Product (including any potential class-related toxicity), Ionis
will promptly (and in no event later than five Business Days following
identification by Ionis) inform Biogen of such issues and, if requested, provide
the data supporting Ionis’ conclusions.

5.4.
Research and Manufacturing Records. Each Party shall maintain, consistent with
its then-current internal policies and practices, and cause its employees and
subcontractors to maintain, consistent with its internal policies and Applicable
Law, for at least ten (10) years, records and laboratory notebooks, inventory,
purchase and invoice records and Manufacturing records, in each case, with
respect to the Products in sufficient detail and in a good scientific manner
appropriate for (i) inclusion in filings with Regulatory Authorities for such
Products, and (ii) obtaining and maintaining intellectual property rights and
protections, including Patent Rights for such Products. Such records and
laboratory notebooks shall be complete and accurate in all material respects and
shall fully and properly reflect all work done, data and developments made, and
results achieved. Each Party shall allow the other Party, to the extent
necessary for such regulatory or intellectual property protection purposes, to
inspect or copy such records, subject to redaction by such Party.

 
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ARTICLE 6.
FINANCIAL PROVISIONS

6.1.
Up-Front Fee. Within [***] Business Days following the Effective Date, Biogen
will pay Ionis an up-front fee of $25,000,000.

6.2.
License Fee. On an Option-by-Option basis, together with Biogen’s written notice
to Ionis stating that Biogen is exercising such Option in accordance with this
Agreement, Biogen will pay to Ionis a license fee of (A) $[***] if such Option
is for the [***] Collaboration Program, or (B) $[***] if such Option is for the
[***] Collaboration Program.

6.3.
Development Milestone Payments. On a Collaboration Program-by-Collaboration
Program basis, Biogen will pay to Ionis the milestone payments as set forth in
Table 1 below when a milestone event (each, a “Development Milestone Event”)
listed in Table 1 is first achieved by a Development Candidate under such
Collaboration Program:

 

 
Table 1
 
Development Milestone
Event
Development Milestone
Event Payment for [***]
Collaboration Program
Development Milestone
Event Payment for [***]
Collaboration Program
 
[***]
$[***]
$[***]
 
[***]
$[***]
$[***]
 
[***]
$[***]
$[***]
 
[***]
$[***]
$[***]

 

6.4.
Sales Milestone Payments. On a Collaboration Program-by-Collaboration Program
basis, Biogen will pay to Ionis the milestone payments as set forth in Table 2
below when a milestone event (each, a “Sales Milestone Event”, and together with
the Development Milestone Events, the “Milestone Events”) listed in Table 2 is
first achieved by a Product under such Collaboration Program:

 
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Table 2
 
Sales Milestone Event
Sales Milestone Event Payment
 
Annual Worldwide Net Sales of a Product > $[***]
$[***]
 
Annual Worldwide Net Sales of a Product > $[***]
$[***]
 
Annual Worldwide Net Sales of a Product > $[***]
$[***]
 
Annual Worldwide Net Sales of a Product > $[***]
$[***]

 

6.5.
Limitations on Milestone Payments; Exceptions; Notice.

6.5.1.
On a Collaboration Program-by-Collaboration Program basis, each milestone
payment set forth in Table 1 and Table 2 above will be paid only once upon the
first achievement of the Milestone Event by a Development Candidate under such
Collaboration Program, regardless of how many Development Candidates related to
such Collaboration Program achieve such Milestone Event.

6.5.2.
If the [***] Milestone Event is not achieved because Development activities
transpired such that achievement of such Milestone Event was unnecessary or did
not otherwise occur, then upon achievement of the [***] Milestone Event, the
Milestone Event payment applicable to the [***] Milestone Event will also be
due. Similarly, if the “Annual Worldwide Net Sales of a Product > $[***]” Sales
Milestone Event is achieved in a particular Calendar Year and the “Annual
Worldwide Net Sales of a Product > $[***]” Sales Milestone Event is also
achieved in such Calendar Year, then both the “Annual Worldwide Net Sales of a
Product > $[***]” and the “Annual Worldwide Net Sales of a Product > $[***]”
Sales Milestone Event payments are due.

6.5.3.
Each time a Milestone Event is achieved under this ARTICLE 6, Biogen will send
Ionis a written notice thereof promptly (but no later than five Business Days)
following the date of achievement of such Milestone Event and such payment will
be due within [***] of the date such notice was delivered.

6.6.
Royalty Payments to Ionis.

6.6.1.
Biogen Full Royalty. As partial consideration for the rights granted to Biogen
hereunder, subject to the provisions of this Section 6.6.1 and Section 6.6.2,
Biogen will pay to Ionis royalties on a Collaboration Program-by-Collaboration
Program basis on Annual worldwide Net Sales of Products included in the
applicable Collaboration Program sold by Biogen, its Affiliates or Sublicensees,
on a country-by-country basis, in each case in the amounts as follows in Table 3
below (the “Biogen Full Royalty”):

 
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Table 3
Royalty
Tier
 
Annual Worldwide Net Sales of
Products for the applicable
Collaboration Program
Royalty
Rate for [***]
Collaboration
Program
Royalty
Rate for [***]
Collaboration
Program
1
 
For the portion of Annual Worldwide Net Sales < $[***]
[***]%
[***]%
2
 
For the portion of Annual Worldwide Net Sales > $[***] but < $[***]
[***]%
[***]%
3
 
For the portion of Annual Worldwide Net Sales > $[***] but < $[***]
[***]%
[***]%
4
 
For the portion of Annual Worldwide Net Sales > $[***] but < $[***]
[***]%
[***]%
5
 
For the portion of Annual Worldwide Net Sales > $[***] but < $[***]
[***]%
[***]%
6
 
For the portion of Annual Worldwide Net Sales > $[***] but < $[***]
[***]%
[***]%
7
 
For the portion of Annual Worldwide Net Sales > $[***]
[***]%
[***]%

Annual worldwide Net Sales of Products will be calculated by [***].

(a)
Biogen will pay Ionis royalties on Net Sales of Products [***] under Applicable
Laws, and Biogen will provide reports and payments to Ionis consistent with
Section 6.9. No royalties are due on Net Sales of Products arising from
compassionate use and other programs providing for the delivery of Product at no
cost. The sales of Products arising from named patient, compassionate use, or
other similar programs will not be considered a First Commercial Sale for
purposes of calculating the Full Royalty Period.

(b)
For purposes of clarification, any Ionis Product-Specific Patents assigned to
Biogen (i) under the Original Agreement that would, but for such assignment,
Cover the applicable Product, or (ii) as set forth in Section 4.2.1, will still
be considered Ionis Product-Specific Patents for determining the royalty term
and applicable royalty rates under this ARTICLE 6.

6.6.2.
Application of Royalty Rates. All royalties set forth under Section 6.6.1 are
subject to the provisions of this Section 6.6.2, and are payable as follows:

(a)
Full Royalty Period. Biogen’s obligation to pay Ionis the Biogen Full Royalty
above with respect to a Product will continue on a country-by-country and
Product-by-Product basis from the date of First Commercial Sale of such Product
until the later of the date of expiration of (i) the last Valid Claim within the
Licensed Patents Covering such Product in the country in which such Product is
made, used or sold, [***], or (iii) the [***] anniversary of the First
Commercial Sale of such Product in such country (such royalty period, the “Full
Royalty Period”).

 
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(b)
Competition from Generic Products. Subject to Section 6.6.2(d), on a
country-by-country and Product-by-Product basis, if, within the [***] a Generic
Product is sold in a country, then the Biogen Full Royalty rate used to pay
Ionis royalties on a Product in such country will be reduced to [***]% of the
otherwise applicable Biogen Full Royalty rate. For the purpose of determining
the [***] for a particular Product under this Section 6.6.2(b), if requested by
Biogen, Ionis and Biogen will meet and confer and mutually agree upon the
Parties’ best estimate of when the Full Royalty Period [***] in each country
where Products are being sold.

(c)
Reduced Royalty Period. Subject to Section 6.6.2(d), on a country-by-country and
Product-by-Product basis, after the expiration of the Full Royalty Period and
until the end of the Reduced Royalty Period, in lieu of the royalty rates set
forth in Table 3 of Section 6.6.1, Biogen will pay Ionis royalty rates (the
“Biogen Reduced Royalty”) on Net Sales of Products calculated on a Calendar
Year-by-Calendar Year basis by [***]; provided, however, that the Biogen Reduced
Royalty rate in each country will in no event exceed the [***].

(d)
Limitation on Aggregate Reductions and Offsets for Biogen Royalties.

(i)
Aggregate Royalty Reductions. In no event will the aggregate royalty reductions
under Section 6.6.2(b) and Section 6.6.2(c) reduce the royalties payable to
Ionis on Net Sales of a Product in any given period to an amount that is less
than the [***] for such Product.

(ii)
Aggregate Royalty Offsets During Full Royalty Period. During the Full Royalty
Period, in no event will the aggregate royalty offsets under Section 6.8.2(b)
and Section 6.8.3 reduce the royalties payable to Ionis on Net Sales of a
Product in any given period to an amount that is less than the greater of (i)
[***], and (ii) [***], provided that Biogen shall have the right to carry
forward as offsets against future royalties payable to Ionis with respect to the
applicable Product, any amounts that but for this Section 6.6.2(d)(ii), Biogen
would have been entitled to deduct from any royalty payments to Ionis.

 
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(iii)
Aggregate Royalty Offsets During Reduced Royalty Period. During the Reduced
Royalty Period, in no event will the aggregate royalty offsets under Section
6.8.2(b) and Section 6.8.3 reduce the royalties payable to Ionis on Net Sales of
a Product in any given period to an amount that is less than the greater of (i)
[***], and (ii) [***], provided that Biogen shall have the right to carry
forward as offsets against future royalties payable to Ionis with respect to the
applicable Product, any amounts that but for this Section 6.6.2(d)(iii), Biogen
would have been entitled to deduct from any royalty payments to Ionis.

(e)
End of Royalty Obligation for Products. On a country-by-country and
Product-by-Product basis, other than [***], Biogen’s obligation to make royalty
payments hereunder for such Product in such country will end on the expiration
of the Reduced Royalty Period for such Product in such country. “Reduced Royalty
Period” means, on a country-by-country and Product-by-Product basis, the period
commencing upon the expiration of [***] in such country and ending when the
[***].

(f)
Royalty Examples. Schedule 6.6.2(f) attached hereto contains examples of how
royalties will be calculated under this Section 6.6.

(g)
Allocation of Net Sales. If, by reason of one or more royalty rate adjustments
under this Section 6.6.2, different royalty rates apply to Net Sales of a
Product from different countries, Biogen will [***] such Net Sales [***].
Schedule 6.6.2(g) attached hereto contains examples of how Net Sales of such
Product from different countries at different royalty rates will be [***].

6.7.
Reverse Royalty Payments to Biogen for a Discontinued Product.

6.7.1.
Reverse Royalty for a Discontinued Product. If Ionis or any of its Affiliates or
Sublicensees Commercializes a Discontinued Product for which Biogen has paid
Ionis a license fee under Section 6.2, then, following the First Commercial Sale
of such Discontinued Product by Ionis or its Affiliates or Sublicensees, Ionis
will pay Biogen or its designated Affiliate a royalty of [***]% of Annual
worldwide Net Sales of such Discontinued Product (“Reverse Royalties”). Ionis’
obligation to pay Biogen Reverse Royalties will [***].

6.7.2.
Applicable Royalty Provisions. In addition to this Section 6.7, the definition
of Net Sales in Appendix 1 and the other provisions contained in this ARTICLE 6
governing payment of royalties from Biogen to Ionis will govern the payment of
Reverse Royalties from Ionis to Biogen under this Section 6.7, mutatis mutandis,
including the provisions of Sections 6.6.2, 6.8, 6.9, 6.10, 6.11, and 6.12.

 
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6.8.
Third Party Payment Obligations.

6.8.1.
Existing Ionis In-License Agreements.

(a)
Certain of the Licensed Technology Controlled by Ionis as of the Effective Date
licensed to Biogen under Section 4.1.1 is in-licensed or acquired by Ionis under
the agreements with Third Party licensors or sellers listed on Schedule 6.8.1 or
in a separate written agreement between the Parties (all such license or
purchase agreements being the “Ionis In-License Agreements”), and certain
milestone or royalty payments and license maintenance fees may become payable by
Ionis to such Third Parties under the Ionis In-License Agreements based on the
Development and Commercialization of a Product by Biogen under this Agreement.

(b)
Any payment obligations arising under the Ionis In-License Agreements as
existing on the Effective Date, as they apply to Products, will be paid by [***]
as [***].

6.8.2.
New Third Party Agreements Prior to Development Candidate Designation.

(a)
If, prior to the designation of a Development Candidate under Section 1.4.2(b)
with respect to a Collaboration Program, either Party becomes aware of Third
Party Patent Rights or Know-How that are necessary to Develop, Manufacture or
Commercialize a Product under such Collaboration Program, Ionis will seek to
obtain a sublicensable license under such Third Party Patent Rights or Know-How.
If Ionis obtains such a license, such Third Party Patent Rights or Know-How
shall automatically be deemed “Licensed Technology” under this Agreement, and
any payment obligations arising under such license, as they apply to Products,
will be paid by [***] as [***]. If any such Third Party Patent Right would have
been considered an Ionis Product-Specific Patent had Ionis Controlled such
Patent Right on the Effective Date, then Biogen shall have the right to review
and comment on the terms of any license with respect to such Third Party Patent
Right prior to execution thereof, and Ionis shall only enter into such license
in the final form approved by Biogen (such approval not to be unreasonably
withheld, delayed or conditioned).

(b)
If Ionis fails to obtain such a license under such Third Party Patent Rights or
Know-How, then Ionis will so notify Biogen, and Biogen may seek to obtain such a
Third Party license. If Biogen obtains such a Third Party license, then, subject
to Section 6.6.2(d), Biogen may offset an amount equal to [***]% of [***]
against [***] (including pursuant to Biogen’s right to carry any excess amounts
forward to subsequent Calendar Quarters as set forth in Section 6.6.2(d)).

 
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6.8.3.
New Third Party Agreements Following Development Candidate Designation.

(a)
Additional Ionis IP.

(i)
If, following the designation of a Development Candidate under Section 1.4.2(b)
with respect to a Collaboration Program, either Party becomes aware of any
Additional Core IP or any Patent Right or Know-How that would have been
considered an Ionis Manufacturing and Analytical Patent or Ionis Manufacturing
and Analytical Know-How had Ionis Controlled such Patent Right or Know-How on
the Effective Date (such Patent Rights and Know-How, “Additional Manufacturing
IP” and, collectively with the Additional Core IP, the “Additional Ionis IP”),
Ionis will have the first right, but not the obligation, to negotiate with and
obtain a license from the Third Party Controlling such Additional Ionis IP. If
Ionis obtains such a Third Party license, Ionis will include such Additional
Ionis IP in the license granted to Biogen under Section 4.1.1, and any financial
obligations under such Third Party agreement will be paid solely by [***] as
[***].

(ii)
If, however, Ionis elects not to obtain such a license to such Additional Ionis
IP, Ionis will so notify Biogen, and Biogen may obtain such a Third Party
license. If Biogen obtains such a Third Party license, then, subject to Section
6.6.2(d), Biogen may offset an amount equal to [***]% of [***] against [***] of
this Agreement [***] (including pursuant to Biogen’s right to carry any excess
amounts forward to subsequent Calendar Quarters as set forth in Section
6.6.2(d)).

(iii)
If it is unclear whether certain Third Party Patent Rights or Know-How
constitute Additional Ionis IP, Ionis will send written notice to such effect to
Biogen, and the Parties will engage a mutually agreed upon independent Third
Party intellectual property lawyer with expertise in the patenting of ASOs, and
appropriate professional credentials in the relevant jurisdiction, to determine
the question of whether or not such Third Party intellectual property is
Additional Ionis IP. The determination of the Third Party expert engaged under
the preceding sentence will be binding on the Parties solely for purposes of
determining whether Biogen is permitted to [***]. The costs of any Third Party
expert engaged under this Section 6.8.3(a)(iii) will be paid by the Party
against whose position the Third Party lawyer’s determination is made.

(iv)
If a Third Party Controlling Additional Ionis IP is awarded a judgment from a
court of competent jurisdiction arising from its claim against Biogen asserting
that [***], Biogen will be permitted to (i) [***], and (ii) [***] (in each case
((A) and (B)), subject to Biogen’s right to carry any excess amounts forward to
subsequent Calendar Quarters as set forth in Section 6.6.2(d)).

 
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(b)
Other Intellectual Property. If following the designation of a Development
Candidate under Section 1.4.2(b) with respect to a Collaboration Program, either
Party becomes aware of Third Party Patent Rights or Know-How that would be [***]
Develop, Manufacture or Commercialize a Product under such Collaboration Program
and that do not constitute Additional Ionis IP [***], then such Party will
promptly provide the other Party with written notice of any such Third Party
Patent Rights or Know-How, and Biogen will have the sole right, but not the
obligation, to negotiate with and obtain a license from the Third Party
Controlling such Third Party Patent Rights or Know-How. Except as expressly set
forth in Section 7.1.3(b), if Biogen obtains such a Third Party license, and
subject to Section 6.6.2(d), Biogen may offset an amount equal to [***]% of
[***] against [***] (including pursuant to Biogen’s right to carry any excess
amounts forward to subsequent Calendar Quarters as set forth in Section
6.6.2(d)); provided, however, [***].

6.9.
Payments.

6.9.1.
Commencement. Beginning with the Calendar Quarter in which the First Commercial
Sale for a Product is made and for each Calendar Quarter thereafter, Biogen will
make royalty payments to Ionis under this Agreement within [***] following the
end of each such Calendar Quarter. Each royalty payment will be accompanied by a
report, summarizing Net Sales for Products during the relevant Calendar Quarter
and the calculation of royalties due thereon, including country, units, sales
price and the exchange rate used and the aggregate reduction to gross sales to
arrive at Net Sales. Following the end of the first full Calendar Quarter
subsequent to First Commercial Sale in a Major Market of any Product (but not in
any subsequent Calendar Quarter unless there is a material change in the amount
of any reduction to gross sales or the methodology used by Biogen to calculate
any such reduction), Biogen will also include in such report a description of
the reductions to gross sales to arrive at Net Sales, broken down by each
category of reduction listed in clauses (a) through (d) of the definition of
“Net Sales” and a non-binding qualitative analysis describing how Biogen
anticipates such reductions may fluctuate over time. If no royalties are payable
in respect of a given Calendar Quarter, Biogen will submit a written royalty
report to Ionis so indicating together with an explanation as to why no such
royalties are payable. In addition, beginning with the Calendar Quarter in which
the First Commercial Sale for a Product is made and for each Calendar Quarter
thereafter, within [***] following the end of each such Calendar Quarter, Biogen
will provide Ionis a [***] report estimating the total Net Sales of, and
royalties payable to Ionis for, Products projected for such Calendar Quarter.

 
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6.9.2.
Mode of Payment. All payments under this Agreement will be (i) payable in full
in United States dollars, regardless of the country(ies) in which sales are
made, (ii) made by wire transfer of immediately available funds to an account
designated by Ionis in writing, and (iii) irrevocable, non-refundable and
non-creditable. Whenever for the purposes of calculating the royalties payable
under this Agreement conversion from any foreign currency will be required, all
amounts will first be calculated in the currency of sale and then converted into
United States dollars by applying the monthly average rate of exchange as
utilized by Biogen, in accordance with GAAP, fairly applied and as employed on a
consistent basis throughout Biogen’s operations.

6.9.3.
Records Retention. Commencing with the First Commercial Sale of a Product,
Biogen will keep complete and accurate records pertaining to the sale of
Products for a period of [***] after the year in which such sales occurred, and
in sufficient detail to permit Ionis to confirm the accuracy of the Net Sales or
royalties paid by Biogen hereunder.

6.10.
Audits. After Biogen is granted a license under Section 4.1.1 for a particular
Product, during the Agreement Term and for a period of [***] thereafter, at the
request and expense of Ionis, Biogen will permit an independent certified public
accountant of nationally recognized standing appointed by Ionis, at reasonable
times and upon reasonable notice, but in no case more than [***], to examine
such records as may be necessary for the purpose of verifying the calculation
and reporting of Net Sales (including for purposes of determining if a milestone
is due under Section 6.4) and the correctness of any royalty payment made under
this Agreement for any period within the preceding [***]. As a condition to
examining any records of Biogen, such auditor will sign a nondisclosure
agreement reasonably acceptable to Biogen in form and substance. Any and all
records of Biogen examined by such independent certified public accountant will
be deemed Biogen’s Confidential Information. Upon completion of the audit, the
accounting firm will provide both Biogen and Ionis with a written report
disclosing whether the royalty payments made by Biogen are correct or incorrect
and the specific details concerning any discrepancies (“Audit Report”). If, as a
result of any inspection of the books and records of Biogen, it is shown that
Biogen’s payments under this Agreement were less than the royalty amount (or
sales milestone amount) which should have been paid, then Biogen will make all
payments required to be made by paying Ionis the difference between such amounts
to eliminate any undisputed discrepancy revealed by said inspection within 45
days of receiving the Audit Report, with interest calculated in accordance with
Section 6.12. If, as a result of any inspection of the books and records of
Biogen, it is shown that Biogen’s payments under this Agreement were greater
than the royalty amount which should have been paid, [***]; provided, however,
that if [***]. Ionis will pay for such audit, except that if Biogen is found to
have underpaid Ionis by more than [***]% of the amount that should have been
paid, Biogen will reimburse Ionis’ reasonable costs of the audit.

 
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6.11.
Taxes.

  6.11.1.
Taxes on Income. Each Party will be solely responsible for the payment of all
taxes imposed on its share of income arising directly or indirectly from the
activities of the Parties under this Agreement.

6.11.2.
Withholding Tax. The Parties agree to cooperate with one another and use
reasonable efforts to lawfully avoid or reduce tax withholding or similar
obligations in respect of royalties, milestone payments, and other payments made
by the paying Party to the receiving Party under this Agreement. To the extent
the paying Party is required to deduct and withhold taxes, interest or penalties
on any payment, the paying Party will pay the amounts of such taxes to the
proper governmental authority for the account of the receiving Party and remit
the net amount to the receiving Party in a timely manner. The paying Party will
promptly furnish the receiving Party with proof of payment of such taxes. If
documentation is necessary in order to secure an exemption from, or a reduction
in, any withholding taxes, the Parties will provide such documentation to the
extent they are entitled to do so.

6.11.3.
Tax Cooperation. Ionis will provide Biogen with any and all tax forms that may
be reasonably necessary in order for Biogen to lawfully not withhold tax or to
withhold tax at a reduced rate under an applicable bilateral income tax treaty.
Following Biogen’s timely receipt of such tax forms from Ionis, Biogen will not
withhold tax or will withhold tax at a reduced rate under an applicable
bilateral income tax treaty, if appropriate under the Applicable Laws. Ionis
will provide any such tax forms to Biogen upon request and in advance of the due
date. Each Party will provide the other with reasonable assistance to determine
if any taxes are applicable to payments under this Agreement and to enable the
recovery, as permitted by Applicable Law, of withholding taxes resulting from
payments made under this Agreement, such recovery to be for the benefit of the
Party who would have been entitled to receive the money but for the application
of withholding tax under this Section 6.11.

The provisions of this Section 6.11 are to be read in conjunction with the
provisions of Section 12.4 below.

6.12.
Interest. Any undisputed payments to be made hereunder that are not paid on or
before the date such payments are due under this Agreement will bear interest at
a rate per annum equal to the lesser of (i) the rate announced by Bank of
America (or its successor) as its prime rate in effect on the date that such
payment would have been first due plus 1% or (ii) the maximum rate permissible
under Applicable Law.

6.13.
Exclusion of Products under Original Agreement. For clarity, and notwithstanding
anything to the contrary in this Agreement or the Original Agreement,
irrespective of whether an [***] Compound or an [***] Compound meets the
definition of a “Compound” as defined in the Original Agreement, if any such
[***] Compound or [***] Compound is designated an [***] Development Candidate,
an [***] Development Candidate, or a Backup Compound under this Agreement, then
such [***] Development Candidate, [***] Development Candidate, and/or Backup
Compound will be subject to the terms of this Agreement and not the terms of the
Original Agreement.

