Exhibit 10.22


 


Confidential Treatment
Requested.  Confidential portions of this
document have been redacted and have been separately filed with the Commission.


 


LICENSE, DEVELOPMENT AND
COMMERCIALIZATION AGREEMENT


 


by and between


 


Incyte Corporation


Experimental Station, Route 141 &
Henry Clay Road


Wilmington, Delaware


 


and


 


Eli Lilly and Company


Lilly Corporate Center


Indianapolis, Indiana 46285


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE I Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE II Licenses

  	
  13

  
	
   

  	
   

  	
   

  
	
   

  	
  2.1

  	
  Rights
  Granted by Incyte to Lilly

  	
  13

  
	
   

  	
  2.2

  	
  Sublicense
  Rights

  	
  13

  
	
   

  	
  2.3

  	
  Section 365(n) of
  The Bankruptcy Code

  	
  14

  
	
   

  	
  2.4

  	
  Field
  Expansion

  	
  14

  
	
   

  	
  2.5

  	
  Retained
  Rights

  	
  15

  
	
   

  	
  2.6

  	
  Non-Compete

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III Governance

  	
  17

  
	
   

  	
   

  	
   

  
	
   

  	
  3.1

  	
  Joint
  Development Committee.

  	
  17

  
	
   

  	
  3.2

  	
  Subcommittees

  	
  18

  
	
   

  	
  3.3

  	
  Committee
  Meetings

  	
  18

  
	
   

  	
  3.4

  	
  Authority

  	
  18

  
	
   

  	
  3.5

  	
  Decisions.

  	
  18

  
	
   

  	
  3.6

  	
  Committee
  Membership.

  	
  19

  
	
   

  	
  3.7

  	
  Future Adjustments in Governance

  	
  19

  
	
   

  	
   

  
	
  ARTICLE IV Development; Regulatory Matters; Supply

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1

  	
  Initial
  Transfer

  	
  20

  
	
   

  	
  4.2

  	
  Conduct
  of Development Activities

  	
  20

  
	
   

  	
  4.3

  	
  Development
  Reports

  	
  23

  
	
   

  	
  4.4

  	
  Licensed
  Product Co-Development Option

  	
  23

  
	
   

  	
  4.5

  	
  Regulatory
  Matters Related to Licensed Products

  	
  25

  
	
   

  	
  4.6

  	
  Manufacture
  and Supply

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V Commercialization

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1

  	
  Commercialization
  Diligence

  	
  26

  
	
   

  	
  5.2

  	
  Marketing
  Responsibilities For Licensed Products

  	
  28

  
	
   

  	
  5.3

  	
  Trademarks.

  	
  28

  
	
   

  	
  5.4

  	
  Co-Promotion.

  	
  28

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI Intellectual Property Ownership,
  Protection and Related Matters

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.1

  	
  Inventorship;
  Ownership

  	
  30

  
	
   

  	
  6.2

  	
  Prosecution
  and Maintenance of Patent Rights

  	
  30

  
	
   

  	
  6.3

  	
  Third
  Party Infringement

  	
  32

  
	
   

  	
  6.4

  	
  Patent Marking

  	
  33

  



 


i

















 


	
  ARTICLE VII Financial Provisions

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.1

  	
  License Fee

  	
  33

  
	
   

  	
  7.2

  	
  Milestone Payments

  	
  33

  
	
   

  	
  7.3

  	
  Royalties

  	
  37

  
	
   

  	
  7.4

  	
  Royalty Reports; Payments

  	
  39

  
	
   

  	
  7.5

  	
  Financial Records

  	
  40

  
	
   

  	
  7.6

  	
  Audits

  	
  40

  
	
   

  	
  7.7

  	
  Tax Matters

  	
  40

  
	
   

  	
  7.8

  	
  Currency Exchange

  	
  40

  
	
   

  	
  7.9

  	
  Late Payments

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII Term and Termination

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.1

  	
  Agreement Term

  	
  41

  
	
   

  	
  8.2

  	
  Termination.

  	
  41

  
	
   

  	
  8.3

  	
  Effects Of Termination

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX Indemnification;
  Limitation of Liability

  	
  45

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.1

  	
  By Lilly

  	
  45

  
	
   

  	
  9.2

  	
  By Incyte

  	
  45

  
	
   

  	
  9.3

  	
  Limitation of Liability

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X Representations and
  Warranties and Covenants

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.1

  	
  Representation Of Authority; Consents

  	
  46

  
	
   

  	
  10.2

  	
  No Conflict

  	
  47

  
	
   

  	
  10.3

  	
  Additional Incyte Representations and Warranties

  	
  47

  
	
   

  	
  10.4

  	
  Disclaimer of Warranty

  	
  48

  
	
   

  	
  10.5

  	
  Standstill

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI Confidentiality

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.1

  	
  Confidential Information

  	
  50

  
	
   

  	
  11.2

  	
  Permitted Disclosure

  	
  50

  
	
   

  	
  11.3

  	
  Publicity; Attribution; Terms of this Agreement; Non-Use of
  Names

  	
  51

  
	
   

  	
  11.4

  	
  Publications

  	
  52

  
	
   

  	
  11.5

  	
  Term

  	
  53

  
	
   

  	
  11.6

  	
  Return of Confidential Information

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII Dispute Resolution

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.1

  	
  Dispute Resolution Process

  	
  54

  
	
   

  	
  12.2

  	
  Injunctive Relief

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIII Miscellaneous

  	
  54

  



 


ii

















 


*** Confidential material redacted
and filed separately with the Commission.


 


	
   

  	
  13.1

  	
  Governing Law

  	
  54

  
	
   

  	
  13.2

  	
  Consent to Jurisdiction

  	
  54

  
	
   

  	
  13.3

  	
  Assignment

  	
  55

  
	
   

  	
  13.4

  	
  Entire Agreement; Amendments

  	
  55

  
	
   

  	
  13.5

  	
  Notices

  	
  55

  
	
   

  	
  13.6

  	
  Force Majeure

  	
  56

  
	
   

  	
  13.7

  	
  Compliance With Laws

  	
  56

  
	
   

  	
  13.8

  	
  Use Of Names, Logos Or Symbols

  	
  57

  
	
   

  	
  13.9

  	
  Independent Contractors

  	
  57

  
	
   

  	
  13.10

  	
  Headings

  	
  57

  
	
   

  	
  13.11

  	
  No Implied Waivers; Rights Cumulative

  	
  57

  
	
   

  	
  13.12

  	
  Severability

  	
  57

  
	
   

  	
  13.13

  	
  Execution In Counterparts

  	
  57

  
	
   

  	
  13.14

  	
  No Third Party Beneficiaries

  	
  57

  
	
   

  	
  13.15

  	
  Performance by Affiliates

  	
  58

  
	
   

  	
  13.16

  	
  Exhibits

  	
  58

  



 


Exhibits


 


Exhibit A:  Incyte Patent Rights


Exhibit A-1:
Genus Patent Rights


Exhibit A-2:
Selection Patent Rights


Exhibit B:  Initial Information Transfer


Exhibit C:  Initial Development Plans


Exhibit D:  Initial Press Release


Exhibit E:
Hematology Field and Oncology Field


 


Schedules


 


Schedule
1.43:  ***


Schedule
1.48:  Initial Licensed Back-Up Compounds


 


iii

















 


*** Confidential material redacted
and filed separately with the Commission.


 


LICENSE, DEVELOPMENT AND
COMMERCIALIZATION AGREEMENT


 


THIS LICENSE, DEVELOPMENT AND
COMMERCIALIZATION AGREEMENT (the “Agreement”) is entered into as of the
18th day of December, 2009 (“Effective Date”),
by and between Incyte Corporation, a Delaware corporation having an office at
Experimental Station, Route 141 & Henry Clay Road, Wilmington,
Delaware (“Incyte”), and Eli Lilly and Company, an Indiana corporation
having an office at Lilly Corporate Center, Indianapolis, Indiana 46285 (“Lilly”).


 


WHEREAS, Incyte and Lilly are each in the
business of discovering, developing and commercializing pharmaceutical
products;


 


WHEREAS, Incyte has discovered and commenced
Development of the Licensed Compounds (as defined below);


 


WHEREAS, Incyte has agreed to grant to Lilly
a license to develop and commercialize the Licensed Compounds;


 


NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties hereby agree as follows:


 


ARTICLE I


 


DEFINITIONS


 


When used in this Agreement, each of the
following terms shall have the meanings set forth in this ARTICLE I:


 


1.1           “Accounting
Standards” with respect to a Party means that such Party shall maintain
records and books of accounts in accordance with (a) US GAAP (United
States Generally Accepted Accounting Principles) or (b) to the extent
applicable, IFRS (International Financial Reporting Standards).


 


1.2           “Affiliate” means any Person that, directly or
indirectly, controls, is controlled by or is under common control with a
Party.  For the purposes of this Section 1.2,
the word “control” (including, with correlative meaning, the terms “controlled
by” or “under common control with”) means the actual power, either directly or
indirectly through one or more intermediaries, to direct the management and
policies of such entity, whether by the ownership of *** of the Voting Stock of
such entity, by contract or otherwise. The Parties acknowledge that in the case
of certain entities organized under the laws of certain countries outside of
the United States, the maximum percentage ownership permitted by law for a
foreign investor may be less than ***, and that in such case such lower
percentage shall be substituted in the preceding sentence, provided  that
such foreign investor has the power to direct the management and policies of
such entity.


 


1

















 


1.3           “Annual Net Sales” means aggregate Net Sales of a
Licensed Product by Lilly or its Affiliates or sublicensees in any Calendar
Year, or in the first and last years of the term of this Agreement, the portion
of such Calendar Year during which this Agreement is in effect.


 


1.4            “Business Day” means a day other than a Saturday
or Sunday or Federal holiday in Wilmington, Delaware or Indianapolis, Indiana.


 


1.5           “Calendar Quarter” means a calendar quarter ending
on the last day of March, June, September or December.


 


1.6           “Calendar Year” means a period of time commencing
on January 1 and ending on the following December 31.


 


1.7           “Clinical Trial” means a Phase I Study, a Phase II
Study, a Phase IIb Study, a Phase III Study, a Phase IV Study or a combination
of two (2) of any of the foregoing studies.


 


1.8           “Commercialization” or “Commercialize” means
any activities directed to obtaining pricing and/or reimbursement approvals,
marketing, promoting, distributing, importing, offering to sell, and/or selling
a product (including establishing the price for such product).


 


1.9           “Commercially Reasonable Efforts” of a Party means,
with respect to an objective, the reasonable, diligent, good faith efforts of a
Party, (including the efforts of its Affiliates, and sublicensees) of the type
to accomplish such objective as a similarly situated (with respect to size,
stage of development, and assets) biotechnology or pharmaceutical company, as
the case may be, would normally use to accomplish a similar objective under
similar circumstances, it being understood and agreed that, with respect to
efforts to be expended in relation to a product (including implementation of
Development and Commercialization strategies to support the pursuit of multiple
Indications in accordance with Exhibit C), such efforts shall be
substantially equivalent to those efforts and resources that a similarly
situated biotechnology or pharmaceutical company, as the case may be, would
typically devote to its own internally discovered compound or product, which
compound or product is at a similar stage in its Development or product life
and is of similar market and economic potential as products expected to result
from the Licensed Compounds at a similar stage in their Development or product
life, taking into account the risks of development, the commercial potential
for the Product, its proprietary position and other relevant factors.


 


1.10         “Confidential Information” means (a) all
confidential or proprietary information relating to Licensed Compounds, and (b) all
other confidential or proprietary documents, technology, Know-How or other
information (whether or not patentable) actually disclosed by one Party to the
other pursuant to this Agreement or the Prior Confidentiality Agreement.


 


1.11         “Control”
or “Controlled” means, with respect to any (a) material, document,
item of information, method, data or other Know-How or (b) Patent Rights
or other Intellectual Property Rights, the possession by a Party or its
Affiliates (whether by ownership or license (other than by a license granted
under this Agreement)), of the ability to grant to the other Party access, a
license and/or a sublicense as provided herein
without requiring the consent of a Third Party or violating the terms of any
agreement or other arrangement with any Third Party, in each 


 


2

















 


*** Confidential material redacted
and filed separately with the Commission.


 


case as of the Effective Date, or if any of the same are acquired or
created after the Effective Date, at the date it is acquired or created by the
relevant Party or its Affiliate.


 


1.12         “Cover”, “Covering” or “Covered” with
respect to a product, technology, process or method, means that, but for a
license granted to a Person under a Valid Claim included in the Patent Rights
under which such license is granted, the Development, manufacture,
Commercialization and/or other use of such product or the practice of such
technology, process or method, by such Person would infringe such Valid Claim
(or, in the case of a Valid Claim that has not yet issued, would infringe such
Valid Claim if it were to issue).


 


1.13         “CPI” means the Consumer Price Index — Urban Wage
Earners and Clerical Workers, U.S. City Average, All Items, 1982-84 = 100,
published by the United States Department of Labor, Bureau of Statistics (or
its successor equivalent index).


 


1.14         “Detail” means face-to-face discussions or other
direct communication (e.g. edetailing)
with physicians and other health care practitioners who are permitted under
applicable Laws to prescribe a Licensed Product for the purpose of promoting a
Licensed Product to such physicians or practitioners.


 


1.15         “Development” or “Develop” means, with respect
to a compound, preclinical and clinical drug development activities, including,
among other things:  the conduct of
Clinical Trials, test method development and stability testing, toxicology,
formulation and delivery system development, process development, pre-clinical
and clinical drug substance and clinical drug product supply, manufacturing
scale-up, development-stage manufacturing, quality assurance/quality control
procedure development and performance with respect to clinical materials,
statistical analysis and report writing and clinical studies, regulatory
affairs, and all other pre-Regulatory Approval activities.  When used as a verb, “Develop” means to
engage in Development.


 


1.16         “Development Costs”
means the costs and expenses incurred by or on behalf of a Party attributable
to, or reasonably allocable to, the Development of Licensed Products and that
are materially consistent, as applicable, with the Development Plan and
Development Budget.  Development Costs
shall not include ***.  “Development
Costs” shall include (a) the costs of Clinical Trials, the preparation,
collation and/or validation of data from such Clinical Trials and the
preparation of medical writing and publishing; (b) the FTE costs of the
relevant Party or its Affiliates; (c) all Out-of-Pocket Costs incurred by
the Parties or their Affiliates, including payments made to Third Parties with
respect to any of the foregoing (except to the extent that such costs have been
included in FTE costs); (d) Out-of-Pocket Costs incurred by or on behalf
of a Party in connection with the preparation and filing of regulatory submissions
for Licensed Product and obtaining of Regulatory Approvals; and (e) the
cost of contract research organizations (CROs) and clinical supply, including: (i) costs,
packaging and distribution of Licensed Products used in Clinical Trials; (ii) expenses
incurred to purchase and/or package comparator drugs; and (iii) costs and
expenses of disposal of clinical samples.


 


1.17         “EMEA” means the European Medicines Agency, or a
successor agency thereto.


 


3

















 


*** Confidential material redacted and filed
separately with the Commission.


 


1.18         “Exchange Act” means the Securities Exchange Act of
1934, as amended.


 


1.19         “Excluded Field” means any and all Indications in
humans and animals in the Hematology Field and the Oncology Field.


 


1.20         “Executive Officers” means the Chief Executive
Officer of Incyte (or a senior executive officer of Incyte designated by Incyte’s
Chief Executive Officer) and the Vice President Autoimmune Product Development
of Lilly (or a senior executive officer of Lilly or its Affiliate as designated
by the Vice President Autoimmune Product Development of Lilly).


 


1.21         “FDA” means the United States Food and Drug
Administration, or a successor agency thereto.


 


1.22         “Field” means the treatment, control, management,
mitigation, prevention or cure of any and all Inflammatory Disease Indications
in humans and animals in any formulation or dosage form, process or delivery
method, but not including the Topical Field.


 


1.23         “First Commercial Sale” means, with respect to a
Licensed Product, the first sale of commercially relevant quantities of such
Licensed Product intended for use by a patient, to a Third Party by, as
applicable, Lilly or its Affiliates or sublicensees in a country following
applicable Regulatory Approval (other than applicable governmental price and
reimbursement approvals) of such Licensed Product in such country.  For the avoidance of doubt, sales or
transfers of Licensed Product for Clinical Trial or other Development purposes,
or for compassionate or similar use, shall not be considered a First Commercial
Sale.


 


1.24         “Force Majeure
Event” means an event, act, occurrence, condition or state of facts, in
each case outside the reasonable control of a Party, including acts of God;
acts of any government; any rules, regulations or orders issued by any
governmental authority or by any officer, department, agency or instrumentality
thereof; fire; storm; flood; earthquake; accident; war; rebellion;
insurrection; riot; terrorism and invasion, that interfere with the normal
business operations of such Party.


 


1.25         “FTE” means a full-time equivalent person year
(consisting of a total of *** hours per year) of scientific or technical work
undertaken by a Party’s or its Affiliates’ employees, or a Third Party
licensee/sublicensee to the extent (a) mutually agreed by the Parties and (b) 
permitted and in accordance with the terms and conditions of this Agreement.


 


1.26         “FTE Rate” means the rate per FTE (which may be
prorated on a daily basis as necessary) of *** and ***, with respect to
Development and manufacturing activities conducted pursuant to this Agreement,
subject to annual adjustment by the rate of the Employment Cost Index for total
compensation for the “management, professional and related” occupational group,
as published by the United States Department of Labor, Bureau of Labor
Statistics (or any similar index agreed upon by the Parties if such index
ceases to be compiled and published).


 


4

















 


*** Confidential material redacted
and filed separately with the Commission.


 


1.27         “Generic Competition” means, with respect to a
Licensed Product in any country in a given Calendar Year, if, during such
Calendar Year one or more Generic Products shall be commercially available in
such country and such Generic Products shall in the aggregate have a market
share of *** of the aggregate market share of such Licensed Product and Generic
Products (based on data provided by IMS International or, if such data is not
available, such other reliable data source as agreed by the Parties (such
agreement not to be unreasonably withheld)) as measured by unit sales in such
country.


 


1.28         “Generic Product” means any pharmaceutical product
that (a) contains a Licensed Compound; (b) is sold by a Third Party
that is not a licensee or sublicensee of Lilly or its Affiliates, under a
marketing authorization granted by a Regulatory Authority to such Third Party;
***.


 


1.29         “Hematology
Field” means the treatment, control, mitigation, prevention, cure, or
diagnosis of all hematologic Indications as defined in subsections 280 — 289
(Diseases of the blood and blood-forming organs) of the International
Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM),
as set forth in Exhibit E.


 


1.30         “HSR Act”
means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (15
U.S.C. §18a), and the rules and regulations promulgated thereunder.


 


1.31         “Incyte IP” means Incyte Know-How and Incyte Patent
Rights.


 


1.32         “Incyte Know-How” means all Know-How that (a) is
Controlled by Incyte or any of its Affiliates as of the Effective Date or
during the Term; and (b) is necessary or useful to Develop, manufacture or
Commercialize any Licensed Compounds or Licensed Products.


 


1.33         “Incyte Patent Rights” means all Patent Rights that (a) are
Controlled by Incyte or any of its Affiliates as of the Effective Date or
during the Term; and (b) (i) Covers a Licensed Compound or Licensed
Product, a composition containing Licensed Compound, a formulation containing a
Licensed Product or (ii) are otherwise necessary to Develop, manufacture
or Commercialize any Licensed Compounds or Licensed Products.  The Incyte Patent Rights that exist as of the
Effective Date are set forth in Exhibit A (A-1 and A-2).


 


1.34         “IND” means an Investigational New Drug Application
filed with the FDA under 21 C.F.R. Part 312 or similar non-United States
application or submission in any country or group of countries for permission
to conduct human clinical investigations.


 


1.35         “Indication” means any disease, condition or
syndrome.


 


1.36         “Inflammatory Disease” means any inflammatory
disease, including the following Indications: rheumatoid arthritis (and other
arthritides including juvenile RA, ankylosing spondylitis, sero-negative
spondyloarthropathies and psoriatic arthritis), inflammatory bowel disease
(ulcerative colitis and Crohn’s Disease), asthma, chronic obstructive pulmonary
disease, multiple sclerosis, systemic lupus erythmatosus and psoriasis.  Notwithstanding the foregoing, Inflammatory
Disease specifically excludes any Indication included in the Excluded Field.


 


5

















 


*** Confidential material redacted
and filed separately with the Commission.


 


1.37         “Intellectual Property Rights” means Patent Rights,
trade secrets, copyrights and other forms of proprietary or industrial rights
pertaining to inventions, Know-How, original works, and other forms of
intellectual property.


 


1.38         “Inventions”
means all patentable inventions, discoveries, improvements and other technology
and any Patent Rights based thereon, that are discovered, made or conceived
during and in connection with the research, Development, manufacture and
Commercialization of Licensed Compounds or Licensed Products.


 


1.39         “JAK” means human Jak Tyrosine Kinase.


 


1.40         “JAK1” means Jak1 Tyrosine Kinase.


 


1.41         “JAK2” means Jak2 Tyrosine Kinase.


 


1.42         “JAK Excluded Compound” means ***.


 


1.43         “JAK2 Inhibitor Compound” means *** in Schedule 1.43.


 


1.44         “Know-How” means any information, ideas, data,
inventions, works of authorship, trade secrets, technology, or materials,
including formulations, molecules, assays, reagents, compounds, compositions,
human or animal tissue, samples or specimens, and combinations or components thereof,
whether or not proprietary or patentable, or public or confidential, and
whether stored or transmitted in oral, documentary, electronic or other form,
including all Regulatory Documentation, but excluding any such information or
materials publicly disclosed in Patent Rights.


 


1.45         “Law” means any law, statute, rule, regulation,
ordinance or other pronouncement having the effect of law, of any federal,
national, multinational, state, provincial, county, city or other political
subdivision, including (a) good clinical practices and adverse event
reporting requirements, guidance from the International Conference on
Harmonization or other generally accepted conventions, and all other rules,
regulations and requirements of the FDA and other applicable Regulatory
Authorities; (b) the Foreign Corrupt Practices Act of 1977, as amended, or
any comparable laws in any country; and (c) all export control laws.


 


1.46         “Lead
Compound” means (a) the Initial Lead Compound or (b) the first
Licensed Back-Up Compound to achieve initiation of a Phase IIb Study (the “Follow-On
Lead Compound”).


 


1.47         “Licensed Back-Up Compounds” means all Licensed
Compounds other than the Initial Lead Compound.


 


1.48         “Licensed Compounds” means (a) the compound
known as INCB28050 (the chemical structure of which has been previously
disclosed to Lilly) (the “Initial Lead


 


6

















 


*** Confidential material redacted
and filed separately with the Commission.


 


Compound”); (b) the back-up compounds set forth on Schedule
1.48 (the chemical structures of which have previously been disclosed to
Lilly) (each an “Initial Licensed Back-Up Compounds”); (c) all
other JAK2 Inhibitor Compounds (other than JAK Excluded Compounds) Covered ***,
within the Selection Patent Rights that exist as of the Effective Date; (d) all
salts, prodrugs, esters, metabolites, solvates, stereoisomers and polymorphs of
the foregoing; and (e) all derivatives of the
foregoing containing one or more atoms substituted with a radio isotope (including
derivatives containing deuterium).


 


1.49         “Licensed
Product” means a product or product candidate that contains one or more
Licensed Compounds in any formulation as the active ingredient, including all
dosages of such Licensed Compounds and all processes and delivery systems that
incorporate such Licensed Compounds, but
not including the Topical Field.


 


1.50         “Major
EU Countries” means ***.


 


1.51         “Major
Market Country” means ***.


 


1.52         “Marketing
and Sales Support” means any
direct support (internal or external, but excluding any allocation of general,
corporate or administrative overhead) relating to the sale, promotion and
marketing of Licensed Products, including: (a) Detailing or such other
contact  regarding Licensed Products; (b) sample
drops and any activities performed by medical information scientists, market
development specialists, managed care account directors and other personnel;
(c), market research, marketing communications, managed care, sales meetings,
sales force training, product hotlines, reimbursement support, contracting,
pricing, and telemarketing services; (d) advertising through any means,
including television and radio advertisements, advertisements appearing in
journals, newspapers, magazines or other media, packaging design, visual aids
and other selling materials, hospital formulary committee presentations and
presentations to state and other governmental formulary committees; and (e) any
public relations activity relating to a Licensed Product.


 


1.53         “MHLW” means the Japanese Ministry of Health, Labor
and Welfare, or a successor agency thereto.


 


1.54         “NDA” means (a) (i) a New Drug Application
submitted to the FDA, or any successor application or procedure, as more fully
defined in 21 C.F.R. § 314.50 et. seq.; or (ii) any non-United States
counterpart of such a New Drug Application; and (b) all supplements and
amendments, including supplemental New Drug Applications (and any non-United
States counterparts) that may be filed with respect to the foregoing.


 


1.55         “Net Sales” means, with respect to any Licensed
Product, the gross amount invoiced by Lilly or its Affiliates, or sublicensees
on sales or other dispositions of Licensed Product to Third Parties, or
otherwise directly or indirectly paid to or earned by Lilly or its Affiliates
or sublicensees with respect to the sale of Licensed Product, less the
following:


 


(a)           trade, cash and/or quantity discounts not already
reflected in the amount invoiced, to the extent related to the gross amount
invoiced;


 


7

















 


(b)           allowances and adjustments credited or payable, including
credit for spoiled, damaged, outdated, recalled and returned Licensed Product,
to the extent related to the gross amount invoiced and substantiated by
reasonable documentation;


 


(c)           freight,
insurance and other transportation charges incurred in shipping a Product to
Third Parties, to the extent identified as such in the invoice to the Third
Party, to the extent included in the gross amount invoiced;


 


(d)           amounts
repaid or credited by reason of rejections, defects, recalls or returns or
because of chargebacks, refunds, rebates (including wholesaler inventory
management fees, retroactive price reductions, commissions, discounts or
billing errors, and any other allowances which effectively reduce the net
selling price);


 


(e)           all
tariffs, duties, excises, sales taxes, or other taxes (including VAT) and
custom duties imposed on Licensed Products, in each case to the extent invoiced
to customers or otherwise included within gross amounts invoiced;


 


(f)            allowance
for distribution expenses; and


 


(g)           other
similar and customary deductions which are in accordance with US GAAP.


 


Net Sales will not include sales between or among Lilly and its
Affiliates and/or sublicensees; provided, however, that any resale to Third
Parties shall be included in Net Sales.


 


Net Sales shall be calculated in accordance with Lilly’s standard
internal policies and procedures, which must be in accordance with Accounting
Standards.  In the case of any sale or other
disposal for value, such as barter or counter-trade, of Licensed Product, or
part thereof, other than in an arm’s length transaction exclusively for cash,
Net Sales shall be calculated as above on the value of the non-cash
consideration received or the fair market price (if higher) of the Licensed
Product in the country of sale or disposal, as determined in accordance with
Accounting Standards. Donated product will be excluded from Net Sales.


 


In the event the Licensed Product is sold in a finished dosage form
containing the Licensed Product in combination with one or more other active
ingredients (a “Combination Product”), the Net Sales of the Licensed
Product, for the purposes of determining royalty payments, shall be determined
by multiplying the Net Sales (as defined above in this Section) of the
Combination Product by the fraction, A/(A+B) where A is the weighted (by sales
volume) average sale price in a particular country of the Licensed Product in
the prior Calendar Year when sold separately in finished form and B is the
weighted average sale price in that country in the prior Calendar Year of the
other product(s) sold separately in finished form.


 


In
the event that the weighted average sale price of the Licensed Product can be
determined but the weighted average sale price of the other product(s) cannot
be determined, Net Sales for purposes of determining royalty payments shall be
calculated by multiplying the Net Sales of the Combination Product by the
fraction A / C where A is the weighted average sale price of the Licensed
Product when sold separately in finished form and C is the weighted average
sale price of the Combination Product.


 


8














 


In the event that the weighted average sale price of the other product(s) can
be determined but the weighted average sale price of the Licensed Product
cannot be determined, Net Sales for purposes of determining royalty payments
shall be calculated by multiplying the Net Sales of the Combination Product by
the following formula:  one (1) minus
B / C where B is the weighted average sale price of the other product(s) when
sold separately in finished form and C is the weighted average sale price of
the Combination Product.


 


In the event that such average sale price cannot be determined for both
the Licensed Product and the other product(s) in combination, Net Sales
for purposes of determining royalty payments shall be agreed by the Parties
based on the relative value contributed by each component, such agreement shall
not be unreasonably withheld.


 


In the initial Calendar Year, a forecasted weighted
average sale price will be used for the Licensed Product, other product(s), or
Combination Product. Any over or under payment due to a difference between
forecasted and actual weighted average sale prices will be paid or credited in
the first royalty payment of the following Calendar Year.


 


1.56         “Oncology
Field” means the treatment, control, mitigation, prevention, cure, or
diagnosis of any oncology Indications as defined in subsections 140 — 239
(Neoplasms) of the International Classification of Diseases, Ninth Revision,
Clinical Modification (ICD-9-CM) as set forth in Exhibit E,
including all hematologic malignancies, solid tumors and myeloproliferative
diseases (including Myelofibrosis, Polycythemia Vera and Essential
Thrombocythemia) as listed in ICD-9-CM.


 


1.57         “Out-of-Pocket Costs”
means, with respect to certain activities hereunder, direct expenses paid or
payable by either Party or its Affiliates to Third Parties (other than
employees of such Party or its Affiliates) that are specifically identifiable
and incurred to conduct such activities for Licensed Products and have been
recorded in accordance with Accounting Standards.


 


1.58         “Party” means Lilly or Incyte.  “Parties” means Lilly and Incyte.


 


1.59         “Patent Rights” means all patents and patent
applications in any country in the world, including any continuations,
continuations-in-part, divisions, provisionals or any substitute applications,
any patent issued with respect to any such patent applications, any reissue,
reexamination, renewal, term adjustment, restoration, or extension (including
any supplemental protection certificate) of any such patent, and any confirmation
patent or registration patent or patent of addition based on any such patent,
and all non-United States counterparts of any of the foregoing.


 


1.60         “Patent Term Extension” means any patent term
extension, adjustment or restoration or supplemental protection certificates.


 


1.61         “Person” means any natural person, general or limited
partnership, corporation, limited liability company, limited liability
partnership, firm, association or organization or other legal entity.


 


9

















 


1.62         “Phase I Study” means a study in humans which
provides for the first introduction into humans of a product, conducted in
healthy volunteers or patients to obtain information on product safety,
tolerability, pharmacological activity or pharmacokinetics, as more fully
defined in 21 C.F.R. § 312.21(a) (or the non-United States equivalent
thereof).


 


1.63         “Phase II Study” means a study in humans of the
safety, dose ranging and efficacy of a product, which is prospectively designed
to generate sufficient data (if successful) to commence pivotal clinical
trials, as further defined in 21 C.F.R. § 312.21(b) (or the non-United
States equivalent thereof).


 


1.64         “Phase
IIb Study” means a well-controlled, dose ranging, multicenter Phase II
Study in patients with the disease or condition under study which is conducted
after a proof of concept study and that is adequately powered to further
evaluate efficacy and safety and define the dosage regimen of a product in the
target indication and which is intended to be among the last clinical trials in
the patient population performed prior to the initiation of Phase III
Studies.  A Phase IIb Study could include several hundred patients but not
to the extent required for registration.


 


1.65         “Phase III Study” means a controlled study in humans
of the efficacy and safety of a product, which is prospectively designed to
demonstrate statistically whether such product is effective and safe for use in
a particular Indication in a manner sufficient to file an NDA to obtain
regulatory approval to market the product, as further defined in 21 C.F.R. §
312.21(c) (or the non-United States equivalent thereof).


 


1.66         “Phase IV Study” means a human clinical trial which
is conducted on a product after Regulatory Approval of the product has been
obtained from an appropriate Regulatory Authority, and includes (a) trials
conducted voluntarily for enhancing marketing or scientific knowledge of an
approved Indication or (b) trials conducted after Regulatory Approval due
to request or requirement of a Regulatory Authority or as a condition of a
previously granted Regulatory Approval.


 


1.67         “Prior Confidentiality Agreement” means the
Confidentiality Agreement between Incyte and Lilly, dated April 23, 2009.


 


1.68          “Publication” means any publication in a scientific
journal, any abstract to be presented to any scientific audience, any
presentation at any scientific conference, including slides and texts of oral
or other public presentations, any other scientific presentation and any other
oral, written or electronic disclosure directed to a scientific audience which
pertains to the Licensed Compound, the Licensed Product or the use of the
Licensed Product.


 


1.69         “Regulatory Approval” means all approvals (including
any applicable governmental price and reimbursement approvals), licenses,
registrations, and authorizations of any federal, national, multinational,
state, provincial or local Regulatory Authority, department, bureau and other
governmental entity that are necessary for the marketing and sale of a Licensed
Product in a country or group of countries.


 


1.70         “Regulatory
Authority” means, with respect to a country, the regulatory authority or
regulatory authorities of such country with authority over the testing,
manufacture, use, 


 


10

















 


*** Confidential material redacted
and filed separately with the Commission.


 


storage, importation, promotion, marketing, pricing or sale of a
pharmaceutical product in such country.


 


1.71         “Regulatory
Documentation” means, with respect to the Licensed Compounds and Licensed
Products, all INDs and other regulatory applications submitted to any
Regulatory Authority, copies of Regulatory Approvals, regulatory materials,
drug dossiers, master files (including Drug Master Files, as defined in 21
C.F.R. 314.420 and any non-United States equivalents), and any other reports,
records, regulatory correspondence and other materials relating to Regulatory
Approval of a Licensed Compound or Licensed Product, or required to
manufacture, distribute or sell the Licensed Products, including any
information that relates to pharmacology, toxicology, chemistry, manufacturing
and controls data, batch records, safety and efficacy, and any safety database
required to be maintained for Regulatory Authorities.


 


1.72         “Regulatory
Exclusivity” means that Third Parties are prevented from legally
Developing, manufacturing or Commercializing a product that could compete with
a Licensed Product in a country, either through data exclusivity rights, orphan
drug designation, or such other rights conferred by a Regulatory Authority in
such country, other than through Patent Rights.


 


1.73         “Right of Reference or Use” means a “Right of
Reference or Use” as that term is defined in 21 C.F.R. §314.3(b) or any
successor regulatory scheme, and any non-United States equivalents.


 


1.74         “Selection Patent Rights” means the Incyte Patent
Rights that are designated as INCY0086 and Joint IP Covering the Licensed
Compounds and Licensed Products.  The Selection
Patent Rights that exist as of the Effective Date are set forth on Exhibit A-2.


 


1.75         “Territory”
means the entire world.


 


1.76         “Third
Party” means any Person other than a Party or any of its Affiliates.


 


1.77         “Topical
Field” means any topical, intranasal, ophthalmic or other non-systemic
formulations or dosage forms (e.g. cream, ointment, lotion, solution, spray,
suspension, emulsion, etc.) that are administered with the intent to achieve a
local/non-systemic pharmacologic activity that provides a localized treatment
***. For avoidance of doubt, Topical Field does not include the administration
of a drug through any route if the primary intent of said administration is to
achieve a systemic pharmacologic effect.


 


1.78         “Valid
Claim” means (a) a claim of an issued patent that has not expired or
been abandoned, or been revoked, held invalid or unenforceable by a patent
office, court or other governmental agency of competent jurisdiction in a final
and non-appealable judgment (or judgment from which no appeal was taken within
the allowable time period) or (b) a claim within a patent application ***
and which claim has not been revoked, cancelled, withdrawn, held invalid or
abandoned.


 


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*** Confidential material redacted
and filed separately with the Commission.


