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CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Exhibit 10.2

CO-PROMOTION AGREEMENT
This Co-Promotion Agreement (this Agreement) is entered into this 27th day of
June, 2013 (the “Effective Date”), by and between Valeant Pharmaceuticals North
America LLC, a Delaware limited liability company (“Valeant”), and Zogenix,
Inc., a Delaware corporation (“Zogenix”). Each of Valeant and Zogenix is
referred to herein, individually, as a “Party” and collectively, as the
“Parties.”
BACKGROUND
A.    Valeant or its Affiliates have exclusive marketing and distribution rights
in the Territory to the Product (as hereinafter defined).
B.    Valeant and Zogenix desire to enhance the marketing of the Product in the
Territory (as hereinafter defined) by enlisting the support and participation of
Zogenix in the Product promotion and detailing effort.
AGREEMENT
Now, therefore, in consideration of the foregoing and the mutual promises herein
contained, Valeant and Zogenix hereby agree as follows:
1.
Definitions.

1.1    “Act” shall mean the United States Federal Food, Drug, and Cosmetic Act,
as it may be amended from time to time.
1.2    “Affiliate” shall mean a corporation or business entity that, directly or
indirectly, is controlled by, controls, or is under common control with any
entity.  For this purpose, control means the direct or indirect ownership of
more than [***] ([***]%) of the voting or income interest in such corporation or
business entity, or such other relationship as, in fact, constitutes actual
control.
1.3    “Authorized Generic” shall mean any intranasal formulation of
dihydroergotamine (other than Migranal) promoted or otherwise commercialized in
the Territory by Valeant or its Affiliates, including without limitation, the
intranasal dihydroergotamine mesylate product (4mg/mL nasal spray) promoted or
otherwise commercialized in the Territory by Oceanside Pharmaceuticals, an
Affiliate of Valeant.
1.4    “Bankruptcy Event” shall mean, with respect to a Party, any of the
following: (i) the entry of an order for relief under the United States
Bankruptcy Code (or any corresponding remedy under successor laws); (ii) the
filing of a petition by or against such Party under any bankruptcy, insolvency,
or similar law (which petition is not dismissed within [***] ([***]) days after
filing), except Chapter 11 of the United States Bankruptcy Code or any successor
statute that permits a corporation to continue its operation while protecting it
from creditors; (iii) the appointment of a receiver for such Party’s business or
property; or (iv) such Party’s making of a general assignment for the benefit of
its creditors.

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1.5    "Change of Control", with respect to a Party, shall occur when: (i) any
“person” or "group" (as such terms are defined below in this Section 1.5) is or
becomes the "beneficial owner" (as defined below), directly or indirectly, of
shares of capital stock or other equity interests of such Party then outstanding
and normally entitled (without regard to the occurrence of any contingency) to
vote in the election of the directors, managers or similar supervisory positions
("Voting Stock") of such Party representing [***] percent ([***]%) or more of
the total voting power of all outstanding classes of Voting Stock of such Party;
(ii) such Party enters into a merger, consolidation or similar transaction with
another Person (whether or not such Party is the surviving entity) and as a
result of such merger, consolidation or similar transaction the Persons that
beneficially owned, directly or indirectly, the shares of Voting Stock of such
Party immediately prior to such transaction do not beneficially own, directly or
indirectly, shares of Voting Stock of the surviving Person representing at least
[***] of the total voting power of all outstanding classes of Voting Stock of
the surviving Person; (iii) such Party sells or transfers to any third party, in
one or more related transactions, properties or assets representing all or
substantially all of such Party's assets; or (iv) the holders of capital stock
or equity of such Party approve a plan or proposal for the liquidation or
dissolution of such Party. For the purpose of this definition of Change of
Control, (A) "person" and "group" have the meanings given such terms under
Section 13(d) and 14(d) of the United States Securities Exchange Act of 1934 and
the term "group" includes any group acting for the purpose of acquiring, holding
or disposing of securities within the meaning of Rule 13d-5(b)(1) under the
United States Securities Exchange Act of 1934, (B) a "beneficial owner" shall be
determined in accordance with Rule 13d-3 under the United States Securities
Exchange Act of 1934, and (C) the term "beneficially owned" and "beneficially
own" shall have meanings correlative to that of "beneficial owner."
1.6    “Co-Promotion Fee” shall have the meaning set forth in Section 5.1.
1.7    “Commercial Officer(s)” shall mean the commercial heads of the branded
pharmaceutical businesses of Zogenix and Valeant (or their respective
Affiliates), or the Chief Executive Officer of either Party (or such other
executive or senior officer of the Party or an Affiliate designated in writing
by the Chief Executive Officer of such Party to the other Party).
1.8    “Current Good Manufacturing Practices” shall mean the current standards
for manufacture, as set forth in the Act and applicable regulations and
guidelines promulgated thereunder or successors thereto, as shall be in effect
from time to time during the Term.
1.9    “Direct Costs” shall mean, as to a Party, [***].
1.10    “FDA” shall mean the United States Food and Drug Administration, or any
successor agency in the Territory.
1.11    “[***]” shall mean [***], except for the [***] hereof, which shall [***]
on the [***] and [***] on the earliest to occur of the [***] in this sentence. 
These [***] correspond to the [***], which ends on [***] of each [***].
1.12    “GAAP” shall mean United States generally accepted accounting
principles, as may be amended from time to time.
1.13    “Joint Commercialization Committee” shall have the meaning set forth in
Section 3.1.
1.14    “Net Sales” shall mean the gross sales of the Product in the Territory
during the applicable period ([***]) (collectively, “Deductions From Net
Sales”): [***]. All such amounts and calculations will be determined from books
and records maintained by Valeant in accordance with GAAP.
1.15    “Net Sales Price” shall mean, with respect to each [***], the [***].

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1.16    “Non-Serious Adverse Event” shall mean any adverse drug experience
associated with the use of the Product in humans, whether or not considered
drug-related, which is not a Serious Adverse Event.
1.17    “Other DHE Product” shall mean an inhaled dihydroergotamine product
[***] or any other AB/AN rated generic product to Migranal promoted or otherwise
commercialized by a third party in the Territory.
1.18    “Prescribers” shall mean physicians and other health care practitioners
who are permitted by law to prescribe Product in the Territory.
1.19    “Product” shall mean: (i) Migranal® (dihydroergotamine mesylate) Nasal
Spray (“Migranal”), (ii) [***], and (iii) [***], in each of (i), (ii) and (iii)
which are promoted or otherwise commercialized by Valeant or any of its
Affiliates in the Territory during the Term.
1.20    “Product Promotional Materials” shall have the meaning set forth in
Section 4.2
1.21    “Product Technical Complaint” shall mean: (i) any complaint that
questions the purity, identity, potency or quality of the Product, its packaging
or labeling or the compliance of the Product with applicable laws, rules and
regulations, including the Act and Current Good Manufacturing Practices; (ii)
any complaint that concerns any incident that causes the Product or its labeling
to be mistaken for, or applied to, another article; (iii) any bacteriological
contamination or significant chemical, physical or other change or deterioration
in the Product; (iv) any failure of the Product to meet the specifications
therefor in the NDA; or (v) any complaint or evidence of tampering with the
Product.
1.22    “Product Trademarks” mean the trademark Migranal® (US registration no.
2048040) associated with the Product, and any other related trademark or service
mark containing the word "Migranal" or a close variant or derivative thereof and
any other trademark or service mark (whether registered or unregistered) used on
or with the Product or in any sales and marketing materials (other than Valeant
Trademarks or the Zogenix Trademarks, as applicable) in the Territory during the
Term. Product Trademarks shall also mean such other name or mark as may be used
by or under authority of Valeant for any product in the Migranal® line.
1.23    “Promotion Commencement Date” shall mean the first date upon which the
Product is promoted within the Territory by the Zogenix Sales Force to
Prescribers, which date shall be no later than [***] ([***]) [***] following the
Effective Date.
1.24    “Proprietary Information” shall mean any proprietary and/or confidential
information communicated by or on behalf of one Party (or any of its Affiliates)
to the other Party (or any of its Affiliates) in connection with or relating to
this Agreement (including discussions and negotiations relating hereto), whether
communicated prior to, on or following the Effective Date, including the
financial, marketing, business, technical and scientific, clinical, regulatory
information or data, information related to a Party's compensation of its Sales
Force, and the information exchanged pursuant to this Agreement, whether
communicated in writing, orally or electronically. For the avoidance of doubt,
the commercial data and information generated by each Party in connection with
its activities under this Agreement are the Proprietary Information of that
Party, the terms of this Agreement are the Proprietary Information of both
Parties, training materials provided by Valeant to Zogenix are the Proprietary
Information of Valeant, Product Promotional Materials are the Proprietary
Information of Valeant and compliance materials of either Party are the
Proprietary Information of that Party (in each case, subject to the exceptions
set forth below in this Section 1.24). Proprietary Information shall not include
information that the receiving Party can show through written documentation: (i)
at the time of disclosure, is publicly known; (ii) after the time of disclosure,
becomes part of the public domain, except by breach of an