 
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ARTICLE 7.
INTELLECTUAL PROPERTY

7.1.
Ownership.

7.1.1.
Ionis Technology and Biogen Technology. As between the Parties, Ionis will own
and retain all of its rights, title and interest in and to the Licensed Know-How
and Licensed Patents and Biogen will own and retain all of its rights, title and
interest in and to the Biogen Know-How and Biogen Patents, subject to any
assignments, rights or licenses expressly granted by one Party to the other
Party under this Agreement.

7.1.2.
Agreement Technology. As between the Parties, Biogen is the sole owner of any
Know-How discovered, developed, invented or created solely by or on behalf of
Biogen or its Affiliates under this Agreement (“Biogen Program Know-How”) and
any Patent Rights that claim or cover Biogen Program Know-How (“Biogen Program
Patents” and together with the Biogen Program Know-How, the “Biogen Program
Technology”), and will retain all of its rights, title and interest thereto,
subject to any rights or licenses expressly granted by Biogen to Ionis under
this Agreement. As between the Parties, Ionis is the sole owner of any Know-How
discovered, developed, invented or created solely by or on behalf of Ionis or
its Affiliates under this Agreement (“Ionis Program Know-How”) and any Patent
Rights that claim or cover such Know-How (“Ionis Program Patents” and together
with the Ionis Program Know-How, the “Ionis Program Technology”), and will
retain all of its rights, title and interest thereto, subject to any assignment,
rights or licenses expressly granted by Ionis to Biogen under this Agreement.
Any Know-How discovered, developed, invented or created jointly under this
Agreement by or on behalf of both Parties or their respective Affiliates or
Third Parties acting on their behalf (“Jointly-Owned Program Know-How”), and any
Patent Rights that claim or cover such Jointly-Owned Program Know-How
(“Jointly-Owned Program Patents”, and together with the Jointly-Owned Program
Know-How, the “Jointly-Owned Program Technology”), are owned jointly by Biogen
and Ionis on an equal and undivided basis, including all rights, title and
interest thereto, subject to any rights or licenses expressly granted by one
Party to the other Party under this Agreement. Except as expressly provided in
this Agreement, neither Party will have any obligation to account to the other
for profits with respect to, or to obtain any consent of the other Party to
license or exploit, Jointly-Owned Program Technology by reason of joint
ownership thereof, and each Party hereby waives any right it may have under the
laws of any jurisdiction to require any such consent or accounting. Each Party
will promptly disclose to the other Party in writing, and will cause its
Affiliates to so disclose, the discovery, development, invention or creation of
any Jointly-Owned Program Technology. The Biogen Program Patents, Ionis Program
Patents and Jointly-Owned Program Patents are collectively referred to herein as
the “Program Patents.”

 
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7.1.3.
Joint Patent Committee.

(a)
The Parties will establish a Joint Patent Committee (the “JPC”). The JPC will
serve as the primary contact and forum for discussion between the Parties with
respect to intellectual property matters arising under this Agreement, including
the preparation of the intellectual property assessment to be included in each
Development Candidate Data Package and the activities set forth in this ARTICLE
7, and will cooperate with respect to any such activities. Ionis’ obligation to
participate in the JPC will terminate upon Biogen’s exercise of (or the
expiration or termination of) the last Option. Thereafter, Ionis will have the
right, but not the obligation, to participate in JPC meetings. In preparing the
intellectual property assessment to be included in each Development Candidate
Data Package, the JPC will discuss a strategy with regard to intellectual
property considerations with respect to the applicable Development Candidate,
including prosecution and maintenance, defense and enforcement of Ionis
Product-Specific Patents that would be or are licensed to Biogen under Section
4.1.1 in connection with a Product and Biogen Product-Specific Patents, defense
against allegations of infringement of Third Party Patent Rights, and licenses
to Third Party Patent Rights or Know-How, in each case to the extent such matter
would be reasonably likely to have a material impact on this Agreement or the
Original Agreement or the licenses granted hereunder or thereunder, which
strategy will be considered in good faith by the Party entitled to prosecute,
enforce or defend such Patent Rights, as applicable, hereunder, but will not be
binding on such Party.

(b)
Ionis or Biogen (as applicable) will provide the JPC with notice of any Know-How
or Patent Rights discovered, developed, invented or created jointly by such
Party and a Third Party in the performance of activities under the ASO
Development Candidate Identification Plan or activities under the preclinical
toxicology strategy for a Collaboration Program, or solely by a Third Party
performing activities under the ASO Development Candidate Identification Plan or
activities under the preclinical toxicology strategy for a Collaboration Program
on such Party’s behalf (such Know-How and Patent Rights, the “Collaborator IP”)
promptly after such Party receives notice or otherwise becomes aware of the
existence of such Collaborator IP. The JPC will determine whether any such
Collaborator IP would be infringed by the Development, registration, Manufacture
or Commercialization of the applicable Development Candidate or any Compound
under consideration for potential designation as a Development Candidate. If the
JPC (or independent patent counsel engaged pursuant to this Section 7.1.3(b))
determines that any Collaborator IP would be infringed by such Development,
registration, Manufacture or Commercialization, [***]; provided that, [***].

 
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Notwithstanding any provision to the contrary in this Agreement, if Collaborator
IP arises from activities performed by a Third Party under the ASO Development
Candidate Identification Plan or activities under the preclinical toxicology
strategy for a Collaboration Program, then any payment obligations arising under
the applicable [***] based on the Development or Commercialization of a Product
will be paid as follows: [***].

With respect to any such Collaborator IP [***], Biogen will have the right in
accordance with Section 4.1.5 to elect to exclude any such Collaborator IP from
the applicable license granted to Biogen under Section 4.1.1 by providing Ionis
written notice prior to Option exercise. If, prior to the date the applicable
license under Section 4.1.1 is granted hereunder, Biogen provides Ionis with
such a written notice to exclude certain of such Collaborator IP from such
license, such Collaborator IP will not be included in the Licensed Technology
licensed with respect to the applicable Products under this Agreement. If Biogen
does not provide Ionis with such a written notice to exclude such Collaborator
IP prior to the date the applicable license under Section 4.1.1 is granted
hereunder, such Collaborator IP (and any Third Party Obligations to the extent
applicable to Products) will be included in the Licensed Technology licensed
with respect to the applicable Products under this Agreement.

In case of a dispute in the JPC over whether any Collaborator IP would be
infringed by the Development, registration, Manufacture or Commercialization of
the applicable Development Candidate or any Compound under consideration for
potential designation as the Development Candidate, at the non-contracting
Party’s request, such dispute will be resolved by independent patent counsel not
engaged or regularly employed in the past two years by either Party and
reasonably acceptable to both Parties, taking into account any existing prior
art. The decision of such independent patent counsel will be binding on the
Parties. Expenses of such patent counsel will be borne by the non-contracting
Party.

(c)
In addition, the JPC will be responsible for the determination of inventorship
of Program Patents in accordance with United States patent laws. In case of a
dispute in the JPC (or otherwise between Ionis and Biogen) over inventorship of
Program Patents, if the JPC cannot resolve such dispute, such dispute will be
resolved by independent patent counsel not engaged or regularly employed in the
past two years by either Party and reasonably acceptable to both Parties. The
decision of such independent patent counsel will be binding on the Parties.
Expenses of such patent counsel will be shared equally by the Parties.

 
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(d)
The JPC will comprise an equal number of members from each Party. The JPC will
meet as often as agreed by them (and at least semi-Annually), to discuss matters
arising out of the activities set forth in this ARTICLE 7. The JPC will
determine by unanimous consent the JPC operating procedures at its first
meeting, including the JPC’s policies for replacement of JPC members, and the
location of meetings, which will be codified in the written minutes of the first
JPC meeting. To the extent reasonably requested by either Party, the JPC will
solicit the involvement of more senior members of their respective legal
departments (up to the most senior intellectual property attorney, where
appropriate) with respect to critical issues, and may escalate issues to the
Executives for input and resolution pursuant to Section 12.1. Each Party’s
representatives on the JPC will consider comments and suggestions made by the
other in good faith. If either Party deems it reasonably advisable, the Parties
will enter into a mutually agreeable common interest agreement covering the
matters contemplated by this Agreement.

7.2.
Prosecution and Maintenance of Patents. The Parties acknowledge and agree that
it is critical to the success of the Products under this Agreement and to the
continued success of Spinraza®, that the Parties closely coordinate the
Prosecution and Maintenance of any Patent Rights for Products under this
Agreement with the Prosecution and Maintenance of the Patent Rights for
Spinraza® under the Original Agreement. Such efforts will include Ionis’
coordination with Biogen prior to Option exercise of Ionis’ Prosecution and
Maintenance of the Ionis Product-Specific Patents and any Jointly-Owned Program
Patents Covering Products.

7.2.1.
Patent Filings. The Party responsible for Prosecution and Maintenance of any
Patent Rights as set forth in Section 7.2.2 and Section 7.2.3 will endeavor to
obtain patent protection for the applicable Product as it Prosecutes and
Maintains its other patents Covering products in development, using counsel of
its own choice but reasonably acceptable to the other Party, in such countries
as the responsible Party sees fit. On a Collaboration Program-by-Collaboration
Program basis, until the earlier of the date Biogen is granted the license under
Section 4.1.1 and the expiration or termination of Biogen’s right to be granted
such license, Ionis will use Commercially Reasonable Efforts to diligently
Prosecute and Maintain all Ionis Product-Specific Patents and any Jointly-Owned
Program Patents Covering Products, in each case to the extent that Ionis has the
right to Prosecute and Maintain such Patent Rights.

 
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7.2.2.
Licensed Patents and Biogen Patents.

(a)
Licensed Patents In General. Prior to the date Biogen is granted the license
under Section 4.1.1 for a Product, Ionis will control and be responsible for all
aspects of the Prosecution and Maintenance of all Licensed Patents that are the
subject of such license grant, subject to Section 7.2.2(b) and Section 7.2.3;
provided if Biogen reasonably believes that Ionis’ planned Prosecution and
Maintenance of a Product-Specific Patent that would be subject to a license
granted to Biogen under Section 4.1.1, is reasonably likely to adversely affect
the scope, validity or enforceability of a Product-Specific Patent Covering
Spinraza® under the Original Agreement, then the Parties through the JPC will
try to develop a strategy that maximizes the protection for the potential
Development Candidates under this Agreement but is not reasonably likely to
adversely affect the scope, validity or enforceability of a Product-Specific
Patent Covering Spinraza® under the Original Agreement. If the Parties cannot
agree on such a strategy then either Party may refer the matter to (and the
Parties will engage) a mutually agreed upon independent Third Party intellectual
property lawyer with expertise in the patenting of ASOs, and appropriate
professional credentials in the relevant jurisdiction, to determine if Ionis’
planned Prosecution and Maintenance is reasonably likely to adversely affect the
scope, validity or enforceability of a Product-Specific Patent Covering
Spinraza® under the Original Agreement. If such independent Third Party
intellectual property lawyer believes Ionis’ planned Prosecution and Maintenance
is reasonably likely to adversely affect the scope, validity or enforceability
of a Product-Specific Patent Covering Spinraza® under the Original Agreement,
such lawyer will propose a strategy to maximize the protection for the potential
Development Candidates under this Agreement but is not reasonably likely to
adversely affect the scope, validity or enforceability of a Product-Specific
Patent Covering Spinraza®. The determination and recommended strategy of the
Third Party expert engaged under this Section 7.2.2(a) will be binding on the
Parties solely for purposes of setting the Prosecution and Maintenance strategy
for the relevant Product-Specific Patent under this Agreement. The costs of any
Third Party expert engaged under this Section 7.2.2(a) will be paid by the Party
against whose position the Third Party lawyer’s determination is made. During
the Agreement Term, Ionis will control and be responsible for all aspects of the
Ionis Core Technology Patents and Ionis Manufacturing and Analytical Patents.

(b)
Licensed Patents After License Grant. After the date Biogen is granted the
license under Section 4.1.1 for a Product, Biogen will control and be
responsible for all aspects of the Prosecution and Maintenance of all the Ionis
Product-Specific Patents and Jointly-Owned Program Patents that are the subject
of such license to the same extent Ionis had the right to control and was
responsible for such Prosecution and Maintenance immediately prior to such
license.

(c)
Biogen Patents. During the Agreement Term, Biogen will control and be
responsible for all aspects of the Prosecution and Maintenance of all Biogen
Patents, subject to Section 7.2.4.

 
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7.2.3.
Jointly-Owned Program Patents. Ionis will control and be responsible for all
aspects of the Prosecution and Maintenance of Jointly-Owned Program Patents that
do not Cover Products. Prior to the date Biogen is granted the license under
Section 4.1.1, Ionis will control and be responsible for all aspects of the
Prosecution and Maintenance of Jointly-Owned Program Patents Covering Products
that are the subject of such license. After the date Biogen is granted the
license under Section 4.1.1, Biogen will control and be responsible for all
aspects of the Prosecution and Maintenance of Jointly-Owned Program Patents
Covering Products that are the subject of such license.

7.2.4.
Other Matters Pertaining to Prosecution and Maintenance of Patents.

(a)
Each Party will keep the other Party informed through the JPC as to material
developments with respect to the Prosecution and Maintenance of the Ionis Core
Technology Patents, Product-Specific Patents and Jointly-Owned Program Patents
for which such Party has responsibility for Prosecution and Maintenance pursuant
to Section 7.2.2, Section 7.2.3 or this Section 7.2.4, including by providing
copies of material data as it arises, any office actions or office action
responses or other correspondence that such Party provides to or receives from
any patent office, including notice of all interferences, reissues,
re-examinations, oppositions or requests for patent term extensions, and all
patent-related filings, and by providing the other Party the timely opportunity
to have reasonable input into the strategic aspects of such Prosecution and
Maintenance.

(b)
If Biogen elects (a) not to file and prosecute patent applications for the
Jointly-Owned Program Patents, Ionis Product-Specific Patents that have been
licensed or assigned to Biogen under this Agreement or Biogen Product-Specific
Patents (“Biogen-Prosecuted Patents”) in a particular country, (b) not to
continue the prosecution (including any interferences, oppositions, reissue
proceedings, re-examinations, and patent term extensions, adjustments, and
restorations) or maintenance of any Biogen-Prosecuted Patent in a particular
country, or (c) not to file and prosecute patent applications for the
Biogen-Prosecuted Patent in a particular country following a written request
from Ionis to file and prosecute in such country, then Biogen will so notify
Ionis promptly in writing of its intention (including a reasonably detailed
rationale for doing so) in good time to enable Ionis to meet any deadlines by
which an action must be taken to establish or preserve any such Patent Right in
such country; and except as set forth in Section 7.2.4(c), Ionis will have the
right, but not the obligation, to file, prosecute, maintain, enforce, or
otherwise pursue such Biogen-Prosecuted Patent in the applicable country at its
own expense with counsel of its own choice. In such case, Biogen will cooperate
with Ionis to file for, or continue to Prosecute and Maintain or enforce, or
otherwise pursue such Biogen-Prosecuted Patent in such country in Ionis’ own
name, but only to the extent that Biogen is not required to take any position
with respect to such abandoned Biogen-Prosecuted Patent that would be reasonably
likely to adversely affect the scope, validity or enforceability of any of the
other Patent Rights being prosecuted and maintained by Biogen under this
Agreement. Notwithstanding anything to the contrary in this Agreement, if Ionis
assumes responsibility for the Prosecution and Maintenance of any such
Biogen-Prosecuted Patent under this Section 7.2.4(b), Ionis will have no
obligation to notify Biogen if Ionis intends to abandon such Biogen-Prosecuted
Patent.

 
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(c)
Notwithstanding Section 7.2.4(b) above, if, after having consulted with outside
counsel, Biogen reasonably determines that filing or continuing to prosecute a
patent application in a particular country for a Biogen-Prosecuted Patent (the
“Conflicting Patent Right”) is reasonably likely to adversely affect the scope,
validity or enforceability of a patent application or issued patent in a
particular country for another Biogen-Prosecuted Patent (the “Superior Patent
Right”), in each case where both the Conflicting Patent Right and the Superior
Patent Right if issued would meet the criteria set forth in clause (i) of
Section 6.6.2(a), then so long as Biogen continues to Prosecute and Maintain the
Superior Patent Right in accordance with this Agreement, Ionis will not have the
right under Section 7.2.4(a) above to file or prosecute the Conflicting Patent
Right.

(d)
If, during the Agreement Term, Ionis intends to abandon any Ionis
Product-Specific Patent for which Ionis is responsible for Prosecution and
Maintenance without first filing a continuation or substitution, then, if
Biogen’s right to obtain a license under Section 4.1.1 to such Ionis
Product-Specific Patent has not expired or terminated, Ionis will notify Biogen
of such intention at least [***] days before such Patent Right will become
abandoned, and Biogen will have the right, but not the obligation, to assume
responsibility for the Prosecution and Maintenance thereof at its own expense
(subject to Section 7.3.1) with counsel of its own choice. Notwithstanding
anything to the contrary in this Agreement, if Biogen assumes responsibility for
the Prosecution and Maintenance of any such Ionis Product-Specific Patent under
this Section 7.2.4(d), Biogen will have no obligation to notify Ionis if Biogen
intends to abandon such Ionis Product-Specific Patent.

(e)
The Parties, through the JPC, will cooperate in good faith to determine if and
when any divisional or continuation applications will be filed with respect to
any Program Patents or Product-Specific Patents, and where a divisional or
continuation patent application filing would be practical and reasonable, then
such a divisional or continuation filing will be made.

 
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(f)
If the Party responsible for Prosecution and Maintenance pursuant to Section
7.2.3 intends to abandon such Jointly-Owned Program Patent without first filing
a continuation or substitution, then such Party will notify the other Party of
such intention at least [***] days before such Jointly-Owned Program Patent will
become abandoned, and such other Party will have the right, but not the
obligation, to assume responsibility for the Prosecution and Maintenance thereof
at its own expense (subject to Section 7.3.1) with counsel of its own choice, in
which case the abandoning Party will, and will cause its Affiliates to, assign
to the other Party (or, if such assignment is not possible, grant a fully-paid
exclusive license in) all of their rights, title and interest in and to such
Jointly-Owned Program Patents. If a Party assumes responsibility for the
Prosecution and Maintenance of any such Jointly-Owned Program Patents under this
Section 7.2.4(f), such Party will have no obligation to notify the other Party
of any intention of such Party to abandon such Jointly-Owned Program Patents.

(g)
In addition, the Parties will consult, through the JPC, and take into
consideration the comments of the other Party for all matters relating to
interferences, reissues, re-examinations and oppositions with respect to those
Patent Rights in which such other Party (i) has an ownership interest, (ii) has
received a license thereunder in accordance with this Agreement, or (iii) may in
the future, in accordance with this Agreement, obtain a license or sublicense
thereunder.

7.3.
Patent Costs.

7.3.1.
Jointly-Owned Program Patents. Unless the Parties agree otherwise, Ionis and
Biogen will share equally the Patent Costs associated with the Prosecution and
Maintenance of Jointly-Owned Program Patents; provided that either Party may
decline to pay its share of costs for filing, prosecuting and maintaining any
Jointly-Owned Program Patents in a particular country or particular countries,
in which case the declining Party will, and will cause its Affiliates to, assign
to the other Party (or, if such assignment is not possible, grant a fully-paid
exclusive license in) all of their rights, titles and interests in and to such
Jointly-Owned Program Patents.

7.3.2.
Licensed Patents and Biogen Patents. Except as set forth in Section 7.3.1, each
Party will be responsible for all Patent Costs incurred by such Party prior to
and after the Effective Date in all countries in the Prosecution and Maintenance
of Patent Rights for which such Party is responsible under Section 7.2;
provided, however, that after the date the license under Section 4.1.1 is
granted to Biogen, Biogen will be solely responsible for Patent Costs arising
from the Prosecution and Maintenance of the Ionis Product-Specific Patents.

 
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7.4.
Defense of Claims Brought by Third Parties.

7.4.1.
If a Third Party initiates a Proceeding claiming a Patent Right owned by or
licensed to such Third Party is infringed by the Development, Manufacture or
Commercialization of a Product, (a) Ionis will have the first right, but not the
obligation, to defend against any such Proceeding initiated prior to the date
Biogen is granted the license under Section 4.1.1 at its sole cost and expense,
and (b) Biogen will have the first right, but not the obligation, to defend
against any such Proceeding initiated after the date Biogen is granted the
license under Section 4.1.1 at its sole cost and expense. If the Party having
the first right to defend against such Proceeding (the “Lead Party”) elects to
defend against such Proceeding, then the Lead Party will have the sole right to
direct the defense and to elect whether to settle such claim (but only with the
prior written consent of the other Party, not to be unreasonably withheld,
conditioned or delayed). The other Party will reasonably assist the Lead Party
in defending such Proceeding and cooperate in any such litigation at the request
and expense of the Lead Party. The Lead Party will provide the other Party with
prompt written notice of the commencement of any such Proceeding that is of the
type described in this Section 7.4, and the Lead Party will keep the other Party
apprised of the progress of such Proceeding. If the Lead Party elects not to
defend against a Proceeding, then the Lead Party will so notify the other Party
in writing within [***] days after the Lead Party first receives written notice
of the initiation of such Proceeding, and the other Party (the “Step-In Party”)
will have the right, but not the obligation, to defend against such Proceeding
at its sole cost and expense and thereafter the Step-In Party will have the sole
right to direct the defense thereof, including the right to settle such claim.
In any event, the Party not defending such Proceeding will reasonably assist the
other Party and cooperate in any such litigation at the request and expense of
the Party defending such Proceeding. Each Party may at its own expense and with
its own counsel join any defense initiated or directed by the other Party under
this Section 7.4. Each Party will provide the other Party with prompt written
notice of the commencement of any such Proceeding under this Section 7.4, and
such Party will promptly furnish the other Party with a copy of each
communication relating to the alleged infringement that is received by such
Party.

7.4.2.
Discontinued Product. If a Third Party initiates a Proceeding claiming that any
Patent Right or Know-How owned by or licensed to such Third Party is infringed
by the Development, Manufacture or Commercialization of a Discontinued Product,
Ionis will have the first right, but not the obligation, to defend against and
settle such Proceeding at its sole cost and expense. Biogen will reasonably
assist Ionis in defending such Proceeding and cooperate in any such litigation
at the request and expense of Ionis. Each Party may at its own expense and with
its own counsel join any defense directed by the other Party. Ionis will provide
Biogen with prompt written notice of the commencement of any such Proceeding, or
of any allegation of infringement of which Ionis becomes aware and that is of
the type described in this Section 7.4.2, and Ionis will promptly furnish Biogen
with a copy of each communication relating to the alleged infringement received
by Ionis.

 
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7.4.3.
Interplay Between Enforcement of IP and Defense of Third Party Claims.
Notwithstanding the provisions of Section 7.4.1 and Section 7.4.2, to the extent
that a Party’s defense against a Third Party claim of infringement under this
Section 7.4 involves (i) the enforcement of the other Party’s Know-How or Patent
Rights (e.g., a counterclaim of infringement), or (ii) the defense of an
invalidity claim with respect to such other Party’s Know-How or Patent Rights,
then, in each case, the general concepts of Section 7.5 will apply to the
enforcement of such other Party’s Know-How or Patent Rights or the defense of
such invalidity claim (i.e., each Party has the right to enforce its own
intellectual property, except that the relevant Commercializing Party will have
the initial right, to the extent provided in Section 7.5, to enforce such
Know-How or Patent Rights or defend such invalidity claim, and the other Party
will have a step-in right, to the extent provided in Section 7.5, to enforce
such Know-How or Patent Rights or defend such invalidity claim).

7.4.4.
Effect of Defense of Third Party Claims on Original Agreement. Notwithstanding
anything to the contrary in this Section 7.4, if, prior to the date Biogen is
granted the license under Section 4.1.1, Biogen reasonably believes that Ionis’
election to defend against a Proceeding (and Ionis’ strategy with respect to
such defense) under this Section 7.4 would be reasonably likely to adversely
affect a Product-Specific Patent Covering Spinraza® under the Original
Agreement, then the Parties through the JPC will try to develop a strategy with
respect to such defense that maximizes the protection for the potential
Development Candidates under this Agreement but is not reasonably likely to
adversely affect the Product-Specific Patent Covering Spinraza® under the
Original Agreement. If the Parties cannot agree on such a strategy then either
Party may refer the matter to (and the Parties will engage) a mutually agreed
upon independent Third Party intellectual property lawyer with expertise in the
patenting of ASOs, and appropriate professional credentials in the relevant
jurisdiction, to determine if Ionis’ planned defense against a Proceeding (and
Ionis’ strategy with respect thereto) is reasonably likely to adversely affect a
Product-Specific Patent Covering Spinraza® under the Original Agreement. If such
independent Third Party intellectual property lawyer believes Ionis’ planned
defense against a Proceeding (and Ionis’ strategy with respect thereto) is
reasonably likely to adversely affect a Product-Specific Patent Covering
Spinraza® under the Original Agreement, such lawyer will propose a strategy to
maximize the protection for the potential Development Candidates under this
Agreement but is not reasonably likely to adversely affect a Product-Specific
Patent Covering Spinraza®. The determination and recommended strategy of the
Third Party expert engaged under this Section 7.4.4 will be binding on the
Parties solely for purposes of setting the defense strategy against the relevant
Proceeding under this Agreement. The costs of any Third Party expert engaged
under this Section 7.4.4 will be paid by the Party against whose position the
Third Party lawyer’s determination is made.