 


1.79         “Voting
Stock” means securities of any class or series of a corporation, limited
liability company, association or other entity, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote generally in
matters put before the shareholders or members of such corporation, limited
liability company, association or other entity, including the right to vote for
the election of directors or members of an equivalent governing body.


 


1.80         Additional Definitions.  Each of the following definitions is set
forth in the section of this Agreement indicated below:


 


	
   

  	
  DEFINITION

  	
   

  	
  SECTION

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Abandoned
  Commercialization

  	
   

  	
  5.1(b)

  	
   

  
	
   

  	
  Abandoned
  Development

  	
   

  	
  4.2(b)(iii)

  	
   

  
	
   

  	
  Additional
  Field

  	
   

  	
  2.4

  	
   

  
	
   

  	
  Agreement

  	
   

  	
  Preamble

  	
   

  
	
   

  	
  Bankruptcy
  Code

  	
   

  	
  2.3

  	
   

  
	
   

  	
  Breaching
  Party

  	
   

  	
  8.2(b)

  	
   

  
	
   

  	
  Combination
  Product

  	
   

  	
  1.55

  	
   

  
	
   

  	
  Co-Promotion
  Option

  	
   

  	
  5.4(a)

  	
   

  
	
   

  	
  Development
  Budget

  	
   

  	
  4.2(a)(iii)C

  	
   

  
	
   

  	
  Development
  Plan

  	
   

  	
  4.2(a)(iii)

  	
   

  
	
   

  	
  Disclosing
  Party

  	
   

  	
  11.1

  	
   

  
	
   

  	
  Effective
  Date

  	
   

  	
  Preamble

  	
   

  
	
   

  	
  Follow-On
  Lead Compound

  	
   

  	
  1.46

  	
   

  
	
   

  	
  Future
  Incyte Patent Rights

  	
   

  	
  6.2(a)

  	
   

  
	
   

  	
  Genus
  Patent Rights

  	
   

  	
  6.2(a)

  	
   

  
	
   

  	
  Global
  Safety Database

  	
   

  	
  4.5(c)

  	
   

  
	
   

  	
  Incyte

  	
   

  	
  Preamble

  	
   

  
	
   

  	
  Incyte
  Indemnified Parties

  	
   

  	
  9.1(a)

  	
   

  
	
   

  	
  Incyte
  Phase IIa Study

  	
   

  	
  4.2(a)(ii)

  	
   

  
	
   

  	
  Initial
  Development Plan

  	
   

  	
  4.2(a)(iii)

  	
   

  
	
   

  	
  Initial
  Lead Compound

  	
   

  	
  1.48

  	
   

  
	
   

  	
  Initial
  Licensed Back-Up Compound

  	
   

  	
  1.48

  	
   

  
	
   

  	
  JDC

  	
   

  	
  3.1(a)

  	
   

  
	
   

  	
  Joint
  IP

  	
   

  	
  6.1(b)

  	
   

  
	
   

  	
  Lilly

  	
   

  	
  Preamble

  	
   

  
	
   

  	
  Lilly
  Indemnified Parties

  	
   

  	
  9.2(a)

  	
   

  
	
   

  	
  ***

  	
   

  	
  2.4

  	
   

  
	
   

  	
  ***

  	
   

  	
  2.4

  	
   

  
	
   

  	
  Non-Breaching
  Party

  	
   

  	
  8.2(b)

  	
   

  
	
   

  	
  Notice

  	
   

  	
  13.5

  	
   

  
	
   

  	
  Ongoing
  Studies

  	
   

  	
  4.2(a)(i)

  	
   

  
	
   

  	
  Promotional
  Plan

  	
   

  	
  5.4(a)

  	
   

  
	
   

  	
  Receiving
  Party

  	
   

  	
  11.1

  	
   

  
	
   

  	
  Royalty
  Term

  	
   

  	
  7.3(b)

  	
   

  
	
   

  	
  SEC

  	
   

  	
  11.3(b)

  	
   

  
	
   

  	
  Severed
  Clause

  	
   

  	
  13.12

  	
   

  



 


12

















 


*** Confidential material redacted
and filed separately with the Commission.


 


	
   

  	
  DEFINITION

  	
   

  	
  SECTION

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Subcommittee

  	
   

  	
  3.2

  	
   

  
	
   

  	
  Term

  	
   

  	
  8.1

  	
   

  
	
   

  	
  Third-Party
  Infringement

  	
   

  	
  6.3(a)

  	
   

  
	
   

  	
  UCC

  	
   

  	
  5.4(b)(iii)

  	
   

  
	
   

  	
  Voting
  Securities

  	
   

  	
  10.5(a)(i)

  	
   

  



 


1.81         Construction. 
In construing this Agreement, unless expressly specified otherwise:


 


(a)           references to Articles, Sections, Exhibits and Schedules
are to articles and sections of, and exhibits and schedules to, this Agreement;


 


(b)           except where the context otherwise requires, use of either
gender includes the other gender, and use of the singular includes the plural
and vice versa;


 


(c)           headings and titles are for convenience only and do not
affect the interpretation of this Agreement;


 


(d)           any list or examples following the word “including” shall
be interpreted without limitation to the generality of the preceding words;


 


(e)           except where the context otherwise requires, the word “or”
is used in the inclusive sense;


 


(f)            all references to “dollars” or “$” herein shall mean U.S.
Dollars; and


 


(g)           each Party represents that it has been represented by
legal counsel in connection with this Agreement and acknowledges that it has
participated in the drafting hereof.  In
interpreting and applying the terms and provisions of this Agreement, the
Parties agree that no presumption will apply against the Party which drafted
such terms and provisions.


 


ARTICLE II


 


LICENSES


 


2.1           Rights Granted by Incyte to Lilly.  Subject to the terms of this Agreement,
Incyte hereby grants Lilly, during the Term, an exclusive (even as to Incyte
and its Affiliates), royalty-bearing, non-transferable (except in accordance
with Section 13.3) license, with the right to sublicense (subject to Section 2.2),
under Incyte IP, to research, Develop, Commercialize, make, have made, use,
offer for sale, sell and import Licensed Compounds and Licensed Products in the
Territory in the Field.


 


2.2           Sublicense Rights. 
Lilly shall have the right to grant sublicenses within the scope of the
license under Section 2.1 solely to its Affiliates and to (a) Bona
Fide Collaborators; (b) Third Parties for the purpose of distributing,
importing, marketing, promoting and selling a Licensed Product in the Field (i) in
any country other than a Major Market Country and (ii) in a Major Market
Country ***;


 


13

















 


*** Confidential material redacted
and filed separately with the Commission.


 


or (c) Third Parties for the purpose of engaging such Third
Parties as contract research organizations, contract manufacturers, contract
sales forces and academic institutions in connection with Development and/or
Commercialization of Licensed Compounds and Licensed Products in the Field in
the Territory; provided  that any sublicense granted under this
Agreement shall be pursuant to a written agreement that subjects such
sublicensee to all relevant restrictions and limitations set forth in this
Agreement.  If Lilly grants a sublicense
to a Third Party pursuant to subclause (a) or (b) to research,
Develop or Commercialize Licensed Products in the United States, Major EU
Countries or Japan, as permitted by Section 2.2(a) or (b), then Lilly
shall provide Incyte with prompt written notice thereof and shall provide
Incyte with an executed copy of any such sublicense (redacted as necessary to
protect confidential or commercially sensitive information).  Except as otherwise agreed by the Parties in
writing, Lilly shall be jointly and severally responsible with its sublicensees
to Incyte for failure by its sublicensees to comply with, and Lilly guarantees
the compliance by each of its sublicensees with, all such applicable
restrictions and limitations in accordance with the terms and conditions of
this Agreement.  For the purposes this Section 2.2,
a “Bona Fide Collaborator” means a Third Party that has entered into a collaboration
with Lilly for the research, Development or Commercialization of Licensed
Compounds and/or Licensed Products in which Lilly plays a significant role in
the decision-making process with respect to the Development and/or
Commercialization of such Licensed Compound and/or Licensed Product.  For purposes of clarity, a Third Party that
is granted a sublicense in accordance with Section 2.2(b) or 2.2(c) shall
not be deemed a Bona Fide Collaborator.


 


2.3           Section 365(n) of
The Bankruptcy Code.  All rights
and licenses granted under or pursuant to any section of this Agreement,
including the licenses granted under this ARTICLE II and the rights granted
under Section 4.1(c), are and will otherwise be deemed to be for purposes
of Section 365(n) of the United States Bankruptcy Code (Title 11,
U.S. Code), as amended (the “Bankruptcy Code”), licenses of rights to “intellectual
property” as defined in Section 101(35A) of the Bankruptcy Code.  Lilly will retain and may fully exercise all
of its respective rights and elections under the Bankruptcy Code.  Incyte agrees that Lilly, as licensee of such rights under this
Agreement, will retain and may fully exercise all of its rights and elections
under the Bankruptcy Code or any other provisions of applicable Law outside the
United States that provide similar protection for “intellectual property.”  Incyte further agree that, in the event of
the commencement of a bankruptcy proceeding by or against Incyte under the
Bankruptcy Code or analogous provisions of applicable Law outside the United
States, Lilly will be entitled to a complete duplicate of (or complete access
to, as Lilly deems appropriate) such intellectual property and all embodiments
of such intellectual property, which, if not already in Lilly’s possession,
will be promptly delivered to it upon Lilly’s written request thereof.  Any agreements supplemental hereto will be
deemed to be “agreements supplementary to” this Agreement for purposes of Section 365(n) of
the Bankruptcy Code.


 


2.4           Field
Expansion.  From time to time during
the Term, Lilly shall have the right, upon written notice to Incyte, to request
to expand the Field to *** (each an “Additional Field”) in which Lilly
has a good faith intention to seek to Develop and Commercialize Licensed
Compounds and Licensed Products, which right shall be subject to any agreement
which Incyte may have entered into with a Third Party with respect to such


 


14

















 


*** Confidential material redacted
and filed separately with the Commission.


 


Additional Field(s).  Following Incyte’s receipt of such
written notice, and upon mutual agreement of the Parties, the Field may be
expanded to include such Additional Field(s). 
The milestone payments set forth in Section 7.2(a)(i) shall
apply as follows for the Lead Compound and in Section 7.2(a)(ii) for
a Licensed Back-Up Compound when Developed for such Additional Field: (a) ***
payments shall apply for *** means an *** in ***; and (b) *** payments
shall apply for *** means an *** in ***.


 


2.5           Retained Rights.


 


(a)           No
Implied Licenses or Rights.  Except
as expressly provided in Section 2.1 or elsewhere in this Agreement, all
rights in and to the Incyte IP, and any other Patent Rights or Know-How of
Incyte and its Affiliates, are hereby retained by Incyte and its Affiliates.


 


(b)           Other
Retained Rights.


 


(i)            Notwithstanding
the exclusive licenses granted to Lilly pursuant to Section 2.1, Incyte
retains the right to practice under the Incyte IP solely to perform (and to
sublicense Third Parties to perform) its obligations under this Agreement
(including the manufacture and supply of Licensed Compound and Licensed Product
to Lilly).


 


(ii)           For
purposes of clarity, the license granted to Lilly in Section 2.1 shall not
require Incyte to remove any Licensed Compounds from Incyte’s compound library,
provided, however, that Incyte shall have no right to Develop or Commercialize
any Licensed Compound or Licensed Product, even if included in Incyte’s
compound library.


 


2.6           Non-Compete.


 


(a)           Incyte
agrees not to, and shall cause its Affiliates not to, directly or indirectly,
including through any ownership interest in any other entity (other than
through an ownership interest of *** or less of a public company), (i) Develop
prior to the First Commercial Sale of the first Licensed Product; and (ii) Commercialize
prior to the First Commercial Sale of the first Licensed Product and for a
period of *** from the First Commercial Sale of the first Licensed Product, any
JAK2 Inhibitor Compound in the Field anywhere in the world, other than a
Licensed Compound in accordance with the terms of this Agreement.


 


(b)           Incyte
shall cause its licensees of the Incyte Patent Rights (other than Lilly with
respect to Licensed Compounds pursuant to this Agreement) not to use such Incyte Patent Rights to, directly or indirectly,
including through any ownership interest in any other entity (other than
through an ownership interest of *** or less of a public company), (i) Develop
prior to the First Commercial Sale of the first Licensed Product; and (ii) Commercialize
prior to the First Commercial Sale of the first Licensed Product and for a
period of *** from the First Commercial Sale of the first Licensed Product, any
JAK2 Inhibitor


 


15

















 


*** Confidential material redacted
and filed separately with the Commission.


 


Compound in the Field anywhere in the world, other than a Licensed
Compound in accordance with the terms of this Agreement.


 


(c)           Lilly
agrees not to, and shall cause its Affiliates and sublicensees not to, directly
or indirectly, including through any ownership interest in any other entity
(other than through an ownership interest of *** or less of a public company), (i) Develop
prior to the First Commercial Sale of the first Licensed Product; and (ii) Commercialize
prior to the First Commercial Sale of the first Licensed Product and for a
period of *** from the First Commercial Sale of the first Licensed Product, any
JAK2 Inhibitor Compound in the Field anywhere in the world, other than a
Licensed Compound in accordance with the terms of this Agreement.


 


(d)           Notwithstanding
the foregoing: (i) nothing in this Agreement shall prohibit either Party
from Developing or Commercializing any JAK Excluded Compound (other than any
JAK Excluded Compound Covered *** ) in any field anywhere in the world and (ii) neither
Party shall Develop or Commercialize any JAK Excluded Compound Covered ***
anywhere in the world in or outside the Field.


 


(e)           During
the Term, Lilly shall not, nor shall Lilly allow its Affiliates or sublicensees
to, Develop or Commercialize any Licensed Compounds anywhere in the world in
the Excluded Field. 


 


(f)            During
the Term, Incyte shall not, nor shall Incyte allow its Affiliates or its licensees of the Incyte Patent Rights
(other than Lilly in the Field in the Territory) to use such Incyte Patent
Rights to, Develop or Commercialize any Licensed Compounds anywhere in the
world in or outside the Field.


 


(g)           In
the event that this Agreement is assigned by Incyte in connection with the sale
or transfer of all or substantially all of the business and assets of Incyte or
Incyte merges with or is consolidated with a Third Party, the Development,
manufacture or Commercialization of a compound or product that, as of the date
of such sale, transfer, merger or consolidation, is being Developed,
manufactured or Commercialized by the assignee or acquirer of Incyte or any
Affiliate controlled by (as “controlled by” is defined in Section 1.2)
such assignee or acquirer, shall not constitute a breach of this Agreement; provided
that (i) such compound or product is not a Licensed Product or
Licensed Compound; (ii) such assignee or acquirer or Affiliate keeps such
Development, manufacture or Commercialization program for such other product
separate from the Development, manufacture and Commercialization programs for
Licensed Products, and ensures that no Lilly Confidential Information is
utilized in such program; (iii) ***; and (iv) Incyte continues to
meet its obligations hereunder.


 


(h)           In
the event Lilly acquires control of any Third Party, the activities of such
Third Party shall not constitute a breach of this Agreement provided  that
(i) within no later than ***,


 


16

















 


Lilly takes appropriate action, through divestiture of assets or
otherwise, to cause Lilly to come into compliance with the terms of this
Agreement; (ii) Lilly keeps such activities separate from the Development,
manufacture and Commercialization programs for Licensed Products, and ensures
that no Incyte Confidential Information is utilized in such activities; and (iii) Lilly
continues to meet its other obligations hereunder.


 


(i)            Notwithstanding
the foregoing, nothing in this Agreement shall prohibit either Party or an
Affiliate of the Party from having or controlling separate Development and/or
Commercialization programs directed toward the use of a JAK2 Inhibitor Compound
outside the Field, provided  that the JAK2 Inhibitor Compound is
not a Licensed Product or Licensed Compound, and the separate Development
and/or Commercialization program activities are separate from the Development
and Commercialization programs for Licensed Products, and such Party ensures
that no Confidential Information received from the other Party or Joint IP is
utilized in such activities.


 


ARTICLE
III


 


GOVERNANCE


 


3.1           Joint Development Committee.


 


(a)           Establishment.  The Parties shall establish a joint
development committee (“JDC”) within thirty (30) days after the
Effective Date that will have the responsibility for the overall coordination
and oversight of the Development of Licensed Compounds and Licensed Products
under this Agreement.  As soon as
practicable following the Effective Date (but in no event more than thirty (30)
days following the Effective Date), each Party shall designate its initial
three (3) representatives on the JDC. 
Each Party’s representatives and any substitute for a representative
shall be bound by the obligations of confidentiality set forth in ARTICLE XI. A representative from Lilly shall act as the chairperson
of the JDC.  The chairperson shall not
have any greater authority than any other representative on the JDC and shall
conduct the following activities of the JDC: (i) calling meetings of the
JDC; (ii) preparing and issuing minutes of each such meeting within thirty
(30) days thereafter; (iii) ensuring that any decision-making delegated to
the JDC is carried out in accordance with Section 3.5; and (iv) preparing
and circulating an agenda for the upcoming meeting; provided  that
the chairperson shall include any agenda items proposed by Incyte.  Each Party shall be free to
change its representatives on notice to the other or to send a substitute
representative to any JDC meeting; provided, however, that each Party shall ensure
that at all times during the existence of the JDC, its
representatives on the JDC are
appropriate in terms of expertise and seniority for the then-current stage of
Development of the Licensed Products.


 


(b)           Responsibilities. 
The JDC shall have responsibility for: 
(i) overseeing the initial transfer of information and designated
activities from Incyte to Lilly relating to the clinical Development of
Licensed Compounds and Licensed Products; (ii) the general oversight of
the Development of Licensed Compounds and Licensed
Products, including the periodic review and approval of the Development
Plans (and any material updates, amendments and modifications thereto) and the
review and evaluation of the progress under the Development Plans; (iii)


 


17

















 


reviewing, amending and
approving the Development Budget(iv) selecting Indications for Development
in the Field; (v) reviewing the regulatory approach and filing strategy
with respect to seeking and obtaining Regulatory Approval of Licensed Products
in the Field in the Territory; and (vi) performing such other functions as
appropriate to further the purposes of this Agreement, as mutually agreed upon
by the Parties in writing.


 


3.2           Subcommittees. 
The JDC may establish and disband such subcommittees as deemed necessary by the JDC (each a “Subcommittee”).  Each Subcommittee shall consist of the same
number of representatives designated by each Party, which number shall be
mutually agreed by the Parties.  Each
Party shall be free to change its representatives on notice to the other or to
send a substitute representative to any Subcommittee meeting; provided, however,
that each Party shall ensure that at all times during the existence of
any Subcommittee, its representatives on such Subcommittee are appropriate in
terms of expertise and seniority for the then-current stage of Development of
the Licensed Product in the Field in the Territory and have the authority to
bind such Party with respect to matters within the purview of the relevant
Subcommittee. Each Party’s representatives and any substitute for a
representative shall be bound by the obligations of confidentiality set forth
in ARTICLE XI.  Except as expressly
provided in this Agreement, no Subcommittee shall have the authority to bind
the Parties hereunder and each Subcommittee shall report to, and any decisions
shall be made by, the JDC.


 


3.3           Committee Meetings.  The JDC and each of the
Subcommittees shall each hold at least one (1) meeting per Calendar
Quarter at such times during such Calendar Quarter as the chairperson elects to
do so.  Except where a Party fails to
appoint a member or members to the JDC or the Subcommittees or fails to
participate in meetings of the JDC or the Subcommittees pursuant to Section 3.6, meetings of the JDC and the Subcommittees, respectively, shall be
effective only if at least one (1) representative of each Party is present
or participating.  The JDC and the
Subcommittees may meet either (i) in person at either Party’s facilities
or at such locations as the Parties may otherwise agree or (ii) by audio
or video teleconference; provided  that no less than one (1) meeting
during each Calendar Year shall be conducted in person.  Other representatives of each Party involved
with Licensed Products (including representatives of such Party’s alliance
management function) may attend meetings as non-voting participants, subject to
the confidentiality provisions set forth in ARTICLE XI.  Additional meetings of the JDC and the
Subcommittees may also be held with the consent of each Party, or as required
under this Agreement, and neither Party shall unreasonably withhold its consent
to hold such additional meetings.  Each
Party shall be responsible for all of its own expenses incurred in connection
with participating in all such meetings.


 


3.4           Authority.  The JDC and any Subcommittee
shall have only the powers assigned expressly to it in this ARTICLE III and
elsewhere in this Agreement, and shall not have any power to amend, modify or
waive compliance with this Agreement.  In
furtherance thereof, each Party shall retain the rights, powers and discretion
granted to it under this Agreement and no such rights, powers or discretion
shall be delegated or vested in the JDC or any Subcommittee unless such
delegation or vesting of rights is expressly provided for in this Agreement or
the Parties expressly so agree in writing.


 


3.5           Decisions.


 


18

















 


(a)           Initial Dispute Resolution Procedures.  Subject to the provisions of this Section 3.5, actions to be taken by the JDC and each of the
Subcommittees shall be taken only following a unanimous vote, with each Party
having one (1) vote.  If any
Subcommittee fails to reach unanimous agreement on a matter before it for
decision for a period in excess of thirty (30) days, either Party shall have
the right to refer the matter to the JDC.


 


(b)           Final Decision-Making. If the JDC fails to reach
unanimous agreement on a matter properly before it (in accordance with this
ARTICLE III) for decision for a period in excess of thirty (30) days, the JDC
representatives appointed by Lilly shall have the deciding vote on any
matter.  Incyte shall have the right to
appeal any such decision of the JDC to the Lilly Executive Officer or a
designee of the Lilly Executive Officer with decision-making authority for
resolution. In such case, the Lilly Executive Officer or designee shall have
the final decision-making authority on such issue.


 


(c)           Notwithstanding the foregoing, Lilly shall not exercise
its right to finally resolve a dispute pursuant to Section 3.5(b):  (i) in a manner that expands Lilly’s
rights or excuses Lilly from any of its obligations specifically enumerated
under this Agreement; (ii) in a manner that negates any consent rights or
other rights specifically allocated to Incyte under this Agreement; (iii) to
resolve any dispute regarding whether a milestone event set forth in Section 7.2
has been achieved; or (iv) in a manner that would require Incyte to
perform any act that it reasonably believes to be inconsistent with any Law or
any approval, order, policy or guidelines of a Regulatory Authority.


 


3.6           Committee Membership.


 


(a)           Appointment is a Right.  The appointment of members of the JDC and any
Subcommittees is a right of each Party and not an obligation and shall not be a
“deliverable” as referenced in any existing authoritative accounting
literature.  Each Party shall be free to
determine not to appoint members to the JDC or any Subcommittee.


 


(b)           Consequence of
Non-Appointment.  If a Party
does not appoint members of the JDC or any Subcommittee, it shall not be a
breach of this Agreement, nor shall any consideration be required to be
returned, and unless and until such members are appointed, the Party that has made the requisite appointments may
unilaterally discharge the roles of the JDC or any Subcommittee for which
members were not appointed, provided  that
neither Party shall unilaterally discharge the roles of the JDC or any Subcommittee as permitted under this Section 3.6(b) unless the other Party has not appointed any members within thirty (30)
days after the first Party has completed its appointment of its members.


 


3.7           Future Adjustments in Governance.  The Parties may at any time by mutual
agreement create or delete governance committees or subcommittees or make other
modifications to the governance structures contemplated by this Agreement in
order to promote the efficient operation of the collaboration. 


 


19














 


*** Confidential material redacted
and filed separately with the Commission.


 


ARTICLE IV


 


DEVELOPMENT; REGULATORY MATTERS; SUPPLY


 


4.1           Initial Transfer.


 


(a)           Initial
Information Transfer to Lilly.  (i) Within
a reasonable period not to exceed *** after the Effective Date, Incyte shall
make available to Lilly, in a mutually-agreed upon format, the material
clinical data and manufacturing Know-How included in the Incyte Know-How and
that is described in Exhibit B; and (ii) from the Effective
Date through ***, Incyte shall make its relevant scientific and technical
personnel reasonably available to Lilly at Incyte’s offices, at reasonable
times during Incyte’s normal business hours and upon reasonable prior notice,
to answer any questions or provide instruction as reasonably requested by Lilly
concerning the information delivered pursuant to this Section 4.1.  Thereafter, with respect to any information
that constitutes Incyte Know-How not transferred to Lilly as contemplated
above, Incyte will, upon request by Lilly, use its good faith efforts to make
available to Lilly such Incyte Know-How as Lilly may reasonably request.


 


(b)           Transfer of Regulatory Documentation.  Upon Lilly’s request after payment of the license fee in
accordance with Section 7.1, Incyte shall transfer ownership to Lilly of
any Regulatory Documentation Controlled by Incyte and existing as of the
Effective Date.


 


(c)           Right of Reference or Use.  Incyte hereby grants to Lilly, solely for the
purposes set forth in this Agreement, a Right of Reference or Use to any and
all Regulatory Documentation Controlled by Incyte relating to Licensed Products
and existing as of the Effective Date or generated from any Clinical Trial
commenced by Incyte prior to the Effective Date, and agrees to sign, and cause
its Affiliates to sign, any instruments reasonably requested by Lilly in order
to effect such grant.  Notwithstanding
the foregoing, nothing in this Section 4.1 is intended to imply the
existence of any particular data, information, drug master file or other
Regulatory Documentation.


 


(d)           Applicability of Bankruptcy Code.  For the avoidance of doubt, rights granted
under this ARTICLE IV shall be deemed to be license of rights to “intellectual
property” as defined in Section 101 (35A) of the Bankruptcy Code and shall
otherwise be subject to Section 2.3.


 


4.2           Conduct of Development Activities.


 


(a)           Generally.


 


(i)            Except as provided in Section 4.2(a)(ii),
from and after the Effective Date, Lilly will, subject to the terms of this
Agreement, be responsible, at its expense, for the Development of Licensed
Products in the Field in the Territory. 
Without limiting the foregoing, except as provided in Section 4.2(a)(ii),
Lilly shall be responsible
for all Out-of-Pocket Costs, including costs for contract research organizations
and drug substance and drug product costs, associated with studies 28050-103,
102 and 110 (the “Ongoing Studies”) that are incurred after the
Effective Date, it being understood that Incyte shall be responsible for all
costs


 


20

















 


*** Confidential material redacted and filed
separately with the Commission.


 


incurred
prior to the Effective Date, whether billed prior to the Effective Date or
thereafter.  Incyte shall transfer the
Ongoing Studies to Lilly within *** after the Effective Date. 
Incyte shall invoice Lilly for Incyte’s Out-of-Pocket Costs incurred
after the Effective Date and FTE costs in connection with the management and
supervision of such Ongoing Studies after the Effective Date.


 


(ii)           Incyte shall continue to advance, at its expense, all
clinical Development conducted by Incyte for the Initial Lead Compound through
the completion of the ongoing Phase IIa trial, Study INCB28050-201 (the “Incyte
Phase IIa Study”).


 


(iii)          The Development of Licensed Products shall be governed by
Development plans that describe the proposed overall program of Development for
Licensed Products (the “Development Plan”); including:


 


A.            overall
goals of the program;


 


B.            the
activities to be performed (including all Clinical Trials and Regulatory
Approvals required for manufacturing, marketing and selling Licensed Products
in the Territory), as well as the characterization of studies;


 


C.            a
detailed budget of Development Costs, including the overall costs for each
study, annualized over the course of each such study (“Development Budget”);


 


D.            anticipated
timelines for performance; and


 


E.             specific
deliverables.


 


(iv)          A current draft of a summary development plan for the
Initial Lead Compound is attached hereto as Exhibit C (the “Initial
Development Plan”).  Lilly shall have the sole right and
responsibility for preparing the Development Plan for each Licensed Product in
the Field in the Territory.  Except as
otherwise provided in this Agreement, with respect to Licensed Product in the
Field in the Territory, all decisions with respect to the creation,
modification and implementation of the Initial Development Plan, all other
Development Plans and all Development activities shall be made by Lilly in its
sole discretion; provided  that Lilly will present a draft
Development Plan for each Licensed Product and any material changes to the
Initial Development Plan to the JDC and will give due consideration to any
comments of Incyte thereto.  Notwithstanding
the foregoing, each Development Plan, as initially prepared and as created,
modified and implemented, will reflect and be consistent with the use of
Commercially Reasonable Efforts to Develop Licensed Products.


 


(b)           Diligence.


 


(i)            Lilly shall use Commercially Reasonable Efforts to (A) Develop
Licensed Compounds and Licensed Products in the Field in the Territory in
accordance with the Development Plans; and (B) seek and obtain Regulatory
Approval for Licensed Products in the Field in the Territory.  Incyte shall reasonably cooperate with Lilly
to obtain Regulatory 


 


21

















 


*** Confidential material redacted and filed
separately with the Commission.


 


Approval for Licensed
Products in the Field in the Territory, including by providing Lilly access to
Incyte Know-How and Incyte personnel and consultants.


 


(ii)           Within either the later of (A) *** after receipt of the ***
clinical study results generated in the Phase IIa Study INCB28050-201 for rheumatoid arthritis; or (B) *** after receipt of the  *** clinical
study results generated in the Phase IIa Study INCB28050-201 for rheumatoid
arthritis, Lilly shall initiate a Phase IIb Study; provided  that (1) the
Phase IIa Study INCB28050-201 supports initiation; (2) the clinical trial
protocol is approved and does not require any specialized equipment, testing,
or site preparation; (3) the clinical trial material is acceptable; (4) there
are no delays caused by a Regulatory Authority; and (5) there are no other
factors that cause a delay that could not have been reasonably avoided by
Lilly.


 


(iii)          Lilly
shall Develop, including seeking Regulatory Approval for, at least ***.  If at any point in time prior to First
Commercial Sale of a Licensed Product, no Development activities conducted in
good faith with the intention of advancing at least *** (and not for the sole
purpose of preserving rights hereunder), have occurred during at least the
preceding *** and (x) no significant constraints on such Development
imposed by a Regulatory Authority or a Force Majeure Event have been in effect
during such period and (y) during such period Lilly has not engaged in
bona fide sublicensing negotiations with a Third Party with respect to the
Development of Licensed Compounds and Licensed Products in the United States
and the Major EU Countries (provided  that the time period in
which such negotiations have taken place does not exceed ***), then Lilly shall
be deemed to have abandoned Development of Licensed Compounds and Licensed
Product (“Abandoned Development”). 
For purposes of clarity, ***.  If
Incyte concludes that Lilly has Abandoned Development, then Incyte shall
deliver written notice to Lilly setting out the basis for Incyte’s
conclusion.  If Lilly disagrees with
Incyte’s conclusion that Lilly has Abandoned Development, then the Parties will
meet within *** to discuss the disagreement. 
If the Parties cannot agree after such discussion, then the terms of 8.2(e) shall
apply to resolve the dispute.  If Lilly
has Abandoned Development, then:


 


A.            If
Lilly has not previously been properly deemed
to have Abandoned Development, then within *** from receipt of notice
from Incyte that Lilly has Abandoned Development, Lilly shall either: (1) ***;
or (2) provide Incyte with written notice that  ***, in which
case Incyte shall have the right to terminate this Agreement in accordance with
Section 8.2(d).  In the event that
Lilly elects to take the actions described in this subclause (A), Lilly shall
have an additional *** from the delivery of *** to initiate and diligently
pursue such steps that will result in Lilly not being deemed to have Abandoned
Development.  If Lilly fails to take such
actions within such *** period, then Incyte may terminate this Agreement in
accordance with Section 8.2(d).


 


22

















 


*** Confidential material redacted and filed
separately with the Commission.


 


B.            If
Lilly has previously been properly deemed to have Abandoned Development and had
previously elected to take the actions described in subclause (A) above,
Incyte shall have the right to terminate this Agreement in accordance with Section 8.2(d).


 


4.3           Development Reports.  Lilly shall provide the JDC with a written
report at least *** summarizing in reasonable detail Lilly’s and its Affiliates’ activities and progress
related to the Development of Licensed
Products in the Field in the Territory, including information concerning the conduct of non-clinical activities
and Clinical Trials, applications for and securing of Regulatory Approvals,
First Commercial Sale of the Licensed Product on a country-by-country basis and any future planned Development activities.


 


4.4           Licensed Product Co-Development Option.   On a Licensed Product-by-Licensed Product
basis, for each Indication for which (x) Lilly anticipates initiating a
Phase IIb Study and (y) there is a means to separately track the Annual
Net Sales of such Licensed Product for such Indication (each a “Co-Development
Indication”) based on a new formulation or a new targeted prescribing
specialist group ***, and provided that Incyte has not exercised the Incyte
Development Opt Out in accordance with Section 4.4(c)(ii) for any
Licensed Product, Incyte shall have the option to co-fund Development of such
Co-Development Indication (the “Co-Development Option”) as follows:


 


(a)           Within  *** prior to the anticipated initiation of a Phase IIb Study for the
Co-Development Indication, Lilly shall notify Incyte of such anticipated
initiation and shall provide Incyte with the following information:  all material pre-clinical and clinical data
and related analysis and regulatory information submitted to any Regulatory Authorities prior to the applicable
time-period mentioned above, and Lilly’s then current Development Plans
and total global Development Budget (including the overall costs for each
study, annualized over the course of each such study) with respect to such
Co-Development Indication (the “Co-Development Indication Budget”).  Incyte shall have the option to co-fund
Development of such Co-Development Indication, exercisable by (i) providing
Lilly written notice within *** after receipt of such information and (ii) co-funding
thirty percent (30%) of Lilly’s total global Development Costs for such
Co-Development Indication incurred after the date of such notice through the
Regulatory Approval of such Co-Development Indication on a country by country
basis (“Incyte Target Global Funding”). As used herein in this Section 4.4,
Regulatory Approval costs include costs for any post-launch studies required by
a Regulatory Authority.


 


(b)           If
Incyte timely delivers such notice, within *** following the end of each
Calendar Quarter after Incyte has delivered such notice, Lilly shall prepare
and deliver to Incyte a quarterly report detailing its Development Costs incurred
during such period with respect to such Co-Development Indication.  Lilly shall submit any supporting information
reasonably requested by Incyte related to such Development Costs included in
its report within *** after its receipt of such request.  Lilly shall issue an invoice to Incyte for
thirty percent (30%) of the Development Costs identified in such report. Incyte
shall pay all amounts payable under any such invoice within *** after its
receipt of such invoice, subject to Section 4.4(c).  Incyte shall have the right to audit the
records of Lilly with respect to any purported Development Costs included in
such reports, in accordance with Section 7.6.


 


23

















 


*** Confidential material redacted and filed
separately with the Commission.


 


(c)           If
Incyte exercises its Co-Development Option with respect to a Licensed Product,
in addition to the royalty rates set forth in Section 7.3, Lilly shall pay
Incyte an incremental *** royalty (the “Target Co-Development Royalty”)
on Annual Net Sales of such Licensed Product for the Co-Development Indication,
provided that:


 


(i)            The
JDC shall review and, as necessary, amend the Co-Development Indication Budget
no later than October 30th of each year and any interim
changes must be reviewed and approved by the JDC.  In the event that the actual global
Development Costs in a Calendar Year exceed (A) *** of the annualized
Co-Development Indication Budget approved by the JDC for such Calendar Year no
later than October 30th of the preceding year or (B) ***
of the projected total Development Costs for a particular study as set forth in
the Co-Development Indication Budget approved by the JDC that was in effect
immediately prior to the initiation of such study (the “Development Cap”),
then Incyte may elect, by providing Lilly with written notice of such election
within *** after receipt of an invoice pursuant to 4.4(b) that would
result in a payment above the Development Cap, not to fund the Co-Development
Indication Budget for that year above the Development Cap (the “Funding Cap
Option”).  Except where the
Development Cap has been reached pursuant to Section 4.4(c)(i)(B), Incyte
shall resume its payment obligation pursuant to 4.4(b) on January 1
following each such election of the Funding Cap Option.  In the event that Incyte elects the Funding
Cap Option, such election of the Funding Cap Option shall not constitute a
violation of this Section 4.4.  Such
Funding Cap Option does not impact the Target Co-Development Royalty for the
Co-Development Indication; however, Incyte agrees to reimburse Lilly for all
unpaid Incyte Target Global Funding pursuant to this Section 4.4(c)(i) solely
in the form of a reduction of future milestone payments and/or royalty payments
as requested by Lilly; and


 


(ii)           In
the event that Incyte provides Lilly with written notice within *** after
receipt of an invoice pursuant to 4.4(b) of its election not to fund the
entire amount of Incyte Target Global Funding for a Licensed Product (“Incyte
Development Opt Out”), then the Target Co-Development Royalty will be
adjusted based on the formula:


 


***


 


By way of example, if ***.


