ex10_48.htm


     

    Exhibit 10.48

     

     

    
      [*]
indicates that a confidential portion of the text of this agreement has been
omitted.

    

    
 

    FIRST AMENDMENT TO
COLLABORATION AGREEMENT

     

    This
First Amendment to Collaboration Agreement (this “First Amendment”) is
effective as of February 28, 2007 and is made by and between Takeda
Pharmaceutical Company Limited, a Japanese corporation having offices at 1-1,
Doshomachi 4-chome, Chuo-ku, Osaka 540-8645, Japan (hereinafter “Takeda”); and XOMA
(US) LLC, a Delaware limited liability company having offices at 2910 Seventh
Street, Berkeley, California 94710, USA (hereinafter “XOMA”).

     

    BACKGROUND

     

    A.           XOMA
and Takeda entered into a certain collaboration agreement dated as of November
1, 2006 (the “Agreement”).

     

    B.           XOMA
and Takeda wish to amend the Agreement to broaden the relationship as specified
herein.

     

    C.           Terms
which are defined in the Agreement shall have the same meanings when used in
this First Amendment, unless a different definition is given
herein.

     

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

     

    Section
1.                      Amendments.  Pursuant
to Section 14.9 of the Agreement,

     

    (a)           Section
1.17 of the Agreement is hereby amended and restated in its entirety to read as
follows:

     

    ““Chiron Exclusivity
Period” shall mean the exclusivity period provided for in Section 3.2 of
the May 26, 2005 Research, Development and Commercialization Agreement between
Chiron Corporation and XOMA (the “Chiron
Agreement”).  The Chiron Exclusivity Period expired on February
27, 2007.”;

     

    (b)           Section
1.38 of the Agreement is hereby amended and restated in its entirety to read as
follows:

     

    ““Field” means any and
all uses including but not limited to the diagnosis, prevention, control or
treatment of Cancer.”;

     

    (c)           the
first sentence of Section 2.1.1 of the Agreement is hereby amended and restated
in its entirety to read as follows:

     

    “The
Parties intend to carry out multiple programs in which Takeda and XOMA will
collaborate to identify and characterize Program Antibodies and to carry out the
Research and Development and Manufacturing of Antibody Products that act through
Collabora-

     


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    tion
Targets for use in the Field (the “Collaboration”),
consistent with the objectives set forth in the applicable
Plan(s).”;

     

    (d)           Section
2.1.3.2 of the Agreement is hereby replaced in its entirety to read as
follows:

     

    “XOMA
agrees that following the Effective Date, the provisions of any new antibody
research and development collaboration agreement between XOMA and a Third Party,
or any modification to any existing such agreement, that provides for
exclusivity as between the parties thereto with respect to matters other than
the specific Target(s) covered thereby (e.g., with respect to the field(s) of
use covered thereby) will not limit, or will expressly exclude, XOMA’s ability
to accept Proposed Targets as Collaboration Targets in accordance with the
explicit terms of this Agreement.”;

     

    (e)           the
second sentence of Section 2.2.2 of the Agreement, which states:

     

    “During
the period [*], Takeda may request XOMA’s consent (which consent shall not be
unreasonably withheld or delayed) to submit additional Proposed Targets to the
Escrow Agent, for consideration as proposed Collaboration Targets by sending the
form attached hereto as Schedule
2.2.2.”

     

    is hereby
amended and restated in its entirety to read as follows:

     

    “During
the period [*], Takeda may request XOMA’s consent (which consent shall not be
unreasonably withheld or delayed) to submit additional Proposed Targets to the
Escrow Agent, for consideration as proposed Collaboration Targets by sending the
form attached hereto as Schedule
2.2.2.”;

     

    (f)           the
fifth sentence of Section 2.2.5.1 of the Agreement, which states:

     

    “XOMA may
elect to reject such Proposed Target in the event that [*].”