 
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7.5.
Enforcement of Patents Against Competitive Infringement.

7.5.1.
Duty to Notify of Competitive Infringement. If either Party learns of an
infringement, unauthorized use, misappropriation or threatened infringement by a
Third Party to which such Party does not owe any obligation of confidentiality
with respect to any Product-Specific Patents by reason of the development,
manufacture, use or commercialization of a product directed against the RNA that
encodes SMN in the Field (“Competitive Infringement”), such Party will promptly
notify the other Party in writing and will provide such other Party with
available evidence of such Competitive Infringement; provided, however, that for
cases of Competitive Infringement under Section 7.5.7 below, such written notice
will be given within 10 days.

7.5.2.
Prior to License Grant.

(a)
For any Competitive Infringement with respect to a Product occurring after the
Effective Date but before the date Biogen is granted the license under Section
4.1.1, Ionis will have the first right, but not the obligation, to institute,
prosecute, and control a Proceeding with respect thereto, by counsel of its own
choice, and Biogen will have the right to be represented in that action by
counsel of its own choice at its own expense, provided, however, Ionis will have
the sole right to control such litigation; and provided, further, that, if
Biogen reasonably believes that Ionis’ election to institute, prosecute, and
control a Proceeding with respect to such Competitive Infringement (and Ionis’
strategy with respect thereto) under this Section 7.5.2 would be reasonably
likely to adversely affect a Product-Specific Patent Covering Spinraza® under
the Original Agreement, then the Parties through the JPC will try to develop a
strategy that maximizes the protection for the potential Development Candidates
under this Agreement but is not reasonably likely to adversely affect a
Product-Specific Patent Covering Spinraza® under the Original Agreement. If the
Parties cannot agree on such a strategy then either Party may refer the matter
to (and the Parties will engage) a mutually agreed upon independent Third Party
intellectual property lawyer with expertise in the patenting of ASOs, and
appropriate professional credentials in the relevant jurisdiction, to determine
if Ionis’ planned enforcement against a Competitive Infringement (and Ionis’
strategy with respect thereto) is reasonably likely to adversely affect a
Product-Specific Patent Covering Spinraza® under the Original Agreement. If such
independent Third Party intellectual property lawyer believes Ionis’ planned
enforcement against a Competitive Infringement (and Ionis’ strategy with respect
thereto) is reasonably likely to adversely affect a Product-Specific Patent
Covering Spinraza® under the Original Agreement, such lawyer will propose a
strategy to maximize the protection for the potential Development Candidates
under this Agreement but is not reasonably likely to adversely affect a
Product-Specific Patent Covering Spinraza®. The determination and recommended
strategy of the Third Party expert engaged under this Section 7.5.2 will be
binding on the Parties solely for purposes of setting the enforcement strategy
against the relevant Competitive Infringement under this Agreement. The costs of
any Third Party expert engaged under this Section 7.5.2 will be paid by the
Party against whose position the Third Party lawyer’s determination is made.

 
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(b)
Ionis will provide Biogen with prompt written notice of the commencement of any
such Proceeding, and Ionis will keep Biogen apprised of the progress of such
Proceeding. If Ionis fails to initiate a Proceeding within a period of 90 days
after receipt of written notice of such Competitive Infringement (subject to a
90 day extension to conclude negotiations, which extension will apply only in
the event that Ionis has commenced good faith negotiations with an alleged
infringer for elimination of such Competitive Infringement within such 90 day
period), Biogen will have the right to initiate and control a Proceeding with
respect to such Competitive Infringement by counsel of its own choice; provided
that Ionis will have the right to be represented in any such action by counsel
of its own choice at its own expense. Notwithstanding the foregoing, Ionis will
at all times have the sole right to institute, prosecute, and control any
Proceeding under this Section 7.5.2 to the extent involving any Ionis Core
Technology Patents or Ionis Manufacturing and Analytical Patents.

7.5.3.
Following License Grant. For any Competitive Infringement with respect to a
particular Product (except for a Discontinued Product) occurring after the date
Biogen is granted the license under Section 4.1.1, so long as part of such
Proceeding Biogen also enforces any Patent Rights Controlled by Biogen
(including any Ionis Product-Specific Patents assigned by Ionis to Biogen under
this Agreement) being infringed that Cover the Product, then Biogen will have
the first right, but not the obligation, to institute, prosecute, and control a
Proceeding with respect thereto by counsel of its own choice at its own expense,
and Ionis will have the right, at its own expense, to be represented in that
action by counsel of its own choice; however, Biogen will have the right to
control such litigation. If Biogen fails to initiate a Proceeding within a
period of 90 days after receipt of written notice of such Competitive
Infringement (subject to a 90 day extension to conclude negotiations, if Biogen
has commenced good faith negotiations with an alleged infringer for elimination
of such Competitive Infringement within such 90 day period), Ionis will have the
right to initiate and control a Proceeding with respect to such Competitive
Infringement by counsel of its own choice, and Biogen will have the right to be
represented in any such action by counsel of its own choice at its own expense.
Notwithstanding the foregoing, Ionis will at all times have the sole right to
institute, prosecute, and control any Proceeding under this Section 7.5.3 to the
extent involving any Ionis Core Technology Patents or Ionis Manufacturing and
Analytical Patents.

 
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7.5.4.
Joinder.

(a)
If a Party initiates a Proceeding in accordance with this Section 7.5, the other
Party agrees to be joined as a party plaintiff where necessary and to give the
first Party reasonable assistance and authority to file and prosecute the
Proceeding. Subject to Section 7.5.5, the costs and expenses of each Party
incurred pursuant to this Section 7.5.4(a) will be borne by the Party initiating
such Proceeding.

(b)
If one Party initiates a Proceeding in accordance with this Section 7.5, the
other Party may join such Proceeding as a party plaintiff where necessary for
such other Party to seek lost profits with respect to such infringement.

7.5.5.
Share of Recoveries. Any damages or other monetary awards recovered with respect
to a Proceeding brought pursuant to this Section 7.5 will be shared as follows:

(a)
the amount of such recovery will first be applied to the Parties’ reasonable
out-of-pocket costs incurred in connection with such Proceeding (which amounts
will be allocated pro rata if insufficient to cover the totality of such
expenses); then

(b)
any remaining proceeds constituting direct or actual damages for acts of
infringement occurring prior to the date Biogen is granted the license under
Section 4.1.1 with respect to the applicable Product will be (i) [***]; or (ii)
[***]; then

(c)
any remaining proceeds constituting direct or actual damages for acts of
infringement occurring after the date Biogen is granted the license under
Section 4.1.1 with respect to the applicable Product [***]; then

(d)
any remaining proceeds constituting punitive or treble damages will be allocated
between the Parties as follows: the Party initiating the Proceeding will receive
and retain [***]% of such proceeds and the other Party will receive and retain
[***]% of such proceeds.

7.5.6.
Settlement. Notwithstanding anything to the contrary under this ARTICLE 7,
neither Party may enter a settlement, consent judgment or other voluntary final
disposition of a suit under this ARTICLE 7 that disclaims, limits the scope of,
admits the invalidity or unenforceability of, or grants a license, covenant not
to sue or similar immunity under a Patent Right Controlled by the other Party
without first obtaining the written consent of the Party that Controls the
relevant Patent Right.

 
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7.5.7.
35 USC 271(e)(2) Infringement. Notwithstanding anything to the contrary in this
Section 7.5, solely with respect to Licensed Patents that have not been assigned
to Biogen under this Agreement for a Competitive Infringement under 35 USC
271(e)(2), the time period set forth in Section 7.5.2 during which a Party will
have the initial right to bring a Proceeding will be shortened to a total of 25
days, so that, to the extent the other Party has the right, pursuant to such
Section to initiate a Proceeding if the first Party does not initiate a
Proceeding, such other Party will have such right if the first Party does not
initiate a Proceeding within 25 days after such first Party’s receipt of written
notice of such Competitive Infringement.

7.6.
Other Infringement.

7.6.1.
Jointly-Owned Program Patents. With respect to the infringement of a
Jointly-Owned Program Patent which is not a Competitive Infringement, the
Parties will cooperate in good faith to bring suit together against such
infringing party or the Parties may decide to permit one Party to solely bring
suit. Any damages or other monetary awards recovered with respect to a
Proceeding brought pursuant to this Section 7.6.1 will be shared as follows: (i)
the amount of such recovery will first be applied to the Parties’ reasonable
out-of-pocket costs incurred in connection with such Proceeding (which amounts
will be allocated pro rata if insufficient to cover the totality of such
expenses); (ii) any remaining proceeds constituting direct damages will be
[***], and (iii) any remaining proceeds constituting punitive or treble damages
will be allocated as follows: (A) if the Parties jointly initiate a Proceeding
pursuant to this Section 7.6.1, [***]; and (B) if only one Party initiates the
Proceeding pursuant to this Section 7.6.1, such Party will receive [***]% of
such proceeds and the other Party will receive [***]% of such proceeds.

7.6.2.
Patents Solely Owned by Ionis. Ionis will retain all rights to pursue an
infringement of any Patent Right solely owned by Ionis which is other than a
Competitive Infringement and Ionis will retain all recoveries with respect
thereto.

7.6.3.
Patents Solely Owned by Biogen. Biogen will retain all rights to pursue an
infringement of any Patent Right solely owned by Biogen which is other than a
Competitive Infringement and Biogen will retain all recoveries with respect
thereto.

7.7.
Patent Listing.

7.7.1.
Biogen’s Obligations. Biogen will promptly, accurately and completely list, with
the applicable Regulatory Authorities during the Agreement Term, all applicable
Patent Rights that Cover each Product. Prior to such listings, the Parties will
meet, through the JPC, to evaluate and identify all applicable Patent Rights,
and Biogen will have the right to review, where reasonable, original records
relating to any invention for which Patent Rights are being considered by the
JPC for any such listing. Notwithstanding the preceding sentence, Biogen will
retain final decision-making authority as to the listing of all applicable
Patent Rights for the Products that are not Ionis Core Technology Patents or
Ionis Manufacturing and Analytical Patents, regardless of which Party owns such
Patent Rights.

 
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7.7.2.
Ionis’ Obligations. Ionis will promptly, accurately and completely list, with
the applicable Regulatory Authorities during the Agreement Term, all applicable
Patent Rights that Cover a Discontinued Product. Prior to such listings, the
Parties will meet, through the JPC, to evaluate and identify all applicable
Patent Rights, and Ionis will have the right to review, where reasonable,
original records relating to any invention for which Patent Rights are being
considered by the JPC for any such listing. Notwithstanding the preceding
sentence, Ionis will retain final decision-making authority as to the listing of
all applicable Patent Rights for such Discontinued Products, as applicable,
regardless of which Party owns such Patent Rights.

7.8.
Joint Research Agreement under the Leahy-Smith America Invents Act.
Notwithstanding anything to the contrary in this ARTICLE 7, neither Party will
have the right to make an election under 35 U.S.C. § 102(c) of the Leahy-Smith
America Invents Act when exercising its rights under this ARTICLE 7 without the
prior written consent of the other Party, which will not be unreasonably
withheld, conditioned or delayed. With respect to any such permitted election,
each Party will use reasonable efforts to cooperate and coordinate their
activities with the other Party with respect to any submissions, filings or
other activities in support thereof. The Parties acknowledge and agree that this
Agreement is a “joint research agreement” as defined in 35 U.S.C. § 100(h).

7.9.
Obligations to Third Parties. Notwithstanding any of the foregoing, each Party’s
rights and obligations with respect to Licensed Technology under this ARTICLE 7
will be subject to the Third Party rights and obligations under any (i) New
Third Party License obtained in accordance with Section 6.8.2(a) or Section
6.8.3(a)(i), (ii) Prior Agreements, and (iii) Ionis In-License Agreements;
provided, however, that, to the extent that Ionis has a non-transferable right
to prosecute, maintain or enforce any Patent Rights licensed to Biogen hereunder
and, this Agreement purports to grant any such rights to Biogen, Ionis will act
in such regard with respect to such Patent Rights at Biogen’s direction.

7.10.
Additional Right and Exceptions. Notwithstanding any provision of this ARTICLE
7, Ionis retains the sole right to Prosecute and Maintain Ionis Core Technology
Patents and Ionis Manufacturing and Analytical Patents during the Agreement Term
and to control any enforcement of Ionis Core Technology Patents and Ionis
Manufacturing and Analytical Patents, and will take the lead on such enforcement
solely to the extent that the scope or validity of any Patent Rights Controlled
by Ionis and Covering the Ionis Core Technology Patents or Ionis Manufacturing
and Analytical Patents is at risk.

7.11.
Patent Term Extension. The Parties will cooperate with each other in gaining
patent term extension wherever applicable to a Product. After the date Biogen is
granted the license under Section 4.1.1 with respect to a Product, Biogen will
have the sole right to determine which relevant patents will be extended.

 
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ARTICLE 8.
REPRESENTATIONS AND WARRANTIES

8.1.
Representations and Warranties of Both Parties. Each Party hereby represents and
warrants to the other Party, as of the Effective Date, that:

8.1.1.
such Party is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization and has full
corporate power and authority to enter into this Agreement and to carry out the
provisions hereof;

8.1.2.
such Party has taken all necessary action on its part to authorize the execution
and delivery of this Agreement and the performance of its obligations hereunder;

8.1.3.
this Agreement has been duly executed and delivered on behalf of such Party, and
constitutes a legal, valid and binding obligation, enforceable against it in
accordance with the terms hereof;

8.1.4.
the execution, delivery and performance of this Agreement by such Party will not
constitute a default under or conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it is bound,
or violate any law or regulation of any court, governmental body or
administrative or other agency having jurisdiction over such Party;

8.1.5.
no government authorization, consent, approval, license, exemption of or filing
or registration with any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, under any Applicable
Laws, rules or regulations currently in effect, is or will be necessary for, or
in connection with, the transaction contemplated by this Agreement or any other
agreement or instrument executed in connection herewith, or for the performance
by it of its obligations under this Agreement and such other agreements; and

8.1.6.
it has not employed (and, to the best of its knowledge, has not used a
contractor or consultant that has employed) and in the future will not employ
(or, to the best of its knowledge, use any contractor or consultant that
employs, provided that such Party may reasonably rely on a representation made
by such contractor or consultant) any Person debarred by the FDA (or subject to
a similar sanction of EMA or foreign equivalent), or any Person which is the
subject of an FDA debarment investigation or proceeding (or similar proceeding
of EMA or foreign equivalent), in the conduct of the Preclinical Studies or
Clinical Studies of the Products and its activities under each Collaboration
Program.

8.2.
Representations and Warranties of Ionis. Ionis hereby represents and warrants to
Biogen, as of the Effective Date, that:

8.2.1.
Ionis Controls the Licensed Patents existing as of the Effective Date and is
entitled to grant all rights and licenses (or sublicenses, as the case may be)
it purports to grant to Biogen under this Agreement;

 
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8.2.2.
to the best of its knowledge and belief, there are no additional licenses
(beyond those that would be granted to Biogen under Section 4.1.1 upon the
exercise of the Option for a Product arising under the Collaboration Programs)
under any intellectual property owned or Controlled by Ionis or its Affiliates
as of the Effective Date that would be required in order for Biogen to further
Develop and Commercialize a Product;

8.2.3.
the Licensed Technology existing as of the Effective Date constitutes all of the
Patent Rights and Know-How Controlled by Ionis as of the Effective Date that are
necessary to Develop, Manufacture or Commercialize the Compounds contemplated
under the Collaboration Programs in the Field. Ionis has not previously
assigned, transferred, conveyed or otherwise encumbered its right, title and
interest in the Licensed Technology in a manner that conflicts with any rights
granted to Biogen hereunder with respect to Products;

8.2.4.
neither Ionis nor its Affiliates owns or Controls any Patent Rights or Know-How
covering formulation or delivery technology as of the Effective Date that would
be useful or necessary in order for Biogen to further Develop or Commercialize
the Compounds contemplated under the Collaboration Programs;

8.2.5.
there are no claims, judgments or settlements against or owed by Ionis or its
Affiliates or pending against Ionis or, to the best of Ionis’ knowledge,
threatened against Ionis, in each case relating to the Ionis Manufacturing and
Analytical Know-How or Ionis Know-How that could impact activities under this
Agreement. To the best of Ionis’ knowledge, there are no claims, judgments or
settlements against or owed by any Third Party that is party to a Prior
Agreement, or pending or threatened claims or litigation against any Third Party
that is party to a Prior Agreement, in each case relating to the Ionis
Manufacturing and Analytical Know-How or Ionis Know-How that would impact
activities under this Agreement;

8.2.6.
Schedule 8.2.6(a), Schedule 8.2.6(b) and Schedule 8.2.6(c) set forth true,
correct and complete lists of all Ionis Core Technology Patents, Ionis
Manufacturing and Analytical Patents, and Ionis Product-Specific Patents that
apply to the Compounds as of the Effective Date, respectively, and indicates
whether each such Patent Right is owned by Ionis or licensed by Ionis from a
Third Party and if so, identifies the licensor or sublicensor from which the
Patent Right is licensed. Ionis Controls such Patent Rights existing as of the
Effective Date and is entitled to grant all rights and licenses (or sublicenses,
as the case may be) under such Patent Rights it purports to grant to Biogen
under this Agreement;

8.2.7.
at the Effective Date (a) there is no fact or circumstance known by Ionis that
would cause Ionis to reasonably conclude that any Licensed Patent is invalid or
un-enforceable, (b) there is no fact or circumstance known by Ionis that would
cause Ionis to reasonably conclude the inventorship of each Licensed Patent is
not properly identified on each patent, (c) all official fees, maintenance fees
and annuities for the Licensed Patents have been paid and all administrative
procedures with governmental agencies have been completed, and (d) none of the
Licensed Patents is currently involved in any interference, reissue,
re-examination, cancellation or opposition proceeding and neither Ionis, nor any
of its Affiliates, has received any written notice from any Person, or has
knowledge, of such actual or threatened proceeding;

 
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8.2.8.
Ionis has set forth on Schedule 6.8.1 or in a separate written agreement with
Biogen true, correct and complete lists of the agreements with Third Party
licensors or sellers pursuant to which Ionis has licensed or acquired the
Licensed Technology Controlled by Ionis as of the Effective Date that is
necessary or useful to conduct the research, Development, Manufacture or
Commercialization of the Products. All Ionis In-License Agreements are in full
force and effect and have not been modified or amended. Neither Ionis nor, to
the best knowledge of Ionis, the Third Party licensor in an Ionis In-License
Agreement is in default with respect to a material obligation under such Ionis
In-License Agreement, and neither such party has claimed or has grounds upon
which to claim that the other party is in default with respect to a material
obligation under, any Ionis In-License Agreement;

8.2.9.
Schedule 8.2.9 is a complete and accurate list of all agreements that create
Third Party Obligations with respect to the Ionis Core Technology Patents and
Ionis Manufacturing and Analytical Patents that affect the rights granted by
Ionis to Biogen under this Agreement with respect to Collaboration Programs;

  8.2.10.
to the best of Ionis’ knowledge, the Development, Manufacture (as manufactured
by Ionis at its facility as of the Effective Date) and Commercialization of the
Compounds or Products as contemplated by this Agreement does not [***]; and

8.2.11.
as of the Effective Date, Ionis has no [***].

8.3.
Ionis Covenants. Ionis hereby covenants to Biogen that, except as expressly
permitted under this Agreement:

8.3.1.
Ionis will promptly amend Schedule 8.2.6(a), Schedule 8.2.6(b) and Schedule
8.2.6(c) and submit such amended Schedules to Biogen if Ionis becomes aware that
any Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents or
Ionis Product-Specific Patents are not properly identified on such Schedule.

8.3.2.
during the Agreement Term, Ionis will maintain and not breach any Ionis
In-License Agreements and any agreements with Third Parties entered into after
the Effective Date (“New Third Party Licenses”) that provide a grant of rights
from such Third Party to Ionis that are Controlled by Ionis and are licensed or
may become subject to a license from Ionis to Biogen for a Development Candidate
under this Agreement;

8.3.3.
Ionis will promptly notify Biogen of any material breach by Ionis or a Third
Party of any New Third Party License, and in the event of a breach by Ionis,
will permit Biogen to cure such breach on Ionis’ behalf upon Biogen’s request;

 
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8.3.4.
Ionis will not amend, modify or terminate any Ionis In-License Agreement or New
Third Party License in a manner that would adversely affect Biogen’s rights
hereunder without first obtaining Biogen’s written consent, which consent may be
withheld in Biogen’s sole discretion;

8.3.5.
Ionis will not enter into any new agreement or other obligation with any Third
Party, or amend an existing agreement with a Third Party, in each case that
restricts, limits or encumbers the rights granted to Biogen under this
Agreement;

8.3.6.
Ionis will cause its Affiliates, licensees and sublicensees to comply with the
terms of Section 2.1;

8.3.7.
all employees and contractors of Ionis performing Development activities
hereunder on behalf of Ionis will be obligated to assign all right, title and
interest in and to any inventions developed by them, whether or not patentable,
to Ionis or such Affiliate, respectively, as the sole owner thereof; and

8.3.8.
if, after the Effective Date, Ionis becomes the owner or otherwise acquires
Control of any formulation or delivery technology that would be necessary or
useful in order for Biogen to further Develop, Manufacture or Commercialize a
Product, and Biogen has exercised the applicable Option and the license granted
to Biogen under this Agreement with respect to such Product is in effect, Ionis
will make such technology available to Biogen on commercially reasonable terms.

8.4.
DISCLAIMER. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER
PARTY NOR ITS AFFILIATES MAKES ANY REPRESENTATION OR EXTENDS ANY WARRANTY OF ANY
KIND, EITHER EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE. BIOGEN AND IONIS UNDERSTAND THAT EACH PRODUCT
IS THE SUBJECT OF ONGOING RESEARCH AND DEVELOPMENT AND THAT NEITHER PARTY CAN
ASSURE THE SAFETY, USEFULNESS OR COMMERCIAL OR TECHNICAL VIABILITY OF EACH
PRODUCT.

ARTICLE 9.
INDEMNIFICATION; INSURANCE

9.1.
Indemnification by Biogen. Biogen will indemnify, defend and hold harmless Ionis
and its Affiliates, and its or their respective directors, officers, employees
and agents, from and against any and all liabilities, damages, losses, costs and
expenses including the reasonable fees of attorneys (collectively “Losses”)
arising out of or resulting from any and all Third Party suits, claims, actions,
proceedings or demands (“Claims”) based upon:

 
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9.1.1.
the gross negligence or willful misconduct of Biogen, its Affiliates or
Sublicensees and its or their respective directors, officers, employees and
agents, in connection with Biogen’s performance of its obligations or exercise
of its rights under this Agreement;

9.1.2.
any breach of any representation or warranty or express covenant made by Biogen
under ARTICLE 8 or any other provision under this Agreement;

9.1.3.
the Development or Manufacturing activities that are conducted by or on behalf
of Biogen or its Affiliates or Sublicensees (which will exclude any Development
or Manufacturing activities that are conducted by or on behalf of Ionis pursuant
to this Agreement); or

9.1.4.
the Commercialization of a Product by or on behalf of Biogen or its Affiliates
or Sublicensees;

except, in each case above, to the extent such Claim arose out of or resulted
from or is attributable to any acts or omissions of Ionis or its Affiliates,
licensees, Sublicensees or contractors, and its or their respective directors,
officers, employees and agents or other circumstance for which Ionis has an
indemnity obligation pursuant to Section 9.2.

