exv10w9






Exhibit 10.9




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.




Execution Version




AMENDMENT TO LICENSE AGREEMENT



     THIS AMENDMENT TO LICENSE AGREEMENT, dated as of September 10, 2010 (the “Amendment”),
is entered into among Biogen Idec MA Inc. (“Biogen Idec”), Covella Pharmaceuticals, Inc.
(“Covella”) and Santarus, Inc. (“Santarus”) (hereinafter collectively, the
“Parties”).



BACKGROUND




	A.	 	Biogen Idec and Covella entered into a License Agreement (the “Agreement”) dated as of
January 22, 2009 pursuant to which Covella obtained an exclusive license to the patents and
certain know-how and other intellectual property owned or controlled by Biogen Idec
relating to Anti-VLA1 integrin antibodies (“Anti-VLA1 Antibody Program”).






	B.	 	Covella has entered into an Agreement and Plan of Merger dated as of September 10,
2010 (the “Merger Agreement”) with Santarus and Lawrence C. Fritz as the
Stockholder Representative pursuant to which Covella will merge with a wholly-owned
subsidiary of Santarus, with Covella surviving (the “Merger”). As a condition to
the Merger, this Amendment is required to be entered into by the Parties.





     NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements herein
contained, and for other good and valuable consideration, the receipt of which are hereby
acknowledged, the Parties hereby agree as follows:



AGREEMENT




	1.	 	Interpretation





     Except as otherwise provided in this Amendment, words and expressions used in this Amendment
have the same meaning as in the Agreement.




	2.	 	Amendments





     With effect on and from the date of this Amendment, the following amendments are made to the
Agreement:



     (a) Section 1.42 shall be amended to read in its entirety:




	 	 	 	“1.42 “Subject Transaction” shall mean any sublicense under this Agreement to a Third
Party that includes the right to




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          commercialize a Licensed Product within the Territory or any portion thereof.”



     (b) Section 2.8(b) shall be deleted in its entirety.



     (c) Section 5.1 shall be deleted in its entirety.



     (d) Section 5.2(e) shall be deleted in its entirety, and the reference to Section 5.2(e) in
Section 5.4(a) shall be deleted.



     (e) Section 7.5 shall be deleted in its entirety.



     (f) Section 8.1 shall be deleted in its entirety and Section 8.2 shall be amended to read in
its entirety as follows:



     “8.2
Adjustment Discussions.  If, (a) Covella requires a license
from [***] (and/or any successor entity to the applicable
rights, including [***]) to utilize the [***] to
produce Product (the “Cell Line License”), and (b) Covella
[***] and (c) [***], then Biogen Idec shall,
upon request of Covella, enter into good-faith negotiations with
Covella, for a period of up to [***].”



     (g) Section 9.1(a) shall be amended by deleting the words “pursue or” in clause (i), deleting
clause (ii) and deleting the last sentence in its entirety and replacing it with the following
sentence: “For purposes of Section 9.1, the phrase “confidential data package” shall be deemed to
mean a confidential package of pre-clinical and clinical trial data from pre-clinical or clinical
trials conducted after the date of this Amendment by or on behalf of Covella with respect to a
Licensed Product.”



     (h) Clause (i) of Section 9.1(c) shall be amended by adding the following proviso at the end
of the first sentence: “; provided, however, that the determination of whether the terms of an
agreement with a Third Party are equal to or less favorable in the aggregate than those specified
in the last written term sheet provided by Biogen Idec shall be made in the reasonable discretion
of Santarus.” (i) Section 9.1(d) shall be amended to replace “Covella” with “Santarus, Inc.” in
clause



     (i) and by deleting clause (ii).



     (j) Section 12.4(b) and Section 12.4(c) shall be deleted in their entirety.



     (k) The last sentence of Section 15.11 shall be deleted in its entirety and replaced with the
following sentence: “This Agreement, as amended by the Amendment, may be further amended, and any
term of this Agreement, as amended by the Amendment; may be modified, only by a written instrument
executed by a duly authorized representative of Biogen Idec, Santarus and, so long as Covella
exists, Covella.