     

    is hereby
amended and restated in its entirety to read as follows:

     

    “XOMA may
elect to reject such Proposed Target in the event that [*].”;

     

    (g)         the
following Section is hereby incorporated into the Agreement as Section
2.2.5.2.  Sections 2.2.5.2, 2.2.5.3 and 2.2.5.4 of the Agreement are
hereby renumbered as Sections 2.2.5.3, 2.2.5.4 and 2.2.5.5,
accordingly:

     

    “2.2.5.2   On
February 26, 2007, XOMA proposed to Takeda that [*] be treated as the second
Collaboration Target for purposes of this Agreement.  With this
background, the Parties agree that, notwithstanding anything contained in this
Agreement, as amended by the First Amendment to Collaboration Agreement
effective as of February 28, 2007 (the “First Amendment”), to
the contrary:

     

    
      	
              (a)

            	
              [*]
      shall be deemed, as of the effective date of the First Amendment, the
      second Collaboration Target;

            


    

     


    
      
         


      

      
        -2-

        
          

        

      

      
         


      

    


    


     

    
      	
              (b)

            	
              within
      [*] after the effective date of the First Amendment, the Parties shall
      prepare and agree (or conclude that they cannot agree) on an initial
      R&D Plan for [*] as the second Collaboration Target, and during the
      course of such preparation, counsel for each of the Parties will discuss
      any intellectual property rights owned or controlled by any Third Party
      known to such Party that relate to [*] and are relevant to the therapeutic
      Antibodies; and

            


    

     

    
      	
              (c)

            	
              in
      the event that such initial R&D Plan for [*] as the second
      Collaboration Target is not mutually agreed within the said [*] period,
      then [*] shall lose its status as a Collaboration Target retroactively as
      of the effective date of the First Amendment and, for purposes of Section
      7.3.5 (as amended by the First Amendment), [*] shall be deemed to be a
      Proposed Target named by Takeda but rejected by XOMA for reasons other
      than those set forth in the last paragraph of Section
    7.3.5.”;

            


    

     

    (h)           Section
7.1 of the Agreement is hereby amended and restated in its entirety to read as
follows:

     

    “Upfront
Fees.  Takeda shall pay XOMA in cash

     

    
      	
               
      

            	
              (a)

            	
              a
      non-refundable fee of [*] for the first Proposed Target (“First Upfront
      Fee”);

            


    

     

    
      	
               
      

            	
              (b)

            	
              a
      non-refundable fee of [*] as set forth in the First Amendment dated
      February 28, 2007 to this Agreement (“Upfront Amendment
      Fee”); and

            


    

     

    
      	
               
      

            	
              (c)

            	
              the
      following additional non-refundable fees for each respective Proposed
      Target becoming a Collaboration Target (each, an “Additional Upfront
      Fee”):

            


    

     

    
      	
               
      

            	
              (i)
      [*] Collaboration Target: [*];

            


    

     

    
      	
               
      

            	
              (ii)
      [*] Collaboartion Target: Insofar as the [*] Collaboration Target is [*],
      there shall be [*].  If the [*] Collaboration Target is a Target
      other than [*],[*];

            


    

     

    
      	
               
      

            	
              (iii)
      [*] Collaboration Target: [*];

            


    

     

    
      	
               
      

            	
              (iv)
      [*] Collaboration Target: [*];

            


    

     

    
      	
               
      

            	
              (v)
      [*] Collaboration Target: [*];

            


    

     

    
      	
               
      

            	
              (vi)
      [*] Collaboration Target: [*];

            


    

     

    
      	
               
      

            	
              (vii)
      [*] Collaboration Target: [*];

            


    

     

    The
Parties hereto acknowledge that the First Upfront Fee was already paid by Takeda
in cash within [*] of execution of this Agreement by the Parties and that the
first Collaboration Target has been accepted into the
Collaboration.  Each Additional Upfront Fee shall be paid in cash
within [*] of acceptance by XOMA of such Collaboration Target for Research and
Development in accordance with Section 2.2.5 hereof.”; and

     


    
      
         


      