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agreement between the disclosing Party or any Affiliate thereof and the
receiving Party or any Affiliate thereof; (iii) is or was in the possession of
the receiving Party or any Affiliate thereof at the time of disclosure by the
disclosing Party and was not acquired directly or indirectly from the disclosing
Party or any Affiliate thereof or from any third party under an agreement of
confidentiality to the disclosing Party or any Affiliate thereof; or (iv) is or
was developed by the receiving Party or its Affiliates without use of or
reference to the other Party's Proprietary Information.
1.25    “Sales Force” shall mean the field-based sales representatives employed
by or on behalf of Valeant or Zogenix, as the case may be, for the detailing of
the Product in the Territory to Prescribers.  Zogenix’ Sales Force may include,
without limitation, any sales representatives engaged through an arrangement
with a contract sales organization.
1.26    “Samples” shall mean free samples of the Product dispensed to a patient
by a Prescriber.
1.27    “Serious Adverse Event” shall mean any adverse drug experience occurring
at any dose that results in any of the following outcomes: death, a
life-threatening adverse drug experience, inpatient hospitalization or
prolongation of existing hospitalization, a persistent or significant
disability/incapacity, or a congenital anomaly/birth defect. Important medical
events that may not result in death, be life-threatening, or require
hospitalization may be considered a Serious Adverse Event when, based upon
appropriate medical judgment, they may jeopardize the patient or subject and may
require medical or surgical intervention to prevent one of the outcomes listed
in this definition.
1.28    “Tail Period” shall mean that period of time which is [***] ([***])
[***] immediately following the end of the Term.
1.29    “Term” shall mean the period of time defined in Section 13.1.
1.30    “Territory” shall mean the United States of America and its territories
and possessions.
1.31    “Third Party Audit” shall mean the third party audit known currently as
[***] (or such other third party data source as the Parties may agree upon from
time to time). [***].
1.32    “TRx-Unit Conversion Rate” shall mean an amount equal to the [***].
1.33    “Unit” shall mean [***].
1.34    “Valeant Supply Failure” shall occur if, in any [***] ([***]) [***]
period during the Term, Valeant fails to meet [***] ([***]%) of [***] the
Product, where “Trade Demand” means with respect to any period, the [***].
1.35    “Valeant Trademarks” shall mean the trademark Valeant®, the Valeant
corporate logo and any other related domain name, trademark or service mark
(whether registered or unregistered) containing the word “Valeant” or a close
variant or derivative thereof.
1.36    “Zogenix Target Physicians” shall mean Prescribers primarily practicing
as neurologists or headache specialists and other Prescribers treating migraine.
1.37    “Zogenix Trademarks” shall mean the trademark Zogenix®, the Zogenix
corporate logo and any other related domain name, trademark or service mark
(whether registered or unregistered) containing the word “Zogenix.”

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2.
Grants and Obligations.

2.1    Grant of Co-Promotion Right.  Valeant hereby grants to Zogenix, during
the Term, the co-exclusive right (solely with Valeant or any of its Affiliates)
to promote and detail the Product in the Territory for its approved indications
through the Zogenix Sales Force to Prescribers, subject to the terms and
conditions of this Agreement.
2.2    Zogenix Target Physicians.  Valeant may, from time to time, but no more
frequently than [***], request that Zogenix provide a list of Prescribers,
including the Zogenix Target Physicians, which the Zogenix Sales Force has
called on in the [***]. Such call list shall be provided by Zogenix within [***]
([***]) days of Valeant’s request.
2.3    Zogenix Detailing Obligation. 
(i)    Zogenix shall use commercially reasonable efforts to have the Promotion
Commencement Date occur as soon as reasonably practicable following the
Effective Date, but no later than [***] ([***]) days thereafter.
(ii)    During the Term, Zogenix shall use commercially reasonable efforts to
promote and detail the Product in the Territory through the Zogenix Sales Force
to Prescribers.
(iii)    For the avoidance of doubt, subject to Zogenix’ obligations set forth
in (i) and (ii) above, Zogenix shall have the sole responsibility and discretion
with respect to determining the priority of the Product presentation among
Zogenix’ other promoted pharmaceutical products and the deployment of the
Zogenix Sales Force.
2.4    Valeant Obligations. In addition to any other obligations set forth in
this Agreement, during the Term, Valeant shall be obligated to use commercially
reasonable efforts to: (i) maintain the authorization and/or ability to market
the Product in the Territory to Prescribers; and (ii) ensure the consistent
supply of the Product and Samples to meet market demand and Zogenix’ orders
pursuant to Section 4.5 and in accordance with Current Good Manufacturing
Practices and all other applicable laws. For the avoidance of doubt, subject to
Valeant’s obligations set forth in this Agreement, Valeant shall have the sole
responsibility and discretion with respect to the following: (a) establishing
and setting the price of the Product in the Territory; (b) booking sales of the
Product in the Territory; (c) distribution of the Product in the Territory; (d)
manufacturing and supply of the Product (including Samples) for the Territory;
and (e) maintaining the marketing authorization for the Product in the
Territory.
3.
Joint Commercialization Committee.

3.1    Establishment of the Joint Commercialization Committee.  Within [***]
([***]) days following the Effective Date, Valeant and Zogenix shall form a
Joint Commercialization Committee (the “Joint Commercialization Committee”),
comprised of no more than [***] ([***]) individuals, [***] of whom shall be
appointed by Valeant and [***] of whom shall be appointed by Zogenix and all of
whom shall be qualified to appropriately represent such Party at the Joint
Commercialization Committee level. Each Party may replace its representatives at
any time, upon written notice to the other Party. Additional representatives
from either Party may attend the Joint Commercialization Committee meetings as
non-voting members on an ad hoc basis as deemed necessary or appropriate by such
Party, with advance notice to the other Party. The Joint Commercialization
Committee shall be chaired by one of the Valeant representatives. The Joint
Commercialization Committee will be used as the forum to oversee and manage the
relationship between the Parties solely with respect to the Product in the
Territory. For the avoidance of doubt, the Joint Commercialization Committee
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responsibility or authority with respect to (i) the manufacturing or sourcing of
any Product, (ii) the NDA for any Product or (iii) the marketing, distribution
and sales of any Product by Valeant.
3.2    Joint Commercialization Committee Meetings. The Joint Commercialization
Committee will meet at least [***] and no less than [***] to review and discuss:
(i) strategic issues related to the marketing and promotion of the Product in
the Territory; (ii) any promotional plans and activities of Zogenix for the
Product in the Territory; (iii) the need for reviewing and approving any Product
Promotional Materials; (iv) updates regarding any product development, clinical,
regulatory, manufacturing/supply and quality matters; and (v) any measures
required to ensure the promotional plans comply with all applicable laws,
restrictions and regulations as well as [***]. The Joint Commercialization
Committee may perform such other functions as may be mutually agreed by Valeant
and Zogenix.  The first meeting of the Joint Commercialization Committee shall
be held as soon as practicable after the Effective Date. Meetings of the Joint
Commercialization Committee need not take place face-to-face, but upon the
agreement of both Parties, can be via other methods of communication, such as
teleconferences or videoconferences. Notwithstanding the creation and role of
the Joint Commercialization Committee, each Party shall retain the rights,
powers and discretions granted to it hereunder. The Joint Commercialization
Committee shall not be delegated or vested with any such rights, powers or
discretions unless expressly provided for herein. Without limiting the
generality of the foregoing, the Joint Commercialization Committee may not amend
or modify this Agreement, which may be amended or modified only as provided in
Section 15.3.
3.3    Expenses.  Each Party shall bear its own costs associated with its
participation in the Joint Commercialization Committee, including but not
limited to the costs of travel and expenses directly associated with
participation in the Joint Commercialization Committee.
3.4    Decision-Making.
(i)    Subject to this Section 3.4, decisions of the Joint Commercialization
Committee shall be made by agreement between the representatives of Valeant, and
the representatives of Zogenix, with each Party having one (1) vote. No decision
of the Joint Commercialization Committee shall be valid unless each Party is
represented by at least [***] ([***]) members at the meeting at which the
decision is made. The Parties shall cause their respective representatives on
the Joint Commercialization Committee to use their good faith efforts to resolve
all matters appropriately presented to them in an expeditious manner.
(ii)    In the event that the Joint Commercialization Committee is unable to
resolve a dispute or make a decision due to a lack of required unanimity within
[***] ([***]) days following consideration of the dispute or the decision by
such committee, then either Party may submit the matter to the Commercial
Officers for a joint decision. The Commercial Officers shall diligently and in
good faith attempt to resolve the referred dispute expeditiously and, in any
event, within [***] ([***]) days of receiving such written notification, or
within such other time as mutually agreed upon in writing between such officers
(and if the officers resolve the dispute, such resolution shall be deemed to be
a decision of the Joint Commercialization Committee). In the event that the
Commercial Officers are unable to reach a resolution of the dispute within such
time period, then such disputes shall be resolved pursuant to Section 15.6
below.