 


24

















 


(iii)          Further,
election of the Incyte Development Opt Out for a Licensed Product thereby terminates
Incyte’s option to co-fund further Development Costs for any Licensed Product
and Incyte’s contribution to actual global Development Costs is determined upon
notice to Lilly that Incyte elects to exercise the Incyte Development Opt Out. 


 


4.5           Regulatory Matters Related to Licensed Products.


 


(a)           Regulatory Submissions.  Lilly shall oversee, monitor and coordinate
all regulatory actions, communications and filings with, and submissions to all
Regulatory Authorities with respect to Licensed Products in the Field in the
Territory.  Lilly shall keep the JDC reasonably informed in connection with the
preparation of all Regulatory Documentation, Regulatory Authority review of
Regulatory Documentation, and Regulatory Approvals, annual reports, annual re-assessments,
and variations and labeling, in each case with respect to the Licensed Product
in the Field; provided  that Lilly shall have the right to redact
any information to the extent not related to Licensed Product in the
Field.  Lilly shall respond within a
reasonable time frame to all reasonable inquiries by Incyte with respect to any
information provided pursuant to this Section 4.5(a).  Unless already the Confidential Information
of Incyte, any information disclosed pursuant to this Section 4.5(a) shall
be the Confidential Information of Lilly. 
Lilly shall use Commercially Reasonable Efforts to promptly take the
actions described in this Section 4.5(a).


 


(b)           Regulatory Meetings and Correspondence.


 


(i)            Lilly shall be responsible for interfacing, corresponding
and meeting with the FDA, EMEA, MHLW and other Regulatory Authorities with
respect to Licensed Products in the Field in the Territory.


 


(ii)           Incyte shall have the right
to have a senior, experienced employee reasonably acceptable to Lilly, participate
as an observer in material or scheduled face-to-face meetings, video
conferences and any teleconferences, involving participation of personnel
beyond regulatory experts, with the FDA, EMEA, and MHLW, and shall be provided
with advance access to Lilly’s material documentation prepared for such
meetings.  Prior to submission of
material correspondence to the applicable Regulatory Authority, Lilly shall,
sufficiently in advance for Incyte to review and comment, provide Incyte any
material correspondence with the FDA, EMEA and MHLW related to such
meetings.  Lilly shall also provide
Incyte with copies of any material correspondence with the FDA, EMEA, and MHLW
relating to Development of, or the process of obtaining Regulatory Approval
for, Licensed Products in the Field, and respond within a reasonable time frame
to all reasonable inquiries by Incyte with respect thereto.


 


(c)           Global Safety Database.  Following the Effective Date, Lilly shall
establish, hold and maintain the global safety databases for each Licensed
Product (the “Global Safety Database”) into which it shall enter
information on all serious adverse events and suspected reactions concerning
the Licensed Product occurring anywhere in the world and reported to either of
the Parties. Such database shall comply in all material respects with all Laws


 


25

















 


*** Confidential material redacted
and filed separately with the Commission.


 


reasonably applicable to pharmacovigilance anywhere where the Licensed Products
are being or have been Developed or Commercialized.


 


4.6           Manufacture and Supply.


 


(a)           As
soon as reasonably practicable after the Effective Date, Incyte and Lilly shall
agree upon an appropriate manufacturing transfer plan and Incyte shall use Commercially
Reasonable Efforts to transition the responsibility for manufacturing Licensed
Compound and Licensed Product to Lilly in accordance with such plan.  Lilly shall have the option, exercisable
within *** following the Effective Date, to obtain Incyte’s existing inventory
of Licensed Product and any related raw materials or supplies at a price equal
to *** of Incyte’s Out-of-Pocket Costs for such inventory of Licensed
Product.  Lilly may exercise such option
by written notice to Incyte during such *** period. In addition, to the extent
Incyte has contracts with Third Party contract manufacturers or others relating
to its manufacturing operations for Licensed Compounds and Licensed Products,
if Lilly so requests, Incyte will use its Commercially Reasonable Efforts to
assign such agreements to Lilly or otherwise facilitate Lilly’s efforts to
continue to utilize such manufacturers or suppliers.


 


(b)           Without limiting the
foregoing, if Lilly
does not assume direct responsibilities for the manufacture of Licensed
Compound and Licensed Product within *** after the Effective Date, Incyte will invoice Lilly for all
Out-of-Pocket Costs incurred by Incyte after the Effective Date for the
manufacture and supply of Licensed Compound and Licensed Product for Lilly as well
as Incyte’s FTEs required to manage and supervise such manufacture and supply.


 


(c)           Notwithstanding
anything in this Agreement to the contrary, Incyte shall not conduct any
manufacturing related activities following the Effective Date without the express
written consent of Lilly, except for those activities incidental to the
transfer of manufacturing responsibility to Lilly in accordance with the
manufacturing transfer plan contemplated above. 
If requested by Lilly and agreed to by Incyte, Incyte shall supply Lilly
with clinical supplies of Licensed Product under the terms of a mutually
acceptable manufacturing agreement, quality agreement, and manufacturing
requirements document relating to Incyte’s activities, all upon commercially
reasonable terms consistent with this Agreement.


 


ARTICLE V


 


COMMERCIALIZATION


 


5.1           Commercialization Diligence.  During the Term, Lilly shall be solely
responsible for Commercializing Licensed Products in the Territory for use in
the Field.


 


(a)           Lilly shall use Commercially Reasonable Efforts, at its expense, to
Commercialize Licensed Products in the Field in the Territory after receipt of Regulatory Approval therefor.  Notwithstanding the foregoing, Lilly shall (i) Commercialize
*** after
receipt of the relevant Regulatory Approval; (ii) Commercialize *** in at least ***


 


26

















 


*** Confidential material redacted
and filed separately with the Commission.


 


after receipt
of the relevant Regulatory Approval; (iii) maintain minimum combined
Marketing and Sales Support (aggregated for all markets) per each *** period following First Commercial Sale for
such Licensed Product of the lesser of *** or *** of total sales of such Licensed Product in
such Calendar; and (iv) reach or contact, the top *** of highest prescribing rheumatologists or
other appropriate specialist in the United States and the Major EU Countries on
average *** times or
more per Calendar Year, beginning in the second full Calendar Year following
First Commercial Sale, provided  that there are no significant
constraints on such Commercialization or contacts imposed by a Regulatory
Authority in the respective jurisdictions. 
These provisions will apply for the first Regulatory Approval of the Licensed
Product, and not per Indication.  These
provisions will not apply in the event that there are any outstanding
negotiations related to Regulatory Approval with any Regulatory Authority
(REMS, label(s), marketing materials or other related matters), or in the event
that Lilly is prevented from meeting the obligations by any other factors that
could not have been reasonably avoided by Lilly.  In the event that this
Agreement is assigned by Lilly in connection with the sale or transfer of all
or substantially all of the business and assets of Lilly or an Affiliate
controlled by (as “controlled by” is defined in Section 1.2) Lilly merges
with or is consolidated with a Third Party, and such sale, transfer, merger or
consolidation results in the stockholders of Lilly immediately prior to such
transaction owning less than *** of the voting power of the Voting Stock of the
acquirer or surviving entity, as the case may be, immediately after such
transaction, then for *** following such sale, transfer, merger or
consolidation, Lilly shall maintain Marketing and Sales Support for each Licensed
Product in each country in the Territory equal to no less than the level of
Marketing and Sales Support that Lilly maintained with respect to such Licensed
Product in such country in the *** prior to such sale, transfer, merger or
consolidation, unless the relevant Licensed Product is within *** of the
anticipated end of the Royalty Term for such country.


 


(b)           If
at any point in time after First Commercial
Sale of a Licensed Product, Lilly does
not promote such Licensed Product in at least *** during the preceding *** and during
that period (i) Lilly has not
reasonably determined that promotion in at least ***, as applicable, is likely to reduce the overall
commercial viability of such Licensed Product in the Territory; (ii) no
significant constraint on such promotion imposed by a Regulatory Authority have
been in effect in the jurisdictions in which such promotion failed to occur; (iii) no
Force Majeure Event has been in effect in any jurisdictions in which such
promotion failed to occur; and (iv) Lilly is not actively seeking Regulatory Approval (including pricing and
reimbursement approval) in at least  ***, as
applicable in the jurisdiction in which such promotion failed to occur; then Lilly
shall be deemed to have abandoned
Commercialization of Licensed Compounds and Licensed Products in that country (“Abandoned
Commercialization”).  For purposes of
clarity, ***.   If Incyte concludes that Lilly
has Abandoned Commercialization, then Incyte shall deliver written notice to
Lilly setting out the basis for Incyte’s conclusion.  If Lilly disagrees with Incyte’s conclusion
that Lilly has Abandoned Commercialization, then the Parties will meet within
*** to discuss the


 


27

















 


*** Confidential material redacted and filed
separately with the Commission.


 


disagreement.  If the Parties
cannot agree after such discussion, then the terms of 8.2(e) shall apply
to resolve the dispute.  If Lilly has
Abandoned Commercialization, then:


 


(i)            If Lilly has not
previously been properly deemed to have Abandoned Commercialization,
then within *** from receipt of notice from Incyte that Lilly has Abandoned Commercialization, Lilly shall either (1) *** not being deemed to have ***; or (2) provide
Incyte with written notice that it chooses not to provide ***, in which case Incyte shall have the right to
terminate this Agreement in accordance with Section 8.2(d).  In the event
that Lilly elects to take the actions described in this subclause (i), Lilly shall have an additional *** from the delivery of *** to initiate and diligently pursue such steps that
will result in Lilly not being deemed to have Abandoned Commercialization.  If Lilly
fails to take such actions within such *** period, then Incyte may terminate this Agreement in accordance with Section 8.2(d).


 


(ii)           If Lilly has previously been properly deemed to have
Abandoned Commercialization and had previously elected to take the actions
described in subclause (i) above, Incyte shall have the right to
terminate this Agreement in accordance with Section 8.2(d).


 


5.2               Marketing Responsibilities For Licensed Products.  Subject to the provisions of Section 5.1,
all business decisions regarding Commercialization of Licensed Products in the
Field in the Territory, including the design, sale, pricing, and promotion of
Licensed Products in the Field in the Territory under this Agreement, shall be
within the sole discretion of Lilly and its Affiliates.  All materials used in the promotion of all
Licensed Products in the Field in the Territory, including product packaging,
materials used in Detailing doctors, product messaging and content used in the
promotion of such Licensed Products, shall be approved solely by Lilly.


 


5.3           Trademarks.


 


(a)           Lilly
and its Affiliates shall select their own trademarks under which they will
market Licensed Products (provided  that no such trademark shall
contain the word “Incyte”) and shall own such trademarks.


 


(b)           Lilly shall use, in connection with all packaging, literature,
labels and other printed matters, to the extent permitted by Law, an expression
to the effect that the Licensed Products were developed under license from
Incyte, together with the Incyte logo.


 


5.4           Co-Promotion.


 


(a)           Co-Promotion
Option.  *** Incyte shall have the
option to co-promote Licensed Products on a Licensed Product-by-Licensed
Product basis in the United States on the terms and conditions set forth in
this Section 5.4 (“Co-Promotion Option”). Lilly shall notify Incyte
at least *** prior to the anticipated launch of each Licensed Product in the
United States and shall provide Incyte with the following information:  Lilly’s then-current Commercialization plans
(“Promotional Plan”) with respect to each such Licensed Product, which
plan shall include (i) a description of the short- and long-term vision
for


 


28

















 


*** Confidential material redacted and filed
separately with the Commission.


 


the Licensed Product and Licensed Product positioning; (ii) a Strengths,
Weaknesses, Opportunities and Threats (SWOT) analysis; (iii) a summary of
the minimum level of sales efforts to be dedicated to the promotion of the
Licensed Product, including the anticipated number of Details and targets of
such Details; and (iv) a detailed budget for the Commercialization
activities.  Incyte may exercise its
Co-Promotion Option by providing Lilly written notice at any time after receipt
of Lilly’s notice and not later than *** prior to the initial anticipated
launch of such Licensed Product in the United States.


 


(b)           Effects
of Exercise of Co-Promotion Option. 
If Incyte exercises its Co-Promotion Option:


 


(i)            The Parties shall, no later
than *** prior to the initial anticipated launch of such Licensed Product in the United States, set out the number of FTE sales representatives Detailing such Licensed
Product in the United States.  In no event
shall Incyte be responsible for a number of FTE sales representatives Detailing
such Licensed Product which exceeds *** of the total FTEs for such Licensed
Product in the United States.


 


(ii)           Incyte shall be responsible for its costs in conducting
co-Detailing activities; provided  that Lilly shall reimburse
Incyte ***. Incyte shall provide an invoice to
Lilly for such expense on a quarterly basis, and Lilly shall pay such invoice
within *** after receipt.


 


(iii)          The Parties shall establish a joint U.S. Commercialization
Committee (“UCC”) to oversee the Detailing of the relevant Licensed
Product in the U.S.  Incyte shall be
entitled to have one (1) representative sit on the UCC or any group
carrying out the UCC’s function after the Effective Date but prior to the UCC’s
establishment.  The UCC shall have
responsibility for general oversight of all promotion and Detailing activities
with respect to such Licensed Product in the United States.  The UCC (or any group carrying out the UCC’s
function after the exercise of the Co-Promotion Option but prior to the UCC’s
establishment) will meet quarterly or more frequently as agreed by the
Parties.  The term of the UCC will be
determined by the Parties.  Lilly shall
have the right to make the final decision with respect to all matters within
the purview of the UCC related to Commercialization of the relevant Licensed
Product.


 


(iv)          Incyte’s sales representatives will be included in training
programs with respect to the applicable Licensed Product that Lilly provides to
its own sales representatives Detailing such Licensed Product. Such training
shall be provided by Lilly to Incyte ***, but Incyte shall be responsible for
all of its costs related to such training programs, including travel and
lodging, for its sales representatives.


 


(v)           Incyte’s sales representatives shall be provided, at Lilly’s
expense, with the same promotional materials, including literature and samples,
as Lilly provides to its own similarly-situated representatives.


 


29

















 


*** Confidential material redacted and filed
separately with the Commission.


 


(vi)          Prior
to the initiation of the co-promotion efforts contemplated hereby, the Parties
shall enter into a mutually acceptable co-promotion agreement containing terms
consistent with this Agreement.  Such
co-promotion agreement shall require Incyte to comply with all applicable Laws,
with Lilly’s Good Promotional Practices and other compliance related practices
and procedures, and with the terms of any order or consent decree applicable to
Lilly’s promotional activities.


 


ARTICLE VI


 


INTELLECTUAL PROPERTY OWNERSHIP,


PROTECTION AND RELATED MATTERS


 


6.1           Inventorship; Ownership.


 


(a)           Inventorship. 
Inventorship of Inventions conceived or reduced to practice during the
course of the performance of activities pursuant to this Agreement shall be
determined in accordance with the patent Laws of the United States.


 


(b)           Ownership. 
As between the Parties, all Inventions made or information created by a
Party’s or any of its Affiliates’ employees, independent contractors or
consultants, in the course of conducting activities under this Agreement,
together with all Intellectual Property Rights therein, shall be owned by such
Party.  All inventions or discoveries
made, or information created, jointly by each Party’s (or any of its Affiliates’)
employees, independent contractors or consultants, in the course of conducting
activities under this Agreement, together with all Intellectual Property Rights
therein, shall be jointly owned by the Parties and are “Joint IP”.  Joint IP shall be owned jointly by Incyte and
Lilly on the basis of an undivided interest without a duty to account to the
other Party and shall be deemed to be Controlled by each Party.  Notwithstanding anything to the contrary
herein, each Party shall have the right to use such Joint IP, or license such
Joint IP to its Affiliates or any Third Party, or sell or otherwise transfer
its interest in such Joint IP to its Affiliates or a Third Party, in each case
without the consent of the other Party, so long as such use, sale, license or
transfer is subject to the licenses granted pursuant to this Agreement and is
otherwise consistent with this Agreement. The Parties, through the JDC, shall
determine which Party shall be responsible for the filing, prosecution and
maintenance of Joint IP on a case-by-case basis; provided that Lilly
shall have the first right to prosecute such Joint IP in accordance with Section 6.2(b) if
such Joint IP Covers Licensed Products. 
Each Party hereby authorizes and grants the other Party its permission
and consent to assume, directly or through its authorized agents, attorneys, or
representatives, the responsibilities set forth in Section 6.2.


 


6.2           Prosecution and Maintenance of Patent Rights.


 


(a)           ***
Prosecution and Maintenance of Incyte Patent Rights.  *** shall have the sole right to file,
prosecute and maintain, at *** expense, the Incyte Patent Rights designated as
INCY0039 (the “Genus Patent Rights”) (the Genus Patent Rights that exist
as of the Effective Date are set forth on Exhibit A-1).  *** shall, subject to Section 6.2(a)(i),
have the sole right to file, prosecute and maintain, at *** expense, the Incyte
Patent Rights other than the Genus Patent Rights and the Selection Patent
Rights (the “Future Incyte Patent Rights”)


 


30

















 


*** Confidential material redacted and filed
separately with the Commission.


 


in the Territory.  If ***
declines to file, prosecute or maintain any Future Incyte Patent Rights in any
country in the Territory, desires to allow any Future Incyte Patent Rights to
lapse in any country in the Territory, or desires to abandon any Future Incyte
Patent Rights in any country in the Territory before all appeals within the
respective jurisdiction have been exhausted, then:


 


(i)           
*** may, in its sole discretion, provide *** with reasonable written notice of
such decision so as to permit *** to decide whether to file, prosecute or
maintain such Future Incyte Patent Right in such country and to take any
necessary action.


 


(ii)           Following
notice from *** pursuant to clause (i), *** may, by providing prompt written
notice thereof to ***, assume control of the filing, prosecution and/or
maintenance of such Future Incyte Patent Right in such country, at *** expense.


 


(b)           ***
Prosecution and Maintenance of Selection Patent Rights.  *** shall have the first right to file, prosecute
and maintain, at Lilly’s expense, the Selection Patent Rights in the Territory
***.  If *** declines to file, prosecute
or maintain any Selection Patent Rights in any country in the Territory,
desires to allow any Selection Patent Rights to lapse in any country in the
Territory, or desires to abandon any Selection Patent Rights in any country in
the Territory before all appeals within the respective jurisdiction have been
exhausted, then:


 


(i)           
*** shall provide *** with reasonable written notice of such decision so as to
permit *** to decide whether to file, prosecute or maintain such Selection
Patent Right in such country and to take any necessary action.


 


(ii)           Following
notice from *** pursuant to clause (i), *** may, by providing prompt written notice
thereof to ***, assume control of the filing, prosecution and/or maintenance of
such Selection Patent Right in such country, at *** expense.


 


(c)               Cooperation. 
For the purposes of rights and obligations described in Section 6.2,
an individual Party responsible for the filing, prosecution and maintenance of
a Selection Patent Right will be referred to as the “Controlling Party”
and the other Party will be referred to as the “Non-Controlling Party”.


 


(i)            The Non-Controlling Party shall, at the Controlling Party’s
expense and reasonable request, assist and cooperate in the filing, prosecution
and maintenance of or any related necessary action for Future Incyte Patent
Rights and Selection Patent Rights.


 


(ii)           The Controlling Party shall provide the Non-Controlling
Party sufficiently in advance, where reasonable, for the Non-Controlling Party
to comment, with copies of all patent applications and other material
submissions and communications (including oral communications) with any patent
counsel or patent authorities pertaining to Future Incyte Patent Rights and
Selection Patent Rights.


 


(iii)          The Controlling Party shall give due consideration to the
Non-Controlling Party’s comments, but shall have the final say in determining
whether or not to incorporate such comments.


 


31














 


*** Confidential material redacted and filed
separately with the Commission.


 


(iv)         *** shall whenever possible provide *** in advance with
copies of all material submissions or other communications with patent
authorities relating to the Genus Patent Rights, or, to the extent that *** has
the right to do so, to communications with Third Parties relating to
enforcement of the Genus Patent Rights, in each case to the extent the same may
be material to Selection Patent Rights or Future Incyte Patent Rights, and
consider in good faith any comments *** may make.


 


(v)           Each Party shall provide the other with copies of all
material communications received from any patent counsel or patent authorities
pertaining to such Future Incyte Patent Rights and Selection Patent Rights.


 


(vi)          As used in this Section 6.2(c) “material”
means that the submission or communication could affect the patentability or
scope of the patents Covering the Licensed Compounds or Licensed Products.


 


(d)           Patent Term Extensions.  *** may select which, if any, Selection
Patent Rights for which a Patent Term Extension is to be sought or
obtained.  *** may select which, if any,
Genus Patent Rights and Future Incyte Patent Rights for which a Patent Term
Extension is to be sought or obtained.


 


6.3           Third Party Infringement.


 


(a)           Notice.  Each
Party shall immediately provide the other Party with written notice reasonably
detailing any (i) known or alleged infringement of Joint IP or any
Selection Patent Rights by a Third Party which is infringing the Joint IP or
any Selection Patent Rights by making, using or selling a product that competes
with a Licensed Product in the Field in the Territory; (ii) “patent
certification” filed in the United States under 21 U.S.C. §355(b)(2) or 21
U.S.C. §355(j)(2) or similar provisions in other jurisdictions; and (iii) any
declaratory judgment, opposition, or similar action alleging the invalidity,
unenforceability or non-infringement of any such Intellectual Property Rights
(collectively “Third-Party Infringement”).  Within *** after receipt of such notice, the
Parties shall consult to determine the response to any Third Party
Infringement.


 


(b)           Enforcement.


 


(i)            If within *** after meeting pursuant to Section 6.3(a) the
Parties fail to agree on a joint course of action with respect to a Third Party
Infringement, *** will have the first right to bring and control any legal
action in the Territory in connection with the Third Party Infringement against
a Third Party which is infringing the relevant Intellectual Property Rights by
making, using or selling a product that competes with a Licensed Product in the
Field in the Territory, at its own expense as it reasonably determines
appropriate, and *** may choose, at its own expense, to be represented in any
such action by counsel of its own choice. If required, *** agrees to be joined
as a necessary party to such action, wherein as a necessary party, *** agrees
to be joined only to the extent necessary, and *** shall not actively direct,
control or otherwise participate in the legal action; provided  that
*** shall pay *** reasonable expenses associated therewith.  At the request and expense of ***, *** shall
provide reasonable assistance to *** in connection therewith, including by
executing


 


32

















 


*** Confidential material redacted and filed
separately with the Commission.


 


reasonably appropriate documents, cooperating
in discovery and joining as a party to the action.  In connection with any such proceeding, ***
shall not enter into any settlement admitting the invalidity of, or otherwise
impairing *** rights in, Joint IP or any Selection Patent Rights without the
prior written consent of ***.  Any
recoveries resulting from such an action relating to a claim of Third Party
Infringement shall be applied as follows:


 


A.            First, to reimburse each Party for all Out-of-Pocket
Costs in connection with such proceeding (on a pro rata basis, based on each
Party’s respective litigation costs, to the extent the recovery was less than
all such litigation costs); and


 


B.            ***


 


(ii)           If within *** after *** receipt of a notice of a Third
Party Infringement with respect to Joint IP or any Selection Patent Rights, ***
does not bring legal action as permitted hereunder against a Third Party who is
infringing such Intellectual Property Rights by making, using or selling a
product that competes with a Licensed Product in the Territory, *** may,
subject to the following sentence, in its sole discretion, bring and control
any legal action in connection therewith at its sole expense.  At the request and expense of ***, *** shall
provide reasonable assistance to *** in connection therewith, including by
executing reasonably appropriate documents, cooperating in discovery and
joining as a party to the action.  In
connection with any such proceeding, *** shall not enter into any settlement
admitting the invalidity of or otherwise impairing *** rights under the Joint
IP or such Selection Patent Rights without the prior written consent of ***.  Any recoveries resulting from such an action
relating to a claim of Third Party Infringement (after payment of each Party’s
costs and expenses ) will be retained by ***.


 


6.4           Patent Marking. 
If permitted and to the extent that Lilly does so with respect to its
other products in the same geographic market, Lilly shall, and shall cause its
Affiliates, distributors and sublicensees, to (a) mark the Licensed
Products with the number of each issued patent under the Incyte Patent Rights
that apply to the Licensed Product and which Lilly determines reasonably should
be listed or marked and (b) comply with the patent marking statutes in
each country in which the Licensed Product is manufactured by or on behalf of
Lilly or its Affiliates.


 


ARTICLE
VII


 


FINANCIAL PROVISIONS


 


7.1           License Fee. 
Within *** after the Effective Date, Lilly shall pay to Incyte a
one-time, non-creditable, non-refundable license fee of Ninety Million U.S.
Dollars (US$90,000,000).


 


7.2           Milestone Payments.


 


(a)           Development and Regulatory Milestones.


 


33

















 


*** Confidential material redacted and filed
separately with the Commission.


 


(i)            Lilly
shall pay Incyte the following one-time, non-refundable, non-creditable
milestone payments within *** after the first achievement by Lilly, its
Affiliates or its sublicensees, or with respect to the milestone event in Section 7.2(a)(i)(A),
Incyte or one of Incyte’s Affiliates, of the corresponding milestone events set
forth below with respect to a Lead Compound (provided that with respect to the
Follow-On Lead Compound, such Follow-On Lead Compound shall only be eligible
for the milestone payments set forth below if such payments have not previously
been made with respect to the Initial Lead Compound):


 


	
  Milestone Event

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
   

  	
   

  	
   

  
	
  ***

  	
   

  	
  ***

  	
   

  	
   

  	
   

  	
   

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  



 


With
respect to the milestone set forth in ***, the milestone payment shall be
contingent *** with a


 


34

















 


*** Confidential material redacted
and filed separately with the Commission.


 


***.


 


	
  ***

  	
   

  	
  ****

  	
   

  	
  ****

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  



 






* ***


(ii)           Lilly
shall pay Incyte the following non-refundable, non-creditable (subject to Section 7.2(c))
milestone payments within *** after the first achievement by Lilly, its
Affiliates or its sublicensees of the corresponding milestone events set forth
below with respect to a Licensed Back-Up Compound (provided that with respect
to the Follow-On Lead Compound, such Follow-On Lead Compound shall only be
eligible for any such milestone payment if it is not eligible for the
comparable one-time Lead Compound milestone payment set forth in Section 7.2(a)(i)):


 


	
  Milestone Event

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  



 


35

















 


*** Confidential material redacted and filed
separately with the Commission.


 


(iii)          For
the avoidance of doubt, the registrations of line extensions (i.e., different
dosage forms or delivery) shall not be eligible for milestone payments set
forth in this Section 7.2(a). 
Additionally, any Combination Products containing a Lead Compound and a
Licensed Back-Up Compound, wherein the Licensed Back-Up Compound is only
available in combination with such Lead Compound, shall be solely eligible for
the one-time Lead Compound milestone payments set forth in Section 7.2(a)(i) and
shall not additionally be eligible for a Licensed Back-Up Compound milestone
set forth in Section 7.2(a)(ii).


 


(b)           Sales
Milestones.


 


(i)            Lilly
shall make the following non-refundable, non-creditable, one-time payments to
Incyte within *** upon the first achievement of aggregate Annual Net Sales of
all Licensed Products in the Territory that meet or exceed the thresholds set
forth below if such Licensed Products contain or incorporate a Lead Compound:


 


	
  Annual
  Net Sales of Licensed Products in the 

  Territory Threshold

  	
   

  	
  Milestone Payment

  
	
  (A) 
  Annual Net Sales of Licensed Products equal to or greater than ***

  	
   

  	
  ***

  
	
  (B) 
  Annual Net Sales of Licensed Products equal to or greater than ***

  	
   

  	
  ***

  
	
  (C) 
  Annual Net Sales of Licensed Products equal to or greater than ***

  	
   

  	
  ***

  



 


(ii)           Lilly
shall make the following non-refundable, non-creditable, one-time payments to
Incyte within *** upon the first achievement of aggregate Annual Net Sales of
all Licensed Products in the Territory that meet or exceed the thresholds set
forth below if such Licensed Products contain or incorporate a Licensed Back-Up
Compound (other than the Follow-On Lead Compound which, for purposes of
clarity, is subject to subsection (i) above):


 


	
  Annual
  Net Sales of Licensed Products in the 

  Territory Threshold

  	
   

  	
  Milestone Payment

  
	
  (A) 
  Annual Net Sales of Licensed Products equal to or greater than ***

  	
   

  	
  ***

  
	
  (B) 
  Annual Net Sales of Licensed Products equal to or greater than ***

  	
   

  	
  ***

  
	
  (C) 
  Annual Net Sales of Licensed Products equal to or greater than ***

  	
   

  	
  ***

  



 


36

















 


*** Confidential material redacted and filed
separately with the Commission.


 


Achievement of the milestone events above in this Section 7.2(b) shall
be determined based on Annual Net Sales of the Licensed Products made by Lilly
and its Affiliates and sublicensees throughout the Territory.  More than
one of the sales milestone payments may be earned concurrently based on the
same Annual Net Sales of the Licensed Products.  By way of example, if in
the first Calendar Year following the First Commercial Sale of a Licensed
Product, the Annual Net Sales for Licensed Products that contain the Lead
Compound is equal to or exceeds ***, but is less than ***, then Lilly shall pay
Incyte the milestone payments set forth in both Sections 7.2(b)(i)(A) and (B) (total
***).


 


(c)           Except as otherwise specified, none of the payments listed
in this Section 7.2 shall be payable more than once, and each shall be
payable at the first achievement of a milestone event for a Licensed Product
and shall not be payable again if subsequently another Licensed Product
achieves the same milestone event.  For
clarification, if a milestone is paid for a Licensed Compound, that milestone
will not be paid again for a back-up compound.


 


(d)           In the event that a milestone event described in Section 7.2(a) is
achieved, all milestones prior to that stage of Development for that Indication
shall be deemed to have been achieved as well, and if the related payment for
any such preceding milestone has not been previously paid, the previously
unpaid payments that would be due for the preceding milestones shall also
become due and payable, even though the missing milestone has not been
achieved; provided  that the foregoing shall not apply to Section 7.2(a)(i)(A) milestone
1b.


 


7.3           Royalties.


 


(a)           Royalty
Rates.


 


(i)            Lilly
shall pay to Incyte royalties on aggregate worldwide Net Sales of all Licensed
Products that contain or incorporate a Lead Compound in the Territory, on a
Licensed Product-by-Licensed Product basis, at the following rates:


 


	
  Annual Net Sales of Licensed Product in the Territory

  	
   

  	
  Royalty Rate

  
	
  On
  Annual Net Sales less than or equal to ***

  	
   

  	
  ***

  
	
  On
  Annual Net Sales greater than *** and less than or equal to ***

  	
   

  	
  ***

  
	
  On
  Annual Net Sales greater than *** and less than or equal to ***

  	
   

  	
  ***

  
	
  On
  Annual Net Sales greater than ***

  	
   

  	
  20%

  



 


37

















 


*** Confidential material redacted and filed
separately with the Commission.


 


(ii)           Lilly
shall pay to Incyte royalties on aggregate worldwide Net Sales of all Licensed
Products that contain or incorporate a Licensed Back-Up Compound (other than
the Follow-On Lead Compound which, for purposes of clarity, is subject to
subsection (i) above) in the Territory, on a Licensed Product-by-Licensed
Product basis, at the following rates:


 


	
  Annual Net Sales of Licensed Product in the Territory

  	
   

  	
  Royalty Rate

  
	
  On
  Annual Net Sales less than or equal to ***

  	
   

  	
  ***

  
	
  On
  Annual Net Sales greater than *** and less than or equal to ***

  	
   

  	
  ***

  
	
  On
  Annual Net Sales greater than *** and less than or equal to ***

  	
   

  	
  ***

  
	
  On
  Annual Net Sales greater than ***

  	
   

  	
  ***

  



 


(iii)          ***


 


(iv)          The
royalty rates set forth in Section 7.3(a)(i) (and not Section 7.3(a)(ii))
shall apply to Annual Net Sales of any Combination Products containing a Lead
Compound and a Licensed Back-Up Compound, wherein the Licensed Back-Up Compound
is only available in combination with such Lead Compound.


 


(b)           Royalties payable under this Section 7.3 shall be
paid by Lilly on a Licensed Product-by-Licensed Product and country-by-country
basis from the date of First


 


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Commercial Sale of each Licensed Product with respect to which royalty
payments are due for a period which is the longer of: (i) the last to
expire of any Valid Claim of Incyte Patent Rights Covering such Licensed
Product in such country; (ii) *** following the date of First Commercial
Sale of such Licensed Product in such country; and (iii) the expiration of
Regulatory Exclusivity for such Licensed Product in such country (each such
term with respect to a Licensed Product and a country, a “Royalty Term”).


 


(c)           Notwithstanding the foregoing, in the event that either (i) the
Royalty Term continues solely due to Section 7.3(b)(ii) (i.e. in a
specific country the Licensed Product is not Covered by a Valid Claim of Incyte
Patent Rights nor is such Licensed Product protected by Regulatory
Exclusivity); or (ii) Generic Competition exists with respect to a
Licensed Product in the Field in a country in the Territory in a Calendar Year,
then the royalty rates in such country for such Licensed Product for such
Calendar Year will be reduced to *** of the applicable rate in Section 7.3(a);
provided  that any reduction of the applicable rate in Section 7.3(a) pursuant
to subclause (ii) due to the existence of Generic Competition shall be
retroactively applied for the relevant Calendar Year.


 


(d)           If
Lilly (i) determines in good faith that, in order to avoid infringement of
any Patent Right not licensed hereunder, it is reasonably necessary to obtain a
license from a Third Party in order to Develop, Commercialize, make, have made,
use, offer for sale, sell or import the Licensed Product in the Field in a
country in the Territory and to pay a royalty or other consideration under such
license (including in connection with the settlement of a patent infringement
claim); or (ii) shall be subject to a final court or other binding order
or ruling requiring any payments, including the payment of a royalty to a Third
Party patent holder in respect of the Development, Commercialization, making,
having made, using, offering for sale, selling and importing of a Licensed
Product in the Field in a country in the Territory, then the amount of Lilly’s
royalty payments under Section 7.3(a) with respect to Net Sales for
such Licensed Product in such country shall be reduced by *** of the amount
payable by Lilly to such Third Party that are reasonably and appropriately
allocable to the Licensed Product in the Field in the Territory, provided,
however, that in no event shall the aggregate deductions under this Section 7.3(d) reduce
any royalty payment made by Lilly in respect of Net Sales of such Licensed
Product pursuant to Section 7.3(a) by more than ***.


 


(e)           Upon the expiration of the Royalty Term with respect to a
Licensed Product in a country, the licenses granted by Incyte to Lilly pursuant
to Section 2.1 shall be deemed to be fully paid-up, irrevocable and
perpetual with respect to such Licensed Product in such country.