      
        -3-

        
          

        

      

      
         


      

    


    


     

    (i)           Section
7.3.5 of the Agreement is hereby amended and restated in its entirety to read as
follows:

     

    “In the
event that the period set forth in Section 2.2.2 (i.e., from [*] until [*],
hereinafter, the “Period for Proposal”) has expierd and if the number of
Collaboration Targets which have been accepted into Collaboration was [*] or
less, then Takeda shall be entitled to the below described reduction in any
milestone payment (but no more than [*] of each of them) that may accrue in the
future under the Collaboration until the full reduction has been realized;
provided, however, that if (a) Takeda, in addition to [*] mentioned in Section
2.2.1, has not named [*] or more Proposed Targets in accordance with Section
2.2.2 by the end of the Period for Proposal or (b) Takeda named [*] or more
Proposed Targets during the last year of the Period of Proposal (i.e., from [*]
through [*]), the reduction hereunder will not apply.

     

    
      	
              Number
      of Collaboration 
Targets Accepted

            	
              Milestone
      Reduction

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction if Takeda named [*] or more Proposed
      Targets

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction if Takeda named [*] or more Proposed
      Targets

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction if Takeda named [*] or more Proposed
      Targets

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction if Takeda named [*] or more Proposed
      Targets

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction if Takeda named [*] or more Proposed
      Targets

            
	 	 
	
              [*]

            	
              [*]
      milestone reduction if Takeda named [*] or more Proposed
      Targets

            


    

    


     

    Any
Proposed Target either (a) submitted by Takeda after disclosure, eithe rpublicly
or confidentially to Takeda in writing, that XOMA has an active research and
development program in place with respect to such Proposed Target or (b)
rejected by XOMA on the grounds that XOMA reasonably believes that the
development of products to such Proposed Target is not technically feasible
pursuant to Section 2.2.5.1 shall not be counted with respect to the number of
Proposed Targets named by Takeda under this Section 7.3.5.”

     

    Section
2.                      Payment of Upfront Amendment
Fee.  The Upfront Amendment Fee shall be paid by Takeda in cash
within [*] after Takeda’s receiving the invoice sent by XOMA simultaneously or
after the execution of this First Amendment.

     

    Section
3.                      Reaffirmation of
Representations and Warranties.  The parties each reaffirm,
effective as of the effective date of this First Amendment, the various
representations

     


    
      
         


      

      
        -4-

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              and
      warranties that each party made to the other party in Article 11 of the
      Agreement.  To the extent that such representations and
      warranties were effective as of the Effective Date of the Agreement, the
      parties reaffirm such representations and warranties as of the effective
      date of this First Amendment. To the extent that such representations and
      warranties represent ongoing obligations, the parties furthermore reaffirm
      such ongoing obligations to the other
party.

            


    

     

    Section
4.                      Press
Release.  The parties hereby agree to the release of a press
release in the form attached hereto as Exhibit A upon full
execution of this First Amendment and the fact of the execution of this First
Amendment, as well as the terms that are expressly described in such press
release, shall be deemed to be in the public domain.  In all other
respects, Section 10.4 of the Agreement shall apply to the terms and conditions
of this First Amendment.

     

    Section
5.                      Effect of
Amendment.  Together with the Agreement (including all
Schedules thereto), the Agreement and this First Amendment constitute the entire
agreement between the parties in connection with the subject matter thereof and
supersede all prior and contemporaneous agreements, understandings, negotiations
and discussions, whether oral or written, of the parties.  Except as
expressly provided for herein, all terms and conditions of the Agreement shall
remain in full force and effect.

     

    Section
6.                      Governing
Law.  This First Amendment shall be governed by and construed
in accordance with the laws of the State of California, without reference to the
conflicts of law principles thereof.

     

    Section
7.                      Counterparts.  This
First Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.

     

    
      	
               
      

            	
              [THE
      BALANCE OF THIS PAGE IS INTENTIONALLY LEFT
  BLANK.]