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(iii)    For clarity, any dispute with respect to whether a Party has breached
its obligations under this Agreement is not subject to the escalation procedures
set forth in this Section 3.4, but either Party may refer such a dispute for
resolution pursuant to Section 15.6.
4.Product Promotion Matters.
4.1    Detailing Costs.  Zogenix shall be responsible for all costs and expenses
related to establishing, maintaining and training the Zogenix Sales Force and
conducting Zogenix’ other activities under this Agreement, except as set forth
in this Section 4. Valeant shall be responsible for all costs and expenses
related to conducting Valeant’s activities under this Agreement.
4.2    Product Promotional Materials. 
(i)    Promptly following the Effective Date, Valeant shall provide to Zogenix
any existing artwork or samples of training, sales and promotional materials
relating to the Product in the Territory (including, without limitation,
training manuals, sales detail aids, leave behinds, coupons and any premium
branded items) (“Product Promotional Materials”).  Subject to this Section 4.2,
Zogenix may create new Product Promotional Materials, based on the existing
Valeant materials or otherwise.
(ii)    All Product Promotional Materials to be used by Zogenix shall be
reviewed and approved by Valeant’s promotional review committee and Zogenix’
promotional review committee prior to their use by Zogenix. Zogenix shall not be
required to use any Product Promotional Materials that are not reviewed by and
acceptable to Zogenix’ promotional review committee. If, after its review of any
Product Promotional Materials (including any new materials introduced after the
Effective Date or the Promotion Commencement Date), a Party believes that
changes to any such Product Promotional Materials are required to meet
applicable legal or regulatory requirements or applicable FDA requirements, such
proposed changes shall be advanced for determination in accordance with
procedures to be established by the Parties. Valeant shall be responsible for
ensuring that all Product Promotional Materials are in compliance with
applicable laws, rules and regulations.
(iii)    Valeant shall provide to Zogenix such quantities of Product Promotional
Materials as reasonably requested by Zogenix in writing and with delivery dates
to be mutually agreed between the Parties on a request by request basis; Zogenix
shall pay Valeant for any Product Promotional Materials delivered to Zogenix
pursuant to its written request, within thirty (30) days of delivery, at [***].
In addition, Zogenix may produce approved Product Promotional Materials at its
own cost. Zogenix shall be permitted to use in connection with the Promotion of
the Product only (A) the Product Promotional Materials approved under this
Agreement by each of Zogenix and Valeant and (B) the FDA-approved Product labels
and inserts. Zogenix shall use such Product Promotional Materials only in the
form so approved and consistent with the training provided pursuant to Section
4.3 and Zogenix shall not change such Product Promotional Materials in any way
following such approval and training, without the express written consent of
Valeant.
(iv)    Valeant shall own all copyrights to all Product Promotional Materials
(other than those items which are subject to third party copyrights). Valeant
shall, and does hereby, grant to Zogenix a royalty-free, non-exclusive right and
license to use, reproduce and distribute Product Promotional Materials or any
other Product-related materials made available to Zogenix by Valeant hereunder,
in each case solely in conjunction with the promotion and/or detailing of the
Product and the performance of Zogenix’ obligations under this Agreement, which
license shall not be sublicensable, assignable or transferable by Zogenix,
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permitted or licensed to make derivative works with respect to, or otherwise
modify, any Product Promotional Materials without the prior written consent of
Valeant.
4.3    Training. Promptly following the Effective Date, Valeant shall provide to
Zogenix any existing training materials for the Product in the Territory at
Valeant’s cost. Zogenix and Valeant shall consult and agree on the development
and implementation of initial and refresher sales training for the Zogenix Sales
Force. Such training materials and training assistance shall address the
following matters: disease state, Product knowledge, competitive product
knowledge, obligations under this Agreement, administration and other
appropriate information. Zogenix [***] shall provide training to each member of
its Sales Force, at Zogenix’ expense, prior to his or her commencement of
promotion of the Product hereunder to ensure that he or she is properly trained
with respect to the matters described in this Section 4.3 and able to satisfy
his or her promotion and detailing responsibilities under this Agreement.
Valeant shall have the right, but not the obligation, to participate in the
sales training process, at Valeant’s expense as Valeant may reasonably deem
necessary to comply with its code of conduct or any related policies or as
required by applicable laws or by a government entity or regulatory agency.
4.4    Compliance with Laws.  Each of Valeant’s and Zogenix’ detailing and
promotional activities with respect to the Product shall be conducted (i) in a
manner which is consistent with FDA and all other applicable regulatory
approvals or requirements which are then in effect with respect to the Product
and with the PhRMA Code on Interactions with Healthcare Professionals and
applicable AMA guidelines; and (ii) in compliance with all applicable laws,
restrictions and regulations of the FDA, the Department of Commerce, the
Department of Health and Human Services and any other United States, state,
local, or applicable agency or authority.  Each of Valeant and Zogenix shall
limit its claims of efficacy and safety for the Product to those that are
consistent with approved Product Promotional Materials and FDA-approved
prescribing information for the Product in the Territory, and shall not add,
delete or modify claims of efficacy and safety in the marketing of the Product
under this Agreement from those claims of efficacy and safety that are
consistent with the FDA-approved prescribing information and applicable
law. Under no circumstance shall a Party engage expenses on behalf of the other
Party that would be reportable for the other Party under the Physician Payments
Sunshine Act.
4.5    Samples. 
(i)    Valeant will provide Zogenix with [***] ([***]) Samples every [***] (the
“Baseline Sample Amount”), with the first shipment of the Baseline Sample Amount
to be delivered to Zogenix’ Sample distribution vendor no later than [***], and
the remaining shipments to occur on [***] during the remainder of the Term. The
Baseline Sample Amount shall be delivered to Zogenix’ Sample distribution vendor
at [***] (including [***]).
(ii)    In the event that Zogenix determines it desires Samples in addition to
the Baseline Sample Amount, Zogenix may order Samples from Valeant no more
frequently than [***] by providing Valeant with a purchase order, setting forth
the requested delivery date (which shall be at least [***] ([***]) days from
Valeant’s receipt of the purchase order). Valeant shall use commercially
reasonable efforts to provide Zogenix with the Samples within [***] ([***]) days
of the requested delivery date.
(iii)    The Parties will work to coordinate delivery of the Baseline Sample
Amount and any additional Samples ordered by Zogenix pursuant to subsection (ii)
so as to minimize delivery costs.
(iv)    Zogenix shall pay Valeant for any Samples ordered by Zogenix pursuant to
subsection (ii) above (Samples in excess of the Baseline Sample Amount) and
delivered by Valeant to Zogenix (or its designee) an amount equal to [***]
associated with the manufacture and supply of such additional Samples. Valeant
shall invoice Zogenix for such additional Samples upon the date of receipt at

