EXHIBIT 10.23(ii)

 

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AMENDMENT NO. 1 TO COLLABORATIVE RESEARCH, LICENSE & COMMERCIALIZATION AGREEMENT

 

This AMENDMENT No. 1 (the “First Amendment”) to the COLLABORATIVE RESEARCH,
LICENSE & COMMERCIALIZATION AGREEMENT is made on the 25th  day of October, 2012
(the “Amendment Effective Date”) by and between:

 

ANACOR PHARMACEUTICALS, INC. a publicly-traded Delaware corporation, having a
place of business at 1020 East Meadow Circle, Palo Alto, CA 94303-4230
(hereafter referred to as “Anacor”);

 

and

 

ELI LILLY AND COMPANY, a publicly-traded Indiana corporation, operating through
its Elanco Animal Health division and having a principal place of business at
2500 Innovation Way N., Greenfield, Indiana 46140-9163 USA and its Affiliates
(hereafter collectively referred to as “Elanco”).

 

WHEREAS, Anacor and Elanco entered into a Collaborative Research, License &
Commercialization Agreement (“Agreement”), as previously amended, effective
August 25, 2010, to collaborate on and to conduct research and development
activities for commercialization of Products;

 

WHEREAS, capitalized terms used and not otherwise defined in this Amendment are
used as defined in the Agreement.

 

NOW, THEREFORE, in consideration of the promises and mutual covenants set forth
herein, the Parties agree to amend the Agreement and agree as follows:

 

1.              The following definitions shall be added to Article I:

 

“Companion Animal Product” means any product that includes an Elanco Compound,
whether or not as the sole active ingredient, and which is researched,
developed, manufactured, imported, used or sold for use in or on Companion
Animals, by or for Elanco or its Affiliates or their respective sublicensees in
the Field in the Territory.  A Companion Animal Product that is researched,
developed, manufactured, imported, used or sold in various dosage forms,
formulations or modes of delivery, or for several different species of Companion
Animals, shall be considered one and the same Companion Animal Product, so long
as each such dosage form, formulation, mode of delivery, or use for Companion
Animals includes the same Elanco Compound.  For clarity, any Elanco Compound
that achieves Protocol Concurrence with a Regulatory Agency as both a Companion
Animal

 

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First AMENDMENT to the COLLABORATIVE RESEARCH, LICENSE & COMMERCIALIZATION
AGREEMENT

 

Product and a Non-Companion Animal Product, is submitted for approval to or
receives approval from a Regulatory Agency as both a Companion Animal Product
and a Non-Companion Animal Product, or is sold as both a Companion Animal
Product and a Non-Companion Animal Product shall be deemed two separate
Products.

 

“Non-Companion Animal” means all species, groups or individual non-human animals
that are other than a Companion Animal.

 

“Non-Companion Animal Product” means any product that includes an Elanco
Compound, whether or not as the sole active ingredient, and which is researched,
developed, manufactured, imported, used or sold for use in or on Non-Companion
Animals, by or for Elanco or its Affiliates or their respective sublicensees in
the Field in the Territory.  A Non-Companion Animal Product that is researched,
developed, manufactured, imported, used or sold in various dosage forms,
formulations or modes of delivery, or for several different species of
Non-Companion Animals, shall be considered one and the same Non-Companion
Product, so long as each such dosage form, formulation, mode of delivery, or use
for Non-Companion Animals includes the same Elanco Compound.  For clarity, any
Elanco Compound that achieves Protocol Concurrence with a Regulatory Agency as
both a Companion Animal Product and a Non-Companion Animal Product, is submitted
for approval to or receives approval from a Regulatory Agency as both a
Companion Animal Product and a Non-Companion Animal Product, or is sold as both
a Companion Animal Product and a Non-Companion Animal Product shall be deemed
two separate Products.

 

2.              The definitions for Elanco Compound, [ * ] Product and Product
shall be amended and restated in their entirety as follows:

 

“Elanco Compound” means (a) a Candidate Compound [ * ] directly resulting from
the Design & Development Program that is selected by Elanco for development and
commercialization as a Product following a Development Decision, and (b) the [ *
] Backup Compounds [ * ] to such selected compound that are selected pursuant to
Section 4.8. Subject to Section 2.9, Elanco Compounds shall not include (i) any
compound that is subject to an option or license granted by Anacor to a Third
Party prior to the Effective Date, (ii) any of the compounds referred to by
Anacor as [ * ], and all backup compounds thereto, (iii) [ * ], (iv) any
compound useful for treating, diagnosing or preventing [ * ], unless agreed
otherwise by Anacor and (v) any [ * ], unless agreed otherwise by Anacor.