 




			
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Securities and Exchange Commission. Confidential treatment has been requested with respect
to the omitted portions.




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     (l) Section 15.4 shall be amended by deleting the notice provisions relating to Covella
and its counsel and replacing them with the following:


“To Santarus and Covella:


Santarus, Inc.

3721 Valley Center Drive, Suite 400

San Diego, CA 92130

Attention:    Legal Affairs Department

Facsimile:    858-314-5701

Telephone:   858-314-5700


With a copy to (which shall not constitute notice hereunder):


Latham & Watkins LLP

12636 High Bluff Drive, Suite 400

San Diego, CA 92130

Attention:    Scott N. Wolfe

Facsimile:    858-523-5450

Telephone:   858-523-5400



     (m) The second sentence of Exhibit 1.4 shall be deleted in its entirety and replaced with the
following: “Biogen Idec shall deliver to Santarus the Biogen Idec Know-How indicated as “[***]”
below within [***] ([***]) days of receipt of a written request from Santarus, which request must
be sent by Santarus within [***] ([***]) days of the date of this Amendment.”



     (n) The second
sentence of Exhibit 1.27 shall be deleted in its entirety and replaced with the following: ““[***]”
means the date upon which Biogen Idec receives a written request from Santarus, which request must
be sent by Santarus within [***] ([***]) days following the date upon which the [***] pursuant to
the Amended Services and Supply Agreement (as defined below) determines that the [***].”




	3.	 	Payments





     (a) Santarus shall pay Biogen Idec (in addition to the milestone payments, royalties and other
payments required under Articles V and VI of the Agreement) the following amounts:



               (i) upon execution of this Amendment (the “Up Front Payment”), $50,000 in cash and
$150,000 payable in shares of the common stock of Santarus (“Parent Common Stock”) based on the
closing price of the Parent Common Stock on NASDAQ as reported in Yahoo! Finance as of the trading
day prior to the date hereof (the “Parent Stock Price”);





 




			
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               (ii) $[***] in cash and $[***] payable in shares of Parent Common Stock (based on the
Parent Stock Price) upon achievement of the First Milestone as defined in the Merger Agreement;



               (iii) $[***] upon achievement of the Second Milestone as defined in the Merger Agreement;



               (iv) $[***] upon achievement of the Third Milestone as defined in the Merger Agreement; and



               (v) Royalties of [***]% of Net Sales of each Product (the “Amendment Royalties”),
provided that Santarus’ obligation to pay the Amendment Royalties shall continue with respect to
sales of a Product in a particular country until the date which is the later of: (i) expiration of
the last Valid Claim in such country; or (ii) ten (10) years after the First Commercial Sale of a
Product (i.e., the first Product) in such country, and thereafter no further Amendment Royalties
shall be due with respect to such Product in such country.



     (b) Each payment payable by Santarus pursuant to Section 3(a)(i)-(iv) of this Amendment shall
be paid only once and shall be paid by Santarus within [***] ([***]) days following the achievement
of the applicable milestone. All Amendment Royalties payable by Santarus pursuant to Section
3(a)(v) of this Amendment shall be paid by Santarus on a quarterly basis (i) within [***] ([***])
days from the last day of the fiscal quarter of Santarus in which such Amendment Royalties were
earned or (ii) if the Amendment Royalties are earned in the fourth quarter of Santarus’ fiscal
year, within the earlier of (A) [***] ([***]) days from the last day of Santarus’ fiscal year or
(B) [***] ([***]) Business Days (as defined in the Merger Agreement) following the date of filing
of Santarus’ Annual Report on Form 10-K for such fiscal year.




	4.	 	Technology Transfer Responsibilities & Services Agreement





     (a) Biogen Idec confirms that it shall comply, with the requirements of Section 3.1 of the
Agreement in respect to the [***] documentation to Santarus (i.e., notwithstanding having already
satisfied such requirements with Covella), as set forth on Exhibits 1.4 and 1.27 of the Agreement,
as amended by this Amendment.



