The symbol
[***] is used to indicate that a portion of the exhibit has been omitted and
filed separately with the commission. 
Confidential treatment has been requested with respect to the omitted
portion.


 


REAL-TIME
INSTRUMENT PATENT LICENSE AGREEMENT


 


This
Agreement, effective April 5, 2004 (the “Effective Date”), is made by and between
Applera Corporation, a corporation of the State of Delaware, through its
Applied Biosystems Group, having an office at 850 Lincoln Centre Drive, Foster
City, California 94404 and Celera Diagnostics, LLC, an indirectly wholly owned
subsidiary of the Applera Corporation (“Applera”),
and Cepheid, a corporation of the State of California having an office at 904
Caribbean Drive, Sunnyvale, California 94089 (“Licensee”)
(each of Applera and Licensee, a “Party” and, collectively, the “Parties”).


 


Whereas,
Applera owns Japanese Patent No. JP 3136129, European Patent No. EP 0 872 562
B1, and patents and applications that claim priority of United States
application Serial No. 08/968,208, all describing and claiming automated
thermal cycling apparatus capable of performing nucleic acid amplification and
detecting that amplification in real time, and apparatus claims in
corresponding counterpart patent applications in other countries.


 


Whereas,
Applera owns U.S. Patent No. 5,656,493, describing and claiming an
amplification system comprising polymerase chain reaction (“PCR”) reagents and a thermal cycler
programmed to carry out a PCR protocol.


 


Whereas,
Licensee and Applera are parties to  a
Thermal Cycler Supplier Agreement having an effective date of April 15, 2000
(the “TCSA”), under which Licensee
has been granted certain limited license rights in certain fields under certain
identified patents and patent applications claiming methods and apparatus for
nucleic acid amplification, including the PCR process, but not including
real-time thermal cycling apparatus rights that are the subject of this
Agreement.


 


Whereas,
Licensee has requested rights in all fields under the Applera real-time thermal
cycling apparatus patent rights, and rights only in the human in vitro diagnostic field under the
Applera amplification system rights, and Applera has agreed to grant those
rights.


 


NOW,
THEREFORE, the Parties agree as follows:


 


1.             Definitions


 


For the
purpose of this Agreement terms when used herein with initial capital letters
shall have the meanings set forth below or as otherwise defined in this
Agreement.  Except where the context
otherwise requires, wherever used, the singular form of such defined terms
shall include the plural.


 


1.1           “AB/Cepheid
Limited-Royalty Collaboration Agreement” means the Collaboration
Agreement between APPLIED BIOSYSTEMS AND CEPHEID, effective October 11, 2002
(the “Collaboration Agreement”).


 


1

















 


1.2           “Affiliate”
of a party to this Agreement shall mean an organization: a) whose voting stock
is controlled or owned directly or indirectly to the extent of fifty percent
(50%) or more by the party; b) which directly or indirectly owns or controls
fifty percent (50%) or more of the voting stock of the party; c) whose majority
ownership is directly or indirectly common to that of the party; or d) defined
under a), b), or c) above except the amount of said ownership is less than fifty
percent (50%) but that amount is the maximum amount permitted by law and
Licensee has effective control.


 


1.3           “Amplification
System Patent Rights” shall mean U.S. Patent No. 5,656,493, which
describes and claims an amplification system comprising PCR reagents and a
thermal cycler programmed to carry out a PCR protocol.  Amplification System Patent Rights include
rights only under the identified Applera patent.  They do not include rights, expressly or by implication, under
any other Applera or any Roche patent or application, or to any patent claim to
reagents, apparatus, or an amplification process, even if that process is a
result of the natural and intended operation of the amplification system.


 


1.4           [***]


 


1.5           [***]


 


1.6           “Licensed
Real-Time Thermal Cycler” shall mean a Real-Time Thermal Cycler as
defined below, where the system or its manufacture, importation, offer for
sale, sale or use would, except for the rights granted under this Agreement,
infringe at least one Valid Claim within the Real-Time Apparatus Patent Rights.


 


1.7           “Molecular
Diagnostics Products” shall mean any products intended or used for
the amplification, detection, quantification, extraction or sequencing of
nucleic acid for human in vitro
diagnostic purposes for the clinical management of patients.


 


1.8           “Net
Sales Price” for apparatus distributed under this Agreement shall
refer to the sales price charged to unrelated Third-Party end users as to whom
the price is not affected by any other purchase, by any other dealing or by any
special course of dealing, and shall mean the gross invoice price to such an
end user less the following deductions where applicable: (i) discount allowed
and taken, in amounts customary in the trade, and (ii) sales and/or use taxes
and/or duties for particular sales.  No
allowance or deduction shall be made for commissions or collections, by
whatever name known.  Instruments
subject to this Agreement shall be separately invoiced items.


 


2

















 


For
distributions other than sales described by the preceding paragraph, including
any sale, loan, lease, consignment, gift or other distribution (i) to an end
user that is Licensee itself, an Affiliate or a distributor, (ii) to an end
user that enjoys a special course of dealing with Licensee, or its Affiliates
or distributors, or (iii) is under a reagent rental agreement or other
arrangement that is not a sale to an unrelated Third-Party end user as to whom
the price is unaffected by other purchase, dealing or special course of
dealing, the Net Sales Price shall be determined by reference to the Net Sales
Price which would be applicable in an arm’s length sale to a similarly situated
unrelated  Third-Party end user as to
whom the price is not affected by any other purchase, by any other dealing or
by any special course of dealing.