 


7.4           Royalty Reports; Payments.  Lilly shall deliver to Incyte, within ***
after the end of each Calendar Quarter, a royalty report for such Calendar
Quarter, together with the required payments. 
Such reports shall indicate, on a country-by-country basis, the Net
Sales and the calculation of royalties from Net Sales with respect thereto,
each determined in accordance with this Agreement and, with respect to sales of
Licensed Product in the United States, such reports shall include gross sales
and all deductions taken from gross sales. 
All payments due to Incyte pursuant to this Agreement shall be made in
United States dollars by wire transfer in immediately available funds from a
Lilly account in the United States to an account designated in advance by
Incyte.


 


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7.5           Financial Records. 
Lilly shall keep complete and accurate books and records in accordance
with Accounting Standards. Lilly will keep such books and records for at least
*** following the end of the Calendar Year to which they pertain. Such books of
accounts shall be kept at the principal place of business of the financial
personnel with responsibility for preparing and maintaining such records.  With respect to royalties, such records shall
be in sufficient detail to support calculations of royalties due to Incyte.


 


7.6           Audits.  ***
during each Calendar Year for the Term, Incyte may retain an independent
certified public accountant reasonably acceptable to Lilly to audit the records
described in Section 7.5, upon at least *** prior notice to Lilly.  Incyte shall bear the costs of such audit,
except as provided below.  The results of
such audit shall be made available to both Parties, but shall be considered
Lilly’s Confidential Information.  If the
audit demonstrates that the payments owed under this Agreement have been
understated, Lilly shall pay the balance to Incyte, together with interest in
accordance with Section 7.9. 
Further, if the amount of the understatement is greater than *** of the
amount owed to Incyte with respect to the audited period, then Lilly shall
reimburse Incyte for the reasonable cost of the audit.  If the audit demonstrates that the payments
owed under this Agreement have been overstated, Lilly shall be entitled to
credit such amount against payments due to Incyte.  All payments owed by Lilly under this Section 7.6
shall be made within *** after the results of the audit are delivered to the
Parties.


 


7.7           Tax Matters. 
The royalties, milestones and other amounts payable by Lilly to Incyte
pursuant to this Agreement shall not be reduced on account of any taxes unless
required by Law.  Lilly shall inform
Incyte of any withholding tax obligation on payments due to Incyte under this
Agreement as soon as Lilly becomes aware of the withholding tax obligation.  The Parties shall meet promptly thereafter to
discuss how best to minimize the amount of such withholding tax obligation in
accordance with Law, and Lilly shall take all reasonable and lawful steps to
minimize the amount of any such withholding tax obligation.  The Parties agree to cooperate in good faith
to provide one another with such documents and certifications as are reasonably
necessary to enable Lilly and Incyte to minimize and/or recover any withholding
tax obligation.  Lilly shall provide to
Incyte documentation of the payment of any withholding tax that is paid
pursuant to this Section 7.7. 
Notwithstanding the foregoing, Lilly represents that the payments to be
paid by Lilly to Incyte pursuant to Sections 7.1, 7.2 and 7.3 hereof shall not
be subject to withholding tax under conditions less favorable to Incyte than
those applicable to treaty-eligible residents under the income tax treaty
between the United States and the country of payment origination in force at
the point of time such payments are paid. 
Payments to Incyte will be made from the United States unless Incyte
receives notice from Lilly that payments will be made from either Puerto Rico
or Ireland.


 


7.8           Currency Exchange. 
All payments to be made by Lilly to Incyte shall be made in U.S.
Dollars.  In the case of sales of
Licensed Product outside the United States, royalty payments by Lilly to Incyte
shall be converted to U.S. Dollars in accordance with the following:  the rate of currency conversion shall be
calculated using the average of the daily foreign exchange rates as published
by The Wall Street Journal, Eastern Edition, for the Calendar Quarter in
which such payments occurred.


 


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7.9           Late Payments. 
The paying Party shall pay interest to the receiving Party on the
aggregate amount of any payments that are not paid on or before the date such
payments are due under this Agreement at a rate per annum equal to the lesser
of ***, as reported by The Wall Street Journal, Eastern Edition, *** or
the highest rate permitted by applicable Law, calculated on the number of days
such payments are paid after the date such payments are due; provided,
that with respect to any disputed payments, no interest payment shall be due
until such dispute is resolved and the interest which shall be payable thereon
shall be based on the finally-resolved amount of such payment, calculated from
the original date on which the disputed payment was due through the date on
which payment is actually made.


 


ARTICLE
VIII


 


TERM AND TERMINATION


 


8.1           Agreement
Term.  The term of this Agreement
shall commence on the Effective Date and shall continue until the earlier of (i) the
termination of this Agreement in accordance with Section 8.2; or (ii) following
the First Commercial Sale of any Licensed Product, the expiration of the
last-to-expire of all Royalty Terms with respect to all Licensed Compounds and
Licensed Products (the “Term”). 
Notwithstanding the above, if there are any ongoing disputes at the end
of the Term as set forth above, this Agreement shall remain in full force and
effect until all such disputes are resolved.


 


8.2           Termination.


 


(a)           Termination for Convenience.  Prior to the first anniversary of the
Effective Date, Lilly may elect to terminate this Agreement at any time by
providing *** prior written notice to Incyte; provided, that at any time
after such notice by Lilly, Incyte may accelerate the effective date of such
termination by providing *** prior written notice to Lilly of such accelerated
effective date.  After the first
anniversary of the Effective Date, Lilly may elect to terminate this Agreement
at any time by providing *** prior written notice to Incyte; provided,
that at any time after such notice by Lilly, Incyte may accelerate the effective
date of such termination by providing *** prior written notice to Lilly of such
accelerated effective date.


 


(b)           Termination for Material Breach.  If either Party (the “Non-Breaching Party”)
believes that the other Party (the “Breaching Party”) is in material
breach of this Agreement, then the Non-Breaching Party may deliver notice of
such breach to the Breaching Party.  If
the Breaching Party fails to cure such breach, or to initiate such steps as
would be considered reasonable to effectively cure such breach (and thereafter
diligently pursues such cure), within *** after receipt of such notice of
breach, the Non-Breaching Party may terminate this Agreement upon written
notice to the Breaching Party.  Notwithstanding
the foregoing, if a Party disputes the termination, then 8.2(e) shall
apply.


 


(c)           Termination
if Lilly Challenges Incyte IP.  If
Lilly or any of its Affiliates or sublicensees, directly or indirectly, (i) initiates
or requests an interference or opposition proceeding with respect to any Incyte
Patent Right; (ii) makes, files or maintains any claim,


 


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demand, lawsuit, or cause of action to challenge the validity or
enforceability of any Incyte Patent Right; or (iii) opposes any extension
of, or the grant of a supplementary protection certificate with respect to, any
Incyte Patent Right, Incyte shall have the right to terminate this Agreement
upon *** written notice to Lilly.  Any
such termination shall only become effective if Lilly or its Affiliate or
sublicensee, as applicable, has not withdrawn such action before the end of the
above notice period.


 


(d)           Termination
for Lilly’s Abandonment of Development or Commercialization.  Subject to Section 4.2(b)(iii)A and
5.1(b)(i), if Lilly has Abandoned Development or Abandoned Commercialization in
accordance with Section 4.2(a)(iii) or 5.1(b), as applicable, Incyte
may elect to terminate this Agreement by providing Lilly written notice of such
termination, such termination to be effective immediately.  Notwithstanding the foregoing, if Lilly
disputes the termination, then 8.2(e) shall apply.


 


(e)           Termination
Disputes.  If a Party gives notice of
termination under Section 8.2(b), if the Parties dispute whether Lilly has
Abandoned Development or Abandoned Commercialization in accordance with Section 4.2(b)(iii) or
5.1(b), as applicable, or Incyte gives notice of termination under 8.2(d), and
the other Party disputes whether such notice was proper, then the issue of
whether or not Lilly has Abandoned Development, Abandoned Commercialization, or
if this Agreement was properly terminated shall be resolved in accordance with
ARTICLE XII, and the Agreement shall remain in full force and effect until such
dispute is resolved.  If as a result of
such dispute resolution process it is determined that the notice of termination
was proper, then such termination shall be deemed to be effective on the date
on which such dispute is resolved.  On
the other hand, if as a result of the dispute resolution process it is
determined that the notice of termination was improper, then no termination
shall have occurred and this Agreement shall remain in full force and effect.


 


8.3           Effects Of Termination.


 


(a)           Upon termination of this Agreement by Lilly under Section 8.2(a) or
by Incyte under Sections 8.2(b), 8.2(c) or 8.2(d):


 


(i)            all licenses granted by Incyte to Lilly hereunder shall
terminate and Lilly shall not have any rights to use or exercise any rights
under the Incyte IP;


 


(ii)           Lilly shall provide to Incyte a fair and accurate summary
report of the status of the Development and Commercialization of the Licensed
Products in each country in the Territory through the effective date of
termination within *** after such termination;


 


(iii)          Lilly hereby grants to Incyte, exercisable from and after
such termination, an exclusive, worldwide, perpetual, irrevocable,
royalty-free, fully-paid license, with the right to grant sublicenses, under
Lilly and its Affiliates’ interest in the Joint IP and any Know-How or Patent
Rights Controlled by Lilly or its Affiliates as of the date of such termination
solely to the extent that such licenses are necessary to research, Develop,
make, have made, use, offer for sale, sell and import Licensed Products in the
Field in the Territory, and Lilly shall retain all other remaining rights;


 


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(iv)          Lilly shall promptly transfer and assign to Incyte all of
Lilly’s and its Affiliates’ rights, title and interests in and to the product
trademark(s) (but not any Lilly house marks or any trademark containing
the word “Lilly” owned by Lilly and used for the Licensed Products in the Field
in the Territory) owned by Lilly and used for the Licensed Products in the
Field in the Territory;


 


(v)           Lilly shall as soon as reasonably practicable transfer and
assign to Incyte all Regulatory Documentation, the Global Safety Database and
other documented technical and other information or materials Controlled by
Lilly which are necessary or useful for the Development, manufacture and
Commercialization of the Licensed Compounds or Licensed Products; provided
that Lilly may retain a single copy of such items for its records.  Within *** after Incyte’s receipt of an
invoice therefor, Incyte shall reimburse Lilly for Lilly’s and its Affiliates’
reasonable Out-of-Pocket Costs incurred in connection with such transfers and
assignment (but not the generation, creation or development of such information
and materials);


 


(vi)          Incyte shall have the option, exercisable within ***
following the effective date of such termination, to obtain Lilly inventory of
Licensed Products at a price equal to *** of Lilly’s
non-auditable “standard cost” that Lilly uses for internal accounting
purposes.  Lilly’s “standard cost” does
not include the research and development costs to develop the molecule or costs
not associated with Licensed Products.  Incyte
may exercise such option by written notice to Lilly during such *** period; provided
that in the event Incyte exercises such right to purchase such
inventory, Lilly shall grant, and hereby does grant, a royalty-free right and
license to any trademarks, names and logos of Lilly contained therein for a
period of *** solely to permit the orderly sale of such inventory, except where
Lilly reasonably believes that continued sales would pose an unreasonable
safety risk, and any materials having a Lilly logo (a housemark or the word “Lilly”)
that are released by Lilly must meet the Lilly quality assurance standards;


 


(vii)         to the extent that Lilly is responsible for manufacturing a Licensed
Product prior to termination of this Agreement, Lilly shall:


 


A.            in exchange
for a payment equal to *** of Lilly’s “standard costs”, use Commercially Reasonable
Efforts to supply Incyte and its Affiliates with comparable quantities of the
Licensed Products in the dosage strength, formulation and presentation as were
being Commercialized as of the effective date of termination until the earlier
of *** after the
effective date of the termination or establishment by Incyte of an alternative
supply for such Licensed Product, it being understood that Lilly is not
obligated to manufacture itself if Lilly reasonably believes that such
manufacture and/or Licensed Product would pose an unreasonable safety risk, and
unless Lilly was manufacturing itself immediately prior to termination, and in
the event Lilly was utilizing a contract manufacturer, Lilly’s obligation is to
use Commercially Reasonable Efforts to cooperate with Incyte to obtain Licensed
Product from such manufacturer; provided  that Incyte shall use
its Commercially Reasonable Efforts to establish an alternative supply as promptly
as reasonably practicable;


 


B.            cooperate with Incyte in reasonable respects to transfer


 


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manufacturing documents and materials which are used (at the time of
the termination) by Lilly in the Manufacture of the applicable Licensed
Products; and


 


C.            cooperate with Incyte in reasonable respects to transfer
to Incyte, or Incyte’s designated contract manufacturer, the manufacturing
technologies (including all relevant Know-How) that are used and necessary (at
the time of the termination) and Controlled by Lilly in the manufacture of the
applicable Licensed Products, provided  that Incyte shall
reimburse Lilly for Lilly’s reasonable Out-of-Pocket Costs to provide such
requested assistance;


 


(viii)        in
the event that Incyte terminates this Agreement pursuant to Section 8.2(d) or
Lilly terminates pursuant to 8.2(a) and such termination occurs after
Lilly has initiated a Phase III Study for a Licensed Product, ***); and


 


(ix)           Section 8.3(d) shall
apply.


 


(b)           Upon termination of this Agreement by Lilly in accordance
with Section 8.2(b):


 


(i)            the license granted to Lilly pursuant to Section 2.1
and the rights and obligations of the Parties pursuant to Sections 6.2 and 6.3
shall remain in effect and Lilly shall continue to pay to Incyte all royalties
due under Section 7.3 and 4.4 and all milestones due under Section 7.2
in accordance with the terms of this Agreement;


 


(ii)           until the last to expire of
all Royalty Terms with respect to Licensed Compounds and Licensed Products, the
rights and obligations of the Parties pursuant to Sections 2.6(d), 2.6(e), 2.6(f) shall
survive; provided however, that if the First
Commercial Sale of a Licensed Product has not occurred at the time of
termination, then the rights and obligations of the Parties pursuant to
Sections 2.6(d), 2.6(e), 2.6(f) shall survive for *** after the effective date of such termination provided  further that if a First
Commercial Sale of a Licensed Product takes place within such *** period, Sections 2.6(d), 2.6(e), 2.6(f) shall survive
until the last to expire of all Royalty Terms;
and


 


(iii)          Section 8.3(d) shall apply.


 


(c)           ARTICLE I (Definitions), IX (Indemnification and Limitation
of Liability), XI (Confidentiality), XII (Dispute Resolution) and XIII
(Miscellaneous) and Sections 6.1 (Inventorship; Ownership), 7.5 (Financial
Records), 7.6 (Audits), 8.3 (Effects of Termination), 10.4 (Disclaimer of
Warranty) and 10.5 (Standstill) shall survive termination or expiration of this
Agreement.


 


(d)           Termination of this Agreement shall be in addition to, and
shall not prejudice, the Parties’ remedies at law or in equity, including the
Parties’ ability to receive legal damages and/or equitable relief with respect
to any breach of this Agreement, regardless of whether or not such breach was
the reason for the termination.


 


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ARTICLE IX


 


INDEMNIFICATION; LIMITATION OF LIABILITY


 


9.1           By
Lilly.


 


(a)           Lilly agrees, at
Lilly’s cost and expense, to defend, indemnify and hold harmless Incyte and its
Affiliates and their respective directors, officers, employees and agents (the “Incyte
Indemnified Parties”) from and against any losses, costs, damages, fees or
expenses arising out of any Third Party claim relating to (i) any breach
by Lilly of any of its representations, warranties or obligations pursuant to
this Agreement; (ii) the gross negligence or willful misconduct of Lilly;
and (iii) the Development, manufacture, Commercialization, use, sale or
other disposition by Lilly, its Affiliates or sublicensees of any Licensed
Compound or Licensed Product.


 


(b)           In the event of any
such claim against the Incyte Indemnified Parties by any Third Party, Incyte
shall promptly notify Lilly in writing of the claim and Lilly shall have the
right, exercisable by notice to Incyte within *** after receipt of notice from
Incyte of the claim, to assume direction and control of the defense,
litigation, settlement, appeal or other disposition of the claim (including the
right to settle the claim solely for monetary consideration) with counsel
selected by Lilly and reasonably acceptable to Incyte.  The Incyte Indemnified Parties shall
cooperate with Lilly and may, at their option and expense, be separately
represented in any such action or proceeding. 
Lilly shall not be liable for any litigation costs or expenses incurred
by the Incyte Indemnified Parties without Lilly’s prior written
authorization.  In addition, Lilly shall
not be responsible for the indemnification or defense of any Incyte Indemnified
Party to the extent arising from any negligent or intentional acts by any
Incyte Indemnified Party or the breach by Incyte of any obligation or warranty
under this Agreement, or any claims compromised or settled without its prior
written consent.  Notwithstanding the
foregoing, Lilly shall not settle a Third Party claim without the written
consent of Incyte, if such settlement would impose any monetary obligation on
Incyte or require Incyte to submit to an injunction.


 


(c)           Notwithstanding
anything to the contrary above, in the event of any such claim against the
Incyte Indemnified Parties by a governmental or criminal action seeking an
injunction against Incyte, Incyte shall have the right to control the defense,
litigation, settlement, appeal or other disposition of the claim at Lilly’s
expense.


 


9.2           By
Incyte.


 


(a)           Incyte agrees, at
Incyte’s cost and expense, to defend, indemnify and hold harmless Lilly and its
Affiliates and their respective directors, officers, employees and agents (the “Lilly
Indemnified Parties”) from and against any losses, costs, damages, fees or
expenses arising out of any Third Party claim relating to (a) any breach
by Incyte of any of its representations, warranties or obligations pursuant to
this Agreement, or (b) the gross negligence or willful misconduct of Incyte, and (c) the Development,
manufacture, Commercialization, use, sale or other disposition by Incyte, its
Affiliates or sublicensees of any Licensed Compound or Licensed Product.


 


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(b)           In the event of any
such claim against the Lilly Indemnified Parties by any Third Party, Lilly
shall promptly notify Incyte in writing of the claim. Incyte shall have the
right, exercisable by notice to Lilly within *** after receipt of notice from
Lilly of the claim, to assume direction and control of the defense, litigation,
settlement, appeal or other disposition of the claim (including the right to
settle the claim solely for monetary consideration) with counsel selected by
Incyte and reasonably acceptable to Lilly. The Lilly Indemnified Parties shall
cooperate with Incyte and may, at their option and expense, be separately
represented in any such action or proceeding. 
Incyte shall not be liable for any litigation costs or expenses incurred
by the Lilly Indemnified Parties without Incyte’s prior written
authorization.  In addition, Incyte shall
not be responsible for the indemnification or defense of any Lilly Indemnified
Party to the extent arising from any negligent or intentional acts by any Lilly
Indemnified Party, or the breach by Lilly of any representation, obligation or
warranty under this Agreement, or any claims compromised or settled without its
prior written consent.  Notwithstanding the
foregoing, Incyte shall not settle a Third Party claim without the written
consent of Lilly,
if such settlement would impose any monetary obligation on Lilly or require Lilly to submit to an injunction.


 


(c)           Notwithstanding
anything to the contrary above, in the event of any such claim against the
Lilly Indemnified Parties by a governmental or criminal action seeking an
injunction against Lilly, Lilly shall have the right to control the defense,
litigation, settlement, appeal or other disposition of the claim at Incyte’s
expense.


 


9.3           Limitation
of Liability.  EXCEPT WITH RESPECT TO A BREACH OF ARTICLE XI, OR A
PARTY’S LIABILITY PURSUANT TO ARTICLE IX, NEITHER PARTY SHALL BE LIABLE FOR
SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, MULTIPLE OR OTHER
INDIRECT OR REMOTE DAMAGES, OR, EXCEPT WITH RESPECT TO A BREACH OF SECTION 2.6,
FOR LOSS OF PROFITS, LOSS OF DATA OR LOSS OF USE DAMAGES ARISING IN ANY WAY OUT
OF THIS AGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, WHETHER BASED UPON
WARRANTY, CONTRACT, TORT, STRICT LIABILITY OR OTHERWISE, EVEN IF SUCH PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR LOSS.


 


ARTICLE X


 


REPRESENTATIONS AND WARRANTIES AND COVENANTS


 


10.1         Representation Of Authority;
Consents.  Incyte and Lilly each
represents and warrants to the other Party that:


 


(a)            as
of the Effective Date, it has full right, power and authority to enter into
this Agreement;


 


(b)           as of the Effective
Date, this Agreement has been duly executed by such Party and constitutes a
legal, valid and binding obligation of such Party, enforceable in accordance
with its terms, except as enforceability may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium and other Laws
relating to or affecting


 


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creditors’ rights
generally and by general equitable principles and public policy constraints
(including those pertaining to limitations and/or exclusions of liability,
competition Laws, penalties and jurisdictional issues including conflicts of
Laws); and


 


(c)           as
of the Effective Date, and except as otherwise contemplated in this Agreement,
all necessary consents, approvals and authorizations of all government
authorities and other persons required to be obtained by such Party in
connection with the execution, delivery and performance of this Agreement have
been and shall be obtained.


 


10.2         No
Conflict.  Each Party represents and
warrants to the other Party that the execution and delivery of this Agreement
and the performance of such Party’s obligations hereunder (a) do not
conflict with or violate such Party’s corporate charter and bylaws or any
requirement of applicable Laws and (b) do not and shall not conflict with,
violate or breach or constitute a default or require any consent under, any
material oral or written contractual obligation of such Party.  Each Party agrees that it shall not during
the term of this Agreement grant any right, license, consent or privilege to any
Third Party or otherwise undertake any action, either directly or indirectly,
that would conflict with the rights granted to the other Party or interfere
with any obligations of such Party set forth in this Agreement.


 


10.3         Additional
Incyte Representations and Warranties. 
Incyte represents and warrants that, as of the Effective Date, except as
previously disclosed to Lilly:


 


(a)           Neither
it nor any of its Affiliates has received written notice of any claim or
litigation which alleges any Intellectual Property Rights of a Third Party are
infringed by a Licensed Compound or the Development or Commercialization of any
Licensed Compound; to the knowledge of Incyte and its Affiliates, none of
Incyte or any of its Affiliates has in the past infringed or is currently
infringing any Third Party Intellectual Property Rights through activities
related to the Licensed Compounds;


 


(b)           there
are no claims, judgments or settlements against or owed by Incyte or any of its
Affiliates, nor, to the knowledge of Incyte or any of its Affiliates, any
pending reissue, reexamination, interference, opposition or similar
proceedings, with respect to any Licensed Compounds or Incyte IP, and Incyte
has not received written notice of any threatened claims or litigation or any
reissue, reexamination, interference, opposition or similar proceedings seeking
to invalidate or otherwise challenge any Incyte IP;


 


(c)           to
the knowledge of Incyte and its Affiliates, no Third Party is infringing any
Incyte Patent Rights;


 


(d)           (i) Incyte
is the legal and beneficial owner or has the right to grant to Lilly the rights
granted herein, to all Incyte IP; (ii) no Third Party has any right,
interest or claim in or to such rights that would limit the rights granted to
Lilly under this Agreement; and (iii) all assignments to Incyte of
inventorship rights relating to the Incyte Patent Rights Controlled by Incyte
are valid and enforceable;


 


(e)           all
fees due to date that are required to maintain the Incyte IP have been paid in
full and to Incyte’s knowledge, the Incyte IP is valid and enforceable; 


 


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(f)            Incyte
has not granted and shall not grant any Third Party rights that are or would be
inconsistent with Lilly’s rights hereunder and there are no agreements or
arrangements to which Incyte or any of its Affiliates is a party relating to
Licensed Compound or Incyte IP that would limit the rights granted to Lilly
under this Agreement; and


 


(g)           Incyte has disclosed
to Lilly all material information known to it and its Affiliates with respect
to the safety and efficacy of each of the Licensed Compounds.


 


(h)           Neither Incyte nor
any of its Affiliates Controls any Patent Rights or Know-How necessary to
Develop, manufacture or Commercialize Licensed Products and not included in the
licenses granted hereunder to Lilly. 
Subject to Section 13.3(b)(ii), in the event Incyte subsequently
determines that any Patent Rights or Know-How necessary to Develop, manufacture
or Commercialize Licensed Products is Controlled by any Affiliate of Incyte,
and not Incyte, Incyte shall immediately cause such Affiliate to grant to
Incyte, a license (that is sublicenseable to Lilly hereunder) to, or ownership
of, such Patent Rights or Know-How in a manner consistent with this Agreement.


 


(i)            None of the Incyte
IP has been licensed or sublicensed from any Third Party, and there are no
royalties or other payments that would be due to Third Parties on account of
Development or Commercialization of Licensed Compounds or Licensed Products
hereunder as a result of any agreement entered into by Incyte or any of its
Affiliates.


 


10.4         Disclaimer
of Warranty.  Nothing in this
Agreement shall be construed as a representation made or warranty given by
Incyte that Lilly will be successful in obtaining any Patent Rights, that any
patents will issue based on pending applications or that any such pending
applications or patents issued thereon will be valid.  ALL INCYTE IP TRANSFERRED PURSUANT TO THIS
AGREEMENT SHALL BE PROVIDED ON AN “AS IS” BASIS.  EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS, WAIVES, RELEASES AND RENOUNCES ANY
WARRANTY, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE AND NONINFRINGEMENT.


 


10.5         Standstill.


 


(a)           Lilly agrees that,
for a period commencing on the Effective Date and ending *** after the
Effective Date, unless specifically invited in writing to do so by Incyte,
Lilly and each of its Affiliates will not in any manner, directly or
indirectly:


 


(i)            effect, or seek,
offer or propose to effect (whether publicly or otherwise) or cause or
participate in, (A) any acquisition of (1) any Voting Stock of Incyte
or any securities that at such time are convertible or exchangeable into or exercisable
for any Voting Stock of Incyte (collectively, “Voting Securities”); (2) any
direct or indirect rights or options to acquire any Voting Securities; or (3) any
assets or securities of Incyte or any of its subsidiaries; (B) any merger,
consolidation, tender or exchange offer, or other business combination
involving Incyte or any Affiliate thereof; (C) any restructuring,
recapitalization, liquidation, dissolution or similar transaction with respect
to Incyte or any Affiliate thereof; (D) any “solicitation” of “proxies”
(as such terms are defined or used in Regulation 14A under the Exchange Act) or


 


48

















 


*** Confidential material redacted and filed separately with
the Commission.


 


consents with
respect to any Voting Securities, any “election contest” (as such term is
defined or used in Rule 14a-11 of the Exchange Act) with respect to
Incyte, or any demand for a copy of Incyte’s stock ledger, list of its
stockholders, or other books and records; or (E) any action inconsistent
with the terms of this Section 10.5;


 


(ii)           form, join,
participate in or encourage the formation of any “group” (within the meaning of
Section 13(d)(3) of the Exchange Act) with respect to any Voting
Securities;


 


(iii)          otherwise act,
alone or in concert with others (including by providing financing for another
party), to seek or offer to control or influence, in any manner, the
management, Board of Directors or policies of Incyte;


 


(iv)          take any action that
might force Incyte to make a public announcement regarding any of the types of
matters set forth in Section 10.5(a)(i);


 


(v)           make (publicly or to
Incyte, or its directors, officers, employees, agents or security holders,
directly or indirectly) any request or proposal to amend, waive or terminate
any provision of this Section 10.5 or any inquiry or statement relating
thereto; or


 


(vi)          instigate, encourage
or assist any Third Party to do any of the foregoing.


 


(b)           Notwithstanding
anything in this Section 10.5 to the contrary, the provisions of this Section 10.5
shall immediately cease to be of any effect as to Lilly and its Affiliates and
shall be deemed to be waived in the event (i) ***; or (ii) a person
or 13D Group not including Lilly or its Affiliates ***.  In the event that the transactions
contemplated by this clause shall have been terminated or abandoned, and such
termination or abandonment is demonstrable by objective, written evidence
provided by Incyte to Lilly, all of the restrictions in this Section 10.5
shall again be applicable as to the activities Lilly or its Affiliates initiate
thereafter for the remainder of the period specified herein.


 


(c)           Notwithstanding
anything in the Section 10.5 to the contrary, Lilly and its Affiliates may
acquire an aggregate amount of Voting Securities that would represent less than
*** of the voting power represented by Incyte’s Voting Stock solely for the
purposes of investment in the ordinary course of business (so long as any
decision to make such acquisition is in compliance with United States securities
laws).  Nothing in this Section 10.5
shall ***. 


 


49

















 


*** Confidential
material redacted and filed separately with the Commission.


 


(d)               
This Section 10.5 shall not apply to any of the activities with
respect to Licensed Compounds or Licensed Products contemplated by this
Agreement.


 


(e)           incyte *** upon (i) ***; and
(ii) ***.


 


ARTICLE XI


 


CONFIDENTIALITY


 


11.1         Confidential Information.  All Confidential Information of a Party (the “Disclosing
Party”) shall not be used by the other Party (the “Receiving Party”)
except in performing its obligations or exercising rights explicitly granted
under this Agreement and shall be maintained in confidence by the Receiving
Party and shall not otherwise be disclosed by the Receiving Party to any Third
Party, without the prior written consent of the Disclosing Party with respect
to such Confidential Information, except to the extent that the Confidential
Information:


 


(a)           was
known by the Receiving Party or its Affiliates prior to its date of disclosure
to the Receiving Party; or


 


(b)           is
lawfully disclosed to the Receiving Party or its Affiliates by sources other
than the Disclosing Party rightfully in possession of the Confidential
Information; or


 


(c)           becomes
published or generally known to the public through no fault or omission on the
part of the Receiving Party, its Affiliates or its sublicensees; or


 


(d)           is
independently developed by or for the Receiving Party or its Affiliates without
reference to or reliance upon such Confidential Information, as established by
written records.


 


Specific information shall not be deemed to be within
any of the foregoing exclusions merely because it is embraced by more general
information falling within those exclusions.


 


11.2         Permitted Disclosure.  The Receiving Party may provide the
Disclosing Party’s Confidential Information:


 


(a)           to the Receiving
Party’s respective employees, consultants and advisors, and to the employees,
consultants and advisors of such Party’s Affiliates, who have a need to know
such information and materials for performing obligations or exercising rights
expressly granted under this Agreement and have an obligation to treat such
information and materials as confidential;


 


50

















 


*** Confidential material redacted and filed separately with
the Commission.


 


(b)           to patent offices in order to seek or
obtain Patent Rights or to Regulatory Authorities in order to seek or obtain
approval to conduct Clinical Trials or to gain Regulatory Approval with respect
to the Licensed Product as contemplated by this Agreement; provided,
that such disclosure may be made only to the extent reasonably necessary to
seek or obtain such Patent Rights or approvals; or


 


(c)           if such disclosure
is required by Law or to defend or prosecute litigation or arbitration; provided
that prior to such disclosure, to the extent permitted by Law, the
Receiving Party promptly notifies the Disclosing Party of such requirement and
furnishes only that portion of the Disclosing Party’s Confidential Information
that the Receiving Party is legally required to furnish. 


 


11.3         Publicity; Attribution; Terms of
this Agreement; Non-Use of Names.


 


(a)           Except as required by judicial order
or applicable Law or as set forth below, neither Party shall make any public
announcement concerning this Agreement without the prior written consent of the
other Party, which consent shall not be unreasonably withheld or delayed.  The Party preparing any such public
announcement shall provide the other Party with a draft thereof at least ***
prior to the date on which such Party would like to make the public
announcement.  Notwithstanding the
foregoing, the Parties shall issue a press release, in the form attached as Exhibit D,
within one (1) Business Day after the Effective Date to announce the
execution of this Agreement and describe the material financial and operational
terms of this Agreement.  For purposes of
disclosure to the investor community during conference calls, investor
presentations, and analyst meetings, the Parties acknowledge that Incyte can
disclose the following information, (i) base royalty: tiered, double digit
royalty payments on future global sales with rates ranging up to twenty
percent, (ii)  Development expenditure of thirty percent (30%) of
Co-Development costs through Regulatory Approval if Incyte fully participates
in co-funding Development, (iii) increased royalties payments on potential
future global sales with tiered rates ranging from twenty percent up to the
high twenties, (iv) the ability for Incyte to defer Development Costs that
exceed a predetermined level against future milestones and royalties, (v) the
ability to terminate Co-Development at any time for an incremental royalty
commensurate with Incyte’s contribution, and (vi) based on the current
Co-Development Budget, Incyte’s option to fund thirty percent (30%) of
Co-Development costs is expected to be primarily funded by the anticipated
development and regulatory milestones associated with this collaboration.  Neither Party shall use the name, trademark,
trade name or logo of the other Party or its employees in any publicity or news
release relating to this Agreement or its subject matter, without the prior
express written permission of the other Party.


 


(b)           Notwithstanding
the terms of this ARTICLE XI,


 


(i)            either Party shall
be permitted to disclose the existence and terms of this Agreement to the
extent required, based on the advice of such Party’s legal counsel, to comply
with applicable Laws, including the rules and regulations promulgated by
the United States Securities and Exchange Commission (the “SEC”) or any
other governmental authority, or the rules or regulations of the New York Stock Exchange (the “NYSE”), The
NASDAQ Stock Market (“NASDAQ”) or any other stock exchange on which
securities issued by a Party or a Party’s Affiliate are traded. 
Notwithstanding the foregoing, before disclosing this Agreement or


 


51

















 


*** Confidential material redacted and filed separately with
the Commission.


 


any of the terms hereof pursuant to this Section 11.3(b), the Parties will coordinate in advance with each
other in connection with the redaction of certain provisions of this Agreement
with respect to any filings with the SEC, the NYSE, NASDAQ or any other stock exchange on which securities issued
by a Party or a Party’s Affiliate are traded, and each Party will use
Commercially Reasonable Efforts to seek confidential treatment for such terms as may be reasonably requested by the other Party; provided that each Party will ultimately
retain control over what information that Party discloses to their relevant
exchange, and provided further that the Parties will use their Commercially
Reasonable Efforts to file redacted versions with any governing bodies which
are consistent with redacted versions previously filed with any other governing
bodies. 
Other than such obligation,
neither Party (nor its Affiliates) will be obligated to consult with or obtain
approval from the other Party with respect to any filings to the SEC, the NYSE,
NASDAQ or any other stock exchange.


 


(ii)           Either
Party may disclose the existence and terms of this Agreement in confidence to
its attorneys and advisors, and to potential acquirers (and their respective
professional attorneys and advisors), in connection with a potential merger,
acquisition or reorganization and to existing and potential investors or
lenders of such Party, as a part of their due diligence investigations, or to
existing and potential licensees or sublicensees or to permitted assignees, in
each case under an agreement to keep the terms of confidentiality and non-use
substantially no less rigorous than the terms contained in this Agreement and
to use such information solely for the purpose permitted pursuant to this Section 11.3(b).


 


(iii)          Either Party may issue a press release
or make a public disclosure relating to this Agreement or the Parties’
activities under this Agreement to the extent that such disclosure describes
the commencement and/or “top-line” results of Clinical Trials of the Licensed
Product, the achievement of any Development events with respect to the Licensed
Product or the filing for or receipt of Regulatory Approval with respect to the
Licensed Product, amounts paid to Incyte in respect of the achievement of any
milestone events, Incyte’s exercise of the co-Development option or the
termination of this Agreement; however, the Party responsible for particular
Clinical Trials will coordinate press release information and disclosures to
protect rights to the Licensed Product and communication strategies relating to
the Licensed Product.  Prior to making
any such disclosure, the Party making the disclosure shall provide the other
Party with a draft of such proposed disclosure at least *** (or, to the extent
timely disclosure of a material event is required by Law or stock exchange or
stock market rules, such period of time sufficiently in advance of the
disclosure so that the other Party will have the opportunity to comment upon
the disclosure) prior to making any such disclosure, for the other Party’s
review and comment.


 


(c)           For
purposes of clarity, either Party may issue a press release or public
announcement or make such other disclosure relating to this Agreement if the
contents of such press release, public announcement or disclosure (i) has
previously been made public other than through a breach of this Agreement by
the issuing Party or its Affiliates or (ii) is contained in such Party’s
financial statements prepared in accordance with Accounting Standards.