            


    

     


    
      
         


      

      
        -5-

        
          

        

      

      
         


      

    


    IN
WITNESS WHEREOF, the undersigned parties have agreed to the foregoing as of the
date first written above.

     

    


     

    
      	
              TAKEDA
      PHARMACEUTICAL COMPANY LIMITED

            
	 
      
	 
      
	
              By:  _____________________________

            
	
                          Name:
      Yasuchika Hasegawa

            
	
                          Title:
      President

            
	 
      
	 
      
	
              XOMA
      (US) LLC

            
	 
      
	 
      
	
              By:  ____________________________

            
	
                          Name:
      John L. Castello

            
	
                          Title:
      Chairman of the Board, President and Chief Executive
    Officer

            


    

    


    



    
      
         


      

      
        -6-

        
          

        

      

      
         


      

    


    EXHIBIT
A

     

    FORM OF PRESS
RELEASE

     

    XOMA
and Takeda Expand Collaboration for Therapeutic Antibody Discovery and
Development

    


    Berkeley, CA, and Osaka, JAPAN
–– XOMA Ltd. (NASDAQ: XOMA) and Takeda Pharmaceutical Company Limited (TSE4502:
Takeda) announced today they have amended their existing agreement to increase
the number of potential therapeutic antibody programs under the collaboration 
initiated in November of 2006.  With this
expansion, XOMA estimates the aggregate upfront, R&D funding, milestone and
other payments could exceed $230 million before royalties over the life of the
agreement.  Since entering the original agreement four months ago,
XOMA has received or is otherwise due approximately $8 million as various
collaboration-related payments.

    


    “We are
pleased that, in connection with the expiration of certain exclusivity
obligations under an agreement with another entity, we are expanding our
collaboration with Takeda to include additional therapeutic antibody programs in
oncology. XOMA is well positioned to capitalize on the growing demand for
monoclonal antibody solutions and this expanded agreement validates our
strengths in translating targets into therapeutic product candidates and
advancing their development thereafter,” said John L. Castello, chairman of the
board, president and chief executive officer of XOMA.

    


    “Takeda
has an extensive collection of cancer-related disease targets that hold promise
for therapeutic intervention using monoclonal antibodies,” said Shigenori
Ohkawa, PhD, General Manager of Pharmaceutical Research Division of
Takeda.  “By expanding our collaboration with XOMA, we are able to
accelerate our antibody drug discovery and development efforts in
oncology.”

    


    About
the XOMA / Takeda Collaboration

    


    XOMA and
Takeda began a collaboration in November of 2006 under which XOMA is using its
extensive collection of phage display libraries and antibody optimization
technologies to discover therapeutic antibodies against multiple targets
selected by Takeda.  Other XOMA activities are expected to include
preclinical studies to support regulatory filings, cell line and process
development, and production of antibodies for initial clinical
trials.  Takeda will be responsible for clinical trials and
commercialization of drugs after IND submission, and is granted the right to
manufacture once the product enters into phase 2 clinical trials.

    


    The
collaboration calls for Takeda to make up-front and milestone payments to XOMA,
fund XOMA’s R&D activities including manufacturing of the antibodies for
preclinical and early clinical supplies, and pay royalties to XOMA on sales of
products resulting from the collaboration.

    


    Under the
November 2006 collaboration agreement, payments to XOMA potentially could have
exceeded $100 million before royalties over the life of the
collaboration.  Today’s announced


    
      
         


      

      
        -7-

        
          

        

      

      
         


      

    


    amendment
to the collaboration provides the potential for Takeda to add an undisclosed
number of new antibody discovery and development programs to those specified in
the initial agreement and raises the estimated potential payments to XOMA to
$230 million before royalties.