 

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

 

Page 2 of 6

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First AMENDMENT to the COLLABORATIVE RESEARCH, LICENSE & COMMERCIALIZATION
AGREEMENT

 

“[ * ]” means a fixed dose [ * ] as may be included by the Parties pursuant to
Section 5.7(a), provided that, a [ * ].

 

“Product” means a Companion Animal Product or a Non-Companion Animal Product. 
Any Companion Animal Product and Non-Companion Animal Product that include the
same Elanco Compound shall be considered two separate Products.  For clarity,
the categorization of a Product under each of these two definitions shall be
determined based on the first to occur of achieving Protocol Concurrence with a
Regulatory Agency, its submission for approval or receipt of approval by a
Regulatory Agency, or the initial sale of such Product.

 

3. Section 2.7 shall be amended and restated in its entirety as follows:

 

2.7 Anacor Exclusivity. Except for (a) Anacor’s activities under the Product
Development Plan and (b) any Product whose rights have reverted to Anacor
pursuant to Section 2.4, Anacor shall not, either alone or with or for any Third
Party or through outlicense to any Third Party, research, develop or
commercialize any compound in the Field during the Research Term [ * ].  For
clarity, the definition of Field as used in this Section 2.7 shall be subject to
adjustment during the Research Term to exclude Rejected Fields, and shall be [ *
].  The terms of this Section 2.7 shall not apply in the event of any transfer
or sale of all or substantially all of the portion of the business of Anacor to
which this Agreement relates, or in the event of Anacor’s merger or
consolidation or change in control or similar transaction or the creation by
Anacor of a special purpose corporation or design and development limited
partnership as permitted in accordance with Section 11.5.

 

4. Section 2.8 shall be amended and restated in its entirety as follows:

 

2.8 Elanco Exclusivity. Except pursuant to this Agreement, Elanco and its
Affiliates shall not, either alone or with or for any Third Party, research,
develop or commercialize any small molecule compound (a) [ * ], or (b) [ * ], in
each case (a) and (b) during the Research Term and for [ * ] thereafter. For
clarity, the foregoing shall not restrict Elanco from conducting any research or
development with compounds [ * ], so long as the research is not directed toward
developing a product for sale that contains a [ * ] in the final product.

 

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

 

Page 3 of 6

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First AMENDMENT to the COLLABORATIVE RESEARCH, LICENSE & COMMERCIALIZATION
AGREEMENT

 

5. Sections 5.3 through 5.6 shall be amended and restated in their entirety, and
a new Section 5.16 shall be added as follows.

 

5.3 Development Decision Milestone(s).  Furthermore, if Elanco wishes to
maintain its exclusive license rights to Product(s) in the Field in the
Territory, subject to Section 5.16, Elanco will pay to Anacor not more than [ *
] days following Elanco’s making a positive Development Decision for each Elanco
Compound in the Field, a one-time (per Elanco Compound), non-refundable,
non-creditable payment of [ * ].  For clarity, Elanco will make only one (1)
payment per Elanco Compound, which includes the lead compound and up to [ * ]
Backup Compounds.  Thus, the replacement of a lead Elanco Compound with a Backup
Compound does not warrant an additional Development Decision payment.  In
addition, with respect to the [ * ] under the Product Development Plan, if
Elanco wishes to maintain its exclusive license rights to Product(s) in the
Field in the Territory, Elanco will pay to Anacor not more than [ * ] days
following Elanco’s making a positive Development Decision for an Elanco Compound
in the [ * ] a one-time, non-refundable, non-creditable payment of [ * ].

 

5.4 Protocol Concurrence. Furthermore, if Elanco wishes to maintain its
exclusive license rights to the Product(s) and Elanco Compounds in the Field in
the Territory, subject to Section 5.16, Elanco will pay to Anacor for each
Product, not more than [ * ] days following Elanco’s receipt of Protocol
Concurrence from a Regulatory Agency, the following:

 

a) A one-time (per Product), non-refundable, non-creditable payment of [ * ] for
the receipt of Protocol Concurrence for a Product containing an Elanco Compound
arising from the [ * ];

 

b) A one-time (per Product), non-refundable, non-creditable payment of [ * ] for
the receipt of Protocol Concurrence for a Product containing an Elanco Compound
arising from a Project other than the [ * ].

 

For clarity, only one payment will be made under this section for any particular
Product following receipt by Elanco of a Protocol concurrence from a Regulatory
Agency regardless of the number of Protocol Concurrences received for that
Product.