 


11.4         Publications.  Each Party and its Affiliates shall have the
right to make disclosures pertaining to Licensed Compound or Licensed Product
to Third Parties in Publications in accordance with the following procedure
(provided that Incyte shall abide by such 
procedure to


 


52

















 


*** Confidential material redacted and filed separately with
the Commission.


 


the extent
possible under any Clinical Trial agreement(s) that Incyte entered into
prior to the Effective Date):  The
publishing Party shall provide the non-publishing Party with an advance copy of
the proposed Publication, and each Party shall then have *** prior to submission
for any Publication in which to recommend any changes it reasonably believes
are necessary to preserve any Patent Rights or Know-How belonging in whole or
in part to the non-publishing Party.  If
the non-publishing Party informs the publishing Party that such Publication, in
the non-publishing Party’s reasonable judgment, could be expected to have a
material adverse effect on any patentable invention owned by or licensed, in
whole or in part, to the non-publishing Party (other than pursuant to a license
granted under this Agreement), or on any Know-How which is Confidential
Information of the non-publishing Party, the publishing Party shall delay or
prevent such Publication as follows:  (i) with
respect to a patentable invention, such Publication shall be delayed
sufficiently long (not to exceed ***) to permit the timely preparation and
filing of a patent application; and (ii) with respect to Know-How which is
Confidential Information of such non-publishing Party, such Know-How shall be
deleted from the Publication.  Following
the initiation of Phase III Clinical Trials with respect to a Licensed Product,
all Publications relating to such Licensed Product shall be controlled by
Lilly, and Incyte shall have no right (other than as required pursuant to any
publication provisions contained in any Clinical Trial agreement(s) that
Incyte entered into prior to the Effective Date) to publish without Lilly’s
prior written consent.  Notwithstanding
the foregoing, Lilly shall be permitted to disclose information on sites such
as clinicaltrials.gov in accordance with Lilly’s normal business practices.


 


11.5         Term.  All obligations under this ARTICLE XI shall
expire (a) *** following expiration of this Agreement pursuant to Section 8.1
or (b) *** following termination of this Agreement pursuant to Sections
8.2(a), 8.2(b), 8.2(c) or 8.2(d).


 


11.6         Return of Confidential Information.  Upon the expiration or termination of this
Agreement, upon request, the Receiving Party shall return to the Disclosing
Party or destroy all Confidential Information received by the Receiving Party
from the Disclosing Party (and all copies and reproductions thereof).  In addition, the Receiving Party shall
destroy:  (a) any notes, reports or
other documents prepared by the Receiving Party which contain Confidential
Information of the Disclosing Party; and (b) any Confidential Information
of the Disclosing Party (and all copies and reproductions thereof) which is in
electronic form or cannot otherwise be returned to the Disclosing Party.   Nothing in this Section 11.6 shall
require the alteration, modification, deletion or destruction of archival tapes
or other electronic back-up media made in the ordinary course of business; provided
that the Receiving Party shall continue to be bound by its obligations
of confidentiality and other obligations under this ARTICLE XI with respect to
any Confidential Information contained in such archival tapes or other
electronic back-up media.  Any requested
destruction of Confidential Information shall be certified in writing to the
Disclosing Party by an authorized officer of the Receiving Party supervising
such destruction.  Notwithstanding the
foregoing, (i) the Receiving Party may retain one copy of the Disclosing
Party’s Confidential Information solely for the purpose of determining the
Receiving Party’s continuing obligations under this ARTICLE XI and (ii) the
Receiving Party may retain the Disclosing Party’s Confidential Information and
its own notes, reports and other documents to the extent reasonably required (x) to
exercise the rights and licenses of the Receiving Party expressly surviving
expiration or termination of this Agreement; (y) to perform the
obligations of the Receiving Party expressly surviving expiration or
termination of this Agreement, and for


 


53

















 


*** Confidential material redacted and filed separately with
the Commission.


 


regulatory or
archival purposes.  Notwithstanding the
return or destruction of the Disclosing Party’s Confidential Information, the
Receiving Party shall continue to be bound by its obligations of
confidentiality and other obligations under this ARTICLE XI.


 


ARTICLE XII


 


DISPUTE RESOLUTION


 


12.1         Dispute Resolution Process.  Matters before the JDC and Subcommittees
shall be governed by the process specified in Section 3.5.  Any controversy, claim or dispute arising out
of or relating to this Agreement that is not subject to Section 3.5, shall
be settled, if possible, through good faith negotiations between the Parties.  If the
Parties are unable to settle such dispute within ***, and a Party wishes to pursue the matter, the
matter may be referred by either Party to the Executive Officers, who shall meet to attempt to resolve the dispute
in good faith.  Such resolution, if any,
of a referred issue shall be final and binding on the Parties.  All negotiations pursuant to this Section 12.1
are confidential and shall be treated as compromise and settlement negotiations
for purposes of applicable rules of evidence.  If the Executive Officers are unable to
settle the dispute within *** after referral thereto pursuant to Section 12.1,
then each Party reserves its right to any and all remedies available under law
or equity with respect to the dispute, subject to Section 12.2.


 


12.2         Injunctive Relief.  Notwithstanding anything to the contrary in
this ARTICLE XII, any Party may seek immediate injunctive or other interim
relief from any court of competent jurisdiction as necessary to enforce the
provisions of Section 10.5 or ARTICLE XI and to enforce and prevent
infringement or misappropriation of the Patent Rights, Know-How or Confidential
Information Controlled by such Party.


 


ARTICLE XIII


 


MISCELLANEOUS


 


13.1         Governing Law.  This Agreement (and any claims or disputes
arising out of or related thereto or to the transactions contemplated thereby
or to the inducement of any party to enter therein, whether for breach of
contract, tortious conduct, or otherwise and whether predicated on common law,
statute or otherwise) shall in all respects be governed by and construed in
accordance with the laws of the State of New York, including all matters of
construction, validity and performance, in each case without reference to any
conflict of law rules that might lead to the application of the laws of
any other jurisdiction.


 


13.2         Consent to Jurisdiction.  Each Party irrevocably submits to the
exclusive jurisdiction of the United States District Court for the Southern
District of New York or the United States District Court for the District of
Delaware, for the purposes of any suit, action or other proceeding arising out
of the Transaction.  Each Party agrees to
commence any such action, suit or proceeding either in the United States
District Court for the Southern District of New York or the United States
District Court for the District of Delaware or if such suit, action or other
proceeding may not be brought in such court for jurisdictional reasons, in the
Supreme Court of the State of New York, New York County.  Each Party further agrees that service of any



 


54

















 


process, summons,
notice or document by U.S. registered mail to such Party’s respective address
set forth in Section 13.5 shall be effective service of process for any
action, suit or proceeding in New York or Delaware with respect to any matters
to which it has submitted to jurisdiction in this Section 13.2. Each Party
irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit or proceeding arising out of this Agreement in (i) the
United States District Court for the Southern District of New York or (ii) the
United States District Court for the District of Delaware, and hereby and
thereby further irrevocably and unconditionally waives and agrees not to plead
or claim in any such court that any such action, suit or proceeding brought in
any such court has been brought in an inconvenient forum.


 


13.3         Assignment.


 


(a)           Neither
Party may assign its rights and obligations under this Agreement without the
prior written consent of the other Party, except that either Party may make
such assignment without the prior written consent of the other Party to an
Affiliate (so long as such Party shall remain jointly and severally liable with
such Affiliate with respect to all obligations so assigned).  Any request for consent to assignment shall
not be unreasonably withheld or delayed. 
Any purported assignment in contravention of this Section 13.3
shall, at the option of the non-assigning Party, be null and void and of no
effect.  No assignment shall release
either Party from responsibility for the performance of any accrued obligation
of such Party hereunder.  This Agreement
shall be binding upon and enforceable against the successor to or any permitted
assignee from either of the Parties.


 


(b)           Each
Party agrees that, notwithstanding any provisions of this Agreement to the
contrary:


 


(i)           
Either Party may assign this Agreement and the rights, obligations and licenses
granted hereunder to a Third Party in connection with a sale or transfer of all
or substantially all of the assigning Party’s business to which this Agreement
relates or if a Party merges or consolidates with a Third Party.


 


(ii)           In
the event that this Agreement is assigned by either Party in connection with a
sale or transfer of all or substantially all of the assigning Party’s business
to which this Agreement relates, such assignment shall not provide (A) the
non-assigning Party with rights or access to Intellectual Property Rights of
the assignee or acquirer of such Party, nor (B) the assignee or acquirer
with rights or access to Intellectual Property Rights of the non-assigning
Party.


 


13.4         Entire Agreement; Amendments.  This Agreement and the Exhibits and Schedules
referred to in this Agreement constitute the entire agreement between the
Parties with respect to the subject matter hereof, and supersede all previous
arrangements with respect to the subject matter hereof, whether written or
oral, including the Prior Confidentiality Agreement.  Any amendment or modification to this
Agreement shall be made in writing signed by both Parties.


 


13.5         Notices.  Notices to Incyte shall be addressed to:


 


Incyte
Corporation


Experimental
Station, Route 141 & Henry Clay Road 


 


55

















 


*** Confidential material redacted and filed separately with
the Commission.


 


Wilmington,
Delaware 19880


Attention: Chief
Commercial Officer


Facsimile
No.: ***


 


with a
copy to:


 


Incyte
Corporation


Experimental
Station, Route 141 & Henry Clay Road


Building
E336


Wilmington,
Delaware 19880


Attention: General
Counsel


Facsimile
No.: ***


 


Notices
to Lilly shall be addressed to:


 


Eli
Lilly and Company


Lilly
Corporate Center


Indianapolis,
Indiana  46285

Attention: Vice President and President, Established Markets


 


with a
copy to:


 


Eli
Lilly and Company


Lilly
Corporate Center


Indianapolis,
Indiana  46285


 


Attention:  General Patent Counsel


 


Facsimile
No.:***


 


Either
Party may change its address to which notices shall be sent by giving notice to
the other Party in the manner herein provided. 
All reports, approvals, and notices required or permitted by this
Agreement to be given to a Party (each a “Notice”) shall be given in
writing, by personal delivery, telecopy or overnight courier, to the Party
concerned at its address as set forth above (or at such other address as a
Party may specify by written notice pursuant to this Section 13.5 to the
other). All Notices shall be deemed effective, delivered and received (a) if
given by personal delivery, or by overnight courier, when actually delivered
and signed for; or (b) if given by facsimile, when such facsimile is
transmitted to the facsimile number specified above and receipt therefor is
confirmed.


 


13.6         Force Majeure.  No failure or omission by either Party in the
performance of any obligation of this Agreement shall be deemed a breach of
this Agreement or create any liability if the same shall arise from a Force
Majeure Event; provided  that the Party affected by such cause
promptly notifies the other Party and uses diligent efforts to cure such
failure or omission as soon as is practicable after the occurrence of one or
more of the above mentioned causes.


 


13.7         Compliance With Laws.  Each Party shall perform its obligations
under this Agreement in compliance with all applicable Laws. 


 


56

















 


13.8         Use Of Names, Logos Or Symbols.  Subject to Sections 5.3 and 11.3, no Party
shall use the name, trademarks, logos, physical likeness, employee names or
owner symbol of the other Party for any purpose, including private or public
securities placements, without the prior written consent of the affected
Party.  Nothing contained in this
Agreement shall be construed as granting either Party any rights or license to
use any of the other Party’s trademarks or trade names or the names of any
employees thereof, without separate, express written permission of the owner of
such trademark or trade name or name.


 


13.9         Independent Contractors.  It is understood and agreed that the
relationship between the Parties is that of independent contractors and that
nothing in this Agreement shall be construed to create a joint venture or any
relationship of employment, agency or partnership between the Parties to this
Agreement.  Neither Party is authorized
to make any representations, commitments, or statements of any kind on behalf
of the other Party or to take any action that would bind the other Party except
as explicitly provided in this Agreement. 
Furthermore, none of the transactions contemplated by this Agreement
shall be construed as a partnership for any tax purposes.


 


13.10       Headings.  The captions or headings of the sections or
other subdivisions hereof are inserted only as a matter of convenience or for
reference and shall have no effect on the meaning of the provisions hereof.


 


13.11       No Implied Waivers; Rights Cumulative.  No failure on the part of Incyte or Lilly to
exercise, and no delay by either Party in exercising, any right, power, remedy
or privilege under this Agreement, or provided by statute or at law or in
equity or otherwise, shall impair, prejudice or constitute a waiver of any such
right, power, remedy or privilege by such Party or be construed as a waiver of
any breach of this Agreement or as an acquiescence therein by such Party, nor
shall any single or partial exercise of any such right, power, remedy or
privilege by a Party preclude any other or further exercise thereof or the
exercise of any other right, power, remedy or privilege.


 


13.12       Severability.  If, under applicable Laws, any provision of
this Agreement is invalid or unenforceable, or otherwise directly or indirectly
affects the validity of any other material provision(s) of this Agreement
(such invalid or unenforceable provision, a “Severed Clause”), this
Agreement shall endure except for the Severed Clause.  The Parties shall consult one another and use
good faith efforts to agree upon a valid and enforceable provision that is a
reasonable substitute for the Severed Clause in view of the intent of this
Agreement.


 


13.13       Execution In Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.  Signatures provided by facsimile transmission
or in AdobeTM Portable Document Format (PDF) sent by electronic mail shall be
deemed to be original signatures.


 


13.14       No Third Party Beneficiaries.  No Person other than Lilly and Incyte (and
their respective assignees) shall be deemed an intended beneficiary hereunder
or have any right to enforce any obligation of this Agreement.


 


57

















 


13.15       Performance by Affiliates.  Either Party may use one or more of its
Affiliates to perform its obligations and duties hereunder and Affiliates of a
Party are expressly granted certain rights herein; provided  that
each such Affiliate shall be bound by the corresponding obligations of such
Party and the Parties shall remain liable hereunder for the prompt payment and
performance of all their respective obligations hereunder.


 


13.16       Exhibits.  In the event of inconsistencies between this
Agreement and any exhibits, schedules or attachments hereto, the terms of this
Agreement shall control.


 


[THE REMAINDER OF
THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]


 


58

















 


IN WITNESS WHEREOF, the Parties have caused their duly authorized
officers to execute and acknowledge this Agreement as of the date first written
above.


 


 


	
  ELI
  LILLY AND COMPANY

  	
  INCYTE CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Steven M. Paul

  	
   

  	
  By:

  	
  /s/ Paul A. Friedman

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Steven M. Paul, M.D.

  	
   

  	
  Name:

  	
  Paul A. Friedman

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  EVP, Science and
  Technology

  	
   

  	
  Title:

  	
  President &
  CEO

  



 


59














 


Exhibit A


 


Incyte Patent Rights


 

















 


*** Confidential material redacted
and filed separately with the Commission.


 


Exhibit A-1


 


Genus
Patent Rights


 


***


	
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  ***

  	
   

  	
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2

















 


***
Confidential material redacted and filed separately with the Commission.


 


	
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3

















 


***
Confidential material redacted and filed separately with the Commission.


 


	
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4

















 


***
Confidential material redacted and filed separately with the Commission.


 


Exhibit A-2


 


Selection
Patent Rights


 


***


 


	
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5

















 


***
Confidential material redacted and filed separately with the Commission.


 


	
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6

















 


Exhibit B


 


Initial Information Transfer


 


Described
below are the items to be provided to Lilly by Incyte pursuant to Section 4.1(a) of
the Agreement, which include the material documents, information and data
listed in this Exhibit B that are recorded in tangible form that are
Incyte Know-How, to the extent each of which exists as of the Effective Date
and has not already been provided to Lilly. 
Within sixty (60) days after the Effective Date, Lilly will confirm in
writing to Incyte whether Incyte’s initial data transfer obligations, as
described in Section 4.1(a) of the Agreement, have been achieved.


 


Clinical &
Regulatory Documents and Information


 


·                  Clinical study related documents, information
and data that are recorded in tangible form, including those currently
possessed by CROs and other third party vendors


·                  Regulatory Authority submissions,
correspondence and all communications, including minutes from teleconferences
and contact reports (US and ex-US)


·                  Regulatory Authority meeting briefing
documents and related minutes (US and ex-US)


·                  Pre-IND submissions


·                  IND submissions


·                  Annual reports to IND(s)


·                  CTA/IMPD submissions


·                  Annual Safety Reports submissions


·                  Investigator’s Brochures and any updates
thereto


·                  Safety reports (CIOMSs and/or Medwatch
reports)


·                  Documents related to serious adverse events (“SAEs”)


·                  Investigator Safety Letters, actions taken
for safety reasons, and other relevant safety information


·                  Safety pharmacology and toxicology study
related documents, information and data that are recorded in tangible form


·                  Pharmacology and Absorption, Distribution,
Metabolism, and Excretion (ADME) related documents, information and data that
are recorded in tangible form


 


Licensed
Compound Documents


 


Incyte
may retain (x) originals of all documents, information and data, including
regulatory submissions, correspondence, and clinical trial data and (y) originals
of regulatory submissions, correspondence, and clinical trial data directly
related to Study 201 until fifteen (15) Business Days after responsibility for
the relevant regulatory filing or clinical trial has been transferred to Lilly
in accordance with the Agreement and this Exhibit B.  Incyte will provide both a shared electronic
depository and paper copies of all requested documents, information and data
where both electronic and paper versions are currently available.


 


Manufacturing
Know-How


 


Incyte
will prepare and compile an inventory of relevant documents and transfer all
Incyte Know-How for manufacturing Licensed Products including: laboratory
notebook data, batch 


 

















 


records,
process data, stability data, summary reports, formulation folders, analytical
methods, development reports, quality and regulatory documentation, validation
reports and other material data related to the development, manufacturing,
and/or distribution of Licensed Compounds and/or Licensed Products. As part of
the Know-How transfer, Incyte shall cooperate with Lilly to establish a
transfer protocol and make resources available at Incyte’s cost to enable the
successful execution of the transfer protocol. 
Additionally, Incyte will disclose and transfer as necessary, any vendor
sourcing and/or contracting information that Lilly may reasonably request.


 


2

















 


Exhibit C


 


Initial Development Plans


 

















 


*** Confidential material redacted
and filed separately with the Commission.


 


***


 

















 


***
Confidential material redacted and filed separately with the Commission.


 


***


 

















 


*** Confidential material redacted and filed separately with the
Commission.


 


***


 

















 


*** Confidential material redacted and filed separately with the
Commission.


 


***


 














 


Exhibit D


 


Press Release


 

















 


	
  

  	
  

  
	
   

  	
   

  
	
   

  	
  Eli
  Lilly and Company

  Lilly
  Corporate Center

  Indianapolis,
  Indiana 46285

  U.S.A.

  www.lilly.com

  



 


Date: December 21, 2009


 


	
  For Release:

  	
  Immediately

  
	
   

  	
   

  
	
  Refer to:

  	
  (317) 276-5795 — Mark E. Taylor (Lilly)

  
	
   

  	
   

  
	
   

  	
  (302) 498-6944 — Pamela Murphy (Incyte)

  



 

















 


	
  

  	
  

  
	
   

  	
   

  
	
   

  	
  Eli
  Lilly and Company

  Lilly
  Corporate Center

  Indianapolis,
  Indiana 46285

  U.S.A.

  www.lilly.com

  



 


Lilly and Incyte Announce
Collaboration for Development and Commercialization of Oral Anti-Inflammatory
and Autoimmune Therapies


 


Lilly Gains Worldwide
Rights for Incyte’s Novel JAK1/JAK2 Inhibitor, INCB28050, for Inflammatory and
Autoimmune Diseases


 


Incyte to Receive $90
Million Upfront Payment and up to $665 Million in Potential Milestones, Plus
Royalties on Future Sales


 


Incyte Retains
Co-Development & Co-Promotion Options


 


INDIANAPOLIS, IN and WILMINGTON, DE —  Eli Lilly and Company (NYSE:LLY) and Incyte
Corporation (NASDAQ:INCY) announced today that they have entered into an
exclusive worldwide license and collaboration agreement for the development and
commercialization of Incyte’s oral JAK1/JAK2 inhibitor, INCB28050, and certain
follow on compounds, for inflammatory and autoimmune diseases. The lead
compound, INCB28050, is currently being studied in a six-month dose-ranging
Phase II trial for rheumatoid arthritis.


 


Under the terms of the agreement, Lilly will receive
worldwide rights to develop and commercialize INCB28050 as an oral treatment
for all inflammatory conditions. In exchange for these rights, Incyte will
receive an initial payment of $90 million and is eligible for up to $665 million
in additional potential development, regulatory, and commercialization
milestones, as well as tiered, double-digit royalty payments on future global
sales with rates ranging up to twenty percent if a product is successfully
commercialized.


 

















 


“This new alliance with Incyte reinforces Lilly’s
commitment to expand our presence in inflammation and autoimmunity through the
development of a new class of oral anti-inflammatory therapies,” said Eiry
Roberts, M.D. Lilly vice president for autoimmune product development. “We look
forward to continuing the development of INCB28050 in RA and initiating
additional clinical studies to help address the unmet patient needs from
debilitating autoimmune and inflammatory diseases.”


 


Paul Friedman, Incyte’s president and chief
executive officer, stated, “Lilly’s success in bringing novel therapies to
market, their commitment to building a franchise in inflammation and
autoimmunity, and their enthusiasm regarding the potential of JAK inhibition
gives us confidence that the full therapeutic and commercial potential of
INCB28050 in RA as well as other autoimmune and inflammatory conditions can be
rapidly and effectively achieved through this agreement.  This collaboration leverages the capabilities
and strengths of each partner and achieves our objective to retain significant
value for Incyte’s shareholders.”


 


Incyte will retain the option to co-develop its
JAK1/JAK2 inhibitors with Lilly on a compound-by-compound and
indication-by-indication basis beginning at the initiation of Phase IIb
development. Under the agreement, if Incyte elects to co-develop any compounds
and/or indications, Incyte would be responsible for funding thirty percent of
the associated future global development costs from the initiation of a Phase
IIb trial. Incyte would receive an incremental royalty rate increase across all
tiers resulting in effective royalty rates ranging up to the high twenties on
potential future global sales for compounds and/or indications that Incyte
elects to co-develop. Incyte expects that the earliest it would consider
exercising a co-development option would be in the second half of 2010,
concurrent with the potential initiation of a Phase IIb trial with INCB28050.


 

















 


Development of the JAK1/JAK2 inhibitors will be
governed by a joint development committee. Incyte also has the option to
co-promote products in the US.


 


As a result of this transaction, Lilly expects to
incur a charge to earnings in the fourth quarter of 2009 of approximately $.05
per share. The company reconfirmed its full-year 2009 earnings-per-share
guidance of $3.90 to $4.00 per share on a reported basis, or $4.30 to $4.40 per
share on a pro forma non-GAAP basis.


 


About Rheumatoid Arthritis (RA)


 


Rheumatoid arthritis is an autoimmune disease,
estimated to affect about 1% of the world’s population. The disease is
characterized by aberrant immune mechanisms that lead to joint inflammation and
swelling with progressive destruction of joints. In addition to affecting the
joints, RA can affect connective tissue in the skin and organs of the
body.  Current treatments include the
non-steroidal anti-inflammatory drugs, disease-modifying anti-rheumatic drugs
such as methotrexate, and the newer injectable biological response modifiers
that target tumor necrosis factor alpha, a pro-inflammatory cytokine implicated
in the pathogenesis of rheumatoid arthritis. None of these treatments is
curative and RA remains a disease for which there is still a significant unmet
clinical need.


 


About JAK Inhibition


 


There are four known JAK enzymes: JAK1, 2, 3 and
TYK2. These enzymes are critical components of signaling mechanisms utilized by
a number of cytokines and growth factors, including those that are elevated in
RA patients. Cytokines such as interleukin-6, -12, and -23 


 

















 


signal through the JAK pathway and have been
clinically validated as therapeutic targets in inflammatory diseases.
Additional JAK-dependent cytokines have also been implicated in a number of
inflammatory and autoimmune diseases suggesting that JAK inhibitors may be
useful for the treatment of a broad range of inflammatory conditions.


 


About INCB28050


 


INCB28050 is an orally-available, potent and
selective JAK1/JAK2 inhibitor that is currently in Phase II development as a
treatment for RA. In previously conducted Phase II studies, Incyte’s JAK1/JAK2
inhibitors have demonstrated efficacy and have been well tolerated in clinical
studies to date.


 


About Incyte


 


Incyte Corporation is a Wilmington, Delaware-based
drug discovery and development company focused on developing proprietary small
molecule drugs for oncology, inflammation and diabetes. Incyte’s most advanced
compound, INCB18424, is in Phase III development for myelofibrosis. For
additional information on Incyte, visit the Company’s web site at
www.incyte.com.


 


About Eli Lilly and Company


 


Lilly, a leading innovation-driven corporation, is
developing a growing portfolio of pharmaceutical products by applying the
latest research from its own worldwide laboratories and from collaborations
with eminent scientific organizations. Headquartered in Indianapolis, Ind.,
Lilly provides answers — through medicines and information — for some of the
world’s most urgent medical needs. 
Additional information about Lilly is available at www.lilly.com.  C-LLY


 

















 


Lilly Safe Harbor Statement


 


This press release contains forward-looking
statements that are based on management’s current expectations, but actual
results may differ materially due to various factors. There are significant
risks and uncertainties in pharmaceutical research and development. There can
be no guarantees with respect to pipeline products (including the compounds
discussed in this press release) that the products will receive the necessary
clinical and manufacturing regulatory approvals or that they will prove to be
commercially successful. The company’s results may also be affected by such
factors as competitive developments affecting current products; the rate of
sales growth of recently launched products; the timing of anticipated
regulatory approvals and launches of new products; other regulatory
developments and government investigations; patent disputes and other
litigation involving current and future products; the impact of governmental
actions regarding pricing, importation, and reimbursement for pharmaceuticals;
business development transactions; changes in tax law; asset impairments and
restructuring charges and the impact of exchange rates. For additional
information about the factors that affect the company’s business, please see
the company’s latest Form 10-K, filed February 2009, and Form 10-Q
filed October 2009. The company undertakes no duty to update
forward-looking statements.


 


Incyte Safe Harbor Statement


 


Except for the historical information contained
herein, the matters set forth in this press release, including statements with
respect to with respect to the potential for Incyte to receive up to $665
million in additional potential milestones, Incyte’s expectation for the
earliest time for it to consider exercising a co-development option, Incyte’s
confidence that the full therapeutic and commercial potential of INCB28050 in
RA as well as other inflammatory conditions can be rapidly and effectively
achieved through the collaboration agreement, and the potential for JAK
inhibitors to be useful for the treatment of a broad range of inflammatory
conditions, are all forward-looking statements within the meaning of the “safe
harbor” provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties that
may cause the parties not to achieve some or all of the commercial and
developmental milestones set forth in the collaboration agreement and that may
otherwise cause Incyte’s actual results and timing to differ materially,
including the high degree of risk and uncertainty associated with drug
development and clinical trials, the uncertainty associated with the regulatory
approval processes, risks related to the timing of and patient enrollment in
clinical trials, risks related to the potential failure of INCB28050 to
demonstrate safety and efficacy in clinical testing, risks and uncertainty
associated with the therapeutic and commercial value of INCB28050, risks
relating to Lilly’s and Incyte’s abilities to successfully develop and commercialize
drug candidates, risks relating to market competition, risks associated with 


 

















 


Incyte’s dependence on its relationship with its
collaboration partners, and other risks detailed from time to time in Incyte’s
filings with the Securities and Exchange Commission, including its Quarterly
Report on Form 10-Q for the quarter ended September 30, 2009. Incyte
disclaims any intent or obligation to update these forward-looking statements.


 


#       #       #


 

















 


Exhibit E


 


Hematology Field and
Oncology Field  (ICD-9CM)


 


 


2.  NEOPLASMS (140-239)


 


1.             Content:


 


This
chapter contains the following broad groups:


 


140-195                          Malignant neoplasms, stated or presumed to be primary, of
specified sites, except of lymphatic and hematopoietic tissue


196-198                          Malignant neoplasms, stated or presumed to be secondary, of
specified sites


199                                                   Malignant neoplasms, without specification of site


200-208                          Malignant neoplasms, stated or presumed to be primary, of
lymphatic and hematopoietic tissue


209                                                   Neuroendocrine tumors


210-229                          Benign neoplasms


230-234                          Carcinoma in situ


235-238                          Neoplasms of uncertain behavior [see Note, at beginning of
section 235-238]


239                                                   Neoplasms of unspecified nature


 


2.             Functional activity


 


All
neoplasms are classified in this chapter, whether or not functionally active.
An additional code from Chapter 3 may be used to identify such functional
activity associated with any neoplasm, e.g.:


catecholamine-producing
malignant pheochromocytoma of adrenal:


code 194.0, additional code 255.6


basophil
adenoma of pituitary with Cushing’s syndrome:


code 227.3, additional code 255.0


 


3.             Morphology [Histology]


 


For
those wishing to identify the histological type of neoplasms, a comprehensive
coded nomenclature, which comprises the morphology rubrics of the ICD-Oncology,
is given after the E-code chapter.


 


4.             Malignant neoplasms overlapping
site boundaries


 


Categories
140-195 are for the classification of primary malignant neoplasms according to
their point of origin.  A malignant
neoplasm that overlaps two or more subcategories within a three-digit rubric
and whose point of origin cannot be determined should be classified to the
subcategory .8 “Other.”  For example, “carcinoma
involving tip and ventral surface of tongue” should be assigned to 141.8. On
the other hand, “carcinoma of tip of tongue, extending to involve the ventral
surface” should be coded to 141.2, as the point of origin, the tip, is
known.  Three subcategories (149.8,
159.8, 165.8) have been provided for malignant neoplasms that overlap the
boundaries of three-digit rubrics within certain systems.  Overlapping malignant neoplasms that cannot
be classified as indicated above should be assigned to the appropriate
subdivision of category 195 (Malignant neoplasm of other and ill-defined
sites).


 


MALIGNANT NEOPLASM OF LIP, ORAL
CAVITY, AND PHARYNX (140-149)


 


Excludes:              carcinoma
in situ (230.0)


 


140                           Malignant
neoplasm of lip


 

















 


Excludes:              skin of lip (173.0)


 


140.0                 Upper lip, vermilion border


Upper lip:


NOS


external


lipstick area


 


140.1                 Lower lip, vermilion border


Lower lip:


NOS


external


lipstick area


 


140.3                 Upper lip, inner aspect


Upper lip:


buccal aspect


frenulum


mucosa


oral aspect


 


140.4                 Lower lip, inner aspect


Lower lip:


buccal aspect


frenulum


mucosa


oral aspect


 


140.5                 Lip, unspecified, inner aspect


Lip, not specified whether
upper or lower:


buccal aspect


frenulum


mucosa


oral aspect


 


140.6                 Commissure of lip


Labial commissure


 


140.8                 Other sites of lip


Malignant neoplasm of
contiguous or overlapping sites of lip whose point of origin cannot be
determined


 


140.9                 Lip, unspecified, vermilion border


Lip, not specified as upper or
lower:


NOS


external


lipstick area


 


141                           Malignant
neoplasm of tongue


 


141.0                 Base of tongue


Dorsal surface of base of
tongue


Fixed part of tongue NOS


 


141.1                 Dorsal surface of tongue


Anterior two-thirds of tongue,
dorsal surface


Dorsal tongue NOS


 


2

















 


Midline of tongue


 


Excludes:              dorsal surface of base of tongue
(141.0)


 


141.2                 Tip and lateral border of tongue


 


141.3                 Ventral surface of tongue


Anterior two-thirds of tongue,
ventral surface


Frenulum linguae


 


141.4                 Anterior two-thirds of tongue, part unspecified


Mobile part of tongue NOS


 


141.5                 Junctional zone


Border of tongue at junction of
fixed and mobile parts at insertion of anterior tonsillar pillar


 


141.6                 Lingual tonsil


 


141.8                 Other sites of tongue


Malignant neoplasm of
contiguous or overlapping sites of tongue whose point of origin cannot be
determined


 


141.9                 Tongue, unspecified


Tongue NOS


 


142                           Malignant
neoplasm of major salivary glands


 


Includes:               salivary ducts


 


Excludes:              malignant neoplasm of minor
salivary glands:


NOS (145.9)


buccal mucosa (145.0)


soft palate (145.3)


tongue (141.0-141.9)


tonsil, palatine (146.0)


 


142.0                 Parotid gland


 


142.1                 Submandibular gland


Submaxillary gland


 


142.2                 Sublingual gland


 


142.8                 Other major salivary glands


Malignant neoplasm of
contiguous or overlapping sites of salivary glands and ducts whose point of
origin cannot be determined


 


142.9                 Salivary gland, unspecified


Salivary gland (major) NOS


 


143                           Malignant
neoplasm of gum


 


Includes:               alveolar (ridge) mucosa


gingiva (alveolar)
(marginal)


interdental papillae


 


Excludes:              malignant odontogenic neoplasms
(170.0-170.1)


 


143.0                 Upper gum


 


143.1                 Lower gum


 


3

















 


143.8                 Other sites of gum


Malignant neoplasm of
contiguous or overlapping sites of gum whose point of origin cannot be
determined


 


143.9                 Gum, unspecified


 


144                           Malignant
neoplasm of floor of mouth


 


144.0                 Anterior portion


Anterior to the premolar-canine
junction


 


144.1                 Lateral portion


 


144.8                 Other sites of floor of mouth


Malignant neoplasm of
contiguous or overlapping sites of floor of mouth whose point of origin cannot
be determined


 


144.9                 Floor of mouth, part unspecified


 


145                           Malignant
neoplasm of other and unspecified parts of mouth


 


Excludes:              mucosa of lips (140.0-140.9)


 


145.0                 Cheek mucosa


Buccal mucosa


Cheek, inner aspect


 


145.1                 Vestibule of mouth


Buccal sulcus (upper) (lower)


Labial sulcus (upper) (lower)


 


145.2                 Hard palate


 


145.3                 Soft palate


 


Excludes:              nasopharyngeal [posterior] [superior]
surface of soft palate (147.3)


 


145.4                 Uvula


 


145.5                 Palate, unspecified


Junction of hard and soft
palate


Roof of mouth


 


145.6                 Retromolar area


 


145.8                 Other specified parts of mouth


Malignant neoplasm of
contiguous or overlapping sites of mouth whose point of origin cannot be
determined


 


145.9                 Mouth, unspecified


Buccal cavity NOS


Minor salivary gland,
unspecified site


Oral cavity NOS


 


146                           Malignant
neoplasm of oropharynx


 


146.0                 Tonsil


Tonsil:


NOS


faucial


 


4

















 


palatine


 


Excludes:              lingual tonsil (141.6)


pharyngeal tonsil
(147.1)


 


146.1                 Tonsillar fossa


 


146.2                 Tonsillar pillars (anterior) (posterior)


Faucial pillar


Glossopalatine fold


Palatoglossal arch


Palatopharyngeal arch


 


146.3                 Vallecula


Anterior and medial surface of
the pharyngoepiglottic fold


 


146.4                 Anterior aspect of epiglottis


Epiglottis, free border
[margin]


Glossoepiglottic fold(s)


 


Excludes:              epiglottis:


NOS (161.1)


suprahyoid portion
(161.1)


 


146.5                 Junctional region


Junction of the free margin of
the epiglottis, the aryepiglottic fold, and the pharyngoepiglottic fold


 


146.6                 Lateral wall of oropharynx


 


146.7                 Posterior wall of oropharynx


 


146.8                 Other specified sites of oropharynx


Branchial cleft


Malignant neoplasm of
contiguous or overlapping sites of oropharynx whose point of origin cannot be
determined


 


146.9                 Oropharynx, unspecified


 


147                           Malignant
neoplasm of nasopharynx


 