 


In all cases,
Net Sales Price shall be calculated on the basis of sales or transfers to end
users by Licensee, its Affiliate or a distributor of either, as the case may
be.  In the event Licensee is unable to
account for end-user sales by any distributor, the Net Sales Price shall be
calculated as the price to the final distributor multiplied by [***] which
factor represents a [***] margin on sales to end users by the distributor.


 


For the avoidance of doubt, the Net Sales
Price for Real-Time Thermal Cyclers shall include the gross invoice price for
all modules, components, computer hardware and software for such Real-Time
Thermal Cyclers whether the same are sold together with or separately from such
Real-Time Thermal Cyclers.


 


1.9           “Real-Time
Apparatus Patent Rights” shall mean (a) Applera’s Japanese Patent
No. JP 3136129, European Patent No. EP 0 872 562 B1; and claims in Applera’s
patents and applications that claim priority of United States patent application
Serial No.  08/968,208; and


 


(b) each
patent claim to an apparatus or to a method of using that apparatus now or
hereafter owned by Applera; provided that such claim would be infringed by the
manufacture, use (in the manner used as of the Effective Date as evidenced by
Licensee’s product literature attached as Exhibit 2 to this Agreement) or sale
of any Cepheid Smart Cycler, GeneXpert or I-CORE- module-containing product
that had been commercially sold by Licensee as of the Effective Date of this Agreement,
as evidenced by Licensee’s product literature attached as Exhibit 2 to this
Agreement.  No other patent claims are
included, whether expressly or by implication, within the definition of
Real-Time Apparatus Rights or Amplification System Patent Rights.  Notwithstanding anything herein to the
contrary, the term Real-Time Apparatus Patent Rights does not include any
patent or patent claim that claims a real-time process, reagent or method.


 


1.10         “Real-Time
Thermal Cycler” shall mean an instrument, whether in single or
multiple modules, that includes a Thermal Cycler or Temperature Cycling
Instrument as defined below and a detector which can be used to detect a
fluorescence optical signal while the Thermal Cycler is in operation and
without opening the vessel(s) in which amplification is occurring.  For the purposes of this Agreement,
Real-Time Thermal Cyclers are limited to the following products:  Cepheid Smart Cycler, GeneXpert and any
Cepheid Thermal Cycler containing one or more I-CORE modules


 


3

















 


(as those modules are defined
in Exhibit 1), and are further limited to thermal cyclers with a capacity of no
more than five hundred (500) reaction aliquots, vessels or tubes that can be
thermally cycled at one time.  For
avoidance of doubt a Real-Time Thermal Cycler does not include disposable test
cartridges or reaction tubes for containing reagents that are to be used with
such Real-Time Thermal Cyclers.


 


1.11         “Temperature
Cycling Instrument” shall mean an instrument, whether in single or
multiple modules, that includes a Thermal Cycler and additional structure for
performing one or more other functions.


 


1.12         “Thermal
Cycler” shall mean an instrument, whether in single or multiple
modules, that is capable in itself of automatically performing thermal cycling
of samples in the PCR process.


 


1.13         “Territory”
shall mean the world.


 


1.14         “Third
Party” shall mean a party other than one of the Parties to this
Agreement.


 


1.15         “Valid
Claim” shall mean a patent claim which has not been held invalid or
permanently unenforceable by a decision of a court or administrative tribunal
from which no appeal has or can be taken, or a pending claim of a patent
application.


 


2.             Grant


 


2.1           Upon the terms and subject to the
exceptions and conditions of this Agreement, Applera hereby grants to Licensee
under the Real-Time Apparatus Patent Rights a personal, non-transferable,
royalty-bearing, non-exclusive license in the Fields and in the HIVD Field, in
the Territory, to make (but not have made), use and import Licensed Real-Time
Thermal Cyclers, and to offer to sell, and sell the same to end users solely
under Licensee’s name and trademarks but not otherwise to manufacture for, or
sell or distribute to or for, thermal cycler instrument suppliers.


 


2.2           Upon the terms and subject to the
exceptions and conditions of this Agreement, Applera grants to Licensee under
the Real-Time Apparatus Patent Rights a personal, non-transferable,
royalty-bearing, non-exclusive license in the Fields and in the HIVD Field, in
the Territory, to make (but not have made), use and import add-on and
substitute components, modules, computer hardware and software for Licensed
Real-Time Thermal Cyclers, and to offer to sell, sell and distribute the same
only to end-user owners of Licensed Real-Time Thermal Cyclers purchased from
Licensee.


 


2.3           Upon the terms and subject to the
exceptions and conditions of this Agreement, Applera grants to Licensee under
the Amplification System Patent Rights a personal, non-transferable,
royalty-bearing, non-exclusive right to convey to end-user customers (including
Licensee itself) of Licensee’s Licensed Real-Time Thermal Cyclers a
non-exclusive license to use such Licensed Real-Time Thermal Cyclers in the
HIVD Field in the Territory.


 


4

















 


2.4           The grants under Sections 2.1, 2.2
and 2.3 include no right, immunity, authorization or license, either expressly
or by implication, under any patent or patent application other than the Real-Time
Apparatus Patent Rights and the Amplification System Patent Rights.  Without limiting the foregoing, no license
is granted pursuant to this Agreement under any patent claim or patent
application claim to a real-time process, reagent or method.  Notwithstanding the rights granted in
Sections 2.1, 2.2, and 2.3, the Licensee, its Affiliate, or distributor may not
make, use, offer to sell, import, or sell a Licensed Real Time Thermal Cycler
for use with Molecular Diagnostics Products for HIV or HCV infection, including
any analyte specific reagent products.


 


2.5           Rights granted to Licensee under this
Agreement are personal to Licensee alone. 
Licensee shall have no right to sublicense, assign or otherwise transfer
or share its rights hereunder, except as permitted under Section 9.1 of this
Agreement.