9.2.
Indemnification by Ionis. Ionis will indemnify, defend and hold harmless Biogen
and its Affiliates, and its or their respective directors, officers, employees
and agents, from and against any and all Losses arising out of or resulting from
any and all Claims based upon:

9.2.1.
the gross negligence or willful misconduct of Ionis, its Affiliates or
Sublicensees or its or their respective directors, officers, employees and
agents, in connection with Ionis’ performance of its obligations or exercise of
its rights under this Agreement;

9.2.2.
any breach of any representation or warranty or express covenant made by Ionis
under ARTICLE 8 or any other provision under this Agreement;

9.2.3.
any Development or Manufacturing activities that are conducted by or on behalf
of Ionis or its Affiliates or Sublicensees (which will exclude any Development
or Manufacturing activities that are conducted by or on behalf of Biogen
pursuant to this Agreement); or

9.2.4.
any development, manufacturing or commercialization activities that are
conducted by or on behalf of Ionis or its Affiliates or Sublicensees with
respect to a Discontinued Product.

except, in each case above, to the extent such Claim arose out of or resulted
from or is attributable to any acts or omissions of Biogen or its Affiliates,
licensees, Sublicensees or contractors and its or their respective directors,
officers, employees and agents or other circumstance for which Biogen has an
indemnity obligation pursuant to Section 9.1.
 
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9.3.
Procedure. If a Person entitled to indemnification under Section 9.1 or Section
9.2 (an “Indemnitee”) seeks such indemnification, such Indemnitee will (i)
inform the indemnifying Party in writing of a Claim as soon as reasonably
practicable after such Indemnitee receives notice of such Claim, (ii) permit the
indemnifying Party to assume direction and control of the defense of the Claim
(including the sole right to settle such Claim at the sole discretion of the
indemnifying Party, provided that (A) such settlement or compromise does not
admit any fault or negligence on the part of the Indemnitee, or impose any
obligation on, or otherwise materially adversely affect, the Indemnitee or other
Party and (B) the indemnifying Party first obtain the written consent of the
Indemnitee with respect to such settlement, which consent will not be
unreasonably withheld), (iii) cooperate as reasonably requested (at the expense
of the indemnifying Party) in the defense of the Claim, and (iv) undertake
reasonable steps to mitigate any Losses with respect to the Claim. The
provisions of Section 7.4 will govern the procedures for responding to a Claim
of infringement described therein. Notwithstanding anything in this Agreement to
the contrary, the indemnifying Party will have no liability under Section 9.1 or
Section 9.2, as the case may be, for Claims settled or compromised by the
Indemnitee without the indemnifying Party’s prior written consent.

9.4.
Insurance.

9.4.1.
Ionis’ Insurance Obligations. Ionis will maintain, at its cost, reasonable
insurance against liability and other risks associated with its activities
contemplated by this Agreement. Ionis will furnish to Biogen evidence of such
insurance upon request.

9.4.2.
Biogen’s Insurance Obligations. Biogen will maintain, at its cost, reasonable
insurance against liability and other risks associated with its activities
contemplated by this Agreement, provided, that, at a minimum, Biogen will
maintain, in force from 30 days prior to enrollment of the first patient in a
Clinical Study, a [***] insurance policy providing coverage of at least $[***]
per claim and $[***] Annual aggregate and, provided further that such coverage
is increased to at least $[***] at least 30 days before Biogen initiates the
First Commercial Sale of a Product hereunder. Biogen will furnish to Ionis
evidence of such insurance upon request. Notwithstanding the foregoing, Biogen
may self-insure to the extent that it self-insures for its other products.

9.5.
LIMITATION OF CONSEQUENTIAL DAMAGES. EXCEPT FOR (a) CLAIMS OF A THIRD PARTY THAT
ARE SUBJECT TO INDEMNIFICATION UNDER THIS ARTICLE 9, (b) CLAIMS ARISING OUT OF A
PARTY’S WILLFUL MISCONDUCT OF THIS AGREEMENT, (c) A PARTY’S BREACH OF ARTICLE 2,
OR A BREACH OF SECTION 10.4.4(a) BY BIOGEN OR ITS AFFILIATES OR (d) CLAIMS
ARISING OUT OF A PARTY’S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS UNDER THIS
AGREEMENT, NEITHER PARTY NOR ANY OF ITS AFFILIATES WILL BE LIABLE TO THE OTHER
PARTY TO THIS AGREEMENT OR ITS AFFILIATES FOR ANY INCIDENTAL, CONSEQUENTIAL,
SPECIAL, PUNITIVE OR OTHER INDIRECT DAMAGES OR LOST OR IMPUTED PROFITS OR
ROYALTIES, LOST DATA OR COST OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES,
WHETHER LIABILITY IS ASSERTED IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT
PRODUCT LIABILITY), INDEMNITY OR CONTRIBUTION, AND IRRESPECTIVE OF WHETHER THAT
PARTY OR ANY REPRESENTATIVE OF THAT PARTY HAS BEEN ADVISED OF, OR OTHERWISE
MIGHT HAVE ANTICIPATED THE POSSIBILITY OF, ANY SUCH LOSS OR DAMAGE.

 
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ARTICLE 10.
TERM; TERMINATION

10.1.
Agreement Term; Expiration. This Agreement is effective as of the Effective Date
and, unless earlier terminated pursuant to the other provisions of this ARTICLE
10, will continue in full force and effect until this Agreement expires as
follows:

  10.1.1.
on a country-by-country basis, on the date of expiration of all payment
obligations by the Commercializing Party under this Agreement with respect to
all Products (or Discontinued Products) in such country;

10.1.2.
in its entirety upon the expiration of all payment obligations under this
Agreement with respect to all Products (or Discontinued Products) in all
countries pursuant to Section 10.1.1;

10.1.3.
where no Development Candidates have been designated by the expiration of the
ASO Development Candidate Identification Term as described in Section 1.9; and

10.1.4.
where every Option has expired as a result of Biogen not providing Ionis a
written notice stating Biogen is exercising such Options and paying Ionis the
applicable license fees under Section 6.2 by the Option Deadline.

The period from the Effective Date until the date of expiration of this
Agreement pursuant to this Section 10.1 is the “Agreement Term.”

10.2.
Termination of the Agreement.

10.2.1.
Biogen’s Termination for Convenience. At any time following payment by Biogen of
the up-front fee under Section 6.1, subject to Section 10.4.1 below, Biogen may
terminate this Agreement for convenience, in its entirety or on a Collaboration
Program-by-Collaboration Program or Product-by-Product basis, at any time by
[***] days’ written notice to Ionis of such termination.

10.2.2.
Termination for Failure to Divest Directly Competitive Product. If a Competing
Acquirer does not, during the Divestiture Period, divest itself of a Directly
Competitive Product, terminate the development and commercialization of such
Directly Competitive Product or assign this Agreement to a Third Party that is
not itself developing or commercializing a Directly Competitive Product as set
forth in Section 12.5, Biogen may terminate this Agreement immediately upon
providing written notice to Ionis.

 
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10.2.3.
Termination Due to Failure to Obtain HSR Clearance.

(a)
If the Parties make an HSR Filing with respect to a Collaboration Program under
Section 3.3 of this Agreement and the HSR Clearance Date has not occurred on or
prior to [***] days after the effective date of the latest HSR Filing made by
the Parties, this Agreement will terminate solely with respect to the applicable
Collaboration Program (i) at the election of either Party immediately upon
notice to the other Party, if the FTC or the DOJ has instituted (or threatened
to institute) any action, suit or proceeding including seeking, threatening to
seek or obtaining a preliminary injunction under the HSR Act against Biogen and
Ionis to enjoin or otherwise prohibit the transactions contemplated by this
Agreement related to such Collaboration Program, or (ii) at the election of
either Party, immediately upon notice to the other Party, if the Parties have
not resolved any and all objections of the FTC and DOJ as contemplated by
Section 3.3.2. Notwithstanding the foregoing, this Section 10.2.3 will not apply
if an HSR Filing is not required to fully perform this Agreement with respect to
a proposed Collaboration Program.

(b)
If Biogen has paid the up-front fee under Section 6.1 and this Agreement is
terminated with respect to a Collaboration Program in accordance with Section
10.2.3(a), then, until [***] as follows:

(i)
If Ionis [***]; and

(ii)
If (a) Ionis, (b) its Affiliates or (c) the licensee [***].

Nothing in this Section 10.2.3(b) obligates Ionis to (y) [***] or (z) [***]. For
clarity, Ionis’ rights to (1) [***] or (2) [***] are subject to the provisions
of ARTICLE 2 of this Agreement.

10.2.4.
Termination for Material Breach.

(a)
Biogen’s Right to Terminate. If Biogen believes that Ionis is in material breach
of this Agreement (other than with respect to a failure to use Commercially
Reasonable Efforts under ARTICLE 1, which is governed by Section 10.2.5 below),
then Biogen may deliver notice of such material breach to Ionis. If the breach
is curable, Ionis will have [***] days to cure such breach. If Ionis fails to
cure such breach within the [***]-day period, or if the breach is not subject to
cure, Biogen in its sole discretion may terminate this Agreement with respect to
the Collaboration Program affected by such breach by providing written notice to
Ionis. Without limiting the foregoing, breach by a Party of ARTICLE 2 of this
Agreement constitutes a material breach of this Agreement with respect to the
Collaboration Program affected by such breach.

 
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(b)
Ionis’ Right to Terminate. On a Product-by-Product basis, if Ionis believes that
Biogen is in material breach of (i) a payment obligation under ARTICLE 6 with
respect to a Product or (ii) one or more material provisions of this Agreement
with respect to a Product, where such material breaches have occurred multiple
times over the course of at least a [***]-month period (where such material
breach is not a single continuous event) demonstrating a pattern of failing to
timely comply with Biogen’s obligations under this Agreement (other than with
respect to a failure to use Commercially Reasonable Efforts under Section 5.1,
which is governed by Section 10.2.5 below), then Ionis may deliver notice of
such material breach with respect to such Product to Biogen. If the breach is
curable, Biogen will have [***] days to cure such breach (except to the extent
such breach involves the failure to make a payment when due, which breach must
be cured within [***] days following such notice). If Biogen fails to cure such
breach within the [***]-day or [***]-day period, as applicable, or if the breach
is not subject to cure, Ionis in its sole discretion may terminate this
Agreement with respect to the Collaboration Program affected by such breach by
providing written notice to Biogen.

10.2.5.
Remedies for Failure to Use Commercially Reasonable Efforts.

(a)
If Ionis, in Biogen’s reasonable determination, fails to use Commercially
Reasonable Efforts in the activities contemplated in ARTICLE 1 prior to the date
Biogen is granted a license under Section 4.1.1 with respect to a Collaboration
Program, Biogen will notify Ionis and, within [***] days thereafter, Ionis and
Biogen will meet and confer to discuss and resolve the matter in good faith, and
attempt to devise a mutually agreeable plan to address any outstanding issues
related to Ionis’ use of Commercially Reasonable Efforts in ARTICLE 1. Following
such a meeting, Ionis will have [***] days to cure such outstanding issues
related to its use of Commercially Reasonable Efforts. If by the end of the
[***]-day period, Ionis fails to use Commercially Reasonable Efforts as
contemplated by ARTICLE 1 with respect to the applicable Collaboration Program,
then subject to Section 10.2.6 below, Biogen will have the right, at its sole
discretion, to (i) terminate this Agreement as it relates to the applicable
Collaboration Program, or (ii) if the breach involves a Collaboration Program
prior to Option exercise, trigger the alternative remedy provisions of Section
10.3 below as it relates to the applicable Collaboration Program in lieu of
terminating this Agreement for such Collaboration Program by providing written
notice to Ionis.

 
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(b)
If Biogen, in Ionis’ reasonable determination, fails to use Commercially
Reasonable Efforts under Section 5.1 above, Ionis will notify Biogen and, within
[***] days thereafter, Ionis and Biogen will meet and confer to discuss and
resolve the matter in good faith, and attempt to devise a mutually agreeable
plan to address any outstanding issues related to Biogen’s use of Commercially
Reasonable Efforts in Section 5.1. Following such a meeting, Biogen will have
[***] days to cure such outstanding issues related to its use of Commercially
Reasonable Efforts. If by the end of the [***]-day period, Biogen fails to use
Commercially Reasonable Efforts as contemplated by Section 5.1, then subject to
Section 10.2.6 below, Ionis will have the right, at its sole discretion, to
terminate this Agreement.

10.2.6.
Disputes Regarding Material Breach. Notwithstanding the foregoing, if the
Breaching Party in Section 10.2.4 or Section 10.2.5 disputes in good faith the
existence, materiality, or failure to cure of any such breach which is not a
payment breach, and provides notice to the Non-Breaching Party of such dispute
within such [***]-day period, the Non-Breaching Party will not have the right to
terminate this Agreement in accordance with Section 10.2.4 or Section 10.2.5, or
trigger the alternative remedy provisions of Section 10.3, as applicable, unless
and until it has been determined in accordance with Section 12.1 that this
Agreement was materially breached by the Breaching Party and the Breaching Party
fails to cure such breach within [***] days following such determination. It is
understood and acknowledged that during the pendency of such dispute, all the
terms and conditions of this Agreement will remain in effect and the Parties
will continue to perform all of their respective obligations hereunder,
including satisfying any payment obligations.

10.2.7.
Termination for Insolvency.

(a)
Either Party may terminate this Agreement if, at any time, the other Party files
in any court or agency pursuant to any statute or regulation of any state or
country a petition in bankruptcy or insolvency or for reorganization or for an
arrangement or for the appointment of a receiver or trustee of the Party or of
substantially all of its assets; or if the other Party proposes a written
agreement of composition or extension of substantially all of its debts; or if
the other Party will be served with an involuntary petition against it, filed in
any insolvency proceeding, and such petition will not be dismissed within 90
days after the filing thereof; or if the other Party will propose or be a party
to any dissolution or liquidation; or if the other Party will make an assignment
of substantially all of its assets for the benefit of creditors.

 
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(b)
All rights and licenses granted under or pursuant to any section of this
Agreement are and will otherwise be deemed to be for purposes of Section 365(n)
of Title 11, United States Code (the “Bankruptcy Code”) licenses of rights to
“intellectual property” as defined in Section 101(56) of the Bankruptcy Code.
The Parties will retain and may fully exercise all of their respective rights
and elections under the Bankruptcy Code. Upon the bankruptcy of any Party, the
non-bankrupt Party will further be entitled to a complete duplicate of, or
complete access to, any such intellectual property, and such, if not already in
its possession, will be promptly delivered to the non-bankrupt Party, unless the
bankrupt Party elects in writing to continue, and continues, to perform all of
its obligations under this Agreement.

10.2.8.
Termination for Patent Challenge. Ionis may terminate this Agreement if Biogen
(i) commences or otherwise voluntarily determines to participate in any action
or proceeding, challenging or denying the enforceability or validity of any
claim within an issued patent or patent application within such Licensed
Patents, or (ii) directs, supports or actively assists any other Person in
bringing or prosecuting any action or proceeding challenging or denying the
validity of any claim within an issued patent or patent application within such
Licensed Patents and, in each case ((i) or (ii)), within [***] days’ written
notice from Ionis, Biogen fails to rescind any and all of such actions, provided
however that, nothing in this clause prevents Biogen from taking any of the
actions referred to in this clause and provided further that Ionis will not have
the right to terminate if Biogen:

(a)
takes any such action as described in clause (i) or (ii) above as may be
necessary or reasonably required to assert a cross-claim or a counter-claim or
to respond to a court request or order or administrative law request or order,
including asserting invalidity as a defense in any court proceeding brought by
Ionis asserting infringement of a Licensed Patent; or

(b)
Acquires a Third Party that has an existing challenge, whether in a court or
administrative proceeding, against a Licensed Patent; or

(c)
licenses a product for which Ionis has an existing challenge, whether in a court
or administrative proceeding, against a Licensed Patent.

10.3.
Alternative Remedies to Termination Available to Biogen Prior to Option
Exercise. If, prior to Option exercise with respect to a particular
Collaboration Program, Biogen elects to exercise the alternative remedy
provisions of this Section 10.3 in lieu of terminating this Agreement for such
Collaboration Program by providing written notice of such election to Ionis in
accordance with Section 10.2.5(a), then, solely with respect to the
Collaboration Program giving rise to Biogen’s exercise of these alternative
remedy provisions, this Agreement will continue in full force and effect with
the following modifications:

(a)
Ionis will have no further rights or obligations to Develop the Product under
the applicable Collaboration Program or participate in the JSC, JPC or any other
subcommittees or working groups established pursuant to this Agreement. Biogen
will solely make all decisions that this Agreement would otherwise require or
permit the JSC, JPC or any other subcommittees or working groups, or the Parties
collectively, to make; provided, however, that Biogen will not have the right to
create any obligations or incur any liabilities for or on behalf of Ionis;

 
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(b)
effective as of the date of Biogen’s notice to Ionis electing the alternative
remedy provisions of this Section 10.3, Biogen will be deemed for all purposes
of this Agreement to have exercised the applicable Option;

(c)
Biogen will have and Ionis grants, the exclusive license granted to Biogen under
Section 4.1.1 for the applicable Collaboration Program;

(d)
Biogen may exclude Ionis from all discussions with Regulatory Authorities
regarding the applicable Products, except to the extent Ionis’ participation is
required by a Regulatory Authority or is otherwise reasonably necessary to
comply with Applicable Law;

(e)
Biogen’s obligation to make further disclosures of Know-How or other information
to Ionis regarding the applicable Products pursuant to this Agreement (including
pursuant to Section 4.9) will terminate, other than reports required by Section
6.9.1, Section 10.4.3 (if applicable), and as reasonably required to permit
Ionis to perform its obligations under this Agreement; provided such remedy will
not limit or diminish the scope of any licenses granted by Biogen to Ionis under
this Agreement; and

(f)
Ionis will perform its obligations under Section 4.9 with respect to the
applicable Product within [***] days of Biogen electing to exercise its
alternative remedies under this Section 10.3, and will provide to Biogen and its
Third Party contractors all Know-How, assistance, assignments and other support
reasonably requested to assist Biogen in assuming complete responsibility for
the Development and Manufacture of the applicable Products in an efficient and
orderly manner.

10.4.
Consequences of Expiration or Termination of the Agreement.

10.4.1.
In General. If this Agreement expires or is terminated by a Party in accordance
with this ARTICLE 10 at any time and for any reason, the following terms will
apply to any Product that is the subject of such expiration or termination:

(a)
Return of Information and Materials. The Parties will return (or destroy, as
directed by the other Party) all data, files, records and other materials
containing or comprising the other Party’s Confidential Information, except to
the extent such Confidential Information is necessary or useful to conduct
activities for a surviving Product or Spinraza®. Notwithstanding the foregoing,
the Parties will be permitted to retain one copy of such data, files, records,
and other materials for archival and legal compliance purposes.

 
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(b)
Accrued Rights. Termination or expiration of this Agreement for any reason will
be without prejudice to any rights or financial compensation that will have
accrued to the benefit of a Party prior to such termination or expiration. Such
termination or expiration will not relieve a Party from obligations that are
expressly indicated to survive the termination or expiration of this Agreement.
For purposes of clarification, milestone payments under ARTICLE 6 accrue as of
the date the applicable Milestone Event is achieved even if the payment is not
due at that time.

(c)
No Effect on Original Agreement. For clarity, the expiration or termination of
this Agreement shall not modify the rights and obligations of the Parties under
the Original Agreement.

(d)
Survival. The following provisions of this Agreement will survive the expiration
or termination of this Agreement: Section 1.9 (End of ASO Development Candidate
Identification Term); Section 1.10 (Carryover Development Candidates); ARTICLE 2
(Exclusivity Covenants) (solely to the extent set forth in Section 2.4
(Exclusivity Under Original Agreement)); Section 3.2 (Option and Option
Deadline) (but only with respect to each Party’s transfer obligations
thereunder); Section 4.1.3 (Effect of Termination on Sublicenses); Section 4.2.2
(Grant Back to Ionis); Section 4.3 (Data Licenses); Section 4.4.3 (Enabling
License to Biogen); Section 4.4.4 (Enabling License to Ionis); Section 4.5
(Licenses to Ionis for Biogen Results); Section 4.6 (Right to Obtain Direct
License from Biogen to Ionis Partner; Sublicensees of Ionis); Section 4.7.2
(Priority Review Vouchers) (but not in the case where this Agreement is
terminated under Section 10.2.2, Section 10.2.4(a) or Section 10.2.5(a));
Section 5.4 (Research and Manufacturing Records); Section 6.7 (Reverse Royalty
Payments to Biogen for a Discontinued Product); Section 6.9.3 (Records
Retention); Section 6.10 (Audits); Section 6.13 (Exclusion of Products under
Original Agreement); Section 7.1.1 (Ionis Technology and Biogen Technology);
Section 7.1.2 (Agreement Technology); Section 8.4 (Disclaimer); ARTICLE 9
(Indemnification; Insurance); Section 10.2.3(b); Section 10.2.7 (Termination for
Insolvency); Section 10.4 (Consequences of Expiration or Termination of the
Agreement) (except Section 10.4.5 (Remedies Available to Biogen after Ionis’
Material Breach After Option Exercise)); ARTICLE 11 (Confidentiality); ARTICLE
12 (Miscellaneous) and Appendix 1 (Definitions) (to the extent definitions are
embodied in the foregoing listed Articles and Sections).

10.4.2.
Natural Expiration. If this Agreement expires in accordance with Section 10.1.1
or Section 10.1.2, the following terms will apply to any Product that is the
subject of such expiration:

 
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(a)
Perpetual, Royalty-Free Non-Exclusive License. If Biogen has been granted a
license under Section 4.1.1 for a particular Product, then upon expiration of
the Reduced Royalty Period for such Product in all countries in which such
Product is being or has been sold, Ionis will and hereby does grant to Biogen a
perpetual, non-exclusive, worldwide, royalty-free, fully paid-up, sublicensable
license under the Ionis Know-How to Manufacture, Develop and Commercialize the
applicable Product.

10.4.3.
Termination Before License Grant. If this Agreement expires or is terminated by
a Party in accordance with this ARTICLE 10 before Biogen has been granted a
license under Section 4.1.1 for a particular Product, then, in addition to the
terms set forth in Section 10.4.1, the following terms will apply to each
Product or Collaboration Program that is the subject of such expiration or
termination:

(a)
Biogen’s Option under ARTICLE 3 will expire.

(b)
Solely in the event that this Agreement expires or is terminated by a Party in
its entirety or upon termination of both Collaboration Programs without Option
exercise by Biogen, Ionis will be free to Develop and Commercialize the
applicable Product (and any other applicable Compounds or other ASOs designed to
bind to the RNA that encodes SMN) on its own or with a Third Party, subject to
the provisions of Section 1.10 and ARTICLE 2 of this Agreement.

(c)
Solely in the event that this Agreement expires or is terminated by a Party in
its entirety or upon termination of both Collaboration Programs without Option
exercise by Biogen, neither Party will have any further obligations under
Section 2.1 of this Agreement, except as expressly set forth in Section 2.4 of
this Agreement.

(d)
Solely in the event that this Agreement expires or is terminated by a Party in
its entirety or upon termination of both Collaboration Programs without Option
exercise by Biogen, to the extent requested by Ionis, Biogen will promptly (1)
assign to Ionis any manufacturing agreements with a CMO identified by Ionis to
which Biogen is a party, solely to the extent such manufacturing agreements
relate to the Collaboration Programs, and (2) transfer to Ionis all data,
results and information (including Biogen’s Confidential Information and any
regulatory documentation (including drafts)) related to the testing and Clinical
Studies under the Collaboration Programs in the possession of Biogen and its
contractors to the extent such data, results and information were generated by
or on behalf of Biogen under this Agreement; and Ionis will pay all
out-of-pocket direct Third Party costs and expenses in transferring such data,
results and information together with Biogen’s FTE Cost in transferring such
data, results and information.

 
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(e)
Except as explicitly set forth in Section 10.4.1(a) or 10.4.1(b), Biogen will
have no further rights and Ionis will have no further obligations with respect
to the terminated Products and Collaboration Programs.