147.0                 Superior wall


Roof of nasopharynx


 


147.1                 Posterior wall


Adenoid


Pharyngeal tonsil


 


147.2                 Lateral wall


Fossa of Rosenmüller


Opening of auditory tube


Pharyngeal recess


 


147.3                 Anterior wall


Floor of nasopharynx


Nasopharyngeal [posterior]
[superior] surface of soft palate


Posterior margin of nasal
septum and choanae


 


147.8                 Other specified sites of nasopharynx


 


5














 


Malignant
neoplasm of contiguous or overlapping sites of nasopharynx whose point of
origin cannot be determined


 


147.9       Nasopharynx, unspecified


Nasopharyngeal wall NOS


 


148          Malignant neoplasm of hypopharynx


 


148.0       Postcricoid region


 


148.1       Pyriform sinus


Pyriform fossa


 


148.2       Aryepiglottic fold,
hypopharyngeal aspect


Aryepiglottic fold or
interarytenoid fold:


NOS


marginal zone


 


Excludes:               aryepiglottic
fold or interarytenoid fold, laryngeal aspect (161.1)


 


148.3       Posterior hypopharyngeal
wall


 


148.8       Other specified sites of
hypopharynx


Malignant neoplasm of
contiguous or overlapping sites of hypopharynx whose point of origin cannot be
determined


 


148.9       Hypopharynx, unspecified


Hypopharyngeal wall NOS


Hypopharynx NOS


 


149          Malignant neoplasm of other and ill-defined sites within the
lip, oral cavity, and pharynx


 


149.0       Pharynx, unspecified


 


149.1       Waldeyer’s ring


 


149.8       Other


Malignant neoplasms of lip,
oral cavity, and pharynx whose point of origin cannot be assigned to any one of
the categories 140-148


 


Excludes:               “book leaf”
neoplasm [ventral surface of tongue and floor of mouth] (145.8)


 


149.9       Ill-defined


 


MALIGNANT
NEOPLASM OF DIGESTIVE ORGANS AND PERITONEUM (150-159)


 


Excludes:               carcinoma in situ (230.1-230.9)


 


150          Malignant neoplasm of esophagus


 


150.0       Cervical esophagus


 


150.1       Thoracic esophagus


 


150.2       Abdominal esophagus


 


Excludes:               adenocarcinoma
(151.0)


cardio-esophageal
junction (151.0)


 


6

















 


150.3       Upper third of esophagus


Proximal third of esophagus


 


150.4       Middle third of
esophagus


 


150.5       Lower third of esophagus


Distal third of esophagus


 


Excludes:               adenocarcinoma
(151.0)


cardio-esophageal
junction (151.0)


 


150.8       Other specified part


Malignant neoplasm of
contiguous or overlapping sites of esophagus whose point of origin cannot be
determined


 


150.9       Esophagus, unspecified


 


151          Malignant neoplasm of stomach


 


Excludes:               benign
carcinoid tumor of stomach (209.63)


malignant carcinoid
tumor of stomach (209.63)


 


151.0       Cardia


Cardiac orifice


Cardio-esophageal junction


 


Excludes:               squamous cell
carcinoma (150.2, 150.5)


 


151.1       Pylorus


Prepylorus


Pyloric canal


 


151.2       Pyloric antrum


Antrum of stomach NOS


 


151.3       Fundus of stomach


 


151.4       Body of stomach


 


151.5       Lesser curvature,
unspecified


Lesser curvature, not
classifiable to 151.1-151.4


 


151.6       Greater curvature,
unspecified


Greater curvature, not
classifiable to 151.0-151.4


 


151.8       Other specified sites of
stomach


Anterior wall, not classifiable
to 151.0-151.4


Posterior wall, not
classifiable to 151.0-151.4


Malignant neoplasm of
contiguous or overlapping sites of stomach whose point of origin cannot be
determined


 


151.9       Stomach, unspecified


Carcinoma ventriculi


Gastric cancer


 


152          Malignant neoplasm of small intestine, including duodenum


 


Excludes:               benign
carcinoid tumor of small intestine and duodenum (209.40-209.43)


malignant carcinoid
tumor of small intestine and duodenum (209.00-209.03)


 


152.0       Duodenum


 


7

















 


152.1       Jejunum


 


152.2       Ileum


 


Excludes:               ileocecal valve
(153.4)


 


152.3       Meckel’s diverticulum


 


152.8       Other specified sites of
small intestine


Duodenojejunal junction


Malignant neoplasm of
contiguous or overlapping sites of small intestine whose point of origin cannot
be determined


 


152.9       Small intestine,
unspecified


 


153          Malignant neoplasm of colon


 


Excludes:               benign
carcinoid tumor of colon (209.50-209.56)


malignant carcinoid
tumor of colon (209.10-209.16)


 


153.0       Hepatic flexure


 


153.1       Transverse colon


 


153.2       Descending colon


Left colon


 


153.3       Sigmoid colon


Sigmoid (flexure)


 


Excludes:               rectosigmoid
junction (154.0)


 


153.4       Cecum


Ileocecal valve


 


153.5       Appendix


 


153.6       Ascending colon


Right colon


 


153.7       Splenic flexure


 


153.8       Other specified sites of
large intestine


Malignant neoplasm of
contiguous or overlapping sites of colon whose point of origin cannot be
determined


 


Excludes:               ileocecal valve
(153.4)


rectosigmoid junction
(154.0)


 


153.9       Colon, unspecified


Large intestine NOS


 


154          Malignant neoplasm of rectum, rectosigmoid junction, and anus


 


Excludes:               benign
carcinoid tumor of rectum (209.57)


malignant carcinoid
tumor of rectum (209.17)


 


154.0       Rectosigmoid junction


Colon with rectum


Rectosigmoid (colon)


 


154.1       Rectum


Rectal ampulla


 


8

















 


154.2       Anal canal


Anal sphincter


 


Excludes:               skin of anus
(172.5, 173.5)


 


154.3       Anus, unspecified


 


Excludes:               anus:


margin (172.5, 173.5)


skin (172.5, 173.5)


perianal skin (172.5,
173.5)


 


154.8       Other


Anorectum


Cloacogenic zone


Malignant neoplasm of
contiguous or overlapping sites of rectum, rectosigmoid junction, and anus
whose point of origin cannot be determined


 


155          Malignant neoplasm of liver and intrahepatic bile ducts


 


155.0       Liver, primary


Carcinoma:


liver, specified as primary


hepatocellular


liver cell


Hepatoblastoma


 


155.1       Intrahepatic bile ducts


Canaliculi biliferi


Interlobular:


bile ducts


biliary canals


Intrahepatic:


biliary passages


canaliculi


gall duct


 


Excludes:               hepatic duct
(156.1)


 


155.2       Liver, not specified as
primary or secondary


 


156          Malignant neoplasm of gallbladder and extrahepatic bile ducts


 


156.0       Gallbladder


 


156.1       Extrahepatic bile ducts


Biliary duct or passage


NOS


Common bile duct


Cystic duct


Hepatic duct


Sphincter of Oddi


 


156.2       Ampulla of Vater


 


156.8       Other specified sites of
gallbladder and extrahepatic bile ducts


Malignant neoplasm of
contiguous or overlapping sites of gallbladder and extrahepatic bile ducts
whose point of origin cannot be determined


 


156.9       Biliary tract, part
unspecified


 


9

















 


Malignant neoplasm involving
both intrahepatic and extrahepatic bile ducts


 


157          Malignant neoplasm of pancreas


 


157.0       Head of pancreas


 


157.1       Body of pancreas


 


157.2       Tail of pancreas


 


157.3       Pancreatic duct


Duct of:


Santorini


Wirsung


 


157.4       Islets of Langerhans


Islets of Langerhans, any part
of pancreas


 


Use
additional code to identify any functional activity


 


157.8       Other specified sites of
pancreas


Ectopic pancreatic tissue


Malignant neoplasm of
contiguous or overlapping sites of pancreas whose point of origin cannot be
determined


 


157.9       Pancreas, part
unspecified


 


158          Malignant neoplasm of retroperitoneum and peritoneum


 


158.0       Retroperitoneum


Periadrenal tissue


Perinephric tissue


Perirenal tissue


Retrocecal tissue


 


158.8       Specified parts of
peritoneum


Cul-de-sac (of Douglas)


Mesentery


Mesocolon


Omentum


Peritoneum:


parietal


pelvic


Rectouterine pouch


Malignant neoplasm of
contiguous or overlapping sites of retroperitoneum and peritoneum whose point
of origin cannot be determined


 


158.9       Peritoneum, unspecified


 


159          Malignant neoplasm of other and ill-defined sites within the
digestive organs and peritoneum


 


159.0       Intestinal tract, part
unspecified


Intestine NOS


 


159.1       Spleen, not elsewhere
classified


Angiosarcoma of spleen


Fibrosarcoma of spleen


 


Excludes:               Hodgkin’s
disease (201.0-201.9)


 


10

















 


lymphosarcoma (200.1)


reticulosarcoma (200.0)


 


159.8       Other sites of digestive
system and intra-abdominal organs


Malignant neoplasm of digestive
organs and peritoneum whose point of origin cannot be assigned to any one of
the categories 150-158


 


Excludes:               anus and rectum
(154.8)


cardio-esophageal
junction (151.0)


colon and rectum (154.0)


 


159.9       Ill-defined


Alimentary canal or tract NOS


Gastrointestinal tract NOS


 


Excludes:               abdominal NOS
(195.2)


intra-abdominal NOS
(195.2)


 


MALIGNANT
NEOPLASM OF RESPIRATORY AND INTRATHORACIC ORGANS (160-165)


 


Excludes:               carcinoma in situ (231.0-231.9)


 


160          Malignant neoplasm of nasal cavities, middle ear, and
accessory sinuses


 


160.0       Nasal cavities


Cartilage of nose


Conchae, nasal


Internal nose


Septum of nose


Vestibule of nose


 


Excludes:               nasal bone
(170.0)


nose NOS (195.0)


olfactory bulb (192.0)


posterior margin of
septum and choanae (147.3)


skin of nose (172.3,
173.3)


turbinates (170.0)


 


160.1       Auditory tube, middle
ear, and mastoid air cells


Antrum tympanicum


Eustachian tube


Tympanic cavity


 


Excludes:               auditory canal
(external) (172.2, 173.2)


bone of ear (meatus)
(170.0)


cartilage of ear (171.0)


ear (external) (skin)
(172.2, 173.2)


 


160.2       Maxillary sinus


Antrum (Highmore) (maxillary)


 


160.3       Ethmoidal sinus


 


160.4       Frontal sinus


 


160.5       Sphenoidal sinus


 


160.8       Other


 


11

















 


Malignant neoplasm of
contiguous or overlapping sites of nasal cavities, middle ear, and accessory
sinuses whose point of origin cannot be determined


 


160.9       Accessory sinus,
unspecified


 


161          Malignant neoplasm of larynx


 


161.0       Glottis


Intrinsic larynx


Laryngeal commissure (anterior)
(posterior)


True vocal cord


Vocal cord NOS


 


161.1       Supraglottis


Aryepiglottic fold or
interarytenoid fold, laryngeal aspect


Epiglottis (suprahyoid portion)
NOS


Extrinsic larynx


False vocal cords


Posterior (laryngeal) surface
of epiglottis


Ventricular bands


 


Excludes:               anterior aspect
of epiglottis (146.4)


aryepiglottic fold or
interarytenoid fold:


NOS (148.2)


hypopharyngeal aspect
(148.2)


marginal zone (148.2)


 


161.2       Subglottis


 


161.3       Laryngeal cartilages


Cartilage:


arytenoid


cricoid


cuneiform


thyroid


 


161.8       Other specified sites of
larynx


Malignant neoplasm of
contiguous or overlapping sites of larynx whose point of origin cannot be
determined


 


161.9       Larynx, unspecified


 


162          Malignant neoplasm of trachea, bronchus, and lung


 


Excludes:               benign
carcinoid tumor of bronchus (209.61)


malignant carcinoid
tumor of bronchus (209.21)


 


162.0       Trachea


Cartilage of trachea


Mucosa of trachea


 


162.2       Main bronchus


Carina


Hilus of lung


 


162.3       Upper lobe, bronchus or
lung


 


162.4       Middle lobe, bronchus or
lung


 


12

















 


162.5       Lower lobe, bronchus or
lung


 


162.8       Other parts of bronchus
or lung


Malignant neoplasm of
contiguous or overlapping sites of bronchus or lung whose point of origin
cannot be determined


 


162.9       Bronchus and lung,
unspecified


 


163          Malignant neoplasm of pleura


 


163.0       Parietal pleura


 


163.1       Visceral pleura


 


163.8       Other specified sites of
pleura


Malignant neoplasm of
contiguous or overlapping sites of pleura whose point of origin cannot be
determined


 


163.9       Pleura, unspecified


 


164          Malignant neoplasm of thymus, heart, and mediastinum


 


164.0       Thymus


 


Excludes:               benign
carcinoid tumor of the thymus (209.62)


malignant carcinoid
tumor of the thymus (209.22)


 


164.1       Heart


Endocardium


Epicardium


Myocardium


Pericardium


 


Excludes:               great vessels
(171.4)


 


164.2       Anterior mediastinum


 


164.3       Posterior mediastinum


 


164.8       Other


Malignant neoplasm of
contiguous or overlapping sites of thymus, heart, and mediastinum whose point
of origin cannot be determined


 


164.9       Mediastinum, part
unspecified


 


165          Malignant neoplasm of other and ill-defined sites within the
respiratory system and intrathoracic organs


 


165.0       Upper respiratory tract,
part unspecified


 


165.8       Other


Malignant neoplasm of
respiratory and intrathoracic organs whose point of origin cannot be assigned
to any one of the categories 160-164


 


165.9       Ill-defined sites within
the respiratory system


Respiratory tract NOS


 


Excludes:               intrathoracic
NOS (195.1)


thoracic NOS (195.1)


 


13

















 


MALIGNANT
NEOPLASM OF BONE, CONNECTIVE TISSUE, SKIN, AND BREAST (170-176)


 


Excludes:               carcinoma in situ:


breast (233.0)


skin (232.0-232.9)


 


170          Malignant neoplasm of bone and articular cartilage


 


Includes:                cartilage
(articular) (joint)


periosteum


 


Excludes:               bone marrow NOS
(202.9)


cartilage:


ear (171.0)


eyelid (171.0)


larynx (161.3)


nose (160.0)


synovia (171.0-171.9)


 


170.0       Bones of skull and face,
except mandible


Bone:


ethmoid


frontal


malar


nasal


occipital


orbital


parietal


sphenoid


temporal


zygomatic


Maxilla (superior)


Turbinate


Upper jaw bone


Vomer


 


Excludes:               carcinoma, any
type except intraosseous or odontogenic:


maxilla, maxillary
(sinus) (160.2)


upper jaw bone (143.0)


jaw bone (lower) (170.1)


 


170.1       Mandible


Inferior maxilla


Jaw bone NOS


Lower jaw bone


 


Excludes:               carcinoma, any
type except intraosseous or odontogenic:


jaw bone NOS (143.9)


lower (143.1)


upper jaw bone (170.0)


 


170.2       Vertebral column,
excluding sacrum and coccyx


Spinal column


Spine


Vertebra


 


Excludes:               sacrum and
coccyx (170.6)


 


170.3       Ribs, sternum, and
clavicle


Costal cartilage


 


14

















 


Costovertebral joint


Xiphoid process


 


170.4       Scapula and long bones
of upper limb


Acromion


Bones NOS of upper limb


Humerus


Radius


Ulna


 


170.5       Short bones of upper
limb


Carpal


Cuneiform, wrist


Metacarpal


Navicular, of hand


Phalanges of hand


Pisiform


Scaphoid (of hand)


Semilunar or lunate


Trapezium


Trapezoid


Unciform


 


170.6       Pelvic bones, sacrum,
and coccyx


Coccygeal vertebra


Ilium


Ischium


Pubic bone


Sacral vertebra


 


170.7       Long bones of lower limb


Bones NOS of lower limb


Femur


Fibula


Tibia


 


170.8       Short bones of lower
limb


Astragalus [talus]


Calcaneus


Cuboid


Cuneiform, ankle


Metatarsal


Navicular (of ankle)


Patella


Phalanges of foot


Tarsal


 


170.9       Bone and articular
cartilage, site unspecified


 


171          Malignant neoplasm of connective and other soft tissue


 


Includes:                blood vessel


bursa


fascia


fat


ligament, except uterine


muscle


peripheral, sympathetic,
and parasympathetic nerves and ganglia


 


15

















 


synovia


tendon (sheath)


 


Excludes:               cartilage (of):


articular (170.0-170.9)


larynx (161.3)


nose (160.0)


connective tissue:


breast (174.0-175.9)


internal organs code to
malignant neoplasm of the site [e.g., leiomyosarcoma of stomach, 151.9]


heart (164.1)


uterine ligament (183.4)


 


171.0       Head, face, and neck


Cartilage of:


ear


eyelid


 


171.2       Upper limb, including shoulder


Arm


Finger


Forearm


Hand


 


171.3       Lower limb, including
hip


Foot


Leg


Popliteal space


Thigh


Toe


 


171.4       Thorax


Axilla


Diaphragm


Great vessels


 


Excludes:               heart (164.1)


mediastinum
(164.2-164.9)


thymus (164.0)


 


171.5       Abdomen


Abdominal wall


Hypochondrium


 


Excludes:               peritoneum
(158.8)


retroperitoneum (158.0)


 


171.6       Pelvis


Buttock


Groin


Inguinal region


Perineum


 


Excludes:               pelvic
peritoneum (158.8)


retroperitoneum (158.0)


uterine ligament, any
(183.3-183.5)


 


171.7       Trunk, unspecified


Back NOS


 


16

















 


Flank NOS


 


171.8       Other specified sites of
connective and other soft tissue


Malignant neoplasm of
contiguous or overlapping sites of connective tissue whose point of origin
cannot be determined


 


171.9       Connective and other soft
tissue, site unspecified


 


172          Malignant melanoma of skin


 


Includes:                melanocarcinoma


melanoma in situ of skin


melanoma (skin) NOS


 


Excludes:               skin of genital
organs (184.0-184.9, 187.1-187.9)


sites other than skin -
code to malignant neoplasm of the site


 


172.0       Lip


 


Excludes:               vermilion
border of lip (140.0-140.1, 140.9)


 


172.1       Eyelid, including
canthus


 


172.2       Ear and external
auditory canal


Auricle (ear)


Auricular canal, external


External [acoustic] meatus


Pinna


 


172.3       Other and unspecified
parts of face


Cheek (external)


Chin


Eyebrow


Forehead


Nose, external


Temple


 


172.4       Scalp and neck


 


172.5       Trunk, except scrotum


Axilla


Breast


Buttock


Groin


Perianal skin


Perineum


Umbilicus


 


Excludes:               anal canal
(154.2)


anus NOS (154.3)


scrotum (187.7)


 


172.6       Upper limb, including
shoulder


Arm


Finger


Forearm


Hand


 


172.7       Lower limb, including
hip


Ankle


Foot


 


17

















 


Heel


Knee


Leg


Popliteal area


Thigh


Toe


 


172.8       Other specified sites of
skin


Malignant melanoma of
contiguous or overlapping sites of skin whose point of origin cannot be
determined


 


172.9       Melanoma of skin, site
unspecified


 


173          Other malignant neoplasm of skin


 


Includes:               malignant
neoplasm of:


sebaceous glands


sudoriferous,
sudoriparous glands


sweat glands


 


Excludes:               Kaposi’s
sarcoma (176.0-176.9)


malignant melanoma of
skin (172.0-172.9)


skin of genital organs
(184.0-184.9, 187.1-187.9)


 


173.0       Skin of lip


 


Excludes:               vermilion
border of lip (140.0-140.1, 140.9)


 


173.1       Eyelid, including
canthus


 


Excludes:               cartilage of
eyelid (171.0)


 


173.2       Skin of ear and external
auditory canal


Auricle (ear)


Auricular canal, external


External meatus


Pinna


 


Excludes:               cartilage of
ear (171.0)


 


173.3       Skin of other and
unspecified parts of face


Cheek, external


Chin


Eyebrow


Forehead


Nose, external


Temple


 


173.4       Scalp and skin of neck


 


173.5       Skin of trunk, except
scrotum


Axillary fold


Perianal skin


Skin of:


abdominal wall


anus


back


breast


buttock


chest wall


groin


 


18














 


perineum


Umbilicus


 


Excludes:               anal canal (154.2)


 


anus NOS (154.3)


skin of scrotum (187.7)


 


173.6                     Skin of upper limb, including shoulder


Arm


Finger


Forearm


Hand


 


173.7                     Skin of lower limb, including hip


Ankle


Foot


Heel


Knee


Leg


Popliteal area


Thigh


Toe


 


173.8                     Other specified sites of skin


Malignant neoplasm of
contiguous or overlapping sites of skin whose point of origin cannot be
determined


 


173.9                     Skin, site unspecified


 


174                              Malignant
neoplasm of female breast


 


Includes:                breast (female)


connective tissue


soft parts


Paget’s disease of:


breast


nipple


 


Use
additional code to identify estrogen receptor status (V86.0, V86.1)


 


Excludes:               skin of breast (172.5, 173.5)


 


174.0                     Nipple and areola


 


174.1                     Central portion


 


174.2                     Upper-inner quadrant


 


174.3                     Lower-inner quadrant


 


174.4                     Upper-outer quadrant


 


174.5                     Lower-outer quadrant


 


174.6                     Axillary tail


 


174.8                     Other specified sites of female breast


Ectopic sites


Inner breast


Lower breast


Midline of breast


 


19

















 


Outer breast


Upper breast


Malignant neoplasm of
contiguous or overlapping sites of breast whose point of origin cannot be
determined


 


174.9                     Breast (female), unspecified


 


175                              Malignant
neoplasm of male breast


 


Use
additional code to identify estrogen receptor status (V86.0, V86.1)


 


Excludes:               skin of breast (172.5, 173.5)


 


175.0                     Nipple and areola


 


175.9                     Other and unspecified sites of male breast


Ectopic breast tissue, male


 


176                              Kaposi’s
sarcoma


 


176.0                     Skin


 


176.1                     Soft tissue


Blood vessel


Connective tissue


Fascia


Ligament


Lymphatic(s) NEC


Muscle


 


Excludes:               lymph glands and nodes (176.5)


 


176.2                     Palate


 


176.3                     Gastrointestinal sites


 


176.4                     Lung


 


176.5                     Lymph nodes


 


176.8                     Other specified sites


Oral cavity NEC


 


176.9                     Unspecified


Viscera NOS


 


MALIGNANT
NEOPLASM OF GENITOURINARY ORGANS (179-189)


 


Excludes:               carcinoma
in situ (233.1-233.9)


 


179                              Malignant
neoplasm of uterus, part unspecified


 


180                              Malignant
neoplasm of cervix uteri


 


Includes:                invasive malignancy [carcinoma]


Excludes:               carcinoma in situ (233.1)


 


180.0                     Endocervix


Cervical canal NOS


Endocervical canal


 


20

















 


Endocervical gland


 


180.1                     Exocervix


 


180.8                     Other specified sites of cervix


Cervical stump


Squamocolumnar junction of
cervix


Malignant neoplasm of
contiguous or overlapping sites of cervix uteri whose point of origin cannot be
determined


 


180.9                     Cervix uteri, unspecified


 


181                              Malignant
neoplasm of placenta


Choriocarcinoma NOS


Chorioepithelioma NOS


 


Excludes:               chorioadenoma (destruens) (236.1)


hydatidiform mole (630)


malignant (236.1)


invasive mole (236.1)


male choriocarcinoma NOS (186.0-186.9)


 


182                              Malignant
neoplasm of body of uterus


 


Excludes:               carcinoma in situ (233.2)


 


182.0                     Corpus uteri, except isthmus


Cornu


Endometrium


Fundus


Myometrium


 


182.1                     Isthmus


Lower uterine segment


 


182.8                     Other specified sites of body of uterus


Malignant neoplasm of
contiguous or overlapping sites of body of uterus whose point of origin cannot
be determined


 


Excludes:               uterus NOS (179)


 


183                              Malignant
neoplasm of ovary and other uterine adnexa


 


Excludes:               Douglas’ cul-de-sac (158.8)


 


183.0                     Ovary


Use
additional code to identify any functional activity


 


183.2                     Fallopian tube


Oviduct


Uterine tube


 


183.3                     Broad ligament


Mesovarium


Parovarian region


 


183.4                     Parametrium


Uterine ligament NOS


Uterosacral ligament


 


21

















 


183.5                     Round ligament


 


183.8                     Other specified sites of uterine adnexa


Tubo-ovarian


Utero-ovarian


Malignant neoplasm of
contiguous or overlapping sites of ovary and other uterine adnexa whose point
of origin cannot be determined


 


183.9                     Uterine adnexa, unspecified


 


184                              Malignant
neoplasm of other and unspecified female genital organs


 


Excludes:               carcinoma in situ (233.30-233.39)


 


184.0                     Vagina


Gartner’s duct


Vaginal vault


 


184.1                     Labia majora


Greater vestibular [Bartholin’s]
gland


 


184.2                     Labia minora


 


184.3                     Clitoris


 


184.4                     Vulva, unspecified


External
female genitalia NOS


Pudendum


 


184.8                     Other specified sites of female genital organs


Malignant neoplasm of
contiguous or overlapping sites of female genital organs whose point of origin
cannot be determined


 


184.9                     Female genital organ, site unspecified


Female genitourinary tract NOS


 


185                              Malignant
neoplasm of prostate


 


Excludes:               seminal vesicles (187.8)


 


186                              Malignant
neoplasm of testis


 


Use
additional code to identify any functional activity


 


186.0                     Undescended testis


Ectopic testis


Retained testis


 


186.9                     Other and unspecified testis


Testis:


NOS


descended


scrotal


 


187                              Malignant
neoplasm of penis and other male genital organs


 


187.1                     Prepuce


Foreskin


 


187.2                     Glans penis


 


22

















 


187.3                     Body of penis


Corpus cavernosum


 


187.4                     Penis, part unspecified


Skin of penis NOS


 


187.5                     Epididymis


 


187.6                     Spermatic cord


Vas deferens


 


187.7                     Scrotum


Skin of scrotum


 


187.8                     Other specified sites of male genital organs


Seminal vesicle


Tunica vaginalis


Malignant neoplasm of
contiguous or overlapping sites of penis and other male genital organs whose
point of origin cannot be determined


 


187.9                     Male genital organ, site unspecified


Male genital organ or tract NOS


 


188                              Malignant
neoplasm of bladder


 


Excludes:               carcinoma in situ (233.7)


 


188.0                     Trigone of urinary bladder


 


188.1                     Dome of urinary bladder


 


188.2                     Lateral wall of urinary bladder


 


188.3                     Anterior wall of urinary bladder


 


188.4                     Posterior wall of urinary bladder


 


188.5                     Bladder neck


Internal urethral orifice


 


188.6                     Ureteric orifice


 


188.7                     Urachus


 


188.8                     Other specified sites of bladder


Malignant neoplasm of
contiguous or overlapping sites of bladder whose point of origin cannot be
determined


 


188.9                     Bladder, part unspecified


Bladder wall NOS


 


189                              Malignant
neoplasm of kidney and other and unspecified urinary organs


 


Excludes:               benign carcinoid tumor of kidney
(209.64)


 


malignant carcinoid
tumor of kidney (209.64)


 


189.0                     Kidney, except pelvis


Kidney NOS


Kidney parenchyma


 


189.1                     Renal pelvis


 


23

















 


Renal calyces


Ureteropelvic junction


 


189.2                     Ureter


 


Excludes:                                              ureteric
orifice of bladder (188.6)


 


189.3                     Urethra


 


Excludes:                                              urethral
orifice of bladder (188.5)


 


189.4                     Paraurethral glands


 


189.8                     Other specified sites of urinary organs


Malignant neoplasm of
contiguous or overlapping sites of kidney and other urinary organs whose point
of origin cannot be determined


 


189.9                     Urinary organ, site unspecified


Urinary system NOS


 


MALIGNANT
NEOPLASM OF OTHER AND UNSPECIFIED SITES (190-199)


 


Excludes:               carcinoma
in situ (234.0-234.9)


 


190                              Malignant
neoplasm of eye


 


Excludes:               carcinoma in situ (234.0)


 


dark area on retina and
choroid (239.81)


eyelid (skin) (172.1,
173.1)


cartilage (171.0)


optic nerve (192.0)


orbital bone (170.0)


retinal freckle (239.81)


 


190.0                     Eyeball, except conjunctiva, cornea, retina, and choroid


Ciliary body


Crystalline lens


Iris


Sclera


Uveal tract


 


190.1                     Orbit


Connective tissue of orbit


Extraocular muscle


Retrobulbar


 


Excludes:               bone of orbit (170.0)


 


190.2                     Lacrimal gland


 


190.3                     Conjunctiva


 


190.4                     Cornea


 


190.5                     Retina


 


190.6                     Choroid


 


190.7                     Lacrimal duct


Lacrimal sac


 


24

















 


Nasolacrimal duct


 


190.8                     Other specified sites of eye


Malignant neoplasm of
contiguous or overlapping sites of eye whose point of origin cannot be
determined


 


190.9                     Eye, part unspecified


 


191                              Malignant
neoplasm of brain


 


Excludes:               cranial nerves (192.0)


 


retrobulbar area (190.1)


 


191.0                     Cerebrum, except lobes and ventricles


Basal ganglia


Cerebral cortex


Corpus striatum


Globus pallidus


Hypothalamus


Thalamus


 


191.1                     Frontal lobe


 


191.2                     Temporal lobe


Hippocampus


Uncus


 


191.3                     Parietal lobe


 


191.4                     Occipital lobe


 


191.5                     Ventricles


Choroid plexus


Floor of ventricle


 


191.6                     Cerebellum NOS


Cerebellopontine angle


 


191.7                     Brain stem


Cerebral peduncle


Medulla oblongata


Midbrain


Pons


 


191.8                     Other parts of brain


Corpus callosum


Tapetum


Malignant neoplasm of
contiguous or overlapping sites of brain whose point of origin cannot be
determined


 


191.9                     Brain, unspecified


Cranial fossa NOS


 


192                              Malignant
neoplasm of other and unspecified parts of nervous system


 


Excludes:               peripheral, sympathetic, and
parasympathetic nerves and ganglia (171.0-171.9)


 


192.0                     Cranial nerves


 


25

















 


Olfactory bulb


 


192.1                     Cerebral meninges


Dura
(mater)


Falx
(cerebelli) (cerebri)


Meninges NOS


Tentorium


 


192.2                     Spinal cord


Cauda equina


 


192.3                     Spinal meninges


 


192.8                     Other specified sites of nervous system


Malignant neoplasm of
contiguous or overlapping sites of other parts of nervous system whose point of
origin cannot be determined


 


192.9                     Nervous system, part unspecified


Nervous system (central) NOS


 


Excludes:               meninges NOS (192.1)


 


193                              Malignant
neoplasm of thyroid gland


 


Thyroglossal duct


Use
additional code to identify any functional activity


 


194                              Malignant
neoplasm of other endocrine glands and related structures


 


Excludes:               islets of Langerhans (157.4)


neuroendocrine tumors
(209.00-209.69)


ovary (183.0)


testis (186.0-186.9)


thymus (164.0)


 


194.0                     Adrenal gland


Adrenal cortex


Adrenal medulla


Suprarenal gland


 


194.1                     Parathyroid gland


 


194.3                     Pituitary gland and craniopharyngeal duct


Craniobuccal pouch


Hypophysis


Rathke’s pouch


Sella turcica


 


194.4                     Pineal gland


 


194.5                     Carotid body


 


194.6                     Aortic body and other paraganglia


Coccygeal body


Glomus jugulare


Para-aortic body


 


194.8                     Other


Pluriglandular involvement NOS


 


Note:                   If the sites of multiple involvements are known, they should
be coded separately.


 


26

















 


194.9                     Endocrine gland, site unspecified


 


195                              Malignant
neoplasm of other and ill-defined sites


 


Includes:                malignant neoplasms of
contiguous sites, not elsewhere classified, whose point of origin cannot be
determined


 


Excludes:               malignant neoplasm:


 


lymphatic and
hematopoietic tissue (200.0-208.9)


secondary sites
(196.0-198.8)


unspecified site
(199.0-199.1)


 


195.0                     Head, face, and neck


Cheek NOS


Jaw NOS


Nose NOS


Supraclavicular region NOS


 


195.1                     Thorax


Axilla


Chest (wall) NOS


Intrathoracic NOS


 


195.2                     Abdomen


Intra-abdominal NOS


 


195.3                     Pelvis


Groin


Inguinal region NOS


Presacral region


Sacrococcygeal region


Sites overlapping systems
within pelvis, as:


rectovaginal (septum)


rectovesical (septum)


 


195.4                     Upper limb


 


195.5                     Lower limb


 


195.8                     Other specified sites


Back NOS


Flank NOS


Trunk NOS


 


196                              Secondary
and unspecified malignant neoplasm of lymph nodes


 


Excludes:               any malignant neoplasm of lymph
nodes, specified as primary (200.0-202.9)


 


Hodgkin’s disease
(201.0-201.9)


lymphosarcoma (200.1)


reticulosarcoma (200.0)


other forms of lymphoma
(202.0-202.9)


secondary neuroendocrine
tumor of (distant) lymph nodes (209.71)


 


196.0                     Lymph nodes of head, face, and neck


Cervical


Cervicofacial


Scalene


Supraclavicular


 


27

















 


196.1                     Intrathoracic lymph nodes


Bronchopulmonary


Intercostal


Mediastinal


Tracheobronchial


 


196.2                     Intra-abdominal lymph nodes


Intestinal


Mesenteric


Retroperitoneal


 


196.3                     Lymph nodes of axilla and upper limb


Brachial


Epitrochlear


Infraclavicular


Pectoral


 


196.5                     Lymph nodes of inguinal region and lower limb


Femoral


Groin


Popliteal


Tibial


 


196.6                     Intrapelvic lymph nodes


Hypogastric


Iliac


Obturator


Parametrial


 


196.8                     Lymph nodes of multiple sites


 


196.9                     Site unspecified


Lymph nodes NOS


 


197                              Secondary
malignant neoplasm of respiratory and digestive systems


 


Excludes:               lymph node metastasis
(196.0-196.9)


 


secondary neuroendocrine
tumor of liver (209.72)


secondary neuroendocrine
tumor of respiratory organs (209.79)


 


197.0                     Lung


Bronchus


 


197.1                     Mediastinum


 


197.2                     Pleura


 


197.3                     Other respiratory organs


Trachea


 


197.4                     Small intestine, including duodenum


 


197.5                     Large intestine and rectum


 


197.6                     Retroperitoneum and peritoneum


 


197.7                     Liver, specified as secondary


 


197.8                     Other digestive organs and spleen


 


28














 


198          Secondary malignant neoplasm of other specified sites


 


Excludes:               lymph node
metastasis (196.0-196.9)


secondary neuroendocrine
tumor of other specified sites (209.79)


 


198.0       Kidney


 


198.1       Other urinary organs


 


198.2       Skin


Skin of breast


 


198.3       Brain and spinal cord


 


198.4       Other parts of nervous
system


Meninges (cerebral) (spinal)


 


198.5       Bone and bone marrow


 


198.6       Ovary


 


198.7       Adrenal gland


Suprarenal gland


 


198.8       Other specified sites


 


198.81 Breast


 


Excludes:               skin of breast
(198.2)


 


198.82 Genital organs


 


198.89 Other


 


Excludes:               retroperitoneal
lymph nodes (196.2)


 


199          Malignant neoplasm without specification of site


 


Excludes:               malignant
carcinoid tumor of unknown primary site (209.20)


malignant (poorly
differentiated) neuroendocrine carcinoma, any site (209.30)


malignant (poorly
differentiated) neuroendocrine tumor, any site (209.30)


neuroendocrine carcinoma
(high grade), any site (209.30)


 


199.0       Disseminated


Carcinomatosis unspecified site
(primary) (secondary)


Generalized:


cancer unspecified site (primary)
(secondary)


malignancy unspecified site
(primary) (secondary)


Multiple cancer unspecified
site (primary) (secondary)


 


199.1       Other


Cancer unspecified site
(primary) (secondary)


Carcinoma unspecified site
(primary) (secondary)


Malignancy unspecified site
(primary) (secondary)


 


199.2       Malignant neoplasm
associated with transplanted organ


Code
first complication of transplanted organ (996.80-996.89)


Use
additional code for specific malignancy


 


MALIGNANT
NEOPLASM OF LYMPHATIC AND HEMATOPOIETIC TISSUE (200-208)


 


29

















 


Excludes:               autoimmune lymphoproliferative syndrome (279.41)


secondary neoplasm of:


bone marrow (198.5)


spleen (197.8)


secondary and unspecified neoplasm of lymph nodes
(196.0-196.9)


 


The following fifth-digit subclassification is for use with
categories 200-202:


 


0  unspecified site, extranodal and solid organ sites


1  lymph nodes of head, face, and neck


2  intrathoracic lymph nodes


3  intra-abdominal lymph nodes


4  lymph nodes of axilla and upper limb


5  lymph nodes of inguinal region and lower limb


6  intrapelvic lymph nodes


7  spleen


8  lymph nodes of multiple sites


 


200          Lymphosarcoma and reticulosarcoma and other specified
malignant tumors of lymphatic tissue


 


Requires
fifth digit. See note before section 200 for codes and definitions.