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the Sample distribution vendor center designated by Zogenix, with such invoice
being due and payable within [***] ([***]) days following receipt.
(v)    Each of Valeant and Zogenix shall maintain records concerning its
distribution of Samples as required by the Prescription Drug Marketing Act of
1987, as amended (together with the implementing rules and regulations
thereunder, the “PDMA”), and relevant state laws.  Each of Valeant and Zogenix
shall take such steps as necessary to ensure that its representatives comply
with all requirements of the PDMA and relevant state laws, including but not
limited to obtaining requests and receipts signed by Prescribers for all Samples
delivered.  Each Party shall maintain records of its sampling activities in
accordance with and for the time periods required by the PDMA and relevant state
laws. Zogenix shall deliver to Valeant records of its sampling as and when
requested by Valeant in a machine readable format sufficient to allow Valeant to
meet its obligations to report samples to the federal government.
(vi)    Valeant shall promptly reimburse Zogenix for the cost of any Samples
purchased by Zogenix during the Term that become obsolete or otherwise unusable
by Zogenix as the result of manufacturing, quality, regulatory or legal
circumstances (other than to the extent caused by Zogenix’ negligence).
4.6    Trademarks. 
(i)    Valeant hereby grants to Zogenix a non-exclusive, royalty-free license to
use the Product Trademarks and Valeant Trademarks solely to promote the Product
as permitted in Section 2.1 in the Territory during the Term, provided that such
promotion is conducted in accordance with the terms of this Agreement.
(ii)    Each Party acknowledges the validity of Zogenix’ right, title and
interest in and to the Zogenix Trademarks and the validity of Valeant’s right,
title and interest in and to the Valeant Trademarks and the Product Trademarks.
The Parties shall not have, assert or acquire any right, title or interest in or
to any of Zogenix Trademarks (in the case of Valeant), or the Valeant Trademarks
or the Product Trademarks (in the case of Zogenix) or the goodwill pertaining
thereto, except as otherwise explicitly provided in Section 4.6(i) of this
Agreement.
4.7    Non-Solicitation of Employees. The Parties hereby agree that, throughout
the Term and for a period of [***] ([***]) [***] immediately thereafter, neither
will, directly or indirectly, solicit for employment any employee of the other
Party (or of the other Party’s designee); provided, however, that the hiring of
employees who respond to general advertisements for employment (not targeted to
employees of the other Party or their designee) shall not be deemed to violate
the foregoing provision.
4.8    Notices. In addition to any other specific notice requirements set forth
herein, Valeant shall provide Zogenix with prompt written notice of any material
developments or changes relating to the Product, which could reasonably be
expected to have an effect on Zogenix’ rights and obligations under this
Agreement. Notwithstanding the generality of the foregoing, Valeant shall
provide prompt written notice of any of the following matters:
(i)    any material manufacturing matters (including potential shortages,
quality matters, significant Product Technical Complaints, voluntary or
mandatory withdrawals or recalls, etc.);
(ii)    any material change in new or existing litigation relating to the
Product;
(iii)    any material communications with regulatory authorities relating to the
Product; and

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(iv)    any changes to the availability of Other DHE Products.
5.
Compensation.

5.1    Compensation. During each [***] of the Term, Valeant shall pay Zogenix a
“Co-Promotion Fee,” calculated on [***], as follows: (i) [***]; and (ii) [***].
For the purposes of this Section 5, the following definitions shall additionally
apply:
(A)    “[***]” shall mean [***], multiplied by [***] multiplied by the
applicable [***] and calculated on [***].
(B)    “[***]” shall mean the [***] in the Territory, as measured by the Third
Party Audit, during the applicable [***].
(C)    The “Baseline Forecast” for purposes of determining Zogenix Net Sales
shall mean the [***], provided that the Baseline Forecast shall be [***].
(D)    The “Baseline Period” shall mean that period of time from the Effective
Date through the end of the [***] immediately prior to [***] (the “Adjustment
Event”).
(E)    The “Adjusted Baseline Forecast” for the purposes of determining [***]
shall be the [***]. The “Adjustment Factor” is set forth on attached Schedule A.
The “Adjusted Baseline Period” shall mean that period of time beginning on the
first day of the [***] in which the Adjustment Event occurs through the
remainder of the Term (and, with respect to the Tail Payment, the [***]
thereafter).
5.2    Tail Payment. In addition to the Co-Promotion Fee, Valeant shall pay to
Zogenix an amount equal to [***] ([***]%) of the [***] during the Tail Period
(the “Tail Payment”).
5.3    Reports; Method of Payments. 
(i)    Within [***] ([***]) days after the end of the applicable [***], Valeant
shall provide a written report to Zogenix, detailing for the applicable [***]
period: (A) the Net Sales, including reasonably detailed descriptions of all
itemized deductions from gross sales; (B) the Zogenix Net Sales, including
[***], each calculated in a manner consistent with Schedule A; (C) the
calculated amount of Co-Promotion Fee due Zogenix on account of such Zogenix Net
Sales; and (D) the basis for calculation of the Co-Promotion Fee due Zogenix,
including applicable deductions/adjustments. If no Co-Promotion Fee is due for a
particular [***] period, Valeant shall so report to Zogenix. Valeant’s [***]
reports under this Section 5.3(i) shall be transmitted to Zogenix by express
mail or express delivery service and by email (to such email addresses as
Zogenix may from time to time designate in writing).
(ii)    Within [***] ([***]) days after the end of the applicable [***], Valeant
shall pay the Co-Promotion Fee to Zogenix.
(iii)    Within [***] ([***]) days after the end of the Tail Period, Valeant
shall pay the Tail Payment to Zogenix.
(iv)    Payment of the Co-Promotion Fee and the Tail Payment shall be made by
wire transfer to an account designated by Zogenix. All payments under this
Agreement shall be made in U.S. Dollars.

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5.4    True-Up of Deductions from Net Sales. No earlier than the end of the
second full [***] following [***] (or as otherwise agreed by the Parties),
Valeant shall perform a true-up for all Net Sales with respect to each [***] in
the prior [***]. Such true-up shall reconcile the actual Deductions from Net
Sales with respect to such Net Sales with the Deductions from Net Sales that
were accrued or estimated with respect thereto. Each Party shall make
reconciling payments to the other as necessary to effect such true-up with
respect to the Co-Promotion Fee paid for the prior [***]. Valeant shall provide
to Zogenix such reconciliation no later than [***] ([***]) days after the end of
the second full [***] following [***]. If Valeant is required to make a payment
to Zogenix to effect such reconciliation, then Valeant shall provide such
payment to Zogenix along with such reconciliation. If Zogenix is required to
make a payment to Valeant to effect such reconciliation, Zogenix shall make such
payment directly to Valeant within [***] ([***]) days following receipt of the
reconciliation. If Zogenix fails to make such payment within [***] ([***]) days
following receipt of the reconciliation, Valeant may set-off such amount from
any amount it owes Zogenix on account of the Co-Promotion Fee then payable by
Valeant to Zogenix. Valeant shall provide to Zogenix, along with the
reconciliation, all documentation reasonably necessary to explain or support the
reconciliation (as well as such other information as Zogenix shall reasonably
request), in a form to be agreed by the Parties.
5.5    Late Payments; Interest. All payments shall bear interest from the date
due until paid (including any adjustments made as a consequence of audit in
accordance with Section 12.2) at a rate equal to the prime rate effective for
the date that payment was due plus three percent (3%), as quoted by the Wall
Street Journal, New York Edition, on the date such payment was due, or, if less,
the maximum rate permitted by applicable law.
6.
Regulatory Affairs.

6.1    Regulatory Affairs.  Valeant shall have the sole right and
responsibility, and shall bear all costs related thereto, to take such actions
as may be necessary, in accordance with accepted business practices and legal
requirements, to maintain the authorization and/or ability to market the Product
in the Territory to Prescribers. 
6.2    Communications with Regulatory Authorities.  Valeant shall have the sole
right and responsibility and shall bear all costs related to communications with
any government agencies to satisfy their requirements regarding the
authorization and/or continued authorization to market the Product in commercial
quantities in the Territory to Prescribers.  Zogenix shall notify Valeant within
[***] ([***]) business days via facsimile of any inquiry or other communication
that it receives from the FDA concerning the Product.  Valeant shall handle all
communications with the FDA concerning the Product, including but not limited to
post-marketing reports of adverse drug experiences in compliance with 21 CFR
§314.80, other post-marketing reports such as those described in 21 CFR §314.81,
submission of advertising and promotional labeling to FDA’s Office of
Prescription Drug Promotion (OPDP), and responding to any inquiries concerning
post-marketing reports and advertising or promotional materials, and shall
provide copies of all such communication to Zogenix within [***] ([***])
business days via facsimile.  Notwithstanding the foregoing, Zogenix shall be
able to communicate with any such governmental agency regarding the Product, to
the extent that such communication is necessary to comply with the terms of this
Agreement or the requirements of any law, governmental order or regulation,
provided that Zogenix shall disclose to Valeant the nature of any such
communication to the extent Zogenix is legally permitted to make such a
disclosure.
6.3    Notice of Adverse Events. Each Party shall promptly notify the other
Party of any event(s) that materially affect(s) or could materially affect the
marketing of the Product, including without limitation Serious Adverse Events,
Non-Serious Adverse Events, and governmental inquiries. As between the Parties,
Valeant shall have the sole responsibility for reporting and responding to such
events to