(f)
If this Agreement is terminated in its entirety by Biogen for convenience, then:

(i)
Biogen will, and does hereby, grant to Ionis a sublicensable, worldwide,
exclusive license or sublicense, as the case may be, to all Biogen Technology
Controlled by Biogen as of the date of such reversion that Covers the applicable
Discontinued Product(s) solely as necessary to Develop, make, have made, use,
sell, offer for sale, have sold, import and otherwise Commercialize the
applicable Discontinued Product(s) in the Field (such license will be
sublicensable by Ionis in accordance with Section 4.1.2, mutatis mutandis); and

(ii)
Within 30 days following the date of the termination, Biogen will assign, and
hereby does assign, to Ionis all of Biogen’s right, title and interest in and to
all Regulatory Materials, including any IND and orphan drug designation that
relate to the applicable Discontinued Product(s), provided that, (x)
notwithstanding the foregoing, and subject to the provisions of Section 2.1, the
Parties acknowledge that Biogen shall be permitted to use excerpts or portions
of any such assigned Regulatory Materials in any other regulatory submissions,
notifications, registrations, approvals and/or other filings and correspondence
made to or with a Regulatory Authority in any country or jurisdiction related to
products under the Ionis/Biogen Additional Agreements or products that do not
include an Oligonucleotide as an active pharmaceutical ingredient, provided,
further that, for such products that do not include an Oligonucleotide as an
active pharmaceutical ingredient, such excerpts or portions shall not include
any Confidential Information of Ionis, and (y) for clarity, such assignment of
Biogen’s right, title and interest in and to such Regulatory Materials shall not
include the assignment of any Know-How (including any data) contained therein.
If Biogen intends to use any excerpt or portion of any such assigned Regulatory
Materials in accordance with clause (x) of the preceding sentence, Biogen shall,
at least 30 days in advance of the anticipated submission of such excerpt or
portion to a Regulatory Authority, notify Ionis of such intent and provide to
Ionis a copy of such proposed excerpt or portion for review and comment. The
Parties shall discuss in good faith any comments of Ionis with respect to such
proposed excerpt or portion prior to submission thereof.

 
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10.4.4.
Termination After License Grant. If this Agreement is terminated by a Party in
accordance with this ARTICLE 10 after Biogen has been granted a license under
Section 4.1.1 for a particular Product, then, in addition to the terms set forth
in Section 10.4.1, the following terms will apply to any Product or
Collaboration Program that is the subject of such termination:

(a)
The applicable licenses granted by Ionis to Biogen under this Agreement will
terminate. Biogen, its Affiliates and Sublicensees will cease selling the
applicable Products, unless Ionis elects to have Biogen continue to sell the
applicable Products as part of the Transition Services to the extent provided in
Section 10.4.6.

(b)
Solely in the event that this Agreement expires or is terminated by a Party in
its entirety, neither Party will have any further obligations under Section 2.1
of this Agreement, except as expressly set forth in Section 2.4 of this
Agreement.

(c)
Except as explicitly set forth in Section 10.4.1(a), Biogen will have no further
rights and Ionis will have no further obligations with respect to the terminated
Product and Collaboration Program(s).

(d)
If (i) Biogen terminates the Agreement under Section 10.2.1 (Biogen’s
Termination for Convenience) or (ii) Ionis terminates this Agreement under
Section 10.2.4(b) (Ionis’ Right to Terminate) or Section 10.2.5 (Remedies for
Failure to Use Commercially Reasonable Efforts), in each case, in its entirety,
then the following additional terms will also apply:

(i)
Biogen will, and does hereby, grant to Ionis a sublicensable, worldwide,
exclusive license or sublicense, as the case may be, to all Biogen Technology
Controlled by Biogen as of the date of such reversion that Covers the
Discontinued Product(s) solely as necessary to Develop, make, have made, use,
sell, offer for sale, have sold, import and otherwise Commercialize the
Discontinued Product(s) in the Field (such license will be sublicensable by
Ionis in accordance with Section 4.1.2, mutatis mutandis);

(ii)
Within 60 days following the date of the termination, Biogen will assign back to
Ionis any Product-Specific Patents and Ionis’ interest in any Program Patents
that relate to the applicable Discontinued Product(s) previously assigned by
Ionis to Biogen under this Agreement;

 
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(iii)
Within 60 days following the date of the termination, Biogen will transfer to
Ionis solely for use with respect to the Development and Commercialization of
the applicable Discontinued Product(s), any Know-How, data, results and copies
of Regulatory Materials in the possession of Biogen as of the date of such
reversion to the extent related to such Discontinued Product(s), and any other
information or material specified in Section 4.9, provided that, for the
avoidance of doubt, as between the Parties, title to any intellectual property
that is Biogen Technology within any of the foregoing will remain with Biogen
subject to the license granted to Ionis under Section 10.4.4(d)(i), except as
otherwise provided in Section 10.4.4(d)(iv) below;

(iv)
Within [***] days following the date of the termination, Biogen will assign, and
hereby does assign, to Ionis all of Biogen’s right, title and interest in and to
all Regulatory Materials, including any NDA, IND and orphan drug designation
that relate to the applicable terminated Product(s), provided that, (x)
notwithstanding the foregoing, and subject to the provisions of Section 2.1, the
Parties acknowledge that Biogen shall be permitted to use excerpts or portions
of any such assigned Regulatory Materials in any other regulatory submissions,
notifications, registrations, approvals and/or other filings and correspondence
made to or with a Regulatory Authority in any country or jurisdiction related to
products under the Ionis/Biogen Additional Agreements or products that do not
include an Oligonucleotide as an active pharmaceutical ingredient, provided,
further that, for such products that do not include an Oligonucleotide as an
active pharmaceutical ingredient, such excerpts or portions shall not include
any Confidential Information of Ionis, and (y) for clarity, such assignment of
Biogen’s right, title and interest in and to such Regulatory Materials shall not
include the assignment of any Know-How (including any data) contained therein.
If Biogen intends to use any excerpt or portion of any such assigned Regulatory
Materials in accordance with clause (x) of the preceding sentence, Biogen shall,
at least 30 days in advance of the anticipated submission of such excerpt or
portion to a Regulatory Authority, notify Ionis of such intent and provide to
Ionis a copy of such proposed excerpt or portion for review and comment. The
Parties shall discuss in good faith any comments of Ionis with respect to such
proposed excerpt or portion prior to submission thereof;

(v)
Biogen will, and does hereby, exclusively license to Ionis any trademarks that
are specific to the Discontinued Product(s) solely for use with such
Discontinued Product(s); provided, however, in no event will Biogen have any
obligation to license to Ionis any trademarks used by Biogen both in connection
with the Product and in connection with the sale of any other product or
service, including any BIOGEN- or BIOGEN-formative marks;

 
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(vi)
Ionis will control and be responsible for all aspects of the Prosecution and
Maintenance of all Jointly-Owned Program Patents arising from the terminated
Product and/or Collaboration Program, and Biogen will provide Ionis with (and
will instruct its counsel to provide Ionis with) all of the information and
records in Biogen’s and its counsel’s possession related to the Prosecution and
Maintenance of such Jointly-Owned Program Patents; provided, however, if Ionis
intends to abandon any such Jointly-Owned Program Patents without first filing a
continuation or substitution, then Ionis will notify Biogen of such intention at
least [***] days before such Patent Right will become abandoned, and Biogen will
have the right, but not the obligation, to assume responsibility for the
Prosecution and Maintenance thereof at its own expense with counsel of its own
choice; and

(vii)
Ionis will have the obligation to pay royalties to Biogen under Section 6.7 with
respect to the Discontinued Product(s). Such payments will be governed by the
financial provisions in Section 6.8.3(b), and the definition of Net Sales will
apply to sales of Discontinued Product(s) by Ionis, in each case mutatis
mutandis.

(e)
If Ionis terminates this Agreement in its entirety due to Biogen’s material
breach or Biogen terminates this Agreement in its entirety for convenience, upon
Ionis’ written request pursuant to a mutually agreed supply agreement, Biogen
will sell to Ionis any bulk API, Clinical Supplies and Finished Drug Product
with respect to the Discontinued Product(s) in Biogen’s possession at the time
of such termination, at a price equal to [***].

(f)
Solely in the event that this Agreement expires or is terminated by a Party in
its entirety, to the extent requested by Ionis, Biogen will promptly assign to
Ionis any manufacturing agreements solely to the extent related to the
Discontinued Product(s) and identified by Ionis to which Biogen is a party.

10.4.5.
Remedies Available to Biogen for Ionis’ Material Breach After Option Exercise.

(a)
Termination of Committees and Information Sharing. If, after Option exercise,
Ionis materially breaches this Agreement and fails to cure such breach within
the time periods set forth under Section 10.2.4(a) or Section 10.2.5(a), and
Biogen does not wish to terminate this Agreement in its entirety (an “Ionis
Breach Event”), then, in addition to any other remedies Biogen may have under
this Agreement or otherwise, Biogen will have the right to do any or all of the
following in Biogen’s discretion solely with respect to the Collaboration
Programs that are the subject of the Ionis Breach Event:

 
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(i)
terminate Ionis’ right to participate in the JPC, which will be disbanded
(except to the extent it is performing activities under an Ionis/Biogen
Additional Agreement);

(ii)
terminate Ionis’ participation in any ongoing research and development programs
under the applicable Collaboration Program and Biogen’s funding obligations
associated therewith;

(iii)
solely make all decisions required or permitted to be made by the JPC or the
Parties collectively under this Agreement in connection with the Development and
Commercialization of the applicable Product; provided, however, that Biogen will
not have the right to create any obligations or incur any liabilities for or on
behalf of Ionis;

(iv)
exclude Ionis from all discussions with Regulatory Authorities regarding
applicable Products, except to the extent Ionis’ participation is required by a
Regulatory Authority or is otherwise reasonably necessary to comply with
Applicable Law;

(v)
terminate Biogen’s obligation to make further disclosures of Know-How or other
information to Ionis pursuant to this Agreement related to the applicable
Products, including pursuant to Section 4.9 and Section 5.3.2, other than
reports required by Section 6.9.1, Section 10.4.4 (if applicable), and as
reasonably required to permit Ionis to perform its obligations under this
Agreement; provided such remedy will not limit or diminish the scope of any
licenses granted by Biogen to Ionis under this Agreement; and

(vi)
if Ionis has not completed the activities that are its responsibility under the
Collaboration Programs, then Biogen may, but will not be obligated to, assume
all responsibility for all such activities that would have otherwise been Ionis’
responsibility under this Agreement.

Ionis will cooperate with the foregoing and provide to Biogen and its Third
Party contractors all Know-How, assistance, assignments and other support
reasonably requested to assist Biogen in assuming complete responsibility for
the Development and Manufacture of the Products in an efficient and orderly
manner.
 
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(b)
Biogen’s Right of Setoff. If there is an [***] and Biogen does not wish to
[***], then, in addition to any other remedies Biogen may have under this
Agreement or otherwise, Biogen may setoff against any amounts owed to Ionis
pursuant to ARTICLE 6 (Financial Provisions) solely with respect to the
Collaboration Program that is the subject of the Ionis Breach Event [***] (the
“Setoff Amount”). If Biogen exercises its setoff right under this Section
10.4.5(b), Biogen will provide Ionis with a written certificate, signed by
Biogen’s Chief Financial Officer, certifying that the amount setoff by Biogen
represents [***]. Notwithstanding the foregoing, if Ionis notifies Biogen in
writing (a “Setoff Dispute Notice”) that it disputes Biogen’s assertion that
Ionis is in material breach of this Agreement or the amount setoff by Biogen (a
“Setoff Dispute”), then (i) both Parties will participate in the dispute
resolution process set forth on Schedule 10.4.5(b), and (ii) pending the
Parties' agreement regarding the appropriate setoff (if any) or a determination
by the Advisory Panel of the proper amount that Biogen may setoff (if any) in
accordance with Schedule 10.4.5(b), Biogen will pay the Setoff Amount into an
interest-bearing escrow account established for the purpose at a bank. If the
Parties cannot settle their dispute by mutual agreement, then, in accordance
with Schedule 10.4.5(b) the Advisory Panel will determine (1) the amount (if
any) that Biogen may setoff against future payments solely with respect to the
Collaboration Program that is the subject of the Ionis Breach Event to Ionis
going forward, and (2) whether any portion of the escrow account should be
released to Ionis or returned to Biogen, provided that any decision or
determination by the Advisory Panel (a “Panel Decision”) will not be treated as
an arbitral award but will be binding on the Parties until and unless a court of
competent jurisdiction (the “Trial Court”) has determined in a judgment
regarding some or all of the issues decided in the Panel Decision, and in any
Action contemplated by the next sentence hereof the Trial Court will determine
the facts and the law de novo, and will give a Panel Decision only such
persuasive effect, if any, that after review of all of the facts and the law
presented to the Trial Court by the Parties, the Trial Court deems appropriate,
provided, that the escrow agent will comply with a Panel Decision that
determines that any portion of the escrow account should be released to Ionis or
returned to Biogen. If it is determined in a judgment by the Trial Court that
Ionis owes Biogen any damages, then, during the pendency of any appeal of the
Trial Court’s decision (or, if the Trial Court’s decision is not appealed, until
Biogen recoups such amount), Biogen may setoff against any future payments
solely with respect to the Collaboration Programs that are the subject of the
Ionis Breach Event to Ionis under this Agreement the amount of any such damages
not paid by Ionis. If it is determined in a Trial Court that Biogen has setoff
an amount that exceeds the amount of losses, damages and expenses actually
incurred by Biogen as a result of Ionis’ breach of this Agreement, then Biogen
will promptly pay Ionis the amount of such excess, plus interest on such amount
as provided for in Section 6.12 (Interest), with interest accruing from the time
Biogen applied such excess setoff. If, with respect to a Setoff Dispute, Ionis
provides a Setoff Dispute Notice to Biogen and Biogen fails to do any of the
following: (X) appoint a member of the Advisory Panel to the extent required in
Section 2 of Schedule 10.4.5(b); (Y) meet with the Advisory Panel as required in
Section 3 of Schedule 10.4.5(b); or (Z) pay the Setoff Amount into an
interest-bearing escrow account established for the purpose at a bank, then
Biogen will forfeit its right to set off under this Section 10.4.5(b) and
Schedule 10.4.5(b) with respect to any and all Setoff Disputes.

 
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10.4.6.
Transition Services. In the case where (i) Biogen terminates this Agreement in
its entirety under Section 10.2.1 (Biogen’s Termination for Convenience) or (ii)
Ionis terminates this Agreement in its entirety under Section 10.2.4(b) (Ionis’
Right to Terminate) or Section 10.2.5 (Remedies for Failure to Use Commercially
Reasonable Efforts), the terms of this Section 10.4.6 shall apply.

(a)
In such event, the Parties wish to provide a mechanism to ensure that patients
who were being treated with a Product prior to such termination or who desire
access to a Product can continue to have access to such Product while the
regulatory and commercial responsibilities for such Product are transitioned
from Biogen to Ionis. As such, Ionis may request Biogen perform transition
services as listed on Schedule 10.4.6 and such other transition services that
the Parties mutually agree in writing to (1) provide patients with continued
access to the applicable Products, (2) transition the responsibilities under all
Approvals and ongoing Clinical Studies for the applicable Product to Ionis or
its designee, and (3) transition the then-current supply process and
responsibilities for the Products to Ionis or its designee (collectively, the
“Transition Services”). Subject to the Parties agreeing on a transition plan as
described in Section 10.4.6(b), Biogen will perform such Transition Services
using reasonable efforts for a period not to exceed [***] months from the
termination date; provided that Biogen and Ionis may mutually agree to conduct
the Transition Services for a longer period of time. Notwithstanding the
provision of the Transition Services under this Section 10.4.6(a), Ionis shall
not conduct activities with respect to any Discontinued Products to the extent
prohibited by ARTICLE 2 of this Agreement.

(b)
Ionis may elect to have Biogen perform the Transition Services by providing
written notice to Biogen no later than 30 days following the effective date of
the termination. If Ionis requests Transition Services, then Ionis shall propose
a transition plan setting forth the Transition Services to be performed by
Biogen, including delivery and transition dates consistent with those set forth
on Schedule 10.4.6, and, for a period of 30 days after such request, the Parties
will use good faith efforts to negotiate a mutually agreeable version of such
transition plan. In addition, the Parties will, within 30 days after such
request, establish a transition committee consisting of at least each Party’s
Alliance Managers, a representative from each Party’s chemistry, manufacturing
and controls (CMC) group who was responsible for the Products prior to the
termination, and up to two additional representatives from each Party who are
from other relevant functional groups to facilitate a smooth transition. While
Biogen is providing Transition Services, Biogen and Ionis will mutually agree on
talking points and a communication plan to customers, specialty pharmacies,
physicians, Regulatory Authorities, patient advocacy groups, and clinical study
investigators, and Biogen will make all such communication to such entities in
accordance with the mutually agreed talking points.

 
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(c)
Ionis will pay Biogen for the Transition Services at [***]% of Biogen’s internal
costs to perform the Transition Services, calculated using the same methodology
as Biogen used to calculate such expenses for such Product in its most recently
audited financial statements prior to the termination date. In addition, Ionis
will reimburse [***]% of Biogen’s out-of-pocket costs to perform the Transition
Services. Ionis will own all revenue derived from the Products after the
termination date and Biogen will remit all such revenues to Ionis no later than
the [***] day following the end of the month in which such revenue was received.

(d)
Ionis or its designee will be sufficiently prepared to accept the transition of
Development, Manufacturing and Commercialization activities with respect to the
Products to Ionis or such designee on the timelines set forth on Schedule 10.4.6
for the Transition Services. Biogen will have no liability under this Agreement
with respect to a failure of or delay in the Transition Services to the extent
caused by any failure or delay by Ionis or its designee in accepting the
transition of Development, Manufacturing and Commercialization activities with
respect to the Products. In the event that Biogen encounters any delays beyond
Biogen’s reasonable control, the Parties shall discuss in good faith and agree
upon extended timelines for completion of the Transition Services.

ARTICLE 11.
CONFIDENTIALITY

11.1.
Confidentiality; Exceptions. Except to the extent expressly authorized by this
Agreement or otherwise agreed in writing, the Parties agree that, during the
Agreement Term and for five years thereafter, the receiving Party (the
“Receiving Party”) and its Affiliates will keep confidential and will not
publish or otherwise disclose or use for any purpose other than as provided for
in this Agreement any confidential or proprietary information or materials,
patentable or otherwise, in any form (written, oral, photographic, electronic,
magnetic, or otherwise) which is disclosed to it by the other Party (the
“Disclosing Party”) or its Affiliates or otherwise received or accessed by a
Receiving Party in the course of performing its obligations or exercising its
rights under this Agreement or the Original Agreement, including trade secrets,
Know-How, inventions or discoveries, proprietary information, formulae,
processes, techniques and information relating to the past, present and future
marketing, financial, and research and development activities of any product or
potential product or useful technology of the Disclosing Party or its Affiliates
and the pricing thereof (collectively, “Confidential Information”).

 
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11.2.
Authorized Disclosure. Except as expressly provided otherwise in this Agreement,
a Receiving Party or its Affiliates may use and disclose to Third Parties
Confidential Information of the Disclosing Party as follows: (i) solely in
connection with the performance of its obligations or exercise of rights granted
or reserved in this Agreement under confidentiality provisions no less
restrictive than those in this Agreement, provided, that Confidential
Information may be disclosed by a Receiving Party to a governmental entity or
agency without requiring such entity or agency to enter into a confidentiality
agreement; (ii) to the extent reasonably necessary to file or prosecute patent,
copyright and trademark applications (subject to Section 11.3 below), complying
with applicable governmental regulations, obtaining Approvals, conducting
Preclinical Studies or Clinical Studies, marketing the Products, or as otherwise
required by Applicable Law, regulation, rule or legal process (including the
rules of the SEC and any stock exchange); provided, however, that if a Receiving
Party or any of its Affiliates is required by law or regulation to make any such
disclosure of a Disclosing Party’s Confidential Information it will, except
where impracticable for necessary disclosures, give reasonable advance notice to
the Disclosing Party of such disclosure requirement and will use its reasonable
efforts to secure confidential treatment of such Confidential Information
required to be disclosed; (iii) in communication with actual or potential
lenders, investors, merger partners, acquirers, consultants, or professional
advisors on a need-to-know basis, in each case under confidentiality provisions
no less restrictive than those of this Agreement; (iv) to the extent such
disclosure is required to comply with existing expressly stated contractual
obligations owed to such Party’s or its Affiliates’ licensor with respect to any
intellectual property licensed to the other Party under this Agreement; or (v)
as mutually agreed to in writing by the Parties.

11.3.
Press Release; Publications; Disclosure of Agreement.

11.3.1.
Public Announcements. On or promptly after the Effective Date, the Parties will
jointly issue a public announcement of the execution of this Agreement in form
and substance mutually agreed by the Parties. Except to the extent required to
comply with Applicable Law, regulation, rule or legal process or as otherwise
permitted in accordance with this Section 11.3, neither Party nor such Party’s
Affiliates will make any public announcements, press releases or other public
disclosures concerning this Agreement or the terms or the subject matter hereof
without the prior written consent of the other, which will not be unreasonably
withheld, conditioned or delayed.

11.3.2.
Use of Name. Except as set forth in Section 11.3.8, neither Party will use the
other Party’s name in a press release or other publication without first
obtaining the prior consent of the Party to be named.

 
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11.3.3.
Notice of Significant Events. Each Party will immediately notify (and provide as
much advance notice as possible, but at a minimum two Business Days’ advance
notice to) the other Party of any event materially related to a Product
(including in such notice any disclosure of starting/stopping of a Clinical
Study, clinical data or results, material regulatory discussions, filings,
Approval or Biogen’s sales projections) so the Parties may analyze the need for
or desirability of publicly disclosing or reporting such event.

11.3.4.
Prior to License Grant. Prior to the date Biogen has been granted a license
under Section 4.1.1 with respect to a Product, such Product is the sole property
of Ionis and, subject to the provisions of this Section 11.3.4, Ionis will have
the sole right to issue press releases, publish, present or otherwise disclose
the progress and results regarding such Product to the public, which shall be
consistent with its practice with its other compounds and products; provided
that, with respect to any proposed press release or other similar public
communication by Ionis disclosing regulatory discussions or data or results
arising from a Collaboration Program or Development activities under this
Agreement, or that may be reasonably anticipated to impact Spinraza®, (i) Ionis
will submit such proposed communication to Biogen for review at least two
Business Days in advance of such proposed public disclosure, (ii) Biogen will
have the right to review and recommend changes to such communication, (iii)
Ionis will in good faith consider any changes that are timely recommended by
Biogen, and (iv) to the extent such communication discloses data or results
arising from a Collaboration Program or Development activities, (x) if Biogen
informs Ionis that such communication contains Biogen Confidential Information,
then Ionis will delete such Biogen Confidential Information from such
communication, and (y) if Biogen informs Ionis that such communication would
disclose inventions made by either Party in the course of a Collaboration
Program or Development activities under this Agreement that have not yet been
protected through the filing of a patent application, or the public disclosure
of such communication could be expected to have a material adverse effect on any
Patent Rights or Know-How solely owned or Controlled by Biogen, then Ionis will
either (a) delay such proposed publication for up to 60 days from the date
Biogen informed Ionis of its objection to such communication, to permit the
timely preparation and first filing of patent application(s) on the information
involved or (b) remove the identified disclosures prior to the publication of
such communication.

 
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11.3.5.
After License Grant. After the date Biogen has been granted a license under
Section 4.1.1 with respect to a Product, subject to the provisions of this
Section 11.3.5, Biogen will have the sole right to issue press releases,
publish, present or otherwise disclose the progress and results regarding such
Product to the public, which shall be consistent with its practice with its
other compounds and products; provided that with respect to any proposed press
release or other similar public communication by Biogen disclosing regulatory
discussions, Biogen’s sales projections or data or results arising from a
Collaboration Program or Development activities under this Agreement, (i) Biogen
will submit such proposed communication to Ionis for review at least two
Business Days in advance of such proposed public disclosure, (ii) Ionis will
have the right to review and recommend changes to such communication, (iii)
Biogen will in good faith consider any changes that are timely recommended by
Ionis, and (iv) to the extent such communication discloses data or results
arising from a Collaboration Program or Development activities, (x) if Ionis
informs Biogen that such communication contains Ionis Confidential Information,
then Biogen will delete such Ionis Confidential Information from such
communication, and (y) if Ionis informs Biogen that such communication would
disclose inventions made by either Party in the course of a Collaboration
Program or Development activities under this Agreement that have not yet been
protected through the filing of a patent application, or the public disclosure
of such communication could be expected to have a material adverse effect on any
Patent Rights or Know-How solely owned or Controlled by Ionis, then Biogen will
either (a) delay such proposed publication for up to 60 days from the date Ionis
informed Biogen of its objection to such communication, to permit the timely
preparation and first filing of patent application(s) on the information
involved or (b) remove the identified disclosures prior to the publication of
such communication.