 


200.0       Reticulosarcoma


[0-8]


 


Lymphoma (malignant):


histiocytic (diffuse):


nodular


pleomorphic cell type


reticulum cell type


Reticulum cell sarcoma:


NOS


pleomorphic cell type


 


200.1       Lymphosarcoma


[0-8]


 


Lymphoblastoma
(diffuse)


Lymphoma
(malignant):


lymphoblastic (diffuse)


lymphocytic (cell type)
(diffuse)


lymphosarcoma
type


Lymphosarcoma:


NOS


diffuse
NOS


lymphoblastic (diffuse)


lymphocytic (diffuse)


prolymphocytic


 


Excludes:               lymphosarcoma:


follicular or nodular
(202.0)


mixed cell type (200.8)


lymphosarcoma cell
leukemia (207.8)


 


200.2       Burkitt’s tumor or
lymphoma


[0-8]


 


Malignant lymphoma, Burkitt’s
type


 


200.3       Marginal zone lymphoma


[0-8]


 


30

















 


Extranodal marginal zone B cell
lymphoma


Mucosa associated lymphoid
tissue [MALT]


Nodal marginal zone B cell
lymphoma


Splenic marginal zone B cell
lymphoma


 


200.4       Mantle cell lymphoma


[0-8]


 


200.5       Primary central nervous
system lymphoma


[0-8]


 


200.6       Anaplastic large cell
lymphoma


[0-8]


 


200.7       Large cell lymphoma


[0-8]


 


200.8       Other named variants


[0-8]


 


Lymphoma (malignant):


lymphoplasmacytoid type


mixed lymphocytic-histiocytic
(diffuse)


Lymphosarcoma, mixed cell type
(diffuse)


Reticulolymphosarcoma (diffuse)


 


201          Hodgkin’s disease


 


Requires
fifth digit. See note before section 200 for codes and definitions.


 


201.0       Hodgkin’s paragranuloma


[0-8]


 


201.1       Hodgkin’s granuloma


[0-8]


 


201.2       Hodgkin’s sarcoma


[0-8]


 


201.4       Lymphocytic-histiocytic
predominance


[0-8]


 


201.5       Nodular sclerosis


[0-8]


 


Hodgkin’s disease, nodular
sclerosis:


NOS


cellular phase


 


201.6       Mixed cellularity


[0-8]


 


201.7       Lymphocytic depletion


[0-8]


 


Hodgkin’s disease, lymphocytic
depletion:


NOS


diffuse fibrosis


reticular type


 


201.9       Hodgkin’s disease,
unspecified


 


31

















 


[0-8]


 


Hodgkin’s:


disease NOS


lymphoma NOS


Malignant:


lymphogranuloma


lymphogranulomatosis


 


202          Other malignant neoplasms of lymphoid and histiocytic tissue


 


Requires
fifth digit. See note before section 200 for codes and definitions.


 


202.0       Nodular lymphoma


[0-8]


 


Brill-Symmers disease


Lymphoma:


follicular (giant) (large cell)


lymphocytic, nodular


Lymphosarcoma:


follicular (giant)


nodular


 


202.1       Mycosis fungoides


[0-8]


 


Excludes:               peripheral
T-cell lymphoma (202.7)


 


202.2       Sézary’s disease


[0-8]


 


202.3       Malignant histiocytosis


[0-8]


 


Histiocytic medullary
reticulosis


Malignant:


reticuloendotheliosis


reticulosis


 


202.4       Leukemic
reticuloendotheliosis


[0-8]


 


Hairy-cell leukemia


 


202.5       Letterer-Siwe disease


[0-8]


 


Acute:


differentiated progressive
histiocytosis


histiocytosis X (progressive)


infantile reticuloendotheliosis


reticulosis of infancy


 


Excludes:               Hand-Schüller-Christian
disease (277.89)


histiocytosis (acute)
(chronic) (277.89)


histiocytosis X
(chronic) (277.89)


 


202.6       Malignant mast cell
tumors


[0-8]


 


Malignant:


mastocytoma


mastocytosis


Mast cell sarcoma


 


32

















 


Systemic tissue mast cell
disease


 


Excludes:               mast cell
leukemia (207.8)


 


202.7       Peripheral T cell
lymphoma


[0-8]


 


202.8       Other lymphomas


[0-8]


 


Lymphoma (malignant):


NOS


diffuse


 


Excludes:               benign lymphoma
(229.0)


 


202.9       Other and unspecified
malignant neoplasms of lymphoid and histiocytic tissue


[0-8]


 


Follicular dendritic cell
sarcoma


Interdigitating dendritic cell
sarcoma


Langerhans cell sarcoma


Malignant neoplasm of bone
marrow NOS


 


203          Multiple myeloma and immunoproliferative neoplasms


 


The following
fifth-digit subclassification is for use with category 203:


 


0  without mention of having achieved remission


failed remission


1  in remission


2  in relapse


 


203.0       Multiple myeloma


[0-2]


 


Kahler’s disease


Myelomatosis


 


Excludes:               solitary
myeloma (238.6)


 


203.1       Plasma cell leukemia


[0-2]


 


Plasmacytic leukemia


 


203.8       Other
immunoproliferative neoplasms


[0-2]


 


204          Lymphoid leukemia


 


Includes:               leukemia:


lymphatic


lymphoblastic


lymphocytic


lymphogenous


 


The following
fifth-digit subclassification is for use with category 204:


 


0  without mention of having achieved remission


failed remission


1  in remission


2  in relapse


 


204.0       Acute


[0-2]


 


33

















 


Excludes:               acute
exacerbation of chronic lymphoid leukemia (204.1)


 


204.1       Chronic


[0-2]


 


204.2       Subacute


[0-2]


 


204.8       Other lymphoid leukemia


[0-2]


 


Aleukemic leukemia:


lymphatic


lymphocytic


lymphoid


 


204.9       Unspecified lymphoid
leukemia


[0-2]


 


205          Myeloid leukemia


 


Includes:               leukemia:


granulocytic


myeloblastic


myelocytic


myelogenous


myelomonocytic


myelosclerotic


myelosis


 


The following
fifth-digit subclassification is for use with category 205:


 


0  without mention of having achieved remission


failed remission


1  in remission


2  in relapse


 


205.0       Acute


[0-2]


 


Acute promyelocytic leukemia


 


Excludes:               acute
exacerbation of chronic myeloid leukemia (205.1)


 


205.1       Chronic


[0-2]


 


Eosinophilic leukemia


Neutrophilic leukemia


 


205.2       Subacute


[0-2]


 


205.3       Myeloid sarcoma


[0-2]


 


Chloroma


Granulocytic sarcoma


 


205.8       Other myeloid leukemia


[0-2]


 


Aleukemic leukemia:


granulocytic


myelogenous


 


34

















 


myeloid


Aleukemic myelosis


 


205.9       Unspecified myeloid
leukemia


[0-2]


 


206          Monocytic leukemia


 


Includes:               leukemia:


histiocytic


monoblastic


monocytoid


 


The following
fifth-digit subclassification is for use with category 206:


 


0  without mention of having achieved remission


failed remission


1  in remission


2  in relapse


 


206.0       Acute


[0-2]


 


Excludes:               acute
exacerbation of chronic monocytic leukemia (206.1)


 


206.1       Chronic


[0-2]


 


206.2       Subacute


[0-2]


 


206.8       Other monocytic leukemia


[0-2]


 


Aleukemic:


monocytic leukemia


monocytoid leukemia


 


206.9       Unspecified monocytic
leukemia


[0-2]


 


207          Other specified leukemia


 


Excludes:               leukemic
reticuloendotheliosis (202.4)


plasma cell leukemia
(203.1)


 


The following
fifth-digit subclassification is for use with category 207:


 


0  without mention of having achieved remission


failed remission


1  in remission


2  in relapse


 


207.0       Acute erythremia and
erythroleukemia


[0-2]


 


Acute erythremic myelosis


Di Guglielmo’s disease


Erythremic myelosis


 


207.1       Chronic erythremia


[0-2]


 


Heilmeyer-Schöner disease


 


35

















 


207.2       Megakaryocytic leukemia


[0-2]


 


Megakaryocytic myelosis


Thrombocytic leukemia


 


207.8       Other specified leukemia


[0-2]


 


Lymphosarcoma cell leukemia


 


208          Leukemia of unspecified cell type


 


The following
fifth-digit subclassification is for use with category 208:


 


0  without mention of having achieved remission


failed remission


1  in remission


2  in relapse


 


208.0       Acute


[0-2]


 


Acute leukemia NOS


Blast cell leukemia


Stem cell leukemia


 


Excludes:               acute
exacerbation of chronic unspecified leukemia (208.1)


 


208.1       Chronic


[0-2]


 


Chronic leukemia NOS


 


208.2       Subacute


[0-2]


 


Subacute leukemia NOS


 


208.8       Other leukemia of
unspecified cell type


[0-2]


 


208.9       Unspecified leukemia


[0-2]


 


Leukemia NOS


 


NEUROENDOCRINE TUMORS (209)


 


209          Neuroendocrine tumors


 


Code
first any associated multiple endocrine neoplasia syndrome (258.01-258.03)


Use
additional code to identify associated endocrine syndrome, such as:


carcinoid syndrome
(259.2)


 


Excludes:               benign
pancreatic islet cell tumors (211.7)


malignant pancreatic
islet cell tumors (157.4)


 


209.0       Malignant carcinoid
tumors of the small intestine


 


209.00 Malignant carcinoid
tumor of the small intestine, unspecified portion


 


209.01 Malignant carcinoid
tumor of the duodenum


 


209.02 Malignant carcinoid tumor
of the jejunum


 


36

















 


209.03 Malignant carcinoid
tumor of the ileum


 


209.1       Malignant carcinoid
tumors of the appendix, large intestine, and rectum


 


209.10 Malignant carcinoid
tumor of the large intestine, unspecified portion


Malignant carcinoid tumor of
the colon NOS


 


209.11 Malignant carcinoid
tumor of the appendix


 


209.12 Malignant carcinoid
tumor of the cecum


 


209.13 Malignant carcinoid
tumor of the ascending colon


 


209.14 Malignant carcinoid
tumor of the transverse colon


 


209.15 Malignant carcinoid
tumor of the descending colon


 


209.16 Malignant carcinoid
tumor of the sigmoid colon


 


209.17 Malignant carcinoid
tumor of the rectum


 


209.2       Malignant carcinoid
tumors of other and unspecified sites


 


209.20 Malignant carcinoid
tumor of unknown primary site


 


209.21 Malignant carcinoid
tumor of the bronchus and lung


 


209.22 Malignant carcinoid
tumor of the thymus


 


209.23 Malignant carcinoid
tumor of the stomach


 


209.24 Malignant carcinoid
tumor of the kidney


 


209.25 Malignant carcinoid
tumor of the foregut NOS


 


209.26 Malignant carcinoid
tumor of the midgut NOS


 


209.27 Malignant carcinoid
tumor of the hindgut NOS


 


209.29 Malignant carcinoid
tumors of other sites


 


209.3       Malignant poorly
differentiated neuroendocrine tumors


 


209.30 Malignant poorly
differentiated neuroendocrine carcinoma, any site


High grade neuroendocrine
carcinoma, any site


Malignant poorly differentiated
neuroendocrine tumor NOS


 


Excludes:               Merkel cell
carcinoma (209.31-209.36)


 


209.31 Merkel cell carcinoma of
the face


Merkel cell carcinoma of the
ear


Merkel cell carcinoma of the
eyelid, including canthus


Merkel cell carcinoma of the
lip


 


209.32 Merkel cell carcinoma of
the scalp and neck


 


209.33 Merkel cell carcinoma of
the upper limb


 


209.34 Merkel cell carcinoma of
the lower limb


 


209.35 Merkel cell carcinoma of
the trunk


 


37

















 


209.36 Merkel cell carcinoma of
other sites


Merkel cell carcinoma of the
buttock


Merkel cell carcinoma of the
genitals


Merkel cell carcinoma NOS


 


209.4       Benign carcinoid tumors
of the small intestine


 


209.40 Benign carcinoid tumor
of the small intestine, unspecified portion


 


209.41 Benign carcinoid tumor
of the duodenum


 


209.42 Benign carcinoid tumor
of the jejunum


 


209.43 Benign carcinoid tumor
of the ileum


 


209.5       Benign carcinoid tumors
of the appendix, large intestine, and rectum


 


209.50 Benign carcinoid tumor
of the large intestine, unspecified portion


Benign carcinoid tumor of the
colon NOS


 


209.51 Benign carcinoid tumor
of the appendix


 


209.52 Benign carcinoid tumor
of the cecum


 


209.53 Benign carcinoid tumor
of the ascending colon


 


209.54 Benign carcinoid tumor
of the transverse colon


 


209.55 Benign carcinoid tumor
of the descending colon


 


209.56 Benign carcinoid tumor
of the sigmoid colon


 


209.57 Benign carcinoid tumor
of the rectum


 


209.6       Benign carcinoid tumors
of other and unspecified sites


 


209.60 Benign carcinoid tumor
of unknown primary site


Carcinoid tumor NOS


Neuroendocrine tumor NOS


 


209.61 Benign carcinoid tumor
of the bronchus and lung


 


209.62 Benign carcinoid tumor
of the thymus


 


209.63 Benign carcinoid tumor
of the stomach


 


209.64 Benign carcinoid tumor
of the kidney


 


209.65 Benign carcinoid tumor
of the foregut NOS


 


209.66 Benign carcinoid tumor
of the midgut NOS


 


209.67 Benign carcinoid tumor
of the hindgut NOS


 


209.69 Benign carcinoid tumors
of other sites


 


209.7       Secondary neuroendocrine
tumors


Secondary carcinoid tumors


 


209.70 Secondary neuroendocrine
tumor, unspecified site


 


209.71 Secondary neuroendocrine
tumor of distant lymph nodes


 


38

















 


Mesentery metastasis of
neuroendocrine tumor


 


209.72 Secondary neuroendocrine
tumor of liver


 


209.73 Secondary neuroendocrine
tumor of bone


 


209.74 Secondary neuroendocrine
tumor of peritoneum


 


209.75 Secondary Merkel cell carcinoma


Merkel
cell carcinoma nodal presentation


Merkel
cell carcinoma visceral metastatic presentation


Secondary Merkel cell
carcinoma, any site


 


209.79 Secondary neuroendocrine
tumor of other sites


 


BENIGN NEOPLASMS (210-229)


 


210          Benign neoplasm of lip, oral cavity, and pharynx


 


Excludes:               cyst (of):


jaw (526.0-526.2,
526.89)


oral soft tissue (528.4)


radicular (522.8)


 


210.0       Lip


Frenulum labii


Lip (inner aspect) (mucosa)
(vermilion border)


 


Excludes:               labial commissure
(210.4)


skin of lip (216.0)


 


210.1       Tongue


Lingual tonsil


 


210.2       Major salivary glands


Gland:


parotid


sublingual


submandibular


 


Excludes:               benign
neoplasms of minor salivary glands:


NOS (210.4)


buccal mucosa (210.4)


lips (210.0)


palate (hard) (soft)
(210.4)


tongue (210.1)


tonsil, palatine (210.5)


 


210.3       Floor of mouth


 


210.4       Other and unspecified
parts of mouth


Gingiva


Gum (upper) (lower)


Labial commissure


Oral cavity NOS


Oral mucosa


Palate (hard) (soft)


Uvula


 


Excludes:               benign
odontogenic neoplasms of bone (213.0-213.1)


 


39

















 


developmental
odontogenic cysts (526.0)


mucosa of lips (210.0)


nasopharyngeal
[posterior] [superior] surface of soft palate (210.7)


 


210.5       Tonsil


Tonsil (faucial) (palatine)


 


Excludes:               lingual tonsil
(210.1)


pharyngeal tonsil
(210.7)


tonsillar:


fossa (210.6)


pillars (210.6)


 


210.6       Other parts of
oropharynx


Branchial cleft or vestiges


Epiglottis, anterior aspect


Fauces NOS


Mesopharynx NOS


Tonsillar:


fossa


pillars


Vallecula


 


Excludes:               epiglottis:


NOS (212.1)


suprahyoid portion
(212.1)


 


210.7       Nasopharynx


Adenoid tissue


Lymphadenoid tissue


Pharyngeal tonsil


Posterior nasal septum


 


210.8       Hypopharynx


Arytenoid fold


Laryngopharynx


Postcricoid region


Pyriform fossa


 


210.9       Pharynx, unspecified


Throat NOS


 


211          Benign neoplasm of other parts of digestive system


 


Excludes:               benign stromal
tumors of digestive system (215.5)


 


211.0       Esophagus


 


211.1       Stomach


Body of stomach


Cardia of stomach


Fundus of stomach


Cardiac orifice


Pylorus


 


Excludes:               benign carcinoid
tumors of the stomach (209.63)


 


211.2       Duodenum, jejunum, and
ileum


Small intestine NOS


 


Excludes:               ampulla of
Vater (211.5)


 


40

















 


benign carcinoid tumors
of the small intestine (209.40-209.43)


ileocecal valve (211.3)


 


211.3       Colon


Appendix


Cecum


Ileocecal
valve


Large intestine NOS


 


Excludes:               benign
carcinoid tumors of the large intestine (209.50-209.56)


rectosigmoid junction
(211.4)


 


211.4       Rectum and anal canal


Anal canal or sphincter


Anus NOS


Rectosigmoid junction


 


Excludes:               anus:


margin (216.5)


skin (216.5)


perianal skin (216.5)


benign carcinoid tumors
of the rectum (209.57)


 


211.5       Liver and biliary
passages


Ampulla of Vater


Common bile duct


Cystic duct


Gallbladder


Hepatic duct


Sphincter of Oddi


 


211.6       Pancreas, except islets
of Langerhans


 


211.7       Islets of Langerhans


Islet cell tumor


 


Use
additional code to identify any functional activity


 


211.8       Retroperitoneum and
peritoneum


Mesentery


Mesocolon


Omentum


Retroperitoneal tissue


 


211.9       Other and unspecified
site


Alimentary tract NOS


Digestive system NOS


Gastrointestinal tract NOS


Intestinal tract NOS


Intestine NOS


Spleen, not elsewhere
classified


 


212          Benign neoplasm of respiratory and intrathoracic organs


 


212.0       Nasal cavities, middle
ear, and accessory sinuses


Cartilage of nose


Eustachian tube


Nares


Septum of nose


Sinus:


 


41

















 


ethmoidal


frontal


maxillary


sphenoidal


 


Excludes:               auditory canal
(external) (216.2)


bone of:


ear (213.0)


nose [turbinates]
(213.0)


cartilage of ear (215.0)


ear (external) (skin)
(216.2)


nose NOS (229.8)


skin (216.3)


olfactory bulb (225.1)


polyp of:


accessory sinus (471.8)


ear (385.30-385.35)


nasal cavity (471.0)


posterior margin of
septum and choanae (210.7)


 


212.1       Larynx


Cartilage:


arytenoid


cricoid


cuneiform


thyroid


Epiglottis (suprahyoid portion)
NOS


Glottis


Vocal cords (false) (true)


 


Excludes:               epiglottis,
anterior aspect (210.6)


polyp of vocal cord or
larynx (478.4)


 


212.2       Trachea


 


212.3       Bronchus and lung


Carina


Hilus of lung


 


Excludes:               benign
carcinoid tumors of bronchus and lung (209.61)


 


212.4       Pleura


 


212.5       Mediastinum


 


212.6       Thymus


 


Excludes:               benign
carcinoid tumors of thymus (209.62)


 


212.7       Heart


 


Excludes:               great vessels
(215.4)


 


212.8       Other specified sites


 


212.9       Site unspecified


Respiratory organ NOS


Upper respiratory tract NOS


 


Excludes:               intrathoracic
NOS (229.8)


thoracic NOS (229.8)


 


42














 


213                              Benign
neoplasm of bone and articular cartilage


 


Includes:                cartilage (articular) (joint)


periosteum


 


Excludes:               cartilage of:


ear (215.0)


eyelid (215.0)


larynx (212.1)


nose (212.0)


exostosis NOS (726.91)


synovia (215.0-215.9)


 


213.0                     Bones of skull and face


 


Excludes:               lower jaw bone (213.1)


 


213.1                     Lower jaw bone


 


213.2                     Vertebral column, excluding sacrum and coccyx


 


213.3                     Ribs, sternum, and clavicle


 


213.4                     Scapula and long bones of upper limb


 


213.5                     Short bones of upper limb


 


213.6                     Pelvic bones, sacrum, and coccyx


 


213.7                     Long bones of lower limb


 


213.8                     Short bones of lower limb


 


213.9                     Bone and articular cartilage, site unspecified


 


214                              Lipoma


 


Includes:                angiolipoma


fibrolipoma


hibernoma


lipoma (fetal) (infiltrating) (intramuscular)


myelolipoma


myxolipoma


 


214.0                     Skin and subcutaneous tissue of face


 


214.1                     Other skin and subcutaneous tissue


 


214.2                     Intrathoracic organs


 


214.3                     Intra-abdominal organs


 


214.4                     Spermatic cord


 


214.8                     Other specified sites


 


214.9                     Lipoma, unspecified site


 


215                              Other
benign neoplasm of connective and other soft tissue


 


Includes:                blood vessel


bursa


 


43

















 


fascia


ligament


muscle


peripheral, sympathetic,
and parasympathetic nerves and ganglia


synovia


tendon (sheath)


 


Excludes:               cartilage:


articular (213.0-213.9)


larynx (212.1)


nose (212.0)


connective tissue of:


breast (217)


internal organ, except
lipoma and hemangioma - code to benign neoplasm of the site


lipoma (214.0-214.9)


 


215.0                     Head, face, and neck


 


215.2                     Upper limb, including shoulder


 


215.3                     Lower limb, including hip


 


215.4                     Thorax


 


Excludes:               heart (212.7)


mediastinum (212.5)


thymus (212.6)


 


215.5                     Abdomen


Abdominal wall


Benign stromal tumors of
abdomen


Hypochondrium


 


215.6                     Pelvis


Buttock


Groin


Inguinal region


Perineum


 


Excludes:               uterine:


leiomyoma (218.0-218.9)


ligament, any (221.0)


 


215.7                     Trunk, unspecified


Back NOS


Flank NOS


 


215.8                     Other specified sites


 


215.9                     Site unspecified


 


216                              Benign
neoplasm of skin


 


Includes:                blue nevus


dermatofibroma


hydrocystoma


pigmented nevus


syringoadenoma


syringoma


 


Excludes:               skin of genital organs
(221.0-222.9)


 


44

















 


216.0                     Skin of lip


 


Excludes:               vermilion border of lip (210.0)


 


216.1                     Eyelid, including canthus


 


Excludes:               cartilage of eyelid (215.0)


 


216.2                     Ear and external auditory canal


Auricle (ear)


Auricular canal, external


External meatus


Pinna


 


Excludes:               cartilage of ear (215.0)


 


216.3                     Skin of other and unspecified parts of face


Cheek, external


Eyebrow


Nose, external


Temple


 


216.4                     Scalp and skin of neck


 


216.5                     Skin of trunk, except scrotum


Axillary fold


Perianal skin


Skin of:


abdominal wall


anus


back


breast


buttock


chest wall


groin


perineum


Umbilicus


 


Excludes:               anal canal (211.4)


anus NOS (211.4)


skin of scrotum (222.4)


 


216.6                     Skin of upper limb, including shoulder


 


216.7                     Skin of lower limb, including hip


 


216.8                     Other specified sites of skin


 


216.9                     Skin, site unspecified


 


217                              Benign
neoplasm of breast


 


Breast (male) (female)


connective tissue


glandular tissue


soft parts


 


Excludes:               adenofibrosis (610.2)


benign cyst of breast
(610.0)


fibrocystic disease
(610.1)


skin of breast (216.5)


 


45

















 


218                              Uterine
leiomyoma


 


Includes:                fibroid (bleeding) (uterine)


uterine:


fibromyoma


myoma


 


218.0                     Submucous leiomyoma of uterus


 


218.1                     Intramural leiomyoma of uterus


Interstitial leiomyoma of
uterus


 


218.2                     Subserous leiomyoma of uterus


Subperitoneal leiomyoma of
uterus


 


218.9                     Leiomyoma of uterus, unspecified


 


219                              Other
benign neoplasm of uterus


 


219.0                     Cervix uteri


 


219.1                     Corpus uteri


Endometrium


Fundus


Myometrium


 


219.8                     Other specified parts of uterus


 


219.9                     Uterus, part unspecified


 


220                              Benign
neoplasm of ovary


 


Use
additional code to identify any functional activity (256.0-256.1)


 


Excludes:               cyst:


corpus albicans (620.2)


corpus luteum (620.1)


endometrial (617.1)


follicular (atretic)
(620.0)


graafian follicle
(620.0)


ovarian NOS (620.2)


retention (620.2)


 


221                              Benign
neoplasm of other female genital organs


 


Includes:                adenomatous polyp


benign teratoma


 


Excludes:               cyst:


epoophoron (752.11)


fimbrial (752.11)


Gartner’s duct (752.11)


parovarian (752.11)


 


221.0                     Fallopian tube and uterine ligaments


Oviduct


Parametrium


Uterine ligament (broad)
(round) (uterosacral)


Uterine
tube


 


46

















 


221.1                     Vagina


 


221.2                     Vulva


Clitoris


External
female genitalia NOS


Greater vestibular [Bartholin’s]
gland


Labia (majora) (minora)


Pudendum


 


Excludes:               Bartholin’s (duct) (gland) cyst
(616.2)


 


221.8                     Other specified sites of female genital organs


 


221.9                     Female genital organ, site unspecified


Female genitourinary tract NOS


 


222                              Benign
neoplasm of male genital organs


 


222.0                     Testis


 


Use
additional code to identify any functional activity


 


222.1                     Penis


Corpus cavernosum


Glans penis


Prepuce


 


222.2                     Prostate


 


Excludes:               adenomatous hyperplasia of
prostate (600.20-600.21)


prostatic:


adenoma (600.20-600.21)


enlargement
(600.00-600.01)


hypertrophy
(600.00-600.01)


 


222.3                     Epididymis


 


222.4                     Scrotum


Skin of scrotum


 


222.8                     Other specified sites of male genital organs


Seminal vesicle


Spermatic cord


 


222.9                     Male genital organ, site unspecified


Male genitourinary tract NOS


 


223                              Benign
neoplasm of kidney and other urinary organs


 


223.0                     Kidney, except pelvis


Kidney NOS


 


Excludes:               benign carcinoid tumors of kidney
(209.64)


renal:


calyces (223.1)


pelvis (223.1)


 


223.1                     Renal pelvis


 


223.2                     Ureter


 


Excludes:               ureteric orifice of bladder
(223.3)


 


47

















 


223.3                     Bladder


 


223.8                     Other specified sites of urinary organs


 


223.81   Urethra


 


Excludes:               urethral orifice of bladder (223.3)


 


223.89   Other


Paraurethral glands


 


223.9                     Urinary organ, site unspecified


Urinary system NOS


 


224                              Benign
neoplasm of eye


 


Excludes:               cartilage of eyelid (215.0)


eyelid (skin) (216.1)


optic nerve (225.1)


orbital bone (213.0)


 


224.0                     Eyeball, except conjunctiva, cornea, retina, and choroid


Ciliary body


Iris


Sclera


Uveal tract


 


224.1                     Orbit


 


Excludes:               bone of orbit (213.0)


 


224.2                     Lacrimal gland


 


224.3                     Conjunctiva


 


224.4                     Cornea


 


224.5                     Retina


 


Excludes:               hemangioma of retina (228.03)


 


224.6                     Choroid


 


224.7                     Lacrimal duct


Lacrimal sac


Nasolacrimal duct


 


224.8                     Other specified parts of eye


 


224.9                     Eye, part unspecified


 


225                              Benign
neoplasm of brain and other parts of nervous system


 


Excludes:               hemangioma (228.02)


neurofibromatosis
(237.7)


peripheral, sympathetic,
and parasympathetic nerves and ganglia (215.0-215.9)


retrobulbar (224.1)


 


225.0                     Brain


 


225.1                     Cranial nerves


 


225.2                     Cerebral meninges


 


48

















 


Meninges NOS


Meningioma (cerebral)


 


225.3                     Spinal cord


Cauda equina


 


225.4                     Spinal meninges


Spinal meningioma


 


225.8                     Other specified sites of nervous system


 


225.9                     Nervous system, part unspecified


Nervous system (central) NOS


 


Excludes:               meninges NOS (225.2)


 


226                              Benign
neoplasm of thyroid glands


 


Use
additional code to identify any functional activity


 


227                              Benign
neoplasm of other endocrine glands and related structures


 


Use
additional code to identify any functional activity


 


Excludes:               ovary (220)


pancreas (211.6)


testis (222.0)


 


227.0                     Adrenal gland


Suprarenal gland


 


227.1                     Parathyroid gland


 


227.3                     Pituitary gland and craniopharyngeal duct (pouch)


Craniobuccal pouch


Hypophysis


Rathke’s pouch


Sella turcica


 


227.4                     Pineal gland


Pineal body


 


227.5                     Carotid body


 


227.6                     Aortic body and other paraganglia


Coccygeal body


Glomus jugulare


Para-aortic body


 


227.8                     Other


 


227.9                     Endocrine gland, site unspecified


 


228                              Hemangioma
and lymphangioma, any site


 


Includes:                angioma (benign) (cavernous)
(congenital) NOS


cavernous nevus


glomus tumor


hemangioma (benign)
(congenital)


 


Excludes:               benign neoplasm of spleen, except
hemangioma and lymphangioma (211.9)


 


49

















 


glomus jugulare (227.6)


nevus:


NOS (216.0-216.9)


blue or pigmented
(216.0-216.9)


vascular (757.32)


 


228.0                     Hemangioma, any site


 


228.00   Of
unspecified site


 


228.01   Of
skin and subcutaneous tissue


 


228.02   Of
intracranial structures


 


228.03   Of
retina


 


228.04   Of
intra-abdominal structures


Peritoneum


Retroperitoneal tissue


 


228.09   Of
other sites


Systemic angiomatosis


 


228.1                     Lymphangioma, any site


Congenital lymphangioma


Lymphatic nevus


 


229                              Benign
neoplasm of other and unspecified sites


 


229.0                     Lymph nodes


 


Excludes:               lymphangioma (228.1)


 


229.8                     Other specified sites


Intrathoracic NOS


Thoracic NOS


 


229.9                     Site unspecified


 


CARCINOMA
IN SITU (230-234)


 


Includes:               Bowen’s
disease


erythroplasia


Queyrat’s erythroplasia


 


Excludes:               leukoplakia
- see Alphabetic Index


 


230                              Carcinoma
in situ of digestive organs


 


230.0                     Lip, oral cavity, and pharynx


Gingiva


Hypopharynx


Mouth [any part]


Nasopharynx


Oropharynx


Salivary gland or duct


Tongue


 


Excludes:               aryepiglottic fold or
interarytenoid fold, laryngeal aspect (231.0)


 


50

















 


epiglottis:


NOS (231.0)


suprahyoid portion
(231.0)


skin of lip (232.0)


 


230.1                     Esophagus


 


230.2                     Stomach


Body of stomach


Cardia of stomach


Fundus of stomach


Cardiac orifice


Pylorus


 


230.3                     Colon


Appendix


Cecum


Ileocecal valve


Large intestine NOS


 


Excludes:               rectosigmoid junction (230.4)


 


230.4                     Rectum


Rectosigmoid junction


 


230.5                     Anal canal


Anal sphincter


 


230.6                     Anus, unspecified


 


Excludes:               anus:


margin (232.5)


skin (232.5)


perianal skin (232.5)


 


230.7                     Other and unspecified parts of intestine


Duodenum


Ileum


Jejunum


Small intestine NOS


 


Excludes:               ampulla of Vater (230.8)


 


230.8                     Liver and biliary system


Ampulla of Vater


Common bile duct


Cystic duct


Gallbladder


Hepatic duct


Sphincter of Oddi


 


230.9                     Other and unspecified digestive organs


Digestive organ NOS


Gastrointestinal tract NOS


Pancreas


Spleen


 


231                              Carcinoma
in situ of respiratory system


 


231.0                     Larynx


 


51

















 


Cartilage:


arytenoid


cricoid


cuneiform


thyroid


Epiglottis:


NOS


posterior surface


suprahyoid portion


Vocal cords (false) (true)


 


Excludes:               aryepiglottic fold or
interarytenoid fold:


NOS (230.0)


hypopharyngeal aspect
(230.0)


marginal zone (230.0)


 


231.1                     Trachea


 


231.2                     Bronchus and lung


Carina


Hilus of lung


 


231.8                     Other specified parts of respiratory system


Accessory sinuses


Middle ear


Nasal cavities


Pleura


 


Excludes:               ear (external) (skin) (232.2)


nose NOS (234.8)


skin (232.3)


 


231.9                     Respiratory system, part unspecified


Respiratory organ NOS


 


232                              Carcinoma
in situ of skin


 


Includes:                pigment cells


 


Excludes:               melanoma in situ of skin
(172.0-172.9)


 


232.0                     Skin of lip


 


Excludes:               vermilion border of lip (230.0)


 


232.1                     Eyelid, including canthus


 


232.2                     Ear and external auditory canal


 


232.3                     Skin of other and unspecified parts of face


 


232.4                     Scalp and skin of neck


 


232.5                     Skin of trunk, except scrotum


Anus, margin


Axillary fold


Perianal skin


Skin of:


abdominal wall


anus


back


breast


 


52

















 


buttock


chest wall


groin


perineum


Umbilicus


 


Excludes:               anal canal (230.5)


anus NOS (230.6)


skin of genital organs
(233.30-233.39, 233.5-233.6)


 


232.6                     Skin of upper limb, including shoulder


 


232.7                     Skin of lower limb, including hip


 


232.8                     Other specified sites of skin


 


232.9                     Skin, site unspecified


 


233                              Carcinoma
in situ of breast and genitourinary system


 


233.0                     Breast


 


Excludes:               Paget’s disease (174.0-174.9)


 


skin of breast (232.5)


 


233.1                     Cervix uteri


Adenocarcinoma
in situ of cervix


Cervical intraepithelial
glandular neoplasia, grade III


Cervical intraepithelial
neoplasia III [CIN III]


Severe dysplasia of cervix


 


Excludes:               cervical intraepithelial
neoplasia II [CIN II] (622.12)


cytologic evidence of
malignancy without histologic confirmation (795.06)


high grade squamous
intraepithelial lesion (HGSIL) (795.04)


moderate dysplasia of
cervix (622.12)


 


233.2                     Other and unspecified parts of uterus


 


233.3                     Other and unspecified female genital organs


 


233.30   Unspecified
female genital organ


 


233.31   Vagina


Severe dysplasia of vagina


Vaginal intraepithelial
neoplasia [VAIN III]


 


233.32   Vulva


Severe dysplasia of vulva


Vulvar intraepithelial
neoplasia [VIN III]


 


233.39   Other
female genital organ


 


233.4                     Prostate


 


233.5                     Penis


 


233.6                     Other and unspecified male genital organs


 


233.7                     Bladder


 


233.9                     Other and unspecified urinary organs


 


53














 


234                              Carcinoma
in situ of other and unspecified sites


 


234.0                     Eye


 


Excludes:                                              cartilage of
eyelid (234.8)


eyelid (skin) (232.1)


optic nerve (234.8)


orbital bone (234.8)


 


234.8                     Other specified sites


Endocrine gland [any]


 


234.9                     Site unspecified


Carcinoma in situ NOS


 


NEOPLASMS
OF UNCERTAIN BEHAVIOR (235-238)


 


Note:                   Categories 235-238 classify by site certain
histo-morphologically well-defined neoplasms, the subsequent behavior of which
cannot be predicted from the present appearance.