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applicable governmental or regulatory authorities; provided that Zogenix may
take such actions (including issuing such reports) as it determines are required
by applicable law, governmental order or regulation.
6.4    Medical Inquiries.  For all medical inquiries, including those related to
information outside of labeling or which Zogenix and its Sales Force are unable
or not authorized under acceptable promotional guidelines to answer, Zogenix and
its Sales Force shall direct such inquiries to Valeant’s Medical Affairs
Department. As between the Parties, any responses to such inquiries from
patients, medical professionals, or other third parties shall be provided solely
by Valeant.
6.5    Pharmacovigilance Responsibilities. The Parties shall enter into a
mutually agreeable safety data exchange agreement no later than [***] ([***])
days following the Effective Date.
6.6    Product Technical Complaints and Recalls.
(v)    If Zogenix becomes aware of any Product Technical Complaint, Zogenix
shall notify Valeant of such Product Technical Complaint promptly but not later
than within [***] ([***]) business days.
(vi)    As between the Parties, Valeant shall have the sole authority and
responsibility to respond to any governmental or regulatory authorities,
including without limitation the FDA, in connection with Product Technical
Complaints and medical complaints, and to handle all returns, recalls or market
withdrawals of the Product in accordance with applicable law, at Valeant’s cost
and expense.
(vii)    Each Party shall promptly (but in any case, not later than [***]
([***]) [***]) notify the other Party in writing via facsimile of any order,
request or directive of a court or other governmental or regulatory authority to
recall or withdraw the Product.
6.7    Government Inspections and Inquiries. Upon being contacted by the FDA or
any other governmental or regulatory authority for any regulatory purpose
pertaining specifically to this Agreement or to the Product, Zogenix shall
notify Valeant within [***] ([***]) business days. Zogenix agrees that it shall
not respond to any such agency making an inquiry of it until and only as
directed by Valeant; provided, however, that the foregoing shall not be
construed to prevent Zogenix in any way from complying with any governmental or
regulatory authority or applicable laws, rules or regulations. Zogenix may
permit unannounced regulatory inspections and respond to the extent necessary to
comply with its obligations under applicable laws, rules or regulations.
6.8    Debarment, Etc. Neither Valeant nor Zogenix nor any of Valeant’s or
Zogenix’ employees or agents who will be performing services under this
Agreement or otherwise with respect to the Product (i) is under investigation by
the FDA for debarment action or is presently debarred under the Act or pursuant
to the Generic Drug Enforcement Act of 1992 (21 U.S.C. ‘301 et seq.) or (ii) has
violated, or is under investigation for violating, any state or federal health
care programs or any federal or state anti-kickback laws or regulations. Each of
Valeant and Zogenix will notify the other Party in writing within [***] ([***])
business days upon any inquiry or the commencement of any of the foregoing
proceedings concerning such Party or any of its employees or agents.

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7.
Supply and Distribution.

7.1    Supply. Valeant shall have sole responsibility and obligation for
ensuring that the Product is manufactured, either directly or through a
contractor, receiving and processing orders, distributing the Product to
customers, and handling Product inventory and receivables, and Valeant shall
bear all costs of such activities.  Valeant shall ensure that sufficient stock
of the Product is available in its inventory to promptly fill orders throughout
the Territory, including Zogenix orders for Samples pursuant to Section 4.5. 
Valeant shall have FDA-approved manufacturing facilities available to it or its
manufacturer (which facilities may be located outside of the Territory) that can
produce an amount of the Product in any fiscal year that is equal to or greater
than the amount of Product reasonably necessary to ensure the consistent
availability of the Product throughout the Territory. Valeant shall manufacture
or cause to be manufactured the Product and Samples in accordance with all
applicable laws, including without limitation the Act and all applicable rules
and regulations thereunder, the NDA and Current Good Manufacturing Practices.
7.2    Distribution.  Valeant will supply and distribute the Product to
customers in accordance with the specifications and requirements set forth in
the NDA approved by the FDA for sale of the Product in the Territory and all
applicable laws, including without limitation the Act and all applicable rules
and regulations thereunder, the NDA and Current Good Manufacturing Practices. 
Valeant will be responsible for supplying the Product in accordance with
purchase orders received by Valeant from customers for the Product, which supply
of the Product shall meet all legal requirements as set forth above.
7.3    Orders Received by Zogenix.  If, for any reason, Zogenix should receive
orders for the Product, Zogenix shall promptly forward such orders to Valeant.
8.
Representations and Warranties.

8.1    Representations and Warranties. Each Party hereby represents and warrants
to the other Party as follows:
(vii)    It is a corporation or limited liability company duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization.  It has all requisite power and authority to carry on its business
and to own and operate its properties and assets.  The execution, delivery and
performance of this Agreement have been duly authorized by all applicable
corporate action of such Party.  Such Party has obtained all authorizations,
consents and approvals, governmental or otherwise, necessary for the execution
and delivery of this Agreement, and to otherwise perform such Party’s
obligations under this Agreement.
(viii)    There is no pending or, to its knowledge, threatened litigation
involving it which would have any material adverse effect on this Agreement or
on its ability to perform its obligations hereunder.
(ix)    There is no indenture, contract, or agreement to which it is a party or
by which it is bound which prohibits, conflicts with or would prohibit the
execution and delivery by it of this Agreement or the performance or observance
by it of any material term or condition of this Agreement.
8.2    Additional Valeant Representations and Warranties. Valeant further hereby
represents and warrants to Zogenix that (i) the data regarding the efficacy and
safety of the Product that is contained in the NDA and other regulatory filings
submitted to the FDA in support of marketing approval of the Product is complete
and accurate in all materials respects, does not contain any misstatement of a
material fact related to safety or efficacy nor omit to state any material fact
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or efficacy; (ii) as of the Effective Date, Valeant has received no notice of a
third party claiming any ownership interest in the patent or trademark rights
covering the Product; (iii) Valeant has the exclusive right to promote, market
and sell the Product in the Territory and to perform its obligations under this
Agreement; (iv) as of the Effective Date, Valeant is unaware of any third-party
infringement of the Product intellectual property (including patent and
trademark rights) which would have a material adverse effect on the rights
granted to Zogenix hereunder; and (v) the Product’s label and labeling and the
related Product Promotional Materials provided to Zogenix by Valeant shall
comply with all applicable laws, rules and regulations.
8.3    Valeant Product Warranty. Valeant warrants to Zogenix that:
(i)    at the time of delivery of all Product (excluding Samples) by or on
behalf of Valeant to a third party, (i) such Product will be in conformity with
the applicable specifications therefor and the NDA, (ii) such Product will have
been manufactured in compliance with Current Good Manufacturing Practices and
all other applicable legal requirements, (iii) such Product will have been
manufactured in facilities that are in compliance with all applicable legal
requirements at the time of such manufacture (including applicable inspection
requirements of FDA and other governmental authorities), (iv) such Product will
not be adulterated or misbranded under the Act, (v) such Product may be
introduced into interstate commerce pursuant to the Act and (vi) the expiration
date of such Product shall be no earlier than [***] ([***]) [***] after the date
of delivery thereof, and
(ii)    at the time of delivery of all Samples to Zogenix hereunder, (i) such
Samples will be in conformity with the applicable specifications therefor and
the NDA, (ii) such Samples will have been manufactured in compliance with
Current Good Manufacturing Practices and all other applicable legal
requirements, (iii) such Samples will have been manufactured in facilities that
are in compliance with all applicable legal requirements at the time of such
manufacture (including applicable inspection requirements of FDA and other
governmental authorities), (iv) such Samples will not be adulterated or
misbranded under the Act, (v) such Samples may be introduced into interstate
commerce pursuant to the Act and (vi) the expiration date of such Samples shall
be no earlier than [***] ([***]) [***] after the date of delivery, unless
otherwise agreed in writing by Zogenix .
9.
Intellectual Property Matters.