 


2.6           Notwithstanding the prohibition of
Section 2.5, Licensee’s rights to sell to end users under the grants of
Sections 2.1 and 2.2, and to convey rights to end-user customers under the
grant of Section 2.3, include the right to sell through Affiliates and
distributors, as long as Licensee reports and pays under this Agreement on
their behalf.


 


2.7           Restriction on Distributors and
Affiliates Licensee shall not make any arrangements or agreements with any
Third Party to distribute or co-market Real-Time Thermal Cyclers if such Third
Party or its affiliates had, individually or in aggregate, worldwide sales of
Molecular Diagnostics Products manufactured by such Third Party or its
affiliates which exceeded [***] in calendar year 2003.


 


3.             Fees,
Royalties, Records and Reports


 


3.1           In consideration of the licenses and
rights granted under Article 2, Licensee shall pay to Applera:


 


a)             a non-refundable license issuance
fee of eleven million five hundred thousand dollars (US$ 11,500,000), not
creditable against royalties, with said license issuance fee to be paid
according to the following schedule: 
[***] upon execution of this Agreement, with subsequent payments of
[***] due on the first business day of each calendar quarter thereafter,
beginning with the next immediate quarter, until the remaining balance of [***]
is paid.  For the avoidance of doubt,
the calendar quarters begin on the first day of the following months: January,
April, July and October;


 


b)            for each Cepheid GeneXpert® Module
(as “GeneXpert® Module” is defined in the Collaboration Agreement) that is a
Licensed Real-Time Thermal Cycler and that is delivered or invoiced
after the issuance of a United States patent that claims priority of United
States patent application Serial No. 
08/968,208to Northrup Grumman or any other third party for delivery to
and use solely by the United States Postal Service


 


5

















 


(“USPS”) with Cartridges (as
the term “Cartridges” is defined in the Collaboration Agreement) supplied to
Cepheid pursuant to the Distribution Agreement dated March 28, 2003 between
Applera and Cepheid as part of a Bio-Threat Agent Detection System (as the term
“Bio-Threat Agent Detection System” is defined in the Collaboration Agreement)
pursuant to the prime contract existing as of the date of this Agreement
between Northrup Grumman and the USPS for the supply of Bio-Threat Agent
Detection Systems with respect to which Cepheid is a subcontractor,  including any modules or components of any
such GeneXpert Module, including without limitation software, [***] of Net
Sales Price for each such Licensed Real-Time Thermal Cycler; and for all other
Licensed Real-Time Thermal Cyclers: (i) [***] of Net Sales Price for each Licensed
Real-Time Thermal Cycler distributed prior to the issuance of any of Applera’s
patents that claim priority of U.S. application Serial No. 08/968,208 and that
cover such Licensed Real-Time Thermal Cycler; and (ii) following the issuance
of any such patents, [***] of Net Sales Price;


 


c)             unless exempted from royalty under
Section 3.1(d), for each component or module (including, without limitation,
computer hardware and software) of a Cepheid GeneXpert® Module (as “GeneXpert®
Module” is defined in the Collaboration Agreement) that is a Licensed Real-Time
Thermal Cycler and that is delivered or invoiced after the issuance of a
United States patent that claims priority of United States patent application
Serial No.  08/968,208 to Northrup
Grumman or any other third party for delivery to and use solely by the USPS
with Cartridges (as the term “Cartridges” is defined in the Collaboration
Agreement) supplied to Cepheid pursuant to the Distribution Agreement dated
March 28, 2003 between Applera and Cepheid as part of a Bio-Threat Agent
Detection System (as the term “Bio-Threat Agent Detection System” is defined in
the Collaboration Agreement) pursuant to the prime contract existing as of the
date of this Agreement between Northrup Grumman and the USPS for the supply of
Bio-Threat Agent Detection Systems with respect to which Cepheid is a
subcontractor,  [***] of Net Sales Price
for each such component or module; and for all other components or modules
(including, without limitation, computer hardware and software) for Licensed
Real-Time Thermal Cyclers:  (i) [***] of
Net Sales Price for each such component or module delivered or invoiced prior
to the issuance of any of Applera=s patents and applications that claim priority
of U.S. application Serial No. 08/968,208 and which cover such Licensed
Real-Time Thermal Cycler; and (ii) following such issuance, [***] of Net Sales
Price for each such component or module delivered or invoiced following the
issuance of any of Applera’s patents and applications that claim priority of
U.S. application Serial No. 08/968,208 and which cover such Licensed Real-Time
Thermal Cycler; and


 


d)            repair, not amounting to
reconstruction, of a Licensed Real-Time Thermal Cycler for which a royalty
already has been paid under this Agreement, including replacement of components
by identical components shall not be subject to royalty hereunder unless the
component itself would directly infringe the Amplification System Patent Rights
or the Real-Time Apparatus Patent Rights.


 


3.2           Royalties that are expressed as a
percentage (but not flat fee royalties) of Net Sales Price (as defined in the
TCSA) and that are paid by Licensee to Applera for


 


6

















 


Licensee’s sales of royalty
bearing products under the TCSA shall be deductible against royalties due for
the same sales of royalty bearing products under Sections 3.1(b) and (c) of
this Agreement.


 


3.3           All amounts payable hereunder shall
be payable in United States dollars. 
Sales in other countries shall be converted to U.S. dollars based on the
New York rate of exchange as quoted in the Wall Street Journal for the last
business day of the applicable quarter. 
If not so published, the Parties may agree on a substitute publication.  In the event there is no comparable
publication, the applicable rate for such date by the appropriate governmental
agency in such country shall apply.