11.3.6.
Scientific or Clinical Presentations for Products. Regarding any proposed
scientific publications or public presentations related to summaries of data or
results arising from a Collaboration Program or Development activities under
this Agreement, the Parties acknowledge that scientific lead time is a key
element of the value of the Products under this Agreement and further agree to
use Commercially Reasonable Efforts to control public scientific disclosures of
such data or results, to prevent any potential adverse effect of any premature
public disclosure of such data or results. The Parties will establish a
procedure for publication review and each Party will first submit to the other
Party through the JPC an early draft of all such publications or presentations,
whether they are to be presented orally or in written form, at least [***] days
prior to submission for publication including to facilitate the publication of
any summaries of such data or results as required on the clinical trial registry
of each respective Party, as applicable. Each Party will review such proposed
publication in order to avoid the unauthorized disclosure of a Party’s
Confidential Information and to preserve the patentability of inventions arising
from the Collaboration Programs. If, during such [***]-day period, the other
Party informs such Party that its proposed publication contains Confidential
Information of the other Party, then such Party will delete such Confidential
Information from its proposed publication. In addition, if at any time during
such [***]-day period, the other Party informs such Party that its proposed
publication discloses inventions made by either Party in the course of a
Collaboration Program or Development activities under this Agreement that have
not yet been protected through the filing of a patent application, or the public
disclosure of such proposed publication could be expected to have a material
adverse effect on any Patent Rights or Know-How solely owned or Controlled by
such other Party, then such Party will either (i) delay such proposed
publication for up to [***] days from the date the other Party informed such
Party of its objection to the proposed publication, to permit the timely
preparation and first filing of patent application(s) on the information
involved or (ii) remove the identified disclosures prior to publication. With
respect to each Clinical Study, Biogen shall determine authorship or attribution
with respect to any proposed publications regarding the results of such Clinical
Study, by interpreting and applying the authorship and attribution principles of
the International Committee of Medical Journal Editors’ Recommendations for the
Conduct, Reporting, Editing and Publication of Scholarly Work in Medical
Journals.

 
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11.3.7.
SEC Filings. Each Party will give the other Party a reasonable opportunity to
review all material filings with the SEC describing the terms of this Agreement
prior to submission of such filings, and will give due consideration to any
reasonable comments by the non-filing Party relating to such filing.

11.3.8.
Subsequent Disclosure. Notwithstanding the foregoing, to the extent information
regarding this Agreement or a Product has already been publicly disclosed,
either Party (or its Affiliates) may subsequently disclose the same information
to the public without the consent of the other Party.

11.3.9.
Acknowledgment. Each Party will acknowledge in any press release, public
presentation or publication regarding the Collaboration Programs or a Product,
the other Party’s role in discovering and developing the Product or Discontinued
Product, as applicable, that the Product is under license from Ionis and
otherwise acknowledge the contributions from the other Party, and each Party’s
stock ticker symbol (e.g., Nasdaq: IONS, BIIB).

(a)
Biogen understands and acknowledges the importance to Ionis of continuing to be
associated with the drugs it discovers under the Collaboration Programs. As
such, Biogen agrees that it will use reasonable efforts to prominently
acknowledge Ionis’ role in the discovery of a Product in any scientific, medical
and other Product-related communications to the extent such communications
address the research, discovery or commercialization of a Product, by
prominently including the words “Discovered by Ionis” or equivalent language
(collectively, the “Ionis Attribution Language”) in any such communications;
provided, however, that Biogen shall have no obligation to include the Ionis
Attribution Language in any of the following: (i) communications or materials
where such inclusion would be prohibited by Applicable Laws or applicable Third
Party institutional, corporate or other policies; (ii) communications that
Biogen does not control, such as publications with non-Biogen lead authors;
(iii) materials primarily focused on or directed to patients, or other materials
where Biogen branding is not prominently featured; or (iv) abstracts or other
communications with a word limitation, if Biogen reasonably determines that such
word limitation would preclude the inclusion of the Ionis Attribution Language,
provided that, in each case, Biogen will use reasonable efforts to have the
Ionis Attribution Language included in any such communication, consistent with
the efforts that Biogen uses to have statements regarding its own contributions
to the Product included in such communication.

 
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(b)
Ionis may include the Products (and identify Biogen as its partner for the
Products) in Ionis’ drug pipeline.

ARTICLE 12.
MISCELLANEOUS

12.1.
Dispute Resolution.

12.1.1.
Escalation. In the event of any Dispute (other than a Setoff Dispute, which
Setoff Dispute will be resolved pursuant to Section 12.1.3, or dispute regarding
the construction, validity or enforcement of either Party’s Patent Rights, which
disputes will be resolved pursuant to Section 12.2), either Party may, within
[***] days after either Party notifies the other Party that the Dispute has not
been resolved (provided, that such notice cannot be given less than [***] days
after the Dispute has arisen), make a written request that the Dispute be
referred for resolution to the Executive Vice President, Business Development of
Biogen and the Chief Operating Officer of Ionis (the “Executives”). Within [***]
days of either Party’s written request that the Dispute be referred to the
Executives, the Executives will meet in person at a mutually acceptable time and
location or by means of telephone or video conference to negotiate a settlement
of a Dispute. If the Executives fail to resolve the Dispute within such
[***]-day period, then the Dispute will be referred to mediation under Section
12.1.2.

12.1.2.
Mediation. If a Dispute subject to Section 12.1.1 cannot be resolved pursuant to
Section 12.1.1, or if neither Party timely makes the written request that the
Dispute be referred to the Executives, the Parties will resolve any such Dispute
in accordance with the dispute resolution procedures set forth in Schedule
12.1.2.

12.1.3.
Setoff Disputes. Setoff Disputes will be resolved in accordance with Section
10.4.5(b) and Schedule 10.4.5(b).

12.1.4.
Technical Failure. If Biogen disagrees with Ionis’ determination that a
Technical Failure has occurred under Section 1.2, Biogen may refer the matter to
an independent qualified Third Party expert accepted by both Parties for final
resolution of the dispute. The expert will use the information, materials and
data provided to her or him by either Party to promptly resolve the dispute. The
decision of the expert will be binding upon both Parties. The Parties will
equally share the costs of the expert. Should the Parties fail to agree on the
expert within 10 days following either Party’s request to nominate an expert
under this Section 12.1.4, each Party will nominate an independent expert (who
will not be a current or former employee of a Party or any of their Affiliates
or have any personal or financial interest in a Party or any of their
Affiliates), and promptly thereafter, those two independent experts will agree
on the Third Party expert to resolve the dispute in accordance with this Section
12.1.4. In the event of any expert proceeding under this Section 12.1.4, Ionis
will not be required to conduct the applicable ASO Development Candidate
Identification Plan during the pendency of such proceeding.

 
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12.2.
Governing Law; Jurisdiction; Venue; Service of Process.

12.2.1.
This Agreement and any Dispute will be governed by and construed and enforced in
accordance with the laws of the State of Delaware, U.S.A., without reference to
conflicts of laws principles.

12.2.2.
Subject to the provisions of Section 12.1, each Party by its execution hereof,
(a) hereby irrevocably submits to the exclusive jurisdiction of the United
States District Court for the District of Delaware (or, if but only if such
court lacks, or will not exercise, subject matter jurisdiction over the entirety
of a Dispute, the Court of Chancery of the State of Delaware, or, if but only if
such court lacks, or will not exercise, subject matter jurisdiction over the
entirety of a Dispute, the Superior Court of the State of Delaware, with respect
to the Dispute) for the purpose of any Dispute arising between the Parties in
connection with this Agreement (each, an “Action”) and (b) hereby waives to the
extent not prohibited by Applicable Law, and agrees not to assert, by way of
motion, as a defense or otherwise, in any such Action, any claim that it is not
subject personally to the jurisdiction of the above-named courts, that venue in
the above-named courts is improper, that its property is exempt or immune from
attachment or execution, that any such Action brought in the above-named courts
should be dismissed on grounds of forum non conveniens, should be transferred or
removed to any court other than the above-named courts, or should be stayed by
reason of the pendency of some other proceeding in any other court other than
the above-named courts, or that this Agreement or the subject matter hereof may
not be enforced in or by such courts and (c) hereby agrees not to commence any
such Action other than before the above-named courts. Notwithstanding the
previous sentence, a Party may commence any Action in a court other than the
above-named court solely for the purpose of enforcing an order or judgment
issued by the above-named court.

12.2.3.
Each Party hereby agrees that service of process: (a) made in any manner
permitted by Delaware law, or (b) made by overnight express courier service
(signature required), prepaid, at its address specified pursuant to Section
12.7, will constitute good and valid service of process in any such Action and
(c) waives and agrees not to assert (by way of motion, as a defense, or
otherwise) in any such Action any claim that service of process made in
accordance with clause (a) or (b) does not constitute good and valid service of
process.

 
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12.3.
Remedies. Notwithstanding anything to the contrary in this Agreement, each Party
will be entitled to seek, in addition to any other right or remedy it may have,
at law or in equity, a temporary restraining order or a preliminary injunction,
without the posting of any bond or other security, enjoining or restraining the
other Party from any violation or threatened violation of this Agreement, and
the Parties agree that in the event of a threatened or actual material breach of
this Agreement injunctive relief would be appropriate. Neither Party will be
entitled to recover any Losses relating to any matter arising under one
provision of this Agreement to the extent that such Party has already recovered
Losses with respect to such matter pursuant to other provisions of this
Agreement (including recoveries under Section 9.1 or Section 9.2). Except for
the offsets and credits explicitly set forth in Section 6.10 and Section
10.4.5(b), neither Party will have the right to setoff any amount it is owed or
believes it is owed against payments due or payable to the other Party under
this Agreement.

12.4.
Assignment and Successors. Neither this Agreement nor any obligation of a Party
hereunder may be assigned by either Party without the consent of the other,
which will not be unreasonably withheld, delayed or conditioned, [***];
provided, if Biogen transfers or assigns this Agreement to [***] described in
this Agreement, then Biogen (or such Affiliate), will [***] due Ionis under
ARTICLE 6 for the [***] such that Ionis receives [***] or assignment. In
addition, Ionis may assign or transfer its rights to receive payments under this
Agreement (but no liabilities), without Biogen’s consent, to an Affiliate or to
a Third Party in connection with a payment factoring transaction. Any purported
assignment or transfer made in contravention of this Section 12.4 will be null
and void.

The [***].

To the extent Ionis utilizes a [***] in any year, Ionis will [***] to Biogen
[***]. To assist Biogen in determining when [***] pursuant to the foregoing
sentence, beginning with the first Annual tax return for the year in which
Biogen [***] payment under this Section 12.4, and each year thereafter
(including, for clarity, all years in which Ionis utilizes [***]), Ionis will
provide Biogen with Ionis’ Annual tax returns (federal and state) and, in years
in which Ionis utilizes [***], supporting documentation for such [***].
Notwithstanding the foregoing, if the [***].

12.5.
Change of Control.

 
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12.5.1.
On a Collaboration Program-by-Collaboration Program basis, if, at any time
during the applicable Option Period, a Change of Control occurs involving Ionis
and a Person that, at the time of the close of such Change of Control, is
developing in human clinical trials or commercializing a Directly Competitive
Product within the Field or is engaged in a Directly Competitive Collaboration
Program (such pre-existing Directly Competitive Product, a “Pre-Existing
Competitive Product”) or, at any time during the Agreement Term after the
closing of such Change of Control, develops or acquires a Directly Competitive
Product or begins a Directly Competitive Collaboration Program (such Person
being hereinafter referred to as a “Competing Acquirer”) and such Competing
Acquirer has not, within [***] of either (i) the closing of the Change of
Control in the event the Directly Competitive Product is being developed in
human clinical trials or commercialized, or the Directly Competitive
Collaboration Program exists, as of such closing date or (ii) the date of first
development or acquisition of such Directly Competitive Product or the date on
which such Competing Acquirer begins such Directly Competitive Collaboration
Program (the “Divestiture Period”) divested itself of the Directly Competitive
Product or Directly Competitive Collaboration Program, or terminated development
and commercialization of such Directly Competitive Product or such Directly
Competitive Collaboration Program, then (A) Ionis will provide written notice to
Biogen of the closing of such Change of Control or Divestiture Period, as
applicable, (B) [***]; (C) solely with respect to any Collaboration Program that
relates to such Directly Competitive Product or Directly Competitive
Collaboration Program for which Initiation of IND-Enabling Toxicology Studies
have not occurred, subject to Section 12.5.2, elect to have Ionis complete Ionis
Activities under this Agreement for such Collaboration Program until such time
as the applicable Collaboration Program is ready to begin IND-Enabling
Toxicology Studies, after which Biogen may elect to exercise its rights under
clause (D) of this Section 12.5.1 with respect to such Collaboration Program (in
which case the applicable deadline for Biogen’s notice under such clause will be
extended until [***] after designation of a Development Candidate for such
Collaboration Program), and (D) Biogen will have the right, within [***]
following such written notice, to either:

(a)
if unexercised, exercise the applicable Option by notifying Ionis in writing of
Biogen’s election to license the applicable Product at a prorated license fee
payment as compared to the license fee payment set forth in Section 6.2, based
upon the stage of Development of the applicable Product at the time of Change of
Control or Divestiture Period, as applicable, which license fee payment shall be
negotiated by the Parties in good faith at the time of such notification by
Biogen. If Biogen exercises the applicable Option pursuant to this Section 12.5,
[***]. Upon Biogen’s exercise of its Option pursuant to this Section 12.5.1(a),
Biogen will be deemed to have obtained and Ionis will be deemed to have granted
the license set forth in Section 4.1.1; or

(b)
Allow such [***]-day period to lapse without providing any such notice of
election under this Section 12.5, or otherwise provide Ionis with written notice
within such period electing not to exercise the applicable Option pursuant to
Section 12.5.1(a) above, in either of which cases Ionis and Biogen will continue
to exercise their rights and perform their respective obligations with respect
to the applicable Product under the terms of this Agreement.

 
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Upon Biogen’s exercise of the applicable Option pursuant to Section 12.5.1(a)
above, Ionis will carry out its technology transfer obligations pursuant to
Section 4.9 with respect to the applicable Product. Provided that Ionis complies
with Section 12.5.2, except as expressly set forth in Section 10.2.2, Biogen’s
rights as set forth in this Section 12.5.1 shall be Biogen’s exclusive remedies
for the failure of a Competing Acquirer to divest or terminate development and
commercialization of a Directly Competitive Product or Directly Competitive
Collaboration Program during the Divestiture Period in accordance with this
Section 12.5.1, and the development or commercialization of a Pre-Existing
Competitive Product by a Competing Acquirer will not be a violation of Ionis’
exclusivity covenants under Section 2.1.1. For the avoidance of doubt, except as
set forth in this Section 12.5.1, all other terms and conditions of this
Agreement will apply to any such license granted pursuant to Biogen’s exercise
of its rights hereunder.

12.5.2.
At any time while Ionis is conducting activities pursuant to Section 12.5.1, to
separate its Development activities under this Agreement from development
activities relating to a Directly Competitive Product (“Directly Competing
Development Activities”), Ionis will, and will cause the Competing Acquirer to,
(a) establish separate teams to conduct Development activities under this
Agreement and such Directly Competing Development Activities, (b) prevent any
Know-How that is Confidential Information relating to the Development of the
applicable Product from being disclosed to, or used by, individuals performing
such Directly Competing Development Activities and (c) not use or reference any
Know-How that is Confidential Information or conduct any activities Covered by
any Patent Rights, in each case Controlled by Ionis or its Affiliates prior to
the effective date of the Change of Control in the development, manufacture or
commercialization of the Directly Competitive Product.

12.6.
Force Majeure. No Party will be held responsible to the other Party nor be
deemed to be in default under, or in breach of any provision of, this Agreement
for failure or delay in performing any obligation of this Agreement when such
failure or delay is due to force majeure, and without the fault or negligence of
the Party so failing or delaying. For purposes of this Agreement, force majeure
means a cause beyond the reasonable control of a Party, which may include acts
of God; acts, regulations, or laws of any government; war; terrorism; civil
commotion; fire, flood, earthquake, tornado, tsunami, explosion or storm;
pandemic; epidemic and failure of public utilities or common carriers. In such
event the Party so failing or delaying will immediately notify the other Party
of such inability and of the period for which such inability is expected to
continue. The Party giving such notice will be excused from such of its
obligations under this Agreement as it is thereby disabled from performing for
so long as it is so disabled for up to a maximum of 90 days, after which time
the Parties will negotiate in good faith any modifications of the terms of this
Agreement that may be necessary to arrive at an equitable solution, unless the
Party giving such notice has set out a reasonable timeframe and plan to resolve
the effects of such force majeure and executes such plan within such timeframe.
To the extent possible, each Party will use reasonable efforts to minimize the
duration of any force majeure.

 
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12.7.
Notices. Any notice or request required or permitted to be given under or in
connection with this Agreement will be deemed to have been sufficiently given if
in writing and personally delivered or sent by certified mail (return receipt
requested), electronic mail transmission (receipt verified), or overnight
express courier service (signature required), prepaid, to the Party for which
such notice is intended, at the address set forth for such Party below:

 
If to Ionis, addressed to:
Ionis Pharmaceuticals, Inc.
   
2855 Gazelle Court
   
Carlsbad, CA 92010
   
Attention: Chief Operating Officer
   
E-mail: [***]
       
with a copy to:
Ionis Pharmaceuticals, Inc.
   
2855 Gazelle Court
   
Carlsbad, CA 92010
   
Attention: General Counsel
   
E-mail: [***]
       
If to Biogen, addressed to:
Biogen MA Inc.
   
225 Binney Street
   
Cambridge, MA 02142
   
Attention: Vice President Corporate Development
   
E-mail: [***]
       
with a copy to:
Biogen MA Inc.
   
225 Binney Street
   
Cambridge, MA 02142
   
Attention: Chief Legal Officer
   
E-mail: [***]
       
and:
Ropes & Gray LLP
   
Prudential Tower
   
800 Boylston Street
   
Boston, MA 02199-3600
   
Attention: Susan Galli, Esq.
   
E-mail: [***]

or to such other address for such Party as it will have specified by like notice
to the other Party; provided that notices of a change of address will be
effective only upon receipt thereof. If delivered personally or by electronic
mail transmission, the date of delivery will be deemed to be the date on which
such notice or request was given. If sent by overnight express courier service,
the date of delivery will be deemed to be the next Business Day after such
notice or request was deposited with such service. If sent by certified mail,
the date of delivery will be deemed to be the third Business Day after such
notice or request was deposited with the U.S. Postal Service.
 
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12.8.
Export Clause. Each Party acknowledges that the laws and regulations of the
United States restrict the export and re-export of commodities and technical
data of United States origin. Each Party agrees that it will not export or
re-export restricted commodities or the technical data of the other Party in any
form without the appropriate United States and foreign government licenses.

12.9.
Waiver. Neither Party may waive or release any of its rights or interests in
this Agreement except in writing. The failure of either Party to assert a right
hereunder or to insist upon compliance with any term or condition of this
Agreement will not constitute a waiver of that right or excuse a similar
subsequent failure to perform any such term or condition. No waiver by either
Party of any condition or term in any one or more instances will be construed as
a continuing waiver or subsequent waiver of such condition or term or of another
condition or term.

12.10.
Severability. If any provision hereof should be held invalid, illegal or
unenforceable in any jurisdiction, the Parties will negotiate in good faith a
valid, legal and enforceable substitute provision that most nearly reflects the
original intent of the Parties and all other provisions hereof will remain in
full force and effect in such jurisdiction and will be liberally construed in
order to carry out the intentions of the Parties hereto as nearly as may be
possible. Such invalidity, illegality or unenforceability will not affect the
validity, legality or enforceability of such provision in any other
jurisdiction.

12.11.
Entire Agreement. This Agreement (together with the Schedules and Appendices
hereto) is a comprehensive and integrated statement of the agreement between the
Parties with respect to the subject matter hereof. For the avoidance of doubt,
except as expressly set forth in Section 2.4 and Section 4.2.3 with respect to
the Original Agreement, this Agreement in no way supersedes, modifies or
otherwise affects any of the Ionis/Biogen Additional Agreements, which will
remain in full force and effect in accordance with each of their respective
terms. There are no covenants, promises, agreements, warranties,
representations, conditions or understandings, either oral or written, between
the Parties with respect to the subject matter hereof other than as set forth
herein and therein. No subsequent alteration, amendment, change or addition to
this Agreement will be binding upon the Parties hereto unless reduced to writing
and signed by the respective authorized officers of the Parties.

12.12.
Independent Contractors. Nothing herein will be construed to create any
relationship of employer and employee, agent and principal, partnership or joint
venture between the Parties. Each Party is an independent contractor. Neither
Party will assume, either directly or indirectly, any liability of or for the
other Party. Neither Party will have the authority to bind or obligate the other
Party and neither Party will represent that it has such authority.

 
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12.13.
Interpretation. Except as otherwise explicitly specified to the contrary, (a)
references to a section, exhibit or schedule means a section of, or schedule or
exhibit to this Agreement, unless another agreement is specified, (b) the word
“including” (in its various forms) means “including without limitation,” (c) the
words “shall” and “will” have the same meaning, (d) references to a particular
statute or regulation include all rules and regulations thereunder and any
predecessor or successor statute, rules or regulation, in each case as amended
or otherwise modified from time to time, (e) words in the singular or plural
form include the plural and singular form, respectively, (f) references to a
particular Person include such Person’s successors and assigns to the extent not
prohibited by this Agreement, (g) unless otherwise specified, “$” is in
reference to United States dollars, and (h) the headings contained in this
Agreement, in any exhibit or schedule to this Agreement and in the table of
contents to this Agreement are for convenience only and will not in any way
affect the construction of or be taken into consideration in interpreting this
Agreement.

12.14.
Books and Records. Any books and records to be maintained under this Agreement
by a Party or its Affiliates or Sublicensees will be maintained in accordance
with GAAP (or any successor standard), consistently applied.

12.15.
Further Actions. Each Party will execute, acknowledge and deliver such further
instruments, and do all such other acts, as may be necessary or appropriate in
order to carry out the expressly stated purposes and the clear intent of this
Agreement.

12.16.
Construction of Agreement. The terms and provisions of this Agreement represent
the results of negotiations between the Parties and their representatives, each
of which has been represented by counsel of its own choosing, and neither of
which has acted under duress or compulsion, whether legal, economic or
otherwise. Accordingly, the terms and provisions of this Agreement will be
interpreted and construed in accordance with their usual and customary meanings,
and each of the Parties hereto hereby waives the application in connection with
the interpretation and construction of this Agreement of any rule of law to the
effect that ambiguous or conflicting terms or provisions contained in this
Agreement will be interpreted or construed against the Party whose attorney
prepared the executed draft or any earlier draft of this Agreement.

12.17.
Supremacy. In the event of any express conflict or inconsistency between this
Agreement and any Schedule or Appendix hereto, the terms of this Agreement will
apply. The Parties understand and agree that the Schedules and Appendices hereto
are not intended to be the final and complete embodiment of any terms or
provisions of this Agreement, and are to be updated from time to time during the
Agreement Term, as appropriate and in accordance with the provisions of this
Agreement.

12.18.
Counterparts. This Agreement may be signed in counterparts, each of which will
be deemed an original, notwithstanding variations in format or file designation
which may result from the electronic transmission, storage and printing of
copies of this Agreement from separate computers or printers. Facsimile
signatures and signatures transmitted via electronic mail in PDF format will be
treated as original signatures.

12.19.
Compliance with Laws. Each Party will, and will ensure that its Affiliates and
Sublicensees will, comply with all relevant laws and regulations and good
laboratory and clinical practices and cGMP in exercising its rights and
fulfilling its obligations under this Agreement.

[SIGNATURE PAGE FOLLOWS]

* - * - * - *
 
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their representatives thereunto duly authorized as of the Effective Date.

BIOGEN MA INC.
     
By:
 
/s/ Michel Vounatsos
 
Name:
Michel Vounatsos
 
Title:
Chief Executive Officer
 

 
[Signature Page to Research Collaboration, Option and License Agreement]
 
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their representatives thereunto duly authorized as of the Effective Date.

IONIS PHARMACEUTICALS, INC.
   