9.1    Intellectual Property Prosecution and Maintenance. Valeant shall, at its
own expense, use commercially reasonable efforts to prosecute and maintain all
Valeant intellectual property in the Territory (including patents, the Product
Trademarks and any copyrights associated with the Product Promotional Materials)
related to the Product or its manufacture, use, offer for sale or sale. Valeant
shall keep Zogenix promptly informed regarding the ongoing prosecution and
maintenance of Valeant patents to the extent they relate to the Product or its
manufacture, use or sale in the Territory, including all office actions and
notices of allowance.
9.2    Ownership. Valeant shall own all intellectual property rights in and to
the regulatory and clinical data (but not commercial data generated in the
course of performance hereunder) or other inventions and improvements
incorporated into the Product, in each case conceived or reduced to practice by
either Party pursuant to this Agreement. Each Party shall own all intellectual
property rights with respect to commercial data generated by or on behalf of it
in the course of performance hereunder.
9.3    Infringement.
(viii)    If either Party shall learn of a claim or assertion that the
manufacture, use or sale of the Product in the Territory infringes or otherwise
violates the intellectual property rights of any third party or that any third
party violates the intellectual property rights owned or Controlled by (i)
Valeant in

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the Product or the Product Trademarks or Valeant Trademarks in the Territory or
(ii) Zogenix in the Zogenix Trademarks, then the Party becoming so informed
shall promptly, but in all events within [***] ([***]) days thereof, notify the
other Party of the claim or assertion. In the event Valeant receives a notice
under Paragraph IV of the U.S. Federal Drug Price Competition and Patent Term
Restoration Act of 1984, as amended, also known as the Hatch-Waxman Act, with
respect to the Product, Valeant shall provide Zogenix with written notice of
such Paragraph IV notice within [***] ([***]) business days.
(ix)    In the event of any infringement of Valeant patent rights related to the
Product or its manufacture, use or sale, or the Product Trademarks or Valeant
Trademarks in the Territory, which infringement involves a product that could or
does compete with the Product or could adversely affect the Parties' interests
in the Product under this Agreement, Valeant shall, in its sole discretion
determine to take the appropriate legal action (as to any Party to redress a
third party infringement, an "Enforcement Action"), if any. In the event such an
Enforcement Action is initiated, Valeant shall use commercially reasonable
efforts to prosecute such matter as it determines in its entire discretion and
shall keep Zogenix reasonably informed regarding any such Enforcement Action. At
Valeant’s reasonable request, Zogenix shall cooperate fully with Valeant with
respect to any such Enforcement Action, and Valeant shall reimburse Zogenix for
its reasonable out-of-pocket costs and expenses incurred in providing such
cooperation. Any recovery received as a result of any Enforcement Action shall
be used first to reimburse the Parties for their costs and expenses not
previously reimbursed (including attorneys' and professional fees) incurred in
connection with such Enforcement Action. If such recovery is not sufficient to
fully reimburse the Parties for such costs and expenses, then the recovery will
be paid to the Parties pro rata, in proportion to such costs and expenses
incurred by each Party. Of any remaining amounts, the amount (if any) which is
required to be paid to any licensors of the applicable patent rights or Product
Trademarks or Valeant Trademarks under the terms of the respective in-license
agreement, if any, shall then be paid to such licensor, if any, and any amounts
remaining thereafter allocable as compensation for lost sales or profits of the
Product during the Term shall be shared between the Parties [***] percent
([***]%) to Zogenix and [***] percent ([***]%) to Valeant.
(x)    In the event of an Enforcement Action by Zogenix with respect to any
Zogenix Trademark, at Zogenix’ reasonable request, Valeant shall cooperate fully
with Zogenix with respect to any such Enforcement Action, and Zogenix shall
reimburse Valeant for its reasonable out-of-pocket expenses incurred in
providing such cooperation. Any recovery achieved by Zogenix with respect to
such Enforcement Action shall be solely for the account of Zogenix.
10.
Indemnification and Insurance.

10.1    Indemnification. 
(iii)    Each Party will defend, at its own expense, indemnify and hold harmless
the other Party and its directors, officers, employees, agents and Affiliates
from and against any and all damages, liabilities, losses, costs, and expenses,
including attorney’s fees, arising out of any claim, suit or proceeding asserted
against the other Party (each, a ”Claim” and collectively, “Claims”) to the
extent such Claim arises out of or relates to (A) any breach or violation of, or
failure to perform, any covenant or agreement made by such indemnifying Party in
this Agreement, unless waived in writing by the indemnified Party; (B) any
breach of the representations or warranties made by such indemnifying Party in
this Agreement; or (C) the negligence or willful misconduct of the indemnifying
Party, except (under any of (A) and (B)) to the extent arising out of the
breach, violation, failure, negligence or willful misconduct of the indemnified
Party. 
(iv)    In addition, Valeant will defend, at its own expense, indemnify and hold
harmless Zogenix and its directors, officers, employees, agents and Affiliates
from and against any and all Claims

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to the extent such Claim arises out of or relates to: (A) any personal injury
(including death) and/or property damage resulting from the handling,
possession, sale or use of the Product; and (B) any other liability arising out
of the manufacture, marketing, labeling, distribution, sale or use of the
Product, including claims of infringement of third party intellectual property
rights, except (under any of (A) and (B)) to the extent arising out of the
breach, violation, failure, negligence or willful misconduct of Zogenix.
(v)    Each Party agrees that it shall promptly notify the other in writing of
any Claim and give the indemnifying Party full information and assistance in
connection therewith.  The indemnifying Party shall have the sole right to
control the defense if any Claim or action and the sole right to settle or
compromise any such Claim, except that the prior written consent of the other
Party shall be required in connection with any settlement or compromise which
could (A) place any obligation on or require any action of such other Party; (B)
admit or imply any liability or wrongdoing of such other Party; or (C) adversely
affect the goodwill or public image of such other Party.  Notwithstanding the
foregoing, the indemnified Party may participate therein through counsel of its
choice, but the cost of such counsel shall be borne solely by the indemnified
Party.
10.2    Insurance. Each Party shall maintain insurance (either through purchase
of a policy from a nationally recognized third party insurer or through
maintenance of a self-insurance program) against such risks and upon such terms
(including coverages, deductible limits and self-insured retentions) as is
customary for the activities to be conducted by such Party under this Agreement
and is appropriate to cover its indemnification obligations hereunder.
Notwithstanding the generality of the foregoing, each Party shall maintain
during the Term comprehensive general liability (CGL) insurance in an amount of
at least [***] dollars ($[***]) and product liability insurance coverage in an
amount of at least [***] dollars ($[***]). Zogenix shall be named as an
additional insured under Valeant’s CGL and product liability insurance policies.
Upon request, Valeant shall provide Zogenix with a certificate of insurance as
evidence of the requested coverage and shall give Zogenix at least [***] ([***])
days’ notice of any cancellation or termination of such insurance.
10.3    Survival.  The provisions of this Section 10 shall survive expiration or
termination of this Agreement and shall remain in effect until a date [***]
([***]) [***] after the Term.
11.
Confidentiality; Publicity.

11.1    Confidentiality Obligation.  Except as specifically authorized by this
Agreement, each Party shall, for the Term and for [***] ([***]) years after the
expiration or termination of this Agreement, keep confidential, not disclose to
third parties (other than consultants bound in writing, financial advisors and
outside counsel who agree to protect the Proprietary Information no less
stringently than herein) and use only for the purposes authorized herein all
Proprietary Information provided by the other under this Agreement. 
Notwithstanding the aforesaid, the recipient may disclose Proprietary
Information to governmental agencies as required by law, provided that the other
Party is provided with prior written notice and a reasonable opportunity to
obtain confidential treatment or other protective order.
11.2    Publicity. Neither Party will originate any publicity, news release,
public comment or other public announcement, written or oral, whether to the
press, to stockholders, or otherwise, relating to this Agreement, without the
consent of the other Party, except for such announcements which, in accordance
with the advice of legal counsel to the Party making such announcement, are
required by law or for such announcements that contain the same disclosure as in
prior permitted/approved public announcements. Except as otherwise permitted
pursuant to the immediately preceding sentence, any Party making any
announcement which is required by law will, unless prohibited by law, give the
other Party an opportunity to review the form and content of such announcement
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made. Either Party shall have the right to make such filings with governmental
agencies, including without limitation the United States Securities and Exchange
Commission, as to the contents and existence of this Agreement as it shall
reasonably deem necessary or appropriate (provided that the Parties will
reasonably cooperate with respect to obtaining confidential treatment of
sensitive information, as appropriate). The Parties have agreed upon the form
and content of a joint press release to be issued by the Parties promptly
following the execution of this Agreement.
11.3    Survival.  The provisions of this Section 11 shall survive expiration or
termination of this Agreement and shall remain in effect until a date [***]
([***]) [***] after the Term.
12.
Maintenance of Books and Records; Audits.