 

5.5 Regulatory Agency Submission Milestone(s). Furthermore, if Elanco wishes to
maintain its exclusive license rights to Product(s) and Elanco Compounds in the
Field in the Territory, subject to Section 5.16, Elanco will pay to Anacor not
more than [ * ] days following Elanco’s receipt of the first Regulatory Agency
acceptance for filing of Elanco’s full or administrative NADA or terminal
submission thereof (i.e., a complete regulatory dossier) for each Product in the
Field, a one-time (per Product), non-refundable, non-creditable payment of [ *
]. For clarity, only one payment will be made for a particular Product submitted
regardless of the number of submissions or countries in which regulatory
submissions are made for that Product. As used in this Section 5.5, “acceptance
for filing” means the receipt by Elanco or its Affiliate or sublicensee of
written notice from the applicable Regulatory Authority that such NADA is
officially filed.

 

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

 

Page 4 of 6

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First AMENDMENT to the COLLABORATIVE RESEARCH, LICENSE & COMMERCIALIZATION
AGREEMENT

 

5.6 Regulatory Agency Approval Milestone(s). Furthermore, if Elanco wishes to
maintain its exclusive license rights to Product(s) and Elanco Compounds in the
Field in the Territory, Elanco will pay to Anacor not more than [ * ] days
following Elanco’s receipt of the first Regulatory Agency approval of Elanco’s
full or administrative NADA or terminal submission thereof (i.e., a complete
regulatory dossier) for each Product in the Field, a one-time (per Product),
non-refundable, non-creditable payment of:

 

(a) [ * ] for a Product containing an Elanco Compound arising from the [ * ]
Project. For clarity, only one payment will be made for a particular Product
approved regardless of the number of regulatory approvals granted for that
Product;

 

(b) [ * ] for a Product containing an Elanco Compound arising from the [ * ]
Project. For clarity, only one payment will be made for any particular Product
approved regardless of the number of regulatory approvals granted for that
Product;

 

(c) [ * ] for a Product containing an Elanco Compound arising from each Project
selected under Section 4.2(c). For clarity, only one payment will be made for
any particular Product approved regardless of the number of regulatory approvals
granted for that Product.

 

5.16                        Milestones Cumulative.  To the extent that a
milestone payment for a Product pursuant to Sections 5.4, 5.5 or 5.6 is not paid
as a result of advancing the Product without the requirement to achieve such
milestone in the development or commercialization of a Product (whether by
decision of or advice from a Regulatory Agency or a determination by Elanco to
by-pass such milestone efforts), then the milestone(s) not previously paid
pursuant to Sections 5.4, 5.5 or 5.6 shall be added to the next milestone
achieved for advancing a Product that results in a payment to Anacor under any
of Sections 5.4, 5.5, 5.6 or 5.7.  By way of example, and without limitation, if
a milestone payment for receipt of Protocol Concurrence is not made for a given
Product, and a Regulatory Agency Submission Milestone payment is not made for a
Product, but such Product is subsequently sold by Elanco, its Affiliates or
sublicensees in the Territory, then the previously unpaid milestone payments for
Protocol Concurrence under Section 5.4, Regulatory Agency Submission under
Section 5.5 and Regulatory Agency Approval under Section 5.6 would also be
payable within [ * ] days of the first sale of the Product in the Field in the
Territory.

 

6.                                                                                     
Miscellaneous.  This Second Amendment amends the terms of the Agreement as
expressly provided above, and the Agreement, as so amended and including all of
its other terms and provisions that are not amended, remains in full force and
effect.  This Second Amendment and any dispute arising from the performance or
breach hereof shall be governed by Section 11.14 of the Agreement.  This Second
Amendment may be executed in counterparts, all of which taken together shall be
regarded as one and the same instrument.

 

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

 

Page 5 of 6

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First AMENDMENT to the COLLABORATIVE RESEARCH, LICENSE & COMMERCIALIZATION
AGREEMENT

 

IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed and
delivered by their respective duly authorized officers.

 

EXECUTED

 

 

 

 

 

Signed on behalf of

 

)

Eli Lilly and Company, operating through its

 

)

Elanco Animal Health division

 

)

by an authorized officer in the presence of:

 

)

 

 

 

 

 

 

/s/ Elizabeth McGraw

 

/s/ William C. Weldon

Signature of Witness

 

Signature of Authorized Officer

 

 

 

Elizabeth McGraw

 

William C. Weldon

Name of Witness (please print)

 

Name of Authorized Officer (please print)

 

 

 

08 November 2012

 

 

Date Signed

 

 

 

 

 

 

 

 

Signed on behalf of

 

)

Anacor

 

)

by an authorized officer in the presence of:

 

)

 

 

 

 

 

 

/s/ James Marconi

 

/s/ Lucy O. Day

Signature of Witness

 

Signature of Authorized Officer

 

 

 

James Marconi

 

Lucy O. Day, VP Finance

Name of Witness (please print)

 

Name of Authorized Officer (please print)

 

 

 

10/30/2012

 

 

Date Signed

 

 

 

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

 

Page 6 of 6

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