 


3.4           Licensee shall keep, and shall
require its pertinent Affiliates and (when Licensee is reasonably able to do so
shall require it distributors) to keep (and make available for audit as set
forth below), full, true and accurate records, in accordance with Generally
Accepted Accounting Principles, detailing all information necessary to show the
amount payable to Applera under this Agreement and to demonstrate Licensee’s
(and its Affiliates’ and distributors’) compliance with its obligations under
this Agreement.  Such books and the
supporting data shall be made available during normal business hours, for three
(3) years following the end of the calendar year to which they pertain (and
access shall not be denied thereafter, if reasonably available), to the
inspection of an independent auditor retained by Applera.  If in dispute, such records shall be kept
until the dispute is settled.  Inspection
shall be at Applera’s expense, unless the auditor concludes that the amount
payable that is stated in a report is understated by five percent (5%) or more,
in which case expenses shall be paid by Licensee.


 


3.5           Licensee shall within thirty (30) days
after the first of January, April, July and October deliver to Applera a true
and accurate royalty report.  This
report shall detail (i) Licensee’s (and its Affiliates’ and distributors’ when
applicable) sales or other transfer on a country-by-country basis of products
that are subject to royalties hereunder; (ii) the Net Sales Price; and (iii)
Licensee’s calculation of its royalty obligations consistent with this
Agreement.  Such report shall also give
such other details of the business conducted by Licensee in each country during
the preceding three (3) calendar months as are pertinent to accounting for
royalty obligations under this Agreement, and shall be in accordance with, and
include all information specified in, the royalty report form attached hereto
as Appendix A.


 


The
correctness and completeness of each report shall be attested to in writing by
the responsible financial officer of Licensee or by Licensee’s external
auditor.


 


3.6           Simultaneously with the delivery of
each royalty report described in Section 3.5 above, Licensee shall pay to
Applera the monies then due under this Agreement for the period covered by the
report.  Each report and payment shall
be sent by the due date to the following address:


 


7

















 


Applied
Biosystems


850 Lincoln
Centre Drive


Foster City,
California, 94404 U.S.A.


Attention:
Director of Licensing


 


with a copy to


 


Celera
Diagnostics


1401 Harbor
Bay Parkway


Alameda,
California, 94502 U.S.A


Attention:
Vice President, Business Development


 


or to any address that Applera may advise in writing.


 


3.7           If Licensee shall fail to pay any
amount owing under this Agreement by the due date, the amount owed shall bear
interest at [***] over the Citibank NA base lending rate (“prime rate”) from
the due date until paid, provided, however, that if this interest rate is held
to be unenforceable for any reason, the interest rate shall be the maximum rate
allowed by law at the time the payment is due.


 


3.8           Failure of Licensee to pay any amount
specified under this Agreement within thirty (30) days after the due date will
give Applera the right to terminate under Section 6.7.


 


4.             Settlement


 


4.1           The Parties have been engaged in a
dispute regarding the patentability or validity, as the case may be, of the
Real-Time Apparatus Patent Rights, including Licensee’s opposition to European
Patent No. EP 0 872 562 B1.  In
settlement of that dispute, the Parties agree as follows:  (i) Licensee will withdraw its opposition to
said European Patent and will not oppose said patent, directly or indirectly;
(ii) upon the Effective Date of this Agreement, Licensee shall pay to Applera
the sum of [***]; and (iii) upon its receipt of said payment, Applera agrees
that all Real-Time Thermal Cyclers delivered or invoiced by Licensee and its
Affiliates (including Real-Time Thermal Cyclers delivered to themselves for
use) prior to the Effective Date of this Agreement shall be considered to have
been licensed under the grants of Sections 2.1, 2.2 and 2.3.


 


5.             License
Notice


 


5.1           Licensee agrees to include
prominently in the front of the user’s manual for each Licensed Real-Time
Thermal Cycler, and for no other Thermal Cycler or Temperature Cycling
Instrument, a Notice as specified from time to time by Applera.  Unless and until Applera reasonably
instructs differently, the Notice shall be:


 


8

















 


NOTICE TO PURCHASER


 


This real-time thermal cycler is licensed for
use in research, diagnostics (except in diagnosis and monitoring of HIV and HCV
infections) and all other applied fields under Applera’s European Patent No. EP
0 872 562, Japanese Patent No. JP 3136129 and patents pending.


 


No rights are conveyed expressly, by
implication or estoppel to any patents on real-time methods, including but not
limited to 5’ nuclease assays, or to any patent claiming a reagent or kit.


 


Applied Biosystems does not guarantee the
performance of this instrument or endorse its use in any application.


 


6.             Term
and Termination


 


6.1           This Agreement, unless sooner
terminated, shall continue until the expiration of the last-to-expire of the
patents under which rights are granted in this Agreement.


 


6.2           This Agreement shall terminate upon a
holding of invalidity or unenforceability of all patent claims licensed hereunder
by a final court decision from which no appeal is or can be taken.


 


6.3           Licensee may terminate this Agreement
for any reason by giving written notice to Applera and ceasing to label,
advertise or promote its Real-Time Thermal Cyclers as Licensed Real-Time
Thermal Cyclers.  Such termination shall
be effective ninety (90) days after said notice or cessation, whichever is
later.  Upon such termination, any
outstanding balance of the license issuance fee (for which the payment
obligation has not already accrued) payable under Section 3.1 (a) of this
Agreement shall be cancelled


 


6.4           The decision of a Court or
Administrative body finding Applera liable or culpable due to Licensee’s
manufacture of Licensed Real-Time Thermal Cyclers or components thereof covered
by this Agreement or due to the sale or distribution of such Licensed Real-Time
Thermal Cyclers or components thereof by Licensee, an Affiliate or a
distributor shall give Applera the right to terminate immediately upon notice,
the licenses granted under this agreement in the country(s) under the
jurisdiction of the above Court or Administrative body that issued the finding.