12.1    Maintenance of Books and Records. Each Party shall maintain complete and
accurate books and records in sufficient detail, in accordance with GAAP and all
applicable laws, rules, ordinances and regulations, to enable verification of
the performance of such Party's obligations under this Agreement. Such records
shall be maintained for a period of [***] ([***]) [***] after the end of the
Term or longer if required by applicable law. 
12.2    Payment Audits.  Zogenix shall have the right, upon [***] prior written
notice, periodically but no more than [***] per calendar year and through the
use of an independent accounting firm or other appropriate independent third
party expert reasonably acceptable to Valeant (“Zogenix Auditor”) to review,
examine and audit the appropriate books and records of Valeant solely related
(i) to the [***], (ii) to the [***], (iii) to the [***], or (iv) [***]. Zogenix
shall not audit any one period of time with respect to any particular subject(s)
of any such audit on more than [***] or later than [***] following the
applicable period of time and Zogenix shall maintain the confidentiality of all
documents and records audited. The costs and expenses of any such audit,
including the Zogenix Auditor, shall be the responsibility of Zogenix, except
that if any audit discloses that an amount due to Zogenix or charged to Zogenix
was in error for the audited period by more than [***]% in Valeant’s favor
(after Valeant has had the opportunity to review and has not disputed the
results of such audit) , the portion of any such direct costs and expenses of
the Zogenix Auditor allocable to such audit shall be the responsibility of
Valeant. Zogenix shall share the results of any audit with Valeant promptly and
each Party shall, within [***] ([***]) days of any adjustment in the other
Party’s favor, pay the appropriate amount to such other Party. In the event of a
dispute over the results of any audit conducted pursuant to this Section 12.2,
Zogenix and Valeant shall work in good faith to resolve such dispute.
Notwithstanding Section 15.6, if the Parties are unable to reach a mutually
acceptable resolution of any such dispute within [***] ([***]) days, the dispute
shall be submitted for arbitration to a certified public accounting firm
selected by the Parties or to such other Person as the Parties shall mutually
agree (the “Accountant”). The decision of the Accountant shall be final and the
costs of such arbitration as well as the initial audit shall be borne between
the Parties in such manner as the Accountant shall determine.
12.3    Other Audits. Upon reasonable prior written notice from the other Party
and from time to time during the Term, but no more than [***] per calendar year,
each Party shall afford to the other Party reasonable access during normal
business hours (and at such other times as the Parties may mutually agree) to
inspect and audit the relevant books, records, facilities (including third party
manufacturing/warehousing facilities) and other information of such Party in
order to monitor such Party's compliance with such Party's obligations under the
terms of this Agreement and for the purposes of determining compliance with the
applicable rules and regulations of governmental or regulatory authorities. Such
access shall be available during normal business hours. Any inspection conducted
by either Party pursuant to this Section 12.3 shall be at the sole cost and
expense of such Party.
13.
Term and Termination.

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13.1    Term.  The “Term” of this Agreement shall commence on the Effective Date
and shall continue, unless terminated sooner in accordance with the terms
hereof, until December 31, 2015 (as the same may be extended or terminated as
set forth in this Section 13). The Term may be renewed for additional [***]
([***]) month periods on mutual agreement of the Parties, following prior
written notice from either Party of its desire to renew, given no less than
[***] ([***]) days prior to the expiration of the then-current Term.
13.2    Termination by Zogenix. Zogenix shall have the right to terminate this
Agreement at any time upon written notice to Valeant in the event (i) of a
Valeant Supply Failure or a material Product recall; or (ii) the Net Sales Price
in a [***] is more than [***] percent ([***]%) less than the Net Sales Price for
the immediately preceding [***] (other than a decrease resulting from one-time,
non-recurring gross to Net Sales deductions) and in Zogenix’ reasonable judgment
such reduction in Net Sales Price would have a material adverse effect on
Zogenix’ financial return as a result of performance of its obligations
hereunder and provided that Zogenix may only exercise such right within [***]
following receipt of notice of any such decrease in Net Sales Price.
13.3    Mutual Termination Rights. Either Party may terminate this Agreement,
without cause, effective on [***] ([***]) months prior written notice, provided
that neither Party may provide notice of termination before January 1, 2014. In
addition, either Party in its sole discretion may terminate this Agreement
following: (i) the commercial introduction of an Other DHE Product in the
Territory other than an Authorized Generic, on [***] ([***]) days prior written
notice; (ii) any action taken or objection raised by any governmental authority
that prevents either Party from performing its obligations under this Agreement
or otherwise makes or would reasonably be expected to make such activity
unlawful or would reasonably be expected to subject the other Party to any
penalty or any claim, investigation or other action, in each case by such
government authority in the Territory, at any time; (iii) a third party files an
action alleging that the use, making, having made, sale, offering for sale or
importation of the Product in the Territory infringes an issued patent owned or
controlled in the Territory by such third party, at any time; (iv) a Change of
Control of either Party, on [***] ([***]) days prior written notice, which
notice must be delivered to the other Party within [***] ([***]) days after the
closing of the transaction constituting a Change of Control or neither Party
shall have the right to terminate this Agreement as a result of the occurrence
of such Change of Control; (v) on [***] ([***]) days prior written notice, if,
other than during the first full [***] following the Promotion Commencement
Date, Zogenix Net Sales within the Territory fall below [***] for [***] ([***])
or more [***]; (vi) at any time, on the occurrence of a Bankruptcy Event of the
other Party; and (vii) a material failure of the other Party to comply with its
material obligations contained in this Agreement (and such failure must be
described with reasonable specificity in a notice); provided that such
termination shall not become effective if the breaching Party cures such failure
within such [***] ([***]) days of the notice.
13.4    Remedies.  Except as indicated in Section 15.4, termination of this
Agreement shall be without prejudice to (i) any remedies which any Party may
then or thereafter have hereunder or at law; and (ii) a Party’s right to receive
any payment accrued under the agreement prior to the termination date but which
became payable thereafter; and (iii) either Party’s right to obtain performance
of any obligations provided for in this Agreement which survive termination by
their terms or by a fair interpretation of this Agreement.

*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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13.5    Post-Termination Obligations. 
(i)    Expiration or termination of this Agreement shall not relieve either
Party of any obligations accruing prior to such expiration or termination. The
following provisions of this Agreement by their terms continue after the
expiration or termination of this Agreement: Sections 4.4, 4.5(iv), 4.5(v),
4.5(vi), 4.7, 5.2, 5.3, 5.4, 5.5, 6.2, 8, 9.2, 9.3, 10, 11, 12, 13.4, 13.5, 14,
and 15. In addition, any other provisions required to interpret and enforce the
Parties' rights and obligations under this Agreement shall also survive, but
only to the extent required for the interpretation and performance of this
Agreement. Upon the expiration or termination of this Agreement pursuant to this
Section 13, each Party shall promptly transfer and return to the other Party or
destroy all Proprietary Information of the other Party (provided that each Party
may keep one copy of such Proprietary Information for archival purposes only).
(ii)    Upon the expiration or termination of this Agreement, Zogenix shall
immediately cease all promotion and detailing of the Product in the Territory
and return all undistributed Samples and undistributed Product Promotional
Materials. For clarity, the Joint Commercialization Committee shall immediately
be disbanded and any and all grant of rights from Valeant to Zogenix shall
immediately cease.
(iii)    Valeant shall pay to Zogenix the Tail Payment as set forth in Sections
5.2 and 5.3(iii), unless Valeant has terminated this Agreement under Section
13.3(vi) or 13.3(vii) in which case no Tail Payment shall be made.
7.
Notices.