    


    About
XOMA

    


    XOMA is a
leader in the discovery, development and manufacture of therapeutic antibodies,
with a therapeutic focus that includes cancer and immune
diseases.  XOMA has royalty interests in RAPTIVA®
(efalizumab), a monoclonal antibody product marketed worldwide (by Genentech,
Inc. and Merck Serono, S.A.) to treat moderate-to-severe plaque psoriasis, and
LUCENTIS®
(ranibizumab injection), a monoclonal antibody product marketed worldwide
(by Genentech and Novartis AG) to treat neovascular (wet) age-related macular
degeneration.

    


    The
company has built a premier antibody discovery and development platform that
includes access to seven of the leading commercially available antibody phage
display libraries and XOMA’s proprietary Human EngineeringTM and Bacterial Cell
Expression (BCE) technologies.  More than 45 companies have signed BCE
licenses.  XOMA’s development collaborators include Lexicon
Pharmaceuticals, Inc., Novartis, Schering-Plough Corporation and Takeda
Pharmaceutical Company Limited.  With a fully integrated product
development infrastructure, XOMA’s product development capabilities extend from
preclinical sciences to product launch.  For more information, please
visit the company's website at www.xoma.com.

    


    About
Takeda

    


    Located
in Osaka, Japan, Takeda is a research-based global pharmaceutical company. As
the largest pharmaceutical company in Japan and one of the global leaders of the
industry, Takeda is committed to striving toward better health for individuals
and progress in medicine by developing superior pharmaceutical
products.

    


    Aiming to
become an “R&D-driven world-class pharmaceutical company”, Takeda is
enhancing its R&D pipeline by concentrating its management resources for
that purpose in the following selected core therapeutic areas:

     
 

    
      	
              n  

            	
              metabolic
      diseases (diabetes, hypertension, hyperlipidemia,
  etc.)

            


    

    
      	
              n  

            	
              oncology
      and urological diseases

            


    

    
      	
              n  

            	
              central
      nervous system disorders, bone/joint
diseases

            


    

    
      	
              n  

            	
              gastroenterological
      diseases

            


    

    


    Additional
information about Takeda is available through its corporate website,
www.takeda.com.

    


    XOMA
Contact:

    Paul
Goodson

    Sr.
Director, Investor Relations

    Tel:
(510) 204-7270

    goodson@xoma.com


    
      
         


      

      
        -8-

        
          

        

      

      
         


      

    


    


    


    Takeda
Pharmaceutical Company Limited Contact:

    Corporate
Communications Department

    Head
Office: +81-6-6204-2060

    Tokyo
Head Office: +81-3-3278-2039

    # #
#

    


    Certain statements
contained herein concerning product development or that otherwise relate to
future periods are forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934.  Such statements include, but are not limited to, statements to
the effect that payments to XOMA could exceed $230 million before royalties over
the life of the collaboration as amended or could have exceeded $100 million
before royalties over the life of the collaboration prior to the
amendment. Such statements are
based on assumptions that may not prove accurate.  Actual results
could differ materially from those anticipated due to certain risks inherent in
the biotechnology industry and for companies engaged in the development of new
products in a regulated market.  In particular, XOMA will not receive
the estimated total amounts of funds if it cannot successfully discover and
develop antibodies as called for in this collaboration.  These and
other risks, including those related to the results of discovery research and
preclinical testing; the timing or results of pending and future clinical trials
(including the design and progress of clinical trials; safety and efficacy of
the products being tested; action, inaction or delay by the FDA, European or
other regulators or their advisory bodies; and analysis or interpretation by, or
submission to, these entities or others of scientific data); uncertainties
regarding the status of biotechnology patents; uncertainties as to the cost of
protecting intellectual property; changes in the status of the existing
collaborative and licensing relationships; the ability of collaborators,
licensees and other third parties to meet their obligations; market demand for
products; scale up and marketing capabilities; competition; international
operations; share price volatility; XOMA’s financing needs and opportunities and
risks associated with XOMA’s status as a Bermuda company, are described in more
detail in XOMA’s most recent annual report on Form 10-K and in other SEC
filings.  Consider such risks carefully in considering XOMA’s
prospects.

     

     

     

     

    
-9-