 


6.5           This Agreement shall terminate
immediately upon (i) an adjudication of Licensee as bankrupt or insolvent, or
Licensee’s admission in writing of its inability to pay its obligations as they
mature; (ii) an assignment by Licensee for the benefit of creditors; (iii) the
appointment of, or Licensee’s applying for or consenting to the appointment of,
a receiver, trustee or similar officer for a substantial part of its property;
(iv) the institution of or any act of Licensee instituting any bankruptcy,
insolvency


 


9

















 


arrangement, or similar
proceeding; (v) the issuance or levy of any judgment, writ, warrant or
attachment or execution or similar process against a substantial party of the
property of Licensee; or (vi) loss of Licensee’s federal or state licenses,
permits or accreditation necessary for distribution of Licensed Real-Time Thermal
Cyclers.


 


6.6           Except as permitted under Section 9.1
of this Agreement, Applera may terminate this Agreement immediately on notice
upon any change in the ownership or control of Licensee or of its assets.  For such purposes, a “change in ownership or
control” shall mean that [***] or more of the voting stock of Licensee becomes
subject to the ownership or control of a person or entity, or any related group
of persons or entities acting in concert, which persons(s) or entity(ies) did
not own or control such portion of voting stock on the Effective Date
hereof.  Applera shall have the same
right to terminate upon any transfer of [***] or more of the assets of
Licensee.


 


6.7           Upon any breach of or default under a
material term (including without limitation any payment obligation) under this
Agreement by Licensee, Applera may terminate this Agreement upon [***] days’
written notice.  Notwithstanding the
foregoing, Applera will not terminate this Agreement if, during the [***] day
notice period, Licensee fully cures such breach or default to Applera’s
reasonable satisfaction.


 


6.8           Upon expiration or termination of
this Agreement, all licenses granted to Licensee shall terminate.  Licensee’s obligations under Article 3 with
respect to sale or royalty obligations accruing prior to termination or
expiration shall survive termination or expiration.  Termination of this Agreement for any reason shall be without
prejudice to any rights that shall have accrued to the benefit of a Party prior
to or on account of such termination or expiration.  All remedies provided hereunder or elsewhere are cumulative.  Section 7.2, Section 7.3 and Articles 8, 10
and 11 of this Agreement shall survive the termination or expiration of this
Agreement for any reason.


 


7.             Confidentiality
– Publicity


 


7.1           Unless and until ABI reasonably
instructs differently, in
advertisements, catalogs, brochures, sales literature and promotional
literature for Licensed Real-Time Thermal Cyclers, Licensee, Affiliates and
distributors shall state the following prominently in type and location:


 


10

















 


Cepheid’s [Real-time thermal cycler model(s)]
(is a) (are) licensed real-time thermal cycler(s) under Applera’s European
Patent No. EP 0 872 562, Japanese Patent No. JP 3136129 and patents pending.


 


Such notice may also include the clause “for all fields including human
in vitro diagnostics except for diagnosis and monitoring of HIV and HCV
infections” or the clause “for human in vitro diagnostics except for diagnosis
and monitoring of HIV and HCV infections” at Cepheid’s option.


 


7.2           With respect to Licensee’s
distribution of any written information to Third Parties, including but not
limited to advertising, brochures, catalogs, promotional and sales material,
and public relations material, Applera shall have the right to prescribe
changes regarding references to, or descriptions of: Applera, Applied
Biosystems, the patents under which rights are granted in this Agreement or
this Agreement.  Licensee agrees to
comply with Applera’s reasonable prescriptions.


 


7.3           Except as provided in Sections 7.1
and 7.2, Licensee shall, to the extent reasonably practicable, maintain the
confidentiality of the provisions of this Agreement and shall refrain from
disclosing the terms of this Agreement without the prior written consent of
Applera, except to the extent Licensee concludes in good faith that such
disclosure is required under applicable law or regulation in which case Applera
shall be notified in advance.  Should
Licensee conclude in good faith that such disclosure is in fact required,
Licensee shall notify Applera in writing thirty (30) days or, in the case of a
court order, as soon as reasonably possible before such disclosure is made to
permit Applera to comment upon or object to the disclosure, or to redact the
disclosure copy of the Agreement.


 


8.             Compliance
and Quality


 


8.1           In the exercise of any and all rights
and in performance hereunder, it shall be the duty of Licensee, not Applera, to
comply fully with all applicable laws, regulations and ordinances and to obtain
and keep in effect licenses, permits and other governmental approvals (federal,
state or local) necessary or appropriate to carry on activities hereunder.


 


8.2           Applera does not approve or endorse
any Real-Time Thermal Cycler of Licensee in any way or for any purpose,
including real-time PCR.  Quality and
quality control with respect to suitability for real-time PCR, according to
standards and requirements that may exist in the marketplace from time to time,
are the sole responsibility of Licensee.