 


235      Neoplasm
of uncertain behavior of digestive and respiratory systems


 


Excludes:                                              stromal tumors
of uncertain behavior of digestive system (238.1)


 


235.0                     Major salivary glands


Gland:


parotid


sublingual


submandibular


 


Excludes:                                              minor salivary
glands (235.1)


 


235.1                     Lip, oral cavity, and pharynx


Gingiva


Hypopharynx


Minor salivary glands


Mouth


Nasopharynx


Oropharynx


Tongue


 


Excludes:                                              aryepiglottic
fold or interarytenoid fold, laryngeal aspect (235.6)


epiglottis:


NOS (235.6)


suprahyoid portion
(235.6)


skin of lip (238.2)


 


235.2                     Stomach, intestines, and rectum


 


235.3                     Liver and biliary passages


Ampulla of Vater


Bile ducts [any]


Gallbladder


Liver


 


235.4                     Retroperitoneum and peritoneum


 


235.5                     Other and unspecified digestive organs


Anal:


canal


 


54

















 


sphincter


Anus NOS


Esophagus


Pancreas


Spleen


 


Excludes:                                              anus:


margin (238.2)


skin (238.2)


perianal skin (238.2)


 


235.6                     Larynx


 


Excludes:                                              aryepiglottic
fold or interarytenoid fold:


NOS (235.1)


hypopharyngeal aspect
(235.1)


marginal zone (235.1)


 


235.7                     Trachea, bronchus, and lung


 


235.8                     Pleura, thymus, and mediastinum


 


235.9                     Other and unspecified respiratory organs


Accessory sinuses


Middle ear


Nasal cavities


Respiratory organ NOS


 


Excludes:                                              ear (external)
(skin) (238.2)


nose (238.8)


skin (238.2)


 


236                              Neoplasm
of uncertain behavior of genitourinary organs


 


236.0                     Uterus


 


236.1                     Placenta


Chorioadenoma (destruens)


Invasive mole


Malignant hydatid(iform) mole


 


236.2                     Ovary


 


Use
additional code to identify any functional activity


 


236.3                     Other and unspecified female genital organs


 


236.4                     Testis


 


Use
additional code to identify any functional activity


 


236.5                     Prostate


 


236.6                     Other and unspecified male genital organs


 


236.7                     Bladder


 


236.9                     Other and unspecified urinary organs


 


236.90   Urinary
organ, unspecified


 


236.91   Kidney
and ureter


 


55

















 


236.99   Other


 


237                              Neoplasm
of uncertain behavior of endocrine glands and nervous system


 


237.0                     Pituitary gland and craniopharyngeal duct


 


Use
additional code to identify any functional activity


 


237.1                     Pineal gland


 


237.2                     Adrenal gland


Suprarenal gland


 


Use
additional code to identify any functional activity


 


237.3                     Paraganglia


Aortic body


Carotid body


Coccygeal body


Glomus jugulare


 


237.4                     Other and unspecified endocrine glands


Parathyroid gland


Thyroid gland


 


237.5                     Brain and spinal cord


 


237.6                     Meninges


Meninges:


NOS


cerebral


spinal


 


237.7                     Neurofibromatosis


von Recklinghausen’s disease


 


237.70   Neurofibromatosis,
unspecified


 


237.71   Neurofibromatosis,
type 1 [von Recklinghausen’s disease]


 


237.72   Neurofibromatosis,
type 2 [acoustic neurofibromatosis]


 


237.9                     Other and unspecified parts of nervous system


Cranial nerves


 


Excludes:                                              peripheral,
sympathetic, and parasympathetic nerves and ganglia (238.1)


 


238                              Neoplasm
of uncertain behavior of other and unspecified sites and tissues


 


238.0                     Bone and articular cartilage


 


Excludes:                                              cartilage:


ear (238.1)


eyelid (238.1)


larynx (235.6)


nose (235.9)


synovia (238.1)


 


238.1                     Connective and other soft tissue


Peripheral, sympathetic, and
parasympathetic nerves and ganglia


Stromal tumors of digestive
system


 


56

















 


Excludes:                                              cartilage (of):


articular (238.0)


larynx (235.6)


nose (235.9)


connective tissue of
breast (238.3)


 


238.2                     Skin


 


Excludes:                                              anus NOS
(235.5)


skin of genital organs
(236.3, 236.6)


vermilion border of lip
(235.1)


 


238.3                     Breast


 


Excludes:                                              skin of breast
(238.2)


 


238.4                     Polycythemia vera


 


238.5                     Histiocytic and mast cells


Mast cell tumor NOS


Mastocytoma NOS


 


238.6                     Plasma cells


Plasmacytoma NOS


Solitary myeloma


 


238.7                     Other lymphatic and hematopoietic tissues


 


Excludes:                                              acute
myelogenous leukemia (205.0)


chronic myelomonocytic
leukemia (205.1)


myelosclerosis NOS
(289.89)


myelosis:


NOS (205.9)


megakaryocytic (207.2)


 


238.71   Essential
thrombocythemia


Essential hemorrhagic
thrombocythemia


Essential thrombocytosis


Idiopathic (hemorrhagic)
thrombocythemia


Primary thrombocytosis


 


238.72   Low
grade myelodysplastic syndrome lesions


Refractory anemia (RA)


Refractory anemia with excess
blasts-1 (RAEB-1)


Refractory anemia with ringed
sideroblasts (RARS)


Refractory cytopenia with
multilineage dysplasia (RCMD)


Refractory cytopenia with
multilineage dysplasia and ringed sideroblasts (RCMD-RS)


 


238.73   High
grade myelodysplastic syndrome lesions


Refractory anemia with excess blasts-2
(RAEB-2)


 


238.74   Myelodysplastic
syndrome with 5q deletion


5q minus syndrome NOS


 


Excludes:                                              constitutional
5q deletion (758.39)


high grade
myelodysplastic syndrome with 5q deletion (238.73)


 


238.75   Myelodysplastic
syndrome, unspecified


 


238.76   Myelofibrosis
with myeloid metaplasia


 


57

















 


Agnogenic myeloid metaplasia


Idiopathic myelofibrosis
(chronic)


Myelosclerosis with myeloid
metaplasia


Primary myelofibrosis


 


Excludes:                                              myelofibrosis
NOS (289.83)


myelophthisic anemia
(284.2)


myelophthisis (284.2)


secondary myelofibrosis
(289.83)


 


238.77   Post-transplant
lymphoproliferative disorder (PTLD)


 


Code
first complications of transplant (996.80-996.89)


 


238.79   Other
lymphatic and hematopoietic tissues


Lymphoproliferative disease
(chronic) NOS


Megakaryocytic myelosclerosis


Myeloproliferative disease
(chronic) NOS


Panmyelosis (acute)


 


238.8                     Other specified sites


Eye


Heart


 


Excludes:                                              eyelid (skin)
(238.2)


cartilage (238.1)


 


238.9                     Site unspecified


 


NEOPLASMS
OF UNSPECIFIED NATURE (239)


 


239                              Neoplasms
of unspecified nature


 


Note:                   Category 239 classifies by site neoplasms of unspecified
morphology and behavior. The term “mass,” unless otherwise stated, is not to be
regarded as a neoplastic growth.


 


Includes:                                               “growth” NOS


neoplasm NOS


new growth NOS


tumor NOS


 


239.0                     Digestive system


 


Excludes:                                              anus:


margin (239.2)


skin (239.2)


perianal skin (239.2)


 


239.1                     Respiratory system


 


239.2                     Bone, soft tissue, and skin


 


Excludes:                                              anal canal
(239.0)


anus NOS (239.0)


bone marrow (202.9)


cartilage:


larynx (239.1)


nose (239.1)


connective tissue of
breast (239.3)


skin of genital organs
(239.5)


vermilion border of lip
(239.0)


 


58

















 


239.3                     Breast


 


Excludes:                                              skin of breast
(239.2)


 


239.4                     Bladder


 


239.5                     Other genitourinary organs


 


239.6                     Brain


 


Excludes:                                              cerebral
meninges (239.7)


cranial nerves (239.7)


 


239.7                     Endocrine glands and other parts of nervous system


 


Excludes:                                              peripheral,
sympathetic, and parasympathetic nerves and ganglia (239.2)


 


239.8                     Other specified sites


 


Excludes:                                              eyelid (skin)
(239.2)


cartilage (239.2)


great vessels (239.2)


optic nerve (239.7)


 


239.81   Retina
and choroid


Dark area on retina


Retinal freckle


 


239.89   Other
specified sites


 


239.9                     Site unspecified


 


4.  DISEASES OF THE BLOOD AND BLOOD-FORMING
ORGANS (280-289)


 


280                              Iron
deficiency anemias


 


Includes:                                               anemia:


asiderotic


hypochromic-microcytic


sideropenic


 


Excludes:                                              familial
microcytic anemia (282.49)


 


280.0                     Secondary to blood loss (chronic)


Normocytic anemia due to blood
loss


 


Excludes:                                              acute
posthemorrhagic anemia (285.1)


 


280.1                     Secondary to inadequate dietary iron intake


 


280.8                     Other specified iron deficiency anemias


Paterson-Kelly syndrome


Plummer-Vinson syndrome


Sideropenic dysphagia


 


280.9                     Iron deficiency anemia, unspecified


Anemia:


achlorhydric


chlorotic


idiopathic hypochromic


iron [Fe] deficiency NOS


 


59

















 


281                              Other
deficiency anemias


 


281.0                     Pernicious anemia


Anemia:


Addison’s


Biermer’s


congenital pernicious


Congenital intrinsic factor
[Castle’s] deficiency


 


Excludes:                                              combined system
disease without mention of anemia (266.2)


subacute degeneration of
spinal cord without mention of anemia (266.2)


 


281.1                     Other vitamin B12 deficiency anemia


Anemia:


vegan’s


vitamin B12 deficiency (dietary)


due to selective vitamin B12
malabsorption with proteinuria


Syndrome:


Imerslund’s


Imerslund-Gräsbeck


 


Excludes:                                              combined system
disease without mention of anemia (266.2)


subacute degeneration of
spinal cord without mention of anemia (266.2)


 


281.2                     Folate-deficiency anemia


Congenital
folate malabsorption


Folate or folic acid deficiency
anemia:


NOS


dietary


drug-induced


Goat’s milk anemia


Nutritional megaloblastic
anemia (of infancy)


 


Use
additional E code to identify drug


 


281.3                     Other specified megaloblastic anemias, not elsewhere
classified


Combined B12 and
folate-deficiency anemia


 


281.4                     Protein-deficiency anemia


Amino-acid-deficiency anemia


 


281.8                     Anemia associated with other specified nutritional deficiency


Scorbutic anemia


 


281.9                     Unspecified deficiency anemia


Anemia:


dimorphic


macrocytic


megaloblastic NOS


nutritional NOS


simple chronic


 


282                              Hereditary
hemolytic anemias


 


282.0                     Hereditary spherocytosis


Acholuric (familial) jaundice


Congenital hemolytic anemia
(spherocytic)


Congenital spherocytosis


 


60

















 


Minkowski-Chauffard syndrome


Spherocytosis (familial)


 


Excludes:                                              hemolytic
anemia of newborn (773.0-773.5)


 


282.1                     Hereditary elliptocytosis


Elliptocytosis (congenital)


Ovalocytosis (congenital)
(hereditary)


 


282.2                     Anemias due to disorders of glutathione metabolism


Anemia:


6-phosphogluconic dehydrogenase
deficiency


enzyme deficiency, drug-induced


erythrocytic glutathione
deficiency


glucose-6-phosphate
dehydrogenase [G-6-PD] deficiency


glutathione-reductase deficiency


hemolytic nonspherocytic
(hereditary), type I


Disorder of pentose phosphate
pathway


Favism


 


282.3                     Other hemolytic anemias due to enzyme deficiency


Anemia:


hemolytic nonspherocytic
(hereditary), type II


hexokinase deficiency


pyruvate kinase [PK] deficiency


triosephosphate isomerase
deficiency


 


282.4                     Thalassemias


 


Excludes:                                              sickle-cell:


disease (282.60-282.69)


trait (282.5)


 


282.41   Sickle-cell
thalassemia without crisis


Sickle-cell thalassemia NOS


Thalassemia Hb-S disease
without crisis


 


282.42   Sickle-cell
thalassemia with crisis


Sickle-cell thalassemia with
vaso-occlusive pain


Thalassemia Hb-S disease with
crisis


 


Use
additional code for type of crisis, such as:


Acute chest syndrome
(517.3)


Splenic sequestration
(289.52)


 


282.49   Other
thalassemia


Cooley’s anemia


Hb-Bart’s disease


Hereditary leptocytosis


Mediterranean anemia (with
other hemoglobinopathy)


Microdrepanocytosis


Thalassemia (alpha) (beta)
(intermedia) (major) (minima) (minor) (mixed) (trait) (with other
hemoglobinopathy)


Thalassemia NOS


 


282.5                     Sickle-cell trait


Hb-AS genotype


Hemoglobin S [Hb-S] trait


Heterozygous:


 


61

















 


hemoglobin S


Hb-S


 


Excludes:                                              that with other
hemoglobinopathy (282.60-282.69)


that with thalassemia
(282.49)


 


282.6                     Sickle-cell disease


Sickle-cell anemia


 


Excludes:                                              sickle-cell
thalassemia (282.41-282.42)


sickle-cell trait
(282.5)


 


282.60   Sickle-cell
disease, unspecified


Sickle-cell anemia NOS


 


282.61   Hb-SS
disease without crisis


 


282.62   Hb-SS
disease with crisis


Hb-SS disease with
vaso-occlusive pain


Sickle-cell crisis NOS


 


Use
additional code for type of crisis, such as:


Acute chest syndrome
(517.3)


Splenic sequestration
(289.52)


 


282.63   Sickle-cell/Hb-C
disease without crisis


Hb-S/Hb-C disease without
crisis


 


282.64   Sickle-cell/HB-C
disease with crisis


Hb-S/Hb-C disease with crisis


Sickle-cell/Hb-C disease with
vaso-occlusive pain


 


Use
additional code for types of crisis, such as:


Acute chest syndrome
(517.3)


Splenic sequestration
(289.52)


 


282.68   Other
sickle-cell disease without crisis


Hb-S/Hb-D disease without
crisis


Hb-S/Hb-E disease without
crisis


Sickle-cell/Hb-D disease
without crisis


Sickle-cell/Hb-E disease
without crisis


 


282.69   Other
sickle-cell disease with crisis


Hb-S/Hb-D disease with crisis


Hb-S/Hb-E disease with crisis


Sickle-cell/Hb-D disease with
crisis


Sickle-cell/Hb-E disease with
crisis


Other sickle-cell disease with
vaso-occlusive pain


 


Use
additional code for type of crisis, such as:


Acute chest syndrome
(517.3)


Splenic sequestration
(289.52)


 


282.7                     Other hemoglobinopathies


Abnormal hemoglobin NOS


Congenital Heinz-body anemia


Disease:


hemoglobin C [Hb-C]


hemoglobin
D [Hb-D]


hemoglobin
E [Hb-E]


 


62

















 


hemoglobin Zurich [Hb-Zurich]


Hemoglobinopathy NOS


Hereditary persistence of fetal
hemoglobin [HPFH]


Unstable hemoglobin hemolytic
disease


 


Excludes:                                              familial
polycythemia (289.6)


hemoglobin M [Hb-M]
disease (289.7)


high-oxygen-affinity
hemoglobin (289.0)


 


282.8                     Other specified hereditary hemolytic anemias


Stomatocytosis


 


282.9                     Hereditary hemolytic anemia, unspecified


Hereditary hemolytic anemia NOS


 


283                              Acquired
hemolytic anemias


 


283.0                     Autoimmune hemolytic anemias


Autoimmune hemolytic disease
(cold type) (warm type)


Chronic cold hemagglutinin
disease


Cold agglutinin disease or
hemoglobinuria


Hemolytic anemia:


cold type (secondary)
(symptomatic)


drug-induced


warm type (secondary)
(symptomatic)


 


Use
additional E code to identify cause, if drug-induced


 


Excludes:                                              Evans’ syndrome
(287.32)


hemolytic disease of
newborn (773.0-773.5)


 


283.1                     Non-autoimmune hemolytic anemias


 


283.10   Non-autoimmune
hemolytic anemia, unspecified


 


283.11   Hemolytic-uremic
syndrome


 


283.19   Other
non-autoimmune hemolytic anemias


Hemolytic anemia:


mechanical


microangiopathic


toxic


 


Use
additional E code to identify cause


 


283.2                     Hemoglobinuria due to hemolysis from external causes


Acute intravascular hemolysis


Hemoglobinuria:


from exertion


march


paroxysmal (cold) (nocturnal)


due to other hemolysis


Marchiafava-Micheli syndrome


 


Use
additional E code to identify cause


 


283.9                     Acquired hemolytic anemia, unspecified


Acquired hemolytic anemia NOS


Chronic idiopathic hemolytic
anemia


 


63














 


284                              Aplastic anemia and other
bone marrow failure syndromes


 


284.0                     Constitutional aplastic anemia


 


284.01   Constitutional
red blood cell aplasia


Aplasia, (pure) red cell:


congenital


of infants


primary


Blackfan-Diamond syndrome


Familial hypoplastic anemia


 


284.09   Other
constitutional aplastic anemia


Fanconi’s anemia


Pancytopenia with malformations


 


284.1                     Pancytopenia


 


Excludes:                                              pancytopenia
(due to) (with):


aplastic anemia NOS
(284.9)


bone marrow infiltration
(284.2)


constitutional red blood
cell aplasia (284.01)


drug induced (284.89)


hairy cell leukemia
(202.4)


human immunodeficiency
virus disease (042)


leukoerythroblastic
anemia (284.2)


malformations (284.09)


myelodysplastic
syndromes (238.72-238.75)


myeloproliferative
disease (238.79)


other constitutional aplastic
anemia (284.09)


 


284.2                     Myelophthisis


Leukoerythroblastic anemia


Myelophthisic anemia


 


Code
first the underlying disorder, such as:


malignant neoplasm of
breast (174.0-174.9, 175.0-175.9)


tuberculosis
(015.0-015.9)


 


Excludes:                                              idiopathic
myelofibrosis (238.76)


myelofibrosis NOS
(289.83)


myelofibrosis with
myeloid metaplasia (238.76)


primary myelofibrosis
(238.76)


secondary myelofibrosis
(289.83)


 


284.8                     Other specified aplastic anemias


 


284.81   Red
cell aplasia (acquired) (adult) (with thymoma)


Red cell aplasia NOS


 


284.89   Other
specified aplastic anemias


Aplastic anemia (due to):


chronic systemic disease


drugs


infection


radiation


toxic (paralytic)


 


Use
additional E code to identify cause


 


64

















 


284.9                     Aplastic anemia, unspecified


Anemia:


aplastic (idiopathic) NOS


aregenerative


hypoplastic NOS


nonregenerative


Medullary hypoplasia


 


Excludes:                                              refractory
anemia (238.72)


 


285                              Other and unspecified
anemias


 


285.0                     Sideroblastic anemia


Anemia:


hypochromic with iron loading


sideroachrestic


sideroblastic:


acquired


congenital


hereditary


primary


secondary (drug-induced) (due
to disease)


sex-linked hypochromic


vitamin B6-responsive


Pyridoxine-responsive
(hypochromic) anemia


 


Excludes:                                              refractory
sideroblastic anemia (238.72)


Use
additional E code to identify cause, if drug-induced


 


285.1                     Acute posthemorrhagic anemia


Anemia due to acute blood loss


 


Excludes:                                              anemia due to
chronic blood loss (280.0)


blood loss anemia NOS
(280.0)


 


285.2                     Anemia of chronic disease


Anemia in (due to) (with)
chronic illness


 


285.21   Anemia
in chronic kidney disease


Anemia in end-stage renal
disease


Erythropoietin-resistant
anemia (EPO resistant anemia)


 


285.22   Anemia in neoplastic disease


 


Excludes:          anemia
due to antineoplastic chemotherapy (285.3)


 


285.29   Anemia
of other chronic disease


Anemia in other chronic illness


 


285.3                     Antineoplastic chemotherapy induced anemia


Anemia due to antineoplastic
chemotherapy


 


Excludes:          anemia
due to drug NEC - code to type of anemia


anemia in neoplastic
disease (285.22)


aplastic anemia due to
antineoplastic chemotherapy (284.89)


 


285.8                     Other specified anemias


Anemia:


dyserythropoietic (congenital)


dyshematopoietic (congenital)


 


65

















 


von Jaksch’s


Infantile pseudoleukemia


 


285.9                     Anemia, unspecified


Anemia:


NOS


essential


normocytic, not due to blood
loss


profound


progressive


secondary


Oligocythemia


 


Excludes:                                              anemia (due
to):


blood loss:


acute (285.1)


chronic or unspecified
(280.0)


iron deficiency
(280.0-280.9)


 


286                              Coagulation defects


 


286.0                     Congenital factor VIII disorder


Antihemophilic globulin [AHG]
deficiency


Factor VIII (functional)
deficiency


Hemophilia:


NOS


A


classical


familial


hereditary


Subhemophilia


 


Excludes:                                              factor VIII
deficiency with vascular defect (286.4)


 


286.1                     Congenital factor IX disorder


Christmas disease


Deficiency:


factor IX (functional)


plasma thromboplastin component
[PTC]


Hemophilia B


 


286.2                     Congenital factor XI deficiency


Hemophilia C


Plasma thromboplastin
antecedent [PTA] deficiency


Rosenthal’s disease


 


286.3                     Congenital deficiency of other clotting factors


Congenital afibrinogenemia


Deficiency:


AC globulin


factor:


I [fibrinogen]


II [prothrombin]


V [labile]


VII [stable]


X [Stuart-Prower]


XII [Hageman]


XIII [fibrin stabilizing]


 


66

















 


Laki-Lorand factor


proaccelerin


Disease:


Owren’s


Stuart-Prower


Dysfibrinogenemia (congenital)


Dysprothrombinemia
(constitutional)


Hypoproconvertinemia


Hypoprothrombinemia
(hereditary)


Parahemophilia


 


286.4                     von Willebrand’s disease


Angiohemophilia (A) (B)


Constitutional thrombopathy


Factor VIII deficiency with
vascular defect


Pseudohemophilia type B


Vascular hemophilia


von Willebrand’s (-Jürgens’)
disease


 


Excludes:                                              factor VIII
deficiency:


NOS (286.0)


with functional defect (286.0)


hereditary capillary
fragility (287.8)


 


286.5                     Hemorrhagic disorder due to intrinsic circulating
anticoagulants


Antithrombinemia


Antithromboplastinemia


Antithromboplastino-genemia


Hyperheparinemia


Increase
in:


anti-VIIIa


anti-IXa


anti-Xa


anti-XIa


antithrombin


Secondary hemophilia


Systemic lupus erythematosus
[SLE] inhibitor


 


286.6                     Defibrination syndrome


Afibrinogenemia, acquired


Consumption coagulopathy


Diffuse or disseminated
intravascular coagulation [DIC syndrome]


Fibrinolytic hemorrhage,
acquired


Hemorrhagic fibrinogenolysis


Pathologic fibrinolysis


Purpura:


fibrinolytic


fulminans


 


Excludes:                                              that
complicating:


abortion (634-638 with
..1, 639.1)


pregnancy or the
puerperium (641.3, 666.3)


disseminated
intravascular coagulation in newborn (776.2)


 


286.7                     Acquired coagulation factor deficiency


Deficiency of coagulation
factor due to:


liver disease


vitamin K deficiency


 


67

















 


Hypoprothrombinemia, acquired


Excludes:                                              vitamin K
deficiency of newborn (776.0)


 


Use additional
E-code to identify cause, if drug-induced


 


286.9                     Other and unspecified coagulation defects


Defective coagulation NOS


Deficiency, coagulation factor
NOS


Delay, coagulation


Disorder:


coagulation


hemostasis


 


Excludes:                                              abnormal
coagulation profile (790.92)


hemorrhagic disease of
newborn (776.0)


that complicating:


abortion (634-638 with
..1, 639.1)


pregnancy or the
puerperium (641.3, 666.3)


 


287                              Purpura and other
hemorrhagic conditions


 


Excludes:                                              hemorrhagic
thrombocythemia (238.79)


purpura fulminans (286.6)


 


287.0                     Allergic purpura


Peliosis rheumatica


Purpura:


anaphylactoid


autoimmune


Henoch’s


nonthrombocytopenic:


hemorrhagic


idiopathic


rheumatica


Schönlein-Henoch


vascular


Vasculitis, allergic


 


Excludes:                                              hemorrhagic
purpura (287.39)


purpura annularis telangiectodes
(709.1)


 


287.1                     Qualitative platelet defects


Thrombasthenia (hemorrhagic)
(hereditary)


Thrombocytasthenia


Thrombocytopathy (dystrophic)


Thrombopathy (Bernard-Soulier)


 


Excludes:                                              von Willebrand’s
disease (286.4)


 


287.2                     Other nonthrombocytopenic purpuras


Purpura:


NOS


senile


simplex


 


287.3                     Primary thrombocytopenia


 


Excludes:                                              thrombotic
thrombocytopenic purpura (446.6)


transient
thrombocytopenia of newborn (776.1)


 


287.30   Primary
thrombocytopenia unspecified


 


68

















 


Megakaryocytic hypoplasia


 


287.31   Immune
thrombocytopenic purpura


Idiopathic thrombocytopenic
purpura


Tidal platelet dysgenesis


 


287.32   Evans’
syndrome


 


287.33   Congenital
and hereditary thrombocytopenic purpura


Congenital and hereditary
thrombocytopenia


Thrombocytopenia with absent
radii (TAR) syndrome


 


Excludes:                                              Wiskott-Aldrich
syndrome (279.12)


 


287.39   Other
primary thrombocytopenia


 


287.4                     Secondary thrombocytopenia


Posttransfusion purpura


Thrombocytopenia (due to):


dilutional


drugs


extracorporeal circulation of
blood


massive blood transfusion


platelet alloimmunization


 


Use
additional E code to identify cause


 


Excludes:                                              heparin-induced
thrombocytopenia (HIT) (289.84)


transient
thrombocytopenia of newborn (776.1)


 


287.5                     Thrombocytopenia, unspecified


 


287.8                     Other specified hemorrhagic conditions


Capillary fragility
(hereditary)


Vascular pseudohemophilia


 


287.9                     Unspecified hemorrhagic conditions


Hemorrhagic diathesis
(familial)


 


288                              Diseases of white blood
cells


 


Excludes:                                              leukemia
(204.0-208.9)


 


288.0                     Neutropenia


Decreased Absolute Neutrophil
Count (ANC)


 


Use
additional code for any associated:


fever (780.61)


mucositis (478.11,
528.00-528.09, 538, 616.81)


 


Excludes:                                              neutropenic
splenomegaly (289.53)


transitory neonatal
neutropenia (776.7)


 


288.00   Neutropenia,
unspecified


 


288.01   Congenital
neutropenia


Congenital agranulocytosis


Infantile genetic
agranulocytosis


Kostmann’s syndrome


 


288.02   Cyclic
neutropenia


Cyclic hematopoiesis


 


69

















 


Periodic neutropenia


 


288.03   Drug
induced neutropenia


 


Use
additional E code to identify drug


 


288.04   Neutropenia
due to infection


 


288.09   Other
neutropenia


Agranulocytosis


Neutropenia:


immune


toxic


 


288.1                     Functional disorders of polymorphonuclear neutrophils


Chronic (childhood)
granulomatous disease


Congenital dysphagocytosis


Job’s syndrome


Lipochrome histiocytosis
(familial)


Progressive septic
granulomatosis


 


288.2                     Genetic anomalies of leukocytes


Anomaly (granulation)
(granulocyte) or syndrome:


Alder’s (-Reilly)


Chédiak-Steinbrinck (-Higashi)


Jordan’s


May-Hegglin


Pelger-Huet


Hereditary:


hypersegmentation


hyposegmentation


leukomelanopathy


 


288.3                     Eosinophilia


Eosinophilia


allergic


hereditary


idiopathic


secondary


Eosinophilic leukocytosis


 


Excludes:                                              Löffler’s
syndrome (518.3)


pulmonary eosinophilia
(518.3)


 


288.4                     Hemophagocytic syndromes


Familial hemophagocytic
lymphohistiocytosis


Familial hemophagocytic
reticulosis


Hemophagocytic syndrome,
infection-associated


Histiocytic syndromes


Macrophage activation syndrome


 


288.5                     Decreased white blood cell count


 


Excludes:                                              neutropenia
(288.01-288.09)


 


288.50   Leukocytopenia,
unspecified


Decreased leukocytes,
unspecified


Decreased white blood cell
count, unspecified


Leukopenia NOS


 


70

















 


288.51   Lymphocytopenia


Decreased lymphocytes


 


288.59   Other
decreased white blood cell count


Basophilic leukopenia


Eosinophilic leukopenia


Monocytopenia


Plasmacytopenia


 


288.6                     Elevated white blood cell count


 


Excludes:          eosinophilia
(288.3)


 


288.60   Leukocytosis,
unspecified


Elevated leukocytes,
unspecified


Elevated white blood cell
count, unspecified


 


288.61   Lymphocytosis
(symptomatic)


Elevated lymphocytes


 


288.62   Leukemoid
reaction


Basophilic leukemoid reaction


Lymphocytic leukemoid reaction


Monocytic leukemoid reaction


Myelocytic leukemoid reaction


Neutrophilic leukemoid reaction


 


288.63   Monocytosis
(symptomatic)


 


Excludes:          infectious
mononucleosis (075)


 


288.64   Plasmacytosis


 


288.65   Basophilia


 


288.66   Bandemia


Bandemia without diagnosis of
specific infection


 


Excludes:          confirmed
infection - code to infection


leukemia  (204.00-208.9)


 


288.69   Other
elevated white blood cell count


 


288.8                     Other specified disease of white blood cells


 


Excludes:                                              decreased white
blood cell counts (288.50-288.59)


elevated white blood
cell counts (288.60-288.69)


immunity disorders
(279.0-279.9)


 


288.9                     Unspecified disease of white blood cells


 


289                              Other diseases of blood and
blood-forming organs


 


289.0                     Polycythemia, secondary


High-oxygen-affinity hemoglobin


Polycythemia:


acquired


benign


due to:


fall in plasma volume


high altitude


 


71

















 


emotional


erythropoietin


hypoxemic


nephrogenous


relative


spurious


stress


 


Excludes:                                              polycythemia:


neonatal (776.4)


primary (238.4)


vera (238.4)


 


289.1                     Chronic lymphadenitis


Chronic:


adenitis any lymph node, except
mesenteric


lymphadenitis any lymph node,
except mesenteric


 


Excludes:                                              acute
lymphadenitis (683)


mesenteric (289.2)


enlarged glands NOS
(785.6)


 


289.2                     Nonspecific mesenteric lymphadenitis


Mesenteric lymphadenitis
(acute) (chronic)


 


289.3                     Lymphadenitis, unspecified, except mesenteric


 


289.4                     Hypersplenism


“Big spleen” syndrome


Dyssplenism


Hypersplenia


 


Excludes:                                              primary splenic
neutropenia (289.53)


 


289.5                     Other diseases of spleen


 


289.50   Disease
of spleen, unspecified


 


289.51   Chronic
congestive splenomegaly


 


289.52   Splenic
sequestration


 


Code
first sickle-cell disease in crisis (282.42, 282.62, 282.64, 282.69)


 


289.53   Neutropenic
splenomegaly


 


289.59   Other


Lien migrans


Perisplenitis


Splenic:


abscess


atrophy


cyst


fibrosis


infarction


rupture, nontraumatic


Splenitis


Wandering spleen


 


Excludes:                                              bilharzial
splenic fibrosis (120.0-120.9)


hepatolienal fibrosis
(571.5)


splenomegaly NOS (789.2)


 


72

















 


289.6                     Familial polycythemia


Familial:


benign polycythemia


erythrocytosis


 


289.7                     Methemoglobinemia


Congenital NADH
[DPNH]-methemoglobin-reductase deficiency


Hemoglobin M [Hb-M] disease


Methemoglobinemia:


NOS


acquired (with
sulfhemoglobinemia)


hereditary


toxic


Stokvis’ disease


Sulfhemoglobinemia


 


Use
additional E code to identify cause


 


289.8                     Other specified diseases of blood and blood-forming organs


 


289.81   Primary
hypercoagulable state


Activated protein C resistance


Antithrombin III deficiency


Factor V Leiden mutation


Lupus anticoagulant


Protein C deficiency


Protein S deficiency


Prothrombin gene mutation


 


289.82   Secondary
hypercoagulable state


 


Excludes:                                              heparin-induced
thrombocytopenia (HIT) (289.84)


 


289.83   Myelofibrosis


Myelofibrosis NOS


Secondary myelofibrosis


 


Code
first the underlying disorder, such as:


malignant neoplasm of
breast (174.0-174.9, 175.0-175.9)


 


Use
additional code for associated therapy-related myelodysplastic syndrome, if
applicable (238.72, 238.73)


 


Use
additional external cause code if due to anti-neoplastic chemotherapy (E933.1)


 


Excludes:          idiopathic
myelofibrosis (238.76)


leukoerythroblastic
anemia (284.2)


myelofibrosis with
myeloid metaplasia (238.76)


myelophthisic anemia
(284.2)


myelophthisis (284.2)


primary myelofibrosis
(238.76)


 


289.84   Heparin-induced
thrombocytopenia (HIT)


 


289.89   Other
specified diseases of blood and blood-forming organs


Hypergammaglobulinemia


Pseudocholinesterase deficiency


 


289.9                     Unspecified diseases of blood and blood-forming organs


Blood dyscrasia NOS


Erythroid hyperplasia


 


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*** Confidential material redacted
and filed separately with the Commission.


 


Schedule 1.43


 


***


 


***


 


2

















 


*** Confidential material redacted
and filed separately with the Commission.


 


***


 


3

















 


*** Confidential material redacted
and filed separately with the Commission.


 


***


 


4

















 


*** Confidential material redacted
and filed separately with the Commission.


 


***


 


5

















 


*** Confidential material redacted
and filed separately with the Commission.


 


Schedule 1.48


 


Initial
Licensed Back-Up Compounds


 


***


***


***


***


 


6