By:
 
/s/ B. Lynne Parshall
 
Name:
B. Lynne Parshall
 
Title:
Chief Operating Officer
 

 
[Signature Page to Research Collaboration, Option and License Agreement]
 
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List of Appendices and Schedules

Appendix 1 – Definitions

Appendix 2 – Development Candidate Checklist

Appendix 3 – ASO Development Candidate Identification Plans

Schedule 1.3.1 – JSC Governance

Schedule 1.3.5 – Alliance Management Activities

Schedule 1.5 – List of [***]

Schedule 4.9.2(c) – Ionis’ Fully Absorbed Cost of Goods Methodology

Schedule 5.1 – Biogen’s Development and Commercialization Activities

Schedule 5.1.1 - Integrated Development Plan Content

Schedule 6.6.2(f) – Royalty Calculation Examples

Schedule 6.6.2(g) – Allocation of Net Sales

Schedule 6.8.1 – Ionis In-License Agreements

Schedule 6.8.3(b) – Royalty Rate Reduction Example

Schedule 8.2.6(a) – Ionis Core Technology Patents

Schedule 8.2.6(b) – Ionis Manufacturing and Analytical Patents

Schedule 8.2.6(c) – Ionis Product-Specific Patents

Schedule 8.2.9 – Prior Agreements

Schedule 10.4.5(b) – Advisory Panel Regarding Setoff Disputes

Schedule 10.4.6 – Transition Services

Schedule 12.1.2 – Mediation
 
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Appendix 1

DEFINITIONS

For purposes of this Agreement, the following capitalized terms will have the
following meanings:

“Action” has the meaning set forth in Section 12.2.2.

“Additional Core IP” means Third Party intellectual property that is necessary
to [***]. For clarity, Additional Core IP does not include any Patent Rights
claiming (or intellectual property related to) [***].

“Additional Ionis IP” has the meaning set forth in Section 6.8.3(a)(i).

“Additional Manufacturing IP” has the meaning set forth in Section 6.8.3(a)(i).

“Advisory Panel” has the meaning in Schedule 10.4.5(b) of this Agreement.

“Affiliate” of an entity means any corporation, firm, partnership or other
entity which directly or indirectly through one or more intermediaries controls,
is controlled by or is under common control with a Party to this Agreement. An
entity will be deemed to control another entity if it (i) owns, directly or
indirectly, at least 50% of the outstanding voting securities or capital stock
(or such lesser percentage which is the maximum allowed to be owned by a foreign
corporation in a particular jurisdiction) of such other entity, or has other
comparable ownership interest with respect to any entity other than a
corporation; or (ii) has the power, whether pursuant to contract, ownership of
securities or otherwise, to direct the management and policies of the entity.
For clarity, Regulus Therapeutics Inc. will not be deemed an “Affiliate” of
Ionis for the purposes of this Agreement under any circumstances.

“Agreement” has the meaning set forth in the Preamble of this Agreement.

“Agreement Term” has the meaning set forth in Section 10.1.

“Alliance Manager” has the meaning set forth in Section 1.3.5.

“Annual” means the period covering a Calendar Year or occurring once per
Calendar Year, as the context requires.

“API” means the bulk active pharmaceutical ingredient manufactured in accordance
with cGMP for a Product.

“Applicable Law” or “Law” means all applicable laws, statutes, rules,
regulations and other pronouncements having the effect of law of any federal,
national, multinational, state, provincial, county, city or other political
subdivision, agency or other body, domestic or foreign, including any applicable
rules, regulations, guidelines, or other requirements of the Regulatory
Authorities that may be in effect from time to time.

“Approval” means, with respect to a Product in any regulatory jurisdiction,
approval from the applicable Regulatory Authority sufficient for the
manufacture, distribution, use, marketing and sale of such Product in such
jurisdiction in accordance with Applicable Laws. In jurisdictions where the
applicable Regulatory Authority sets the pricing or reimbursement authorizations
necessary for the general marketing and sale of such Product in the marketplace,
Approval will not be deemed to have occurred if the final approval to market and
sell such Product is being withheld because Biogen (or its Affiliate or
Sublicensee) and the Regulatory Authority have not yet determined pricing or
reimbursement even if all other approvals, licenses, registrations or
authorizations necessary for marketing, sale or use of such Product in such
jurisdiction have been obtained. “Approval” does not include authorization by a
Regulatory Authority to conduct named patient, compassionate use or other
similar activities.
 
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“ASO” means a [***] Oligonucleotide compound, or analog, variant, mimic, or
mimetic thereof, having a sequence that is at least six bases long and that
modulates expression or splicing of a gene target via the binding, partially or
wholly, of such compound to the RNA of such gene target.

“ASO Development Candidate Identification Plan” means, with respect to each
Collaboration Program, the initial draft plan to identify a Development
Candidate under such Collaboration Program. The ASO Development Candidate
Identification Plans have been mutually agreed to by the Parties as of the
Effective Date and attached hereto as Appendix 3, and may be modified from time
to time as determined by the JSC to address the discovery, research and
optimization activities that Ionis will conduct under the applicable
Collaboration Program.

“ASO Development Candidate Identification Term” has the meaning set forth in
Section 1.2.

“Audit Report” has the meaning set forth in Section 6.10.

“Backup Compound” has the meaning set forth in Section 1.4.2(b).

“Bankruptcy Code” has the meaning set forth in Section 10.2.7(b).

“Biogen” has the meaning set forth in the Preamble of this Agreement.

“Biogen Activities” means, under an ASO Development Candidate Identification
Plan or high-level preclinical toxicology strategy, any and all research,
preclinical and/or clinical activities that Biogen agrees to conduct; provided
that Biogen will be deemed to have agreed to conduct any activities designated
as Biogen Activities under any ASO Development Candidate Identification Plan it
approves.

“Biogen-Approved Costs” has the meaning set forth in Section 1.8.

“Biogen Full Royalty” has the meaning set forth in Section 6.6.1.

“Biogen Know-How” means any Know-How owned, used, developed by, or licensed to
Biogen or its Affiliates, in each case to the extent Controlled by Biogen or its
Affiliates on the Effective Date or at any time during the Agreement Term, but
specifically excluding the Biogen Program Know-How.

“Biogen Manufacturing Program Patent” has the meaning set forth in Section
4.9.3.

“Biogen Patents” means any Patent Rights included in the Biogen Technology.

“Biogen Product-Specific Patents” means all Product-Specific Patents owned,
used, developed by, or licensed to Biogen or its Affiliates, in each case to the
extent Controlled by Biogen or its Affiliates on the Effective Date or at any
time during the Agreement Term.

“Biogen Program Know-How” has the meaning set forth in Section 7.1.2.

“Biogen Program Patents” has the meaning set forth in Section 7.1.2.

“Biogen Program Technology” has the meaning set forth in Section 7.1.2.
 
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“Biogen-Prosecuted Patents” has the meaning set forth in Section 7.2.4.

“Biogen Reduced Royalty” has the meaning set forth in Section 6.6.2(c).

“Biogen Results” has the meaning set forth in Section 4.9.3.

“Biogen Supported Pass-Through Costs” means [***].

“Biogen Technology” means the Biogen Program Technology, Jointly-Owned Program
Technology, Biogen Product-Specific Patents and any trademarks described in
Section 4.1.6, owned, used, developed by, or licensed to Biogen or its
Affiliates that is necessary or useful to Develop, register, Manufacture or
Commercialize a Product.

“Biogen’s FTE Cost” means the FTE Rate applicable to Biogen, multiplied by the
applicable number of FTEs.

“[***] ASO Product” has the meaning set forth in Section 2.1.2(a)(iv).

“Breaching Party” means the Party that is believed by the Non-Breaching Party to
be in material breach of this Agreement.

“Business Day” means any day other than a Saturday or Sunday on which banking
institutions in New York, New York are open for business.

“Calendar Quarter” means a period of three (3) consecutive months ending on the
last day of March, June, September, or December, respectively, and will also
include the period beginning on the Effective Date and ending on the last day of
the Calendar Quarter in which the Effective Date falls.

“Calendar Year” means a year beginning on January 1 (or, with respect to 2017,
the Effective Date) and ending on December 31.

“Carryover Development Candidate” has the meaning set forth in Section 1.10.

“Carryover Period” has the meaning set forth in Section 1.10.
“cGMP” means current Good Manufacturing Practices as specified in the United
States Code of Federal Regulations, ICH Guideline Q7A, or equivalent laws,
rules, or regulations of an applicable Regulatory Authority at the time of
manufacture.

“Change of Control” means, with respect to Ionis, (a) a merger or consolidation
of Ionis with a Third Party which results in the voting securities of Ionis
outstanding immediately prior thereto ceasing to represent at least 50% of the
combined voting power of the surviving entity immediately after such merger or
consolidation, (b) a transaction or series of related transactions in which a
Third Party, together with its Affiliates, becomes the owner of 50% or more of
the combined voting power of Ionis’ outstanding securities, (c) the sale or
other transfer to a Third Party of all or substantially all of Ionis’ business
to which the subject matter of this Agreement relates, or (d) the stockholders
or equity holders of Ionis will approve a plan of complete liquidation of Ionis
or an agreement for the sale or disposition by Ionis of all or a substantial
portion of its assets, other than pursuant to the transaction as described above
or to an Affiliate. Notwithstanding the foregoing, the sale or issuance of
shares in exchange for cash for purposes of a bona fide financing will not
constitute a Change of Control.

“Claims” has the meaning set forth in Section 9.1.
 
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“Clinical Study” or “Clinical Studies” means a Phase 1 Trial, Phase 2 Trial,
Phase 3 Trial or Phase 4 Trial, or such other study in humans that is conducted
in accordance with good clinical practices and is designed to generate data in
support or maintenance of an NDA, MAA or other similar marketing application.

“Clinical Supplies” means API and finished drug Product for use in a Clinical
Study.

“CMO” means a Third Party contract manufacturer Manufacturing API, Clinical
Supplies or Finished Drug Product for any purpose under this Agreement.

“Collaboration Program” means (a) a collaboration program between Biogen and
Ionis focused on the discovery, designation of, and preclinical research for a
Development Candidate that is an [***] Compound (the “[***] Collaboration
Program”) and (b) a collaboration program between Biogen and Ionis focused on
the discovery, designation of and preclinical research for a Development
Candidate that is an [***] Compound (the “[***] Collaboration Program”), in each
case in accordance with the applicable ASO Development Candidate Identification
Plan and high-level preclinical toxicology strategy.

“Collaborator IP” has the meaning set forth in Section 7.1.3(b).

“Collaborator License” has the meaning set forth in Section 7.1.3(b).

“Commercialize,” “Commercialization”, “Commercializing” or “Commercial” means
any and all activities directed to marketing, promoting, detailing,
distributing, importing, having imported, exporting, having exported, selling or
offering to sell a Product following receipt of Approval for such Product in the
applicable country, including conducting pre-and post-Approval activities,
including studies reasonably required to increase the market potential of such
Product and studies to provide improved formulation and Product delivery, and
launching and promoting such Product in each country.

“Commercializing Party” means (a) Biogen, with respect to a Product that is
being Developed and Commercialized by or on behalf of Biogen, its Affiliates or
Sublicensees hereunder, and (b) Ionis, with respect to a Discontinued Product
that is being Developed and Commercialized by or on behalf of Ionis, its
Affiliates or Sublicensees hereunder.

“Commercially Reasonable Efforts” means the carrying out of discovery, research,
development or commercialization activities using good-faith commercially
reasonable and diligent efforts that the applicable Party would reasonably
devote to a compound or product of similar market potential or profit potential
at a similar stage in development or product life resulting from its own
research efforts, based on conditions then prevailing and taking into account,
without limitation, issues of safety and efficacy, regulatory authority-approved
labeling, product profile, the competitiveness of alternative products in the
marketplace (including Spinraza®), the likely timing of the product’s entry into
the market, the patent and other proprietary position, the likelihood of
Approval and other relevant scientific, technical and commercial factors.
Without limiting any of the foregoing, Commercially Reasonable Efforts as it
applies to Biogen’s Development or Commercialization of a Product hereunder
includes the use of Commercially Reasonable Efforts to perform the “[***]”
described in [***], and Commercially Reasonable Efforts as it applies to Ionis’
performance hereunder includes use of Commercially Reasonable Efforts to [***].

“Competing Acquirer” has the meaning set forth in Section 12.5.1.

“Competitive Infringement” has the meaning set forth in Section 7.5.1.
 
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“Complete,” “Completed,” or “Completion” means, with respect to a Clinical
Study, the point in time at which the primary database lock for such study has
occurred and, if such study has a statistical analysis plan, the data generated
based on that primary database lock under the statistical analysis plan for such
study are available.

“Compound” means any [***] Compound or [***] Compound.

“Confidential Information” has the meaning set forth in Section 11.1.
“Confidential Information” does not include information that:

  (a)
was in the lawful knowledge and possession of the Receiving Party or its
Affiliates prior to the time it was disclosed to, or learned by, the Receiving
Party or its Affiliates, or was otherwise developed independently by the
Receiving Party or its Affiliates, as evidenced by written records kept in the
ordinary course of business, or other documentary proof of actual use by the
Receiving Party or its Affiliates;

(b)
was generally available to the public or otherwise part of the public domain at
the time of its disclosure to the Receiving Party or its Affiliates;

(c)
became generally available to the public or otherwise part of the public domain
after its disclosure and other than through any act or omission of the Receiving
Party or its Affiliates in breach of this Agreement; or

(d)
was disclosed to the Receiving Party or its Affiliates, other than under an
obligation of confidentiality, by a Third Party who had no obligation to the
Disclosing Party or its Affiliates not to disclose such information to others.

“Conflicting Patent Right” has the meaning set forth in Section 7.2.4(c).

“Control” or “Controlled” means possession of the ability to grant a license or
sublicense hereunder without violating the terms of any agreement with any Third
Party; provided, however, that if a Party has a right to grant a license or
sublicense, with respect to an item of intellectual property to the other Party
only upon payment of compensation (including milestones or royalties) to a Third
Party (“Third Party Compensation”) (other than Ionis Supported Pass-Through
Costs in the case of Ionis, and other than Biogen Supported Pass-Through Costs
in the case of Biogen), then the first Party will be deemed to have “Control” of
the relevant item of intellectual property only if the other Party agrees to
bear the cost of such Third Party Compensation. Notwithstanding anything to the
contrary under this Agreement, with respect to any Third Party that becomes an
Affiliate of a Party after the Effective Date (including a Third Party
acquirer), no intellectual property of such Third Party will be included in the
licenses granted hereunder by virtue of such Third Party becoming an Affiliate
of such Party.

“Cover,” “Covered” or “Covering” means, with respect to a patent, that, but for
rights granted to a Person under such patent, the act of making, using or
selling by such Person would infringe a Valid Claim included in such patent, or
in the case of a patent that is a patent application, would infringe a Valid
Claim in such patent application if it were to issue as a patent.

“CSHL Agreement” means that certain Amended and Restated Collaboration and
License Agreement between Cold Spring Harbor Laboratory and Ionis dated October
26, 2011, as amended.
 
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“Develop,” “Developing” or “Development” means with respect to a Product, any
and all discovery, characterization, or preclinical (including IND-Enabling
Toxicology Studies), clinical, or regulatory activity with respect to such
Product to seek Approval (including the submission of all necessary filings with
applicable Regulatory Authorities to support such preclinical and clinical
activities and Approval), including human clinical trials conducted after
Approval of such Product to seek Approval for additional indications for such
Product.

“Development Candidate” means an [***] Development Candidate or an [***]
Development Candidate.

“Development Candidate Data Package” means, with respect to a [***], the [***];
provided such package contains the [***] and is consistent with the applicable
ASO Development Candidate Identification Plan, and includes the intellectual
property assessment generated by the JPC in accordance with Section 7.1.3(a).
The checklist Ionis uses as of the Effective Date when reviewing potential
development candidates for approval is attached hereto as Appendix 2.

“Development Candidate Data Package Deficiency Notice” has the meaning set forth
in Section 1.4.2(a).

“Development Milestone Event” has the meaning set forth in Section 6.3.

“Diagnostic Option” has the meaning set forth in Section 3.4.1.

“Directly Competing Development Activities” has the meaning set forth in Section
12.5.2.

“Directly Competitive Collaboration Program” means any internal research program
for which [***] or [***], with the goal of discovering and developing a Directly
Competitive Product for which drug discovery activities have been initiated.

“Directly Competitive Product” means any product, other than a Product, that is
designed to bind to or directly modulate SMN.

“Disclosing Party” has the meaning set forth in Section 11.1.

“Discontinued Product” means a Product upon termination of this Agreement in its
entirety.

“Dispute” means any dispute arising between the Parties relating to, arising out
of or in any way connected with this Agreement or any term or condition hereof,
or the performance by either Party of its obligations hereunder, whether before
or after termination of this Agreement that cannot be resolved by the Parties.

“Divestiture Period” has the meaning set forth in Section 12.5.1.

“DOJ” has the meaning set forth in Section 3.3.1.

“Draft Report” means, with respect to an IND-Enabling Toxicology Study, an
integrated, audited report containing the pharmacology, toxicology,
bioanalytical and pharmacokinetic data generated from such IND-Enabling
Toxicology Study.

“Duplex Product” means a product containing [***], which may also include [***].

“Effective Date” has the meaning set forth in the Recitals of this Agreement.

“EMA” means the European Medicines Agency and any successor entity thereto.
 
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“[***] Compound” means any ASO containing [***] that is designed to bind to the
RNA that encodes SMN, where such ASO is discovered by Ionis prior to or during
the ASO Development Candidate Identification Term, but excluding nusinersen and
any Specified ASO Product in any form, formulation or dosage. An [***] Compound
may contain other chemical modifications that are utilized in drugs in Ionis’
clinical development pipeline as of the Effective Date (e.g., constrained ethyl
and DNA), but does not contain chemical modifications that have not, as of the
Effective Date, been administered intrathecally to non-human primates, such as
[***].

“[***] Development Candidate” means an [***] Compound that is designated by the
JSC (or Biogen in accordance with Section 1.4.2(b)) as [***].

“European Union” or “EU” means each and every country or territory that is
officially part of the European Union.

“Excluded Payments” means (i) royalty or profit sharing payments, or any other
type of payment based on periodic sales of a Product; (ii) payments made in
consideration of Ionis’ or Ionis’ Affiliate’s equity or debt securities at fair
market value; (iii) payments made to pay for or reimburse Ionis or Ionis’
Affiliate for the fully-burdened cost of research and development; (iv) payments
made to pay for or reimburse Ionis or Ionis’ Affiliate for the cost of
prosecuting, maintaining or defending Patent Rights; and (v) payments made to
Ionis or Ionis’ Affiliate to pass-through to a Third Party in satisfaction of a
payment obligation Ionis or Ionis’ Affiliate has to such Third Party.

“Executives” has the meaning set forth in Section 12.1.1.

“FDA” means the United States Food and Drug Administration and any successor
entity thereto.

“Field” means, except as may be limited under Section 4.1.5, the prophylactic or
therapeutic use or form of administration of a Product for any indication.

“Finished Drug Product” means any drug product containing API as an active
ingredient in finished bulk form for the Development or Commercialization by a
Party under this Agreement.

“First Commercial Sale” means the first sale of a Product by Biogen, its
Affiliate or its Sublicensee to a Third Party in a particular country after
Approval of such Product has been obtained in such country.

“FTC” has the meaning set forth in Section 3.3.1.

“FTE” means a total of 47 weeks or 1880 hours per year of work on the
Development, Manufacturing or Commercialization of a Product carried out by
employees of a Party having the appropriate relevant expertise to conduct such
activities.

“FTE Costs” has the meaning set forth in Section 1.8.

“FTE Rate” means $[***] for the Calendar Year 2017. The FTE Rate will be
increased each Calendar Year thereafter by the [***].

“Full Royalty Period” has the meaning set forth in Section 6.6.2.

“Fully Absorbed Cost of Goods” means the costs incurred by Ionis as determined
using the methodology set forth in Schedule 4.9.2(c) fairly applied and as
employed on a consistent basis throughout Ionis’ operations.

“GAAP” has the meaning set forth in the definition of Net Sales.
 
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“Gene-Editing Product” means a synthetic nucleoside-containing compound that,
when introduced into a cell of an organism, (a) is stably integrated within the
genome or stable episome of the cell of such organism or (b) causes (or is
perceived to cause) a permanent change in the genome of the cell of such
organism.

“Generic Product” means, with respect to a particular Product (the “Reference
Product”), one or more Third Party product(s), where (i) such Third Party
product(s) (a) are approved in reliance, in whole or in part, on a prior
Regulatory Approval of the Reference Product [***] (b) are determined by a
Regulatory Authority to be substitutable for the Reference Product, [***] (ii)
such Third Party product(s) when taken in the aggregate have a market share
(measured in number of prescriptions with the numerator of such fractional share
being such Third Party product(s) taken in the aggregate, and the denominator
being the total of such Third Party product(s) taken in the aggregate plus such
Product taken in the aggregate, as provided by IMS) during the applicable
Calendar Quarter in such country of at least [***]%.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the rules and regulations promulgated thereunder.

“HSR Clearance” means all applicable waiting periods under the HSR Act with
respect to the transactions contemplated under this Agreement have expired or
have been terminated.

“HSR Clearance Date” means the earliest date on which the Parties have actual
knowledge that all applicable waiting periods under the HSR Act with respect to
the transactions contemplated under this Agreement have expired or have been
terminated.

“HSR Filing” means filings by Biogen and Ionis with the United States Federal
Trade Commission and the Antitrust Division of the United States Department of
Justice of a Notification and Report Form for Certain Mergers and Acquisitions
(as that term is defined in the HSR Act) with respect to the matters set forth
in this Agreement, together with all required documentary attachments thereto.

“[***]” has the meaning set forth in Section 12.4.

“IND” means an Investigational New Drug Application (as defined in the Food,
Drug and Cosmetic Act, as amended) filed with the FDA or its foreign
counterparts.

“IND-Enabling Toxicology Studies” means the pharmacokinetic and toxicology
studies required to meet the requirements for filing an IND.

“IND-Enabling Toxicology Studies Completion Date” has the meaning set forth in
Section 3.1.

“Indemnitee” has the meaning set forth in Section 9.3.

“Initiation” or “Initiate” means, with respect to any IND-Enabling Toxicology
Study, dosing of the first animal subject in such IND-Enabling Toxicology Study
and, with respect to any Clinical Study, dosing of the first human subject in
such Clinical Study.

“Integrated Development Plan” or “IDP” has the meaning set forth in Section
5.1.1.

“Ionis” has the meaning set forth in the Preamble of this Agreement.

“Ionis Activities” means the activities for which Ionis is designated as
responsible under any ASO Development Candidate Identification Plan.
 
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“Ionis/Biogen Additional Agreements” means (i) the Original Agreement, (ii) the
DMPK Research, Development, Option and License Agreement between the Parties
dated June 27, 2012, (iii) the Neurology Drug Discovery and Development
Collaboration, Option and License Agreement between the Parties dated December
10, 2012 and (iv) the Strategic Neurology Drug Discovery and Development
Collaboration, Option and License Agreement between the Parties dated September
5, 2013, in each case, as amended and/or restated from time to time.

“Ionis Attribution Language” has the meaning set forth in Section 11.3.9.

“Ionis Breach Event” has the meaning set forth in Section 10.4.5(a).

“Ionis Core Technology Patents” means all Patent Rights owned, used, developed
by, or licensed to Ionis or its Affiliates, in each case to the extent
Controlled by Ionis or its Affiliates on the Effective Date or at any time
during the Agreement Term, claiming subject matter generally applicable to ASOs,
other than Ionis Product-Specific Patents or Ionis Manufacturing and Analytical
Patents. A list of Ionis Core Technology Patents as of the Effective Date is set
forth on Schedule 8.2.6(a) attached hereto.

“Ionis In-License Agreements” has the meaning set forth in Section 6.8.1.

“Ionis Internal ASO Safety Database” has the meaning set forth in Section 5.3.2.

“Ionis Know-How” means any Know-How, including any Jointly-Owned Program
Know-How and Ionis Program Know-How, owned, used, developed by, or licensed to
Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its
Affiliates on the Effective Date or at any time during the Agreement Term. Ionis
Know-How does not include the Ionis Manufacturing and Analytical Know-How.

“Ionis Manufacturing and Analytical Know-How” means Know-How, including
Jointly-Owned Program Know-How, that relates to the synthesis or analysis of a
Product regardless of sequence or chemical modification, owned, used, developed
by, or licensed to Ionis or its Affiliates, in each case to the extent
Controlled by Ionis or its Affiliates on the Effective Date or at any time
during the Agreement Term. Ionis Manufacturing and Analytical Know-How does not
include the Ionis Know-How.