 


9.             Assignment


 


9.1           This Agreement (and the licenses
granted hereunder) is personal in nature. 
This Agreement and the rights hereunder are non-delegable and
non-assignable by the Licensee.  Without
limiting the foregoing, this Agreement cannot be assumed or assumed


 


11

















 


and assigned by a trustee or
debtor-in-possession in bankruptcy as set forth in Section 365(c)(1) of the
United States Bankruptcy Code or any similar provisions of state or federal
law.  This Agreement shall not be
assigned by Licensee (including without limitation by any attempted assignment
or transfer that would arise from a sale or transfer of Licensee’s business or
assets or acquisition of all of the equity or Licensee) except as permitted
under this Section 9.1.  Any such
assignment or attempted assignment (except as permitted under this Section 9.1)
shall be void ab initio and
result in the immediate and automatic termination of this Agreement without any
requirement or notice or other action by ABI. Notwithstanding the foregoing,
Licensee may assign the Agreement to the purchaser of substantially all of the
equity or assets of Licensee, but only under the following conditions:


 


a)              Licensee
must be in good standing under this Agreement;


 


b)             if
such assignee or its affiliates had, individually or in aggregate, worldwide
sales of Molecular Diagnostics Products manufactured by such Third Party or
affiliates which exceeded [***] in calendar year 2003, Licensee must obtain the
prior written consent of Applera, the granting of which shall be at the sole
discretion of Applera;


 


c)              the
assignee shall accept in writing the provisions of this Agreement and agree to
be bound by them; and,


 


d)             within
thirty days of such assignment, assignee shall pay to Applera an assignment
fee, not creditable against any remaining balance of the issuance fee due under
Section 3.1 (a), to be determined according to the following schedule: [***]


 


9.2           Applera may assign all or any part of
its rights and obligations under this Agreement at any time without the consent
of Licensee.  Licensee agrees to execute
such further acknowledgements or other instruments as Applera may reasonably
request in connection with such assignment.


 


10.          Warranties,
Negation of Warranties and Indemnity


 


10.1         Except as provided in Paragraph 10.4,
nothing in this Agreement shall be construed as: a) a warranty or
representation by Applera as to the validity or scope of any patent; b) a
warranty or representation that making, using or selling any Real-Time Thermal
Cyclers or any components, modules, computer hardware or software thereof or
the practice under the Real-time Apparatus Patent Rights or Amplification
System Patent Rights is or will be free from infringement of patents of Third
Parties; c) an obligation on the part of Applera to sue Third Parties for
infringement; d) except as expressly set forth herein, conferring the right to
use in advertising, publicity or otherwise, in any form, the name of, or any trademark
or trade name of, Applera or any of its affiliates; e) conferring by
implication, estoppel or otherwise any license, immunity or right under any
patent owned by or licensed to Applera other than those specified, regardless
of whether such


 


12

















 


patent is dominant or
subordinate to the patents under which rights are granted in this Agreement; f)
an obligation to furnish any know-how; or g) creating any agency, partnership,
joint venture or similar relationship between Applera and Licensee.


 


10.2         APPLERA MAKES NO EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR
NON-INFRINGEMENT.


 


10.3         Licensee agrees to take all reasonable
precautions to prevent death, personal injury, illness and property damage from
the use of Licensed Real-Time Thermal Cyclers. 
Licensee shall assume full responsibility for its operation under the
patents under which rights are granted in this Agreement, the manufacture of
Licensed Real-Time Thermal Cyclers and the use thereof and shall defend,
indemnify and hold Applera harmless from and against all liability, demands,
damages, expenses (including attorneys’ fees) and losses for death, personal
injury, illness, property damage or any other injury or damage, including any
damages or expenses arising in connection with state or federal regulatory
action, in view  of the use by Licensee,
its officers, directors, agents and employees of the Real-Time Apparatus Patent
Rights, the Amplification System Patent Rights and the manufacture and use of
Licensed Real-Time Thermal Cyclers except that Licensee shall not be liable to
Applera for injury or damage arising solely because of Applera’s negligence.


 


10.4         Applera represents and warrants to
Cepheid that Applera is the sole and exclusive owner of all right, title and
interest in the Amplification System Patent Rights and Real-Time Apparatus
Patent Rights (the collective set of rights hereinafter known as “Applera
Owned Patent Rights”), and such Applera Owned Patent Rights are not subject
to any encumbrance, lien or claim of ownership by any Third Party that would
encumber the rights granted to Cepheid in this Agreement.


 


11.          General


 


11.1         If after execution of this Agreement,
Applera grants a license to any Third Party, other than Roche or a
collaboration partner (including, without limitation, any party to an agreement
with Applera entailing collaborative research, development or manufacturing) of
substantially the same scope and encompassing the same fields as the license
granted to Licensee herein but under more favorable royalty rates (expressed as
a percentage of the Net Sales Price of such other licensee’s royalty-bearing
products) than those given to Licensee under this Agreement then: Applera shall
promptly notify Licensee of such more favorable royalty rates, and Licensee
shall have the right and option to substitute such more favorable royalty rates
that are expressed as percentages of Net Sales Price (such more favorable
royalty rate, the “Substituted Royalty Rate”) for the royalty rates contained
herein; provided that Licensee accepts all other terms and conditions (whether
more or less favorable to Licensee) of such agreement with such Third Party
(such new agreement with Licensee on the same terms and conditions, mutatis
mutandum, as apply to such Third Party, referred to hereafter as the
“Substituted


 


13

















 


Agreement”).  [***]


 


11.2         This Agreement, together with the
Nondisclosure Agreement entered into by the Parties on June 4, 2004,
constitutes the entire agreement between the Parties as to the subject matter
hereof, and supersedes all prior negotiations, representations, agreements and
understandings.  This Agreement may be
modified or amended only by written agreement, executed by the authorized
representatives of each of the Parties.


 


11.3         Any notice required or permitted to be
given by this Agreement shall be given by postpaid, first class, registered or
certified mail, or by overnight courier or facsimile, properly addressed to the
other party at the respective address as shown below:


 


If to Applera:


 


Applied
Biosystems


850 Lincoln
Centre Drive


Foster City,
California, U.S.A. 94404


Attention:
Director of Licensing


 


If to
Licensee:


 


Cepheid


904 Caribbean Drive


Sunnyvale, CA
94089


Attention:
Vice President, Business Development


 


Either
party  may change its address by
providing notice to the other.  A notice
shall be deemed given four (4) full business days after the day of mailing, or
one full day after the date of delivery to the courier, or the date of
facsimile transmission, as the case may be.