Unless otherwise provided herein, all notifications, demands, approvals and
communications required to be made under this Agreement shall be given in
writing and shall be effective when either personally delivered or sent by
facsimile if followed by prepaid air express addressed as set forth below.  The
Parties hereto shall have the right to notify each other of changes of address
during the Term. All notices shall be deemed made upon receipt by the addressee.
If to Zogenix, to:
ZOGENIX, INC.
12400 High Bluff Drive, Suite 650
San Diego, CA 92130
Attention: Chief Financial Officer
Facsimile: (858) 259-1166
With a copy to (which shall not constitute notice hereunder):

Latham & Watkins LLP
12636 High Bluff Drive, Suite 400
San Diego, CA 92130
Attention: Faye H. Russell
Fax No: (858) 523-5450

    
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If to Valeant, to:
VALEANT PHARMACEUTICALS INTERNATIONAL, INC.
700 Route 202-206 North
Bridgewater, NJ 08807
Attention:  General Counsel
Facsimile: (949) 271-3796

8.
Miscellaneous.

15.1    Assignment.  This Agreement and the rights granted herein shall not be
assignable (or otherwise transferred) by either Party hereto without the prior
written consent of the other Party. Any attempted assignment without consent
shall be void. Notwithstanding the foregoing, a Party may transfer, assign or
delegate its rights and obligations under this Agreement without consent to (i)
an Affiliate reasonably capable of performing such Party's obligations under
this Agreement, or (ii) a successor to all or substantially all of its business
or assets of the assigning Party to which this Agreement relates, whether by
sale, merger, consolidation, acquisition, transfer, operation of law or
otherwise. In addition, either Party may assign its right to receive proceeds
under this Agreement or grant a security interest in such right to receive
proceeds to one or more financial institutions providing financing to such Party
pursuant to the terms of a security or other agreement related to such
financing. For the avoidance of doubt, any such assignment in connection with a
Change of Control, whether permitted or not hereunder, shall not affect the
right of any Party to terminate this Agreement as a consequence of a Change of
Control of either Party pursuant to and in accordance with Section 13.3. Any
assignment of this Agreement not in compliance with this Section 15.1 shall be
void.
15.2    Independent Contractors.  Nothing herein contained shall be construed to
constitute the Parties hereto as partners or as joint venturers, or either as
agent for the other.  No employee or representative of a Party shall have any
authority to bind or obligate the other Party to this Agreement for any sum in
any manner whatsoever, or to create or impose any contractual or other liability
on the other Party without said Party’s authorized written approval.  For all
purposes, and notwithstanding any other provision of this Agreement to the
contrary, Zogenix’ legal relationship under this Agreement to Valeant shall be
that of independent contractor.
15.3    Entire Agreement.  This Agreement represents the entire agreement
between the Parties concerning the subject matter hereof and supersedes all
prior or contemporaneous oral or written agreements of the Parties.  This
Agreement may be modified, amended or changed only by a written instrument
signed and delivered by the Parties, with clear intent to modify, amend or
change the provisions hereof.
15.4    Limitation on Damages.  Neither Valeant nor Zogenix (which for the
purposes of this Section 15.4 shall include their respective Affiliates,
directors, officers, employees and agents) shall have any liability to the other
for any punitive damages, special, incidental, consequential or indirect
damages, relating to or arising from this Agreement, even if such damages may
have been foreseeable. For the avoidance of doubt, nothing in this Section 15.4
shall be interpreted to limit the indemnification obligation of either Party in
connection with the characterization of damages or losses claimed by a third
party as being punitive, special, incidental, consequential or indirect or other
like damages or losses.

    
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15.5    Force Majeure. Neither Party shall be liable to the other Party for any
failure to perform as required by this Agreement if the failure to perform is
due to circumstances reasonably beyond such Party's control including, without
limitation, any act of God, civil disorder or commotion, act of aggression,
fire, explosion, flood, drought, war, sabotage, embargo, utility failure,
material shortage, labor disturbance, national health emergency, or
appropriation of property. A Party whose performance is affected by a force
majeure event shall take prompt action using all commercially reasonable efforts
to remedy the effects of the force majeure event.
15.6    Dispute Resolution. The Parties hereby agree that they will attempt in
good faith to resolve any controversy or claim arising out of or relating to
this Agreement promptly by negotiations and, where specifically provided for, in
accordance with any specific provisions for dispute resolution set forth
elsewhere in this Agreement with respect to any particular matter or section
hereof. If a controversy or claim should arise hereunder, and if a dispute
resolution provision is not otherwise provided herein for settlement of such
controversy or claim, appropriate representatives of the Parties will confer at
least once and will attempt to resolve the matter. Except as specifically
provided elsewhere in this Agreement, if the matter has not been resolved within
[***] ([***]) days of their first meeting, the representatives shall refer the
matter to appropriate Commercial Officers. If the matter has not been resolved
within [***] ([***]) days after referral to the Parties' Commercial Officers,
either Party may pursue such remedies as it may deem necessary or appropriate.
For the avoidance of doubt, disputes arising on issues within the jurisdiction
of a Committee shall be resolved in accordance with the procedures set forth in
Section 3.4.
15.7    Counterparts.  This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original.
15.8    Governing Law.  This Agreement will be construed under and in accordance
with, and governed in all respects by, the laws of the State of New York,
without regard to its conflicts of law principles.
15.9    Waiver.  Except to the extent that a Party may have otherwise agreed in
writing, no waiver by such Party of any breach by any other Party of any of the
other Party’s obligations, agreements or covenants hereunder shall be deemed to
be a waiver by such first Party of any subsequent or other breach of the same or
any other obligation, agreement or covenant; nor shall any forbearance by a
Party to seek a remedy for any breach by the other be deemed a waiver by said
Party of its rights or remedies with respect to such breach or of any subsequent
or other breach of the same or any other obligation, agreement or covenant.
15.10    Binding Effect.  Except as provided in Section 15.1, this Agreement
shall be binding upon and inure to the benefit of the Parties to this Agreement
and their respective successors.
15.11    Headings.  Headings as used in this Agreement are for convenience only
and are not to be construed as having any substantive effect by way of
limitation or otherwise.  References to Sections herein are, unless otherwise
indicated, references to the designated Sections of this Agreement, unless the
content requires otherwise.
15.12    Severability.  If one or more of the provisions of this Agreement
shall, by any court or under any provision of law, be found to be void or
unenforceable, the agreement as a whole shall not be affected thereby, and the
provisions in question shall be replaced by an interpretation in conformity with
law which comes closer to effecting the Parties original intention.

[Signature Page Follows]

*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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EXECUTION COPY

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and
delivered by their undersigned duly authorized representatives as of the
Effective Date.
ZOGENIX, INC.
 
By:   /s/ Roger L. Hawley
Name: Roger L. Hawley
Title: Chief Executive Officer
VALEANT PHARMACEUTICALS NORTH AMERICA LLC
By:   /s/ Hemanth Varghese
Name: Hemanth Varghese
Title: Sr. Vice President Corporate Development

    
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Schedule A
[***],[***] & [***]

Profit Share Calc
Month A
Defined Terms
TRx-Unit Conversion Rate
[***]
 
 
 
 
[***]
                      [***] 
 
[***]
                      [***] 
 
Total
                      [***] 
[***]
 
 
 
Baseline
                      [***] 
Baseline Forecast (Or Adjusted Baseline Forecast)
Above baseline
                         [***] 
 
Threshold
 
 
[***]
[***]
[***]
[***]
[***]
[***]
 
 
 
 
 
 
Valeant Net Sales
$[***]
Net Sales
[***]
             [***] 
Units 
[***]
 $ [***] 
[***]
 
 
 
Applicable Net Sales
 $ [***]
Zogenix Net Sales
Zogenix
$ [***]
Zogenix Service Fee
[***]
 $ [***] 
[***]
[***]
 $ [***]
[***]
 
 
 
Valeant
 $ [***]
 

*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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[***]
 
 
 
 
[***]
                                   [***]
 
 
 
Product
Form
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]

Adjustment Factor
 
[***] 1
[***]
 
[***] 2
[***]
 
[***] 3
[***]
 
[***] 4
[***]
 
[***] 5
[***]
 
[***] 6
[***]
 
[***] 7
[***]
 
[***] 8
[***]
 
[***] 9
[***]
 
[***] 10
[***]
 
[***] 11
[***]
 
[***] 12
[***]
 
[***] 13
[***]
 
[***] 14
[***]
 
[***] 15
[***]
 
[***] 16
[***]
 
[***] 17
[***]
 
[***] 18
[***]
 
[***] 19
[***]
 
[***] 20
[***]
 
[***] 21
[***]
 
[***] 22
[***]
 
[***] 23
[***]
 
[***] 24
[***]
 
 
 
 
[***]

*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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