     (b) Santarus agrees to reimburse Biogen Idec for any agreed upon out of pocket costs incurred
thereby in its performance of clause (a) above and for any internal costs associated therewith
including any personnel time provided by Biogen Idec to facilitate such transfer at an FTE based
cost of [***]/per hour. All such payments by Santarus shall be made within [***] ([***]) days of
receipt of an invoice, reasonably detailing the associated costs and expenses, delivered by Biogen
Idec.



     (c) Biogen Idec agrees to provide certain testing, storage, technology transfer support, and
supply services relating to materials manufactured by Biogen Idec for use in the Anti-VLA1 Antibody
Program. The Parties acknowledge and agree that Biogen Idec’s services





 




			
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Securities and Exchange Commission. Confidential treatment has been requested with respect to the
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and supply obligations are conditioned upon, and shall be subject to a mutually acceptable
Amended Services and Supply Agreement (the “Amended Services and Supply Agreement”) to be entered
into by the Parties on the date hereof.





	5.	 	Acknowledgments and Consents; Conditions to Effectiveness





     (a) The Parties acknowledge and consent that upon execution of this Amendment and subject only
to the satisfaction of the conditions to effectiveness set forth in subsection (d) below, Santarus
shall inure to the benefits and assume the obligations of Covella under the Agreement, as amended
by this Amendment, and the Amended Services and Supply Agreement, (collectively, the “Transaction
Agreements”) and Biogen Idec consents to the assignment of the Transaction Agreements to Santarus
(directly or indirectly through its acquisition of Covella).



     (b) Biogen Idec hereby confirms that immediately prior to the execution of this Amendment, the
Agreement was in full force and effect.



     (c) Subject to the satisfaction of the conditions of effectiveness set forth in clause (d)
below, Biogen Idec waives (i) any breach of the Agreement that it is aware of as of the date
hereof; and (ii) its Right of Negotiation set forth in Article IX of the Agreement with respect to
the Merger (and any subsequent merger of Covella into Santarus).



     (d) This Amendment shall not become effective and will have no force and effect until the
satisfaction of the following conditions:



               (i) The Merger shall have closed as contemplated by the Merger Agreement;



               (ii) The Upfront Payment shall have been paid by Santarus to Biogen Idec; and



               (iii) The Parties shall have entered into the Amended Services and Supply Agreement.




	6.	 	Governing Law





     The Amendment shall be governed by and construed in accordance with the laws of California,
without regard to the conflicts of law principles that would provide for application of a
jurisdiction other than California. Any Dispute under this Amendment will be governed by Section
15.6 of the Agreement.




	7.	 	Entire Agreement





     The Agreement (including the Exhibits attached thereto), as amended by this Amendment,
contains the entire agreement of the Parties with respect to the subject matter and



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supersedes any prior express or implied agreements, understandings and representations, either oral
or written which may have related to the subject matter hereof in any way.





	8.	 	Counterparts





     This Amendment may be executed in two (2) or more counterparts, each of which shall be deemed
an original but all of which together shall constitute one and the same instrument. Facsimile and
other electronically scanned signatures shall have the same effect as their originals.



[Remainder of page intentionally left blank.]



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     IN WITNESS WHEREOF, the Parties have executed this Amendment as of the date first set forth
above.



	 	 	 	 	 	 	 
	BIOGEN IDEC MA INC.	 	SANTARUS, INC.
	 
	By:

	 	/s/ George A. Scongos
	 	By:
	 	/s/ Gerald T. Proehl
	 

	 	 
	 	 	 	 
	 

	 	Name: George A. Scongos
	 	 	 	Name: Gerald T. Proehl
	 

	 	Title: Chief Executive Officer
	 	 	 	Title: President and Chief Executive Officer






	 	 	 	 	 
	COVELLA PHARMACEUTICALS, INC.

 	 
	By:  	/s/ Lawrence C. Fritz
 	 
	 	Name:  	Lawrence C. Fritz 	 
	 	Title:  	Chief Executive Officer 	 



[Signature Page to Amendment to License Agreement]