 


14

















 


11.4         This Agreement shall be deemed made in
the State of California, and it shall be construed and enforced in accordance
with the law of the State of California. 
The Parties agree that the exclusive jurisdiction and venue for any
dispute or controversy arising from this Agreement shall be in the state or
federal courts in California.


 


11.5         If any provision hereof should be held
invalid, illegal or unenforceable in any respect, then, to the fullest extent
permitted by applicable law: (a) all other provisions hereof shall remain in
full force and effect and shall be liberally construed in order to carry out
the intent of the Parties as nearly as may be possible, and (b) the Parties
agree to negotiate in good faith a provision, in replacement of the provision
held invalid, illegal or unenforceable, that is consistent with applicable law
and accomplishes, as nearly as possible, the original intention of the Parties
with respect thereto.  To the fullest
extent permitted by applicable law, each Party hereby waives any provision of
law that would render any provision hereof prohibited or unenforceable in any
respect.


 


11.6         Except where the context otherwise
requires, wherever used, the singular shall include the plural and the word
“or” is used in the inclusive sense. 
The captions and headings of this Agreement are for convenience of
reference only and in no way define, describe, extend or limit the scope or
intent of this Agreement or the intent of any provision contained in this
Agreement.  Each Party hereto and its
counsel have participated fully in the review and negotiation of this
Agreement.  Both Parties have participated
equally in the formation of this Agreement; the language of this Agreement
shall not be presumptively construed against either Party.


 


11.7         It is expressly agreed that the
Parties, shall be independent contractors and that the relationship between the
Parties shall not constitute a partnership, joint venture or agency.


 


11.8         Notwithstanding anything herein to the
contrary, nothing in this Agreement shall preclude either Party from seeking
interim or provisional relief, in the form of a temporary restraining order,
preliminary injunction or other interim equitable relief as necessary to
protect the interests of such Party.


 


11.9         The waiver by either Party hereto of
any right hereunder or the failure to perform or a breach by the other Party
shall not be deemed a waiver of any other right hereunder or of any other
breach or failure by said other Party whether of a similar nature or otherwise.


 


11.10       This Agreement may be executed (including
via facsimile) in two (2) or more counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same
instrument.


 


11.11       The representations, warranties,
covenants, rights and obligations set forth in this Agreement are for the sole
benefit of the Parties and their successors and permitted assigns, and they
shall not be construed as conferring any rights on any Third Party.


 


15

















 


IN WITNESS
WHEREOF, The Parties hereto have duly executed this Agreement on the date(s)
indicated below.


 


	
  APPLERA

  	
   

  	
  CEPHEID

  
	
   

  	
   

  	
  (LICENSEE)

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
								



 


16

















 


APPENDIX A


Summary Royalty/Fee
Report


REAL-TIME INSTRUMENT PATENT LICENSE AGREEMENT


 


for the Period:
             to
             for
Sales in the country of
            


 




	
  Licensee:

  	
   

  	
  Cepheid

  	
   

  	
  Effective Date:

  	
   

  	
  April 5.
  2004

  	
   

  	
  Royalty/Fee Rate:

  	
   

  	
  [***

  	
  ] NSP

  






 


o Check here if there
were no sales for this period.


 


	
  Real-Time TC/Module/Add-

  On Model or Part No.

  	
   

  	
  No. Sold

  	
   

  	
  Gross

  Invoice Price

  (US$)

  	
   

  	
  Deductions
  Allowed

  (US$) (explain)

  	
   

  	
  Net Sales

  Price

  (US$)

  	
   

  	
  Royalty
  Rate

  ([***] NSP)

  	
   

  	
  Gross
  Royalty

  Due (US$)

  	
   

  	
  Royalty
  ($)

  Paid on Same

  Sale per TCSA

  	
   

  	
  Net
  Royalty

  Due

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Total Net 

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Royalty
  Due

  	
   

  	
   

  	
   

  



 


I hereby certify the information set forth
above is correct and complete with respect to the amounts due under this
License Agreement.


 


	
  By:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name (please print):

  	
   

  	
   

  	
   

  	
   

  	
   

  
										



 


Applera
Corporation Send
report to: Director of Licensing, Applied Biosystems, 850 Lincoln Centre Drive,
Foster City, CA 94404   USA


 


17

















 


EXHIBITS


 


Attached are (i) a definition
and set of prospective general specifications for a Cepheid Real-Time Thermal
Cycler containing one or more I-CORE modules (Exhibit
1) and (ii) product descriptions, features and specifications for
the Cepheid Smart Cycler and Cepheid GeneXpert Exhibits 2a and 2b), both as of the Effective Date of this
Agreement.


 


Exhibit 1


 


Definition and set of prospective general
specifications for a Cepheid Real-Time Thermal Cycler containing one or more
I-CORE modules


 


The instruments are those containing one or more
I-CORETM modules.  An I-CORE module is
comprised of (1) a single site, discrete, individually controllable heater
sleeve containing a heating element and designed to accept a disposable
reaction tube or cartridge, (2) an integrated cooling mechanism (e.g. a fan)
that enables passage of ambient or cooled air across the heater sleeve, and (3)
optical blocks containing solid state components that enable optical
interrogation of the reaction solution in the reaction tube or cartridge.


 


In a single site configuration comprised or a single
I-CORE module, the I-CORE module will contain all of the elements listed above.