“Ionis Manufacturing and Analytical Patents” means Patent Rights, including
Jointly-Owned Program Patents, that claim methods and materials used in the
synthesis or analysis of a Product regardless of sequence or chemical
modification, owned, used, developed by, or licensed to Ionis or its Affiliates,
in each case to the extent Controlled by Ionis or its Affiliates on the
Effective Date or at any time during the Agreement Term. A list of Ionis
Manufacturing and Analytical Patents as they related to ASOs as of the Effective
Date is set forth on Schedule 8.2.6(b) attached hereto. Ionis Manufacturing and
Analytical Patents do not include the Ionis Product-Specific Patents or the
Ionis Core Technology Patents.

“Ionis Product-Specific Patents” means all Product-Specific Patents, in each
case to the extent Controlled by Ionis or its Affiliates on the Effective Date
or at any time during the Agreement Term. A list of Ionis Product-Specific
Patents as of the Effective Date is set forth on Schedule 8.2.6(c) attached
hereto.

“Ionis Program Know-How” has the meaning set forth in Section 7.1.2.

“Ionis Program Patents” has the meaning set forth in Section 7.1.2.
 
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“Ionis Program Technology” has the meaning set forth in Section 7.1.2.

“Ionis Results” has the meaning set forth in Section 4.9.3.

“Ionis Supported Pass-Through Costs” means [***].

“Japan NDA” or “JNDA” means the Japanese equivalent of an NDA filed with the
Koseisho (i.e., the Japanese Ministry of Health and Welfare, or any successor
agency thereto).

“Jointly-Owned Program Know-How” has the meaning set forth in Section 7.1.2.

“Jointly-Owned Program Patents” has the meaning set forth in Section 7.1.2.

“Jointly-Owned Program Technology” has the meaning set forth in Section 7.1.2.

“JPC” has the meaning set forth in Section 7.1.3.

“JSC” has the meaning set forth in Section 1.3.1.

“JSC Decision Period” has the meaning set forth in Section 1.4.2(b).

“[***] Criteria” means, with respect to a Collaboration Program, the [***]
Criteria, the criteria set forth in the ASO Development Candidate Identification
Plan for such Collaboration Program [***], and such other criteria set forth in
such ASO Development Candidate Identification Plan that are designated as “[***]
Criteria” by mutual agreement of the Parties.

“[***] Criteria” means, with respect to a Collaboration Program, the criteria
set forth in the ASO Development Candidate Identification Plan for such
Collaboration Program for [***].

“Know-How” means inventions, technical information, know-how and materials,
including technology, data, compositions, formulas, biological materials,
assays, reagents, constructs, compounds, discoveries, procedures, processes,
practices, protocols, methods, techniques, results of experimentation or
testing, knowledge, trade secrets, skill and experience, in each case whether or
not patentable or copyrightable and, in each case, that are unpatented.

“Lead Party” has the meaning set forth in Section 7.4.1.

“Licensed Know-How” means Ionis Manufacturing and Analytical Know-How, and Ionis
Know-How. For clarity, Licensed Know-How does not include any Know-How covering
formulation technology or delivery devices.

“Licensed Patents” means the Ionis Product-Specific Patents, Ionis Core
Technology Patents and Ionis Manufacturing and Analytical Patents and Ionis’
interest in Jointly-Owned Program Patents. For clarity, Licensed Patents do not
include any Patent Rights claiming formulation technology or delivery devices
unless such Patent Rights are included in the Jointly-Owned Program Patents. For
clarity, Licensed Patents that are jointly-owned by Ionis and Biogen will count
toward the calculation of the Full Royalty Period in a particular country if the
use or sale of a Product by an unauthorized Third Party in such country would
infringe a Valid Claim of such Licensed Patent.

“Licensed Technology” means any and all Licensed Patents and Licensed Know-How,
but excluding all technology licensed to Ionis under the UMass Agreement or the
CSHL Agreement (and Ionis is not granting a sublicense or any other rights under
the UMass Agreement or the CSHL Agreement).

“Losses” has the meaning set forth in Section 9.1.
 
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“MAA” means a marketing authorization application filed with the EMA or other
European Regulatory Authority after completion of Clinical Studies to obtain
Approval for a Product under the centralized European filing procedure or, if
the centralized EMA filing procedure is not used, filed using the applicable
procedures in any European Union country or other country in Europe.

“Major Market” means any of the following countries: the United States, Japan,
the United Kingdom, Germany, France, Italy and Spain.

“Manufacture” or “Manufactured” or “Manufacturing” means any activity involved
in or relating to the manufacturing, quality control testing (including
in-process, release and stability testing), releasing or packaging, for
preclinical and clinical purposes, of API or Finished Drug Product.

“Manufacturing Process Development Terms” means Section 4.1.3(b), Section
4.4.1(a), Section 4.4.2, Section 4.5, Section 4.6, Section 4.8.2 and Section
4.9.3 of this Agreement.

“Milestone Event” has the meaning set forth in Section 6.4.

“Minimum Third Party Payments” means [***].

“NDA” means a New Drug Application filed with the FDA after completion of
Clinical Studies to obtain Approval for a Product in the United States.

“Net Sales” means the gross amount billed or invoiced on sales of a Product by
Biogen, its Affiliates and Sublicensees, less the following: (a) customary
trade, quantity, or cash discounts to non-affiliated brokers or agents to the
extent actually allowed and taken; (b) amounts repaid or credited by reason of
rejection or return; (c) to the extent separately stated on purchase orders,
invoices, or other documents of sale, any taxes or other governmental charges
levied on the production, sale, transportation, delivery, or use of such Product
which is paid by or on behalf of Biogen; and (d) outbound transportation costs
prepaid or allowed and costs of insurance in transit.

In any transfers of a Product between Biogen, its Affiliates and Sublicensees,
Net Sales are calculated based on the final sale of such Product to an
independent Third Party. If Biogen, its Affiliate or a Sublicensee receives
non-monetary consideration for a Product, Net Sales are calculated based on the
fair market value of that consideration. If Biogen, its Affiliates or
Sublicensees uses or disposes of a Product in the provision of a commercial
service, the Product is sold and the Net Sales are calculated based on the sales
price of the Product to an independent Third Party during the same royalty
period or, in the absence of sales, on the fair market value of the Product as
determined by the Parties in good faith. Net Sales shall not include any
transfers of supplies of the applicable Product for (i) use in clinical trials,
Preclinical Studies or other research or development activities, or (ii) a bona
fide charitable purpose; or (iii) a commercially reasonable sampling program.

With respect to Net Sales as it applies to royalties payable by Ionis, the
Parties agree that any reasonable definition of “net sales” that is (x)
customarily used in pharmaceutical industry technology licensing or
collaboration contracts and (y) consistent with generally accepted accounting
principles in the United States (“GAAP”) or International Financial Reporting
Standards and is subsequently agreed to by Ionis (or a Third Party acquirer or
assignee) and Ionis’ Sublicensee or commercialization partner in an arms-length
transaction under a particular sublicense or commercialization agreement will
replace the definition of Net Sales in this Agreement and will be used in
calculating the royalty payment to Biogen on sales of products sold pursuant to
such agreement. If Ionis uses such an alternate definition of “net sales” in a
particular sublicense, (A) Ionis will include such “net sales” definition in the
applicable royalty reports to assist Biogen with verifying royalty payments and
(B) if such definition is not consistent with GAAP or International Financial
Reporting Standards, upon Biogen’s request, Ionis will reconcile the royalties
calculated under such definition with GAAP or International Financial Reporting
Standards.
 
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“New SMA Compound” means any ASO that is designed to bind to the RNA that
encodes SMN discovered by or on behalf of Ionis after the Effective Date,
including any Specified ASO Product, but, until the expiration of the ASO
Development Candidate Identification Term and, if applicable, the Carryover
Period, excluding any [***] Compound or [***] Compound that is not a Specified
ASO Product.

“New SMA Compound Notice” has the meaning set forth in Section 2.3.

“New Third Party Licenses” has the meaning set forth in Section 8.3.2.

“[***] Compound” means any ASO containing a [***] that is designed to bind to
the RNA that encodes SMN, where such ASO is discovered by Ionis prior to or
during the ASO Development Candidate Identification Term, but excluding any
Specified ASO Product.

“[***] Development Candidate” means an [***] Compound that is designated by the
JSC (or Biogen in accordance with Section 1.4.2(b)) as [***].

“Non-Breaching Party” means the Party that believes the Breaching Party is in
material breach of this Agreement.

“Oligonucleotide” means a synthetic compound that comprises or consists of [***]
and that is not a Gene-Editing Product or a Duplex Product. For clarity, [***]
of Oligonucleotides [***] and Oligonucleotides [***]. Oligonucleotides may be
single-stranded or may have sufficient self-complementarity to be entirely or
partially double-stranded.

“Option” has the meaning set forth in Section 3.2.

“Option Deadline” has the meaning set forth in Section 3.2.

“Option Period” has the meaning set forth in Section 2.1.1(a).

“Original Agreement” has the meaning set forth in the Preamble of this
Agreement.

“Other Activities” has the meaning set forth in Section 1.8.

“Other ASO Product” has the meaning set forth in Section 2.1.2(a)(iv).

“Panel Decision” has the meaning set forth in Section 10.4.5(b).

“Party” or “Parties” means Biogen and Ionis individually or collectively.

“Patent Costs” means the reasonable fees and expenses paid to outside legal
counsel, and filing, maintenance and other reasonable out-of-pocket expenses
paid to Third Parties, incurred in connection with the Prosecution and
Maintenance of Patent Rights.
 
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“Patent Rights” means (a) patents, patent applications and similar
government-issued rights protecting inventions in any country or jurisdiction
however denominated, (b) all priority applications, divisionals, continuations,
substitutions, continuations-in-part of and similar applications claiming
priority to any of the foregoing, and (c) all patents and similar
government-issued rights protecting inventions issuing on any of the foregoing
applications, together with all registrations, reissues, renewals,
re-examinations, confirmations, supplementary protection certificates, and
extensions of any of (a), (b) or (c).
 
“Permitted Licenses” means (1) licenses granted by Ionis before or after the
Effective Date to any Third Party under the Ionis Core Technology Patents, the
Ionis Manufacturing and Analytical Patents, or the Ionis Manufacturing and
Analytical Know-How (but not under the Ionis Product-Specific Patents) to (a)
use ASOs (or supply ASOs to end users) solely to conduct preclinical research,
or (b) enable such Third Party to manufacture or formulate ASOs, where (i) such
Third Party is primarily engaged in providing contract manufacturing or services
and is not primarily engaged in drug discovery, development or commercialization
of therapeutics; and (ii) Ionis does not assist such Third Party to identify,
discover or make a Compound or Product; and (2) material transfer agreements
with academic collaborators or non-profit institutions solely to conduct
non-commercial research.

“Person” will mean any corporation, limited or general partnership, limited
liability company, joint venture, trust, unincorporated association,
governmental body, authority, bureau or agency, any other entity or body, or an
individual.

“Phase 1 Trial” means, with respect to a Product, a first clinical study in
human beings of such Product, as further defined in 21 C.F.R. 312.21(a) or the
corresponding regulation in jurisdictions other than the United States.

“Phase 2 Trial” means, with respect to a Product, a Clinical Study that is
intended to explore the feasibility, safety, dose ranging or efficacy of such
Product, that is prospectively designed to generate sufficient data (if
successful) to commence a Phase 3 Trial (or foreign equivalent) of such product,
as further defined in 21 C.F.R. 312.21(b) or the corresponding regulation in
jurisdictions other than the United States.

“Phase 3 Trial” means, with respect to a Product, a pivotal Clinical Study in
humans performed to gain evidence with statistical significance of the efficacy
of such product in a target population, and to obtain expanded evidence of
safety for such product that is needed to evaluate the overall benefit-risk
relationship of such product, to form the basis for approval of an NDA by a
Regulatory Authority and to provide an adequate basis for physician labeling, as
described in 21 C.F.R. 312.21(c), as amended from time to time, or the
corresponding regulation in jurisdictions other than the United States.

“Phase 4 Trial” means, with respect to a Product, (a) any Clinical Study
conducted to satisfy a requirement of a Regulatory Authority in order to
maintain a Regulatory Approval for such Product or (b) any Clinical Study
conducted after the first Regulatory Approval in the same disease state for
which such Product received Regulatory Approval other than for purposes of
obtaining Regulatory Approval.

“Preclinical Studies” means in vitro and in vivo studies of a Product, not in
humans, including those studies conducted in whole animals and other test
systems, designed to determine the toxicity, bioavailability, and
pharmacokinetics of a Product and whether such Product has a desired effect.

“Pre-Existing Competitive Product” has the meaning set forth in Section 12.5.1.
 
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“Prior Agreements” means the agreements listed on Schedule 8.2.9 attached
hereto.

“Priority Review Voucher” means a voucher or right granted by the FDA or other
Regulatory Authority that allows for priority review of a potential product that
is issued or granted to a sponsor of a neglected disease or rare disease product
application when a product to treat a neglected disease or rare disease is
approved by such Regulatory Authority.

“Proceeding” means an action, suit or proceeding.

“Product” means a finished drug product containing a Compound as an active
pharmaceutical ingredient.

“Product-Specific Patents” means, with respect to a Product, Patent Rights
Controlled by a Party or any of its Affiliates on or after the Effective Date,
including any Program Patents, claiming (i) the specific composition of matter
of such Product, or (ii) methods of using such Product as a prophylactic or
therapeutic; provided however, Patent Rights Controlled by Ionis or any of its
Affiliates that (y) include claims that are directed to subject matter
applicable to ASOs or products in general, or (z) include an ASO, the sequence
of which targets the RNA that encodes SMN and the RNA of a gene that does not
encode SMN, will not be considered Product-Specific Patents, and in the case of
(y) and (z), such Patent Rights will be considered Ionis Core Technology
Patents.

“Program Patents” has the meaning set forth in Section 7.1.2.

“Prosecution and Maintenance” or “Prosecute and Maintain” means, with regard to
a Patent Right, the preparing, filing, prosecuting and maintenance of such
Patent Right, as well as handling re-examinations, reissues, and requests for
patent term extensions with respect to such Patent Right, together with the
conduct of interferences, the defense of oppositions and other similar
proceedings with respect to the particular Patent Right. For clarification,
“Prosecution and Maintenance” or “Prosecute and Maintain” will not include any
other enforcement actions taken with respect to a Patent Right.

“Receiving Party” has the meaning set forth in Section 11.1.

“Reduced Royalty Period” has the meaning set forth in Section 6.6.2(e).

“Regulatory Approval” means the approval necessary for the commercial
manufacture, distribution, marketing, promotion, offer for sale, use, import,
export, and sale of a pharmaceutical product in a jurisdiction regulated by a
Regulatory Authority.

“Regulatory Authority” means any governmental authority, including the FDA, EMA
or Koseisho (i.e., the Japanese Ministry of Health and Welfare, or any successor
agency thereto), that has responsibility for granting any licenses or approvals
or granting pricing or reimbursement approvals necessary for the marketing and
sale of a Product in any country.

“Regulatory Materials” means, with respect to a Product, any regulatory
submissions, notifications, registrations, approvals and/or other filings and
correspondence made to or with a Regulatory Authority in any country or
jurisdiction, and any other records required by Applicable Law to be maintained
that may be necessary or useful to develop, manufacture, market, sell or
otherwise commercialize such Product in any such country or jurisdiction.

“Research” means conducting the research activities with ASOs or Compounds as
set forth in the ASO Development Candidate Identification Plan or the
preclinical toxicology strategy, including preclinical research and lead
optimization, but specifically excluding Development and Commercialization.
 
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“Results” has the meaning set forth in Section 4.9.3.

“Reverse Royalties” has the meaning set forth in Section 6.7.1.

“RMC” means Ionis’ Research Management Committee, or any successor committee.

“Royalty Quotient” has the meaning set forth in Section 6.6.2(c).

“Sales Milestone Event” has the meaning set forth in Section 6.4.

“Setoff Amount” has the meaning set forth in Section 10.4.5(b).

“Setoff Dispute” has the meaning set forth in Section 10.4.5(b).

“Setoff Dispute Notice” has the meaning set forth in Section 10.4.5(b).

“SMN” means (i) SMN1 or SMN2, or (ii) both SMN1 and SMN2.

“SMN1” means the gene, Survival of Motor Neuron 1 (GenBank accession #
NM_000344; Gene ID: 6606), or any alternative splice variants, mutants,
polymorphisms and fragments thereof.

“SMN2” means the gene, Survival of Motor Neuron 2 (GenBank accession #NM_017411;
Gene ID: 6607), or any alternative splice variants, mutants, polymorphisms and
fragments thereof.

“Specified ASO Product” has the meaning set forth in Section 2.1.2(a)(iv).

“Spinal Muscular Atrophy” means an autosomal recessive motor neuron disease
primarily affecting neonates and young children that results from a loss of SMN1
(GenBank accession # NM_000344; Gene ID: 6606) protein.

“Spinraza®” means the nusinersen product marketed under the brand name Spinraza®
in the United States, or the equivalent nusinersen product of Biogen or its
Affiliates or Sublicensees in other jurisdictions, whether or not marketed under
such brand name.

“Step-In Party” has the meaning set forth in Section 7.4.1.

“Sublicensee” means a Third Party to whom a Party or its Affiliates or
Sublicensees has granted a sublicense or license under any Licensed Technology
or Biogen Technology, as the case may be, licensed to such Party in accordance
with the terms of this Agreement.

“Subsequent Deal” has the meaning set forth in Section 10.2.3(b)(i).

“Superior Patent Right” has the meaning set forth in Section 7.2.4(c).

“[***] ASO Product” has the meaning set forth in Section 2.1.2(a)(iv).

“Target Related Biogen Program Claim” has the meaning set forth in Section
4.4.4.

“Target Related Ionis Program Claim” has the meaning set forth in Section 4.4.3.

“Technical Failure” has the meaning set forth in Section 1.2.

“Third Party” means a Person or entity other than the Parties or their
respective Affiliates.

“Third Party Obligations” means any financial and non-financial encumbrances,
obligations, restrictions, or limitations imposed by an agreement between Ionis
and a Third Party (including the Ionis In-License Agreements) that relate to a
Product or SMN, including field or territory restrictions, covenants, milestone
payments, diligence obligations, sublicense revenue, royalties, or other
payments.
 
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“Transition Services” has the meaning set forth in Section 10.4.6.

“Trial Court” has the meaning set forth in Section 10.4.5(b).

“UMass Agreement” means that certain Exclusive License Agreement between the
University of Massachusetts and Ionis dated January 14, 2010, as amended.

“United States” or “U.S.” means the fifty states of the United States of America
and all of its territories and possessions and the District of Columbia.

“Valid Claim” means a claim (i) of any issued, unexpired United States or
foreign Patent Right, which will not, in the country of issuance, have been
donated to the public, disclaimed, nor held invalid or unenforceable by a court
of competent jurisdiction in an unappealed or unappealable decision, or (ii) of
any United States or foreign patent application within a Patent Right, which
will not, in the country in question, have been cancelled, withdrawn, abandoned
nor been pending for more than seven years, not including in calculating such
seven-year period of time in which such application is in interference or
opposition or similar proceedings or time in which a decision of an examiner is
being appealed. Notwithstanding the foregoing, on a country-by-country basis, a
patent application pending for more than [***] years will not be considered to
have any Valid Claim for purposes of this Agreement unless and until a patent
meeting the criteria set forth in clause (i) above with respect to such
application issues.
 
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Appendix 2

Development Candidate Checklist

[***]
 
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Appendix 3

ASO Development Candidate Identification Plans

[***]
 
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Schedule 1.3.1

JSC Governance

(a)
The JSC will determine the JSC operating procedures, including frequency of
meetings (at least quarterly), location of meetings, and responsibilities for
agendas and minutes. The JSC will codify these operating procedures in the
written minutes of the first meeting.

(b)
The JSC may hold meetings in person or by audio or video conference as
determined by the JSC; but at least two meetings per year will be in person (one
held at Ionis’ facilities, and the other held at Biogen’s facilities in the
U.S.). Alliance Managers will attend JSC meetings as participating non-members.
In addition, upon prior approval of the other Party, each Party may invite its
employees or consultants to attend JSC meetings, including any subject matter
expert(s) with valuable knowledge of SMN2 or Spinal Muscular Atrophy.

(c)
The co-chairs will be responsible for ensuring that activities occur as set
forth in this Agreement, including ensuring that JSC meetings occur, JSC
recommendations are properly reflected in the minutes, and any dispute is given
prompt attention and resolved in accordance with Section 7.1.3 and Section 12.1,
as applicable.

(d)
The JSC members from the same Party will collectively have one vote. The JSC
will strive to make recommendations with approval of both Ionis members and
Biogen members, and record such recommendations in the minutes of the JSC
meeting.

(e)
The JSC may form subcommittees and working groups as it determines in order to
carry out its activities under this Agreement, all of which will dissolve when
the JSC dissolves.

 
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Schedule 1.3.5

Alliance Management Activities

Each Alliance Manager is responsible for:

(a)
Promoting the overall health of the relationship between the Parties;

(b)
Developing a mutually agreed alliance launch plan covering any activities and
systems that the Parties need to implement within the first 100 days after the
Effective Date to support the Collaboration Programs;

(c)
Organizing JSC meetings, including agendas, drafting minutes, and publishing
final minutes;

(d)
Supporting the co-chairs of the JSC with organization of meetings, information
exchange, meeting minutes, and facilitating dispute resolution as necessary;

(e)
Preparing status and progress reports on the above as determined necessary by
the JSC;

(f)
Ensuring compliance in maintaining the Ionis Internal ASO Safety Database as
outlined in Section 5.3; and

(g)
Ensuring proper approval of publications prior to submission as required in
Section 11.3.

 
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Schedule 1.5

List of [***]

For [***] studies:

[***]

For [***] studies:

[***]
 
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Schedule 4.9.2(c)

Ionis’ Fully Absorbed Cost of Goods Methodology
Cost Estimate of API Cost per Kilogram
(OOO’s)

 [***]
 
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Schedule 5.1

Biogen’s Development and Commercialization Activities

 [***]
 
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Schedule 5.1.1

Integrated Development Plan Content

[***]
 
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Schedule 6.6.2(f)

Royalty Calculation Examples

[***]
 
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Schedule 6.6.2(g)

Allocation of Net Sales

[***]
 
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Schedule 6.8.1

Ionis In-License Agreements

(Relevant to the Compounds as of the Effective Date)

[***]
 
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Schedule 6.8.3(b)

Royalty Rate Reduction Example

[***]
 
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Schedule 8.2.6(a)

Ionis Core Technology Patents

[***]
 
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Schedule 8.2.6(b)

Ionis Manufacturing and Analytical Patents

[***]
 
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Schedule 8.2.6(c)

Ionis Product-Specific Patents

[***]
 
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Schedule 8.2.9

Prior Agreements

[***]
 
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Schedule 10.4.5(b)

Advisory Panel Regarding Setoff Disputes

[***]
 
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Schedule 10.4.6

Transition Services

[***]
 
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Schedule 12.1.2

Mediation

1.
Mediation.

1.1.         If a Dispute cannot be resolved pursuant to Section 12.1.1 of the
Agreement (Escalation), the Parties agree to try in good faith to resolve any
such Dispute by non-binding mediation administered by the American Arbitration
Association (the “AAA”) in accordance with its Commercial Mediation Procedures
then in effect (the “Procedures”), as modified by this Section 1.1 of this
Schedule 12.1.2. The mediation will be conducted by a single mediator appointed
by agreement of the Parties, within 15 days after either Party notifies the
other Party of its intention to mediate such Dispute, or failing such agreement,
appointed by the AAA in accordance with the Procedures; provided, that in either
case the mediator will be a retired Delaware state or federal judge. Unless
otherwise mutually agreed upon by the Parties, the mediation proceedings will be
conducted in Dover, Delaware. The Parties agree that they will share equally the
costs and expenses of the mediation; provided, that each Party will bear its own
attorneys’ fees and associated costs and expenses. The mediation conference will
be held within [***] after appointment of the mediator, and will last no more
than two consecutive days unless otherwise mutually agreed upon by the Parties.
Any resolution of a Dispute by mediation pursuant to this Section 1.1 of these
mediation procedures will be in writing and signed by duly authorized
representatives of both Parties.

1.2.         If the Parties cannot resolve a Dispute in accordance with Section
1.1 of this Schedule 12.1.2, then such Dispute will be resolved by the Parties
in accordance with Section 12.2 of the Agreement (Governing Law; Jurisdiction;
Venue; Service of Process).
 
 
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