 


In a multi-site configuration comprised of multiple
I-CORE modules, each I-CORE module:


 


a)                                      will
contain a single site, discrete, individually controllable heater sleeve
containing a heating element and designed to accept a disposable reaction tube
or cartridge.


 


b)                                     may
or may not contain an integrated cooling mechanism.  If an integrated cooling mechanism is not included, each I-CORE
reaction site will be cooled by the passage of ambient or cooled air coming
from an external source passing across the heater sleeve.


 


c)                                      may
or may not contain optical blocks.  If
optical blocks are not included, the instrument will be optically “blind”, that
is, it will not be capable of optical interrogation, or optical interrogation
will occur on a separate module.


 


18

















 


Exhibit 2a


 


Smart Cycler II


 


[images of Smart Cycler II and Technician]


 


cycle smarter


 


Real-time PCR with the Smart Cycler
II


 


The Smart Cycler II is built with sixteen modular
I-CORE® (Intelligent Cooling/heating Optical Reaction) modules.  Each independent module must maintain tight
temperature specifications, established with National Institute of Standards
Technology (NIST)-traceable standards. 
Consistent results are obtained by measuring the cycle threshold (Ct),
the first cycle in which there is significant increase in fluorescence above
the background, and which correlates to the log-linear phase of PCR
amplification.


 


Real-time detection.  Combine amplification and detection in one
step.  Fluorescence is measured in real
time as PCR products are generated.


 


Flexible.  Assay optimization is easy and expedited
with the ability to run a different protocol in each of the sixteen sites
simultaneously.  The ability for
multiple operators to use the system concurrently gives new meaning to the term
multi-tasking.


 


Fast.  Results are available in as little as 20
minutes due to very rapid, accurate heating and cooling cycles.


 


Four-channel optics.  Develop multiplex assays with the ability to
detect fluorescent signal in four distinct channels.


 


Expandable.  Link up to six processing blocks for
cost-effective system expansion.


 


The following text is associated with a graphic
depicting the Structure of the Smart Cycler II:


 


Smart Cycler reaction tubes


 


•                  Closed tube
assays reduce potential for amplicon contamination


•                  Thin walled
polypropylene construction allows rapid hearing and cooling


•                  Designed to
maximize dye excitation and detection of fluorescent emission


 


I-CORE Modules


 


•                  Each module is
an independently-controlled thermal cycler fluorometer


•                  Solid state,
non-moving parts for robust performance


•                  Incorporates
four-channel optical detection


 


19

















 


Optical blocks


 


•                  High-intensity
LEDs, silicon photodetectors, and multiple filters aflow simultaneous exitation
and detection of four different special bands


 


Smart Cycler System


 


•                  Starter system
includes one processing block, manual, computer and accessory kit


•                  Expand by
linking up to six processing blocks to one computer system


 


20

















 


Performance you can rely on


 


Four optical channels


 


The Smart Cycler II System’s optics allow the
measurement of fluorescence in four channels at the same time.  High intensity LEDs and optical filters are
optimized for spectral separation.  The
instrument’s calibration allows use of FAM or SYBR® Green in Channel
1, Cy3 or TET in Channel 2, Texas Red (TxR) in Channel 3, and Cy5 in Channel 4.


 


Multiplex capability


 


Multiplex assays allow the detection of several
targets within a single sample.  The use
of multiple fluorescent dyes permits detection of signal in up to four channels
at one time on the Smart Cycler system.


 


Various detection chemistries can be used with the
Smart Cycler optics, including TaqMan® and Molecular Beacons probes,
AmplifluorTM and ScorpionTM primers, and intercalating dyes such as SYBR®
Green.


 


Sensitivity


 


Assay sensitivity on the Smart Cycler platform is
affected by many factors, including the quality of template preparation, primer
and probe design, and optimization of PCR conditions.  Quantitative low copy detection is illustrated with an orthopox
assay.


 


[associated graphics omitted]


 


Instrument precision


 


Reproducible data is achieved through the Smart
Cycler’s robust optical, heating and cooling elements.


 


	
  Run #

  	
   

  	
  N

  	
   

  	
  Mean Ct

  	
   

  	
  SD

  	
   

  	
  %CV

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  32

  	
   

  	
  33.2

  	
   

  	
  0.14

  	
   

  	
  0.43%

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  32

  	
   

  	
  33.2

  	
   

  	
  0.13

  	
   

  	
  0.39%

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  32

  	
   

  	
  33.3

  	
   

  	
  0.17

  	
   

  	
  0.51%

  



 


	
  Total mean (n = 96)

  	
   

  	
  33.2

  
	
  Total SD (n = 96)

  	
   

  	
  0.16

  



 


Precision data:  Neisseria ganarrahoeae assay at 5000 copies.


 


21

















 


Dynamic range


 


The Smart Cycler system allows detection over a broad
range of target concentration.  A linear
standard curve can be created from a serial dilution, allowing the
determination of an unknown sample concentration.


 


22

















 


Five steps to real-time PCR


 


1.  Click
“Create Run”


 


2.  Enter run
name


 


3.  Select dye
set & tube size


 


4.  Select
reaction sites & protocols


 


5.  Click
“Start Run”


 


[screen shot omitted]


 


. . .
with ease of analysis


 


Display options


 


Define and view:


 


•                                          Protocol
definitions


 


•                                          Data
analysis settings including primary curve or second derivative analysis


 


•                                          Fluorescence
and temperature data graphs


 


Data management


 


With advanced Smart
Cycler Software version 2.0:


 


•                                          Manage
runs with controlled ramp rates


 


•                                          Automatically
advance to next stage after crossing threshold


 


•                                          Define
default data analysis and data access


 


•                                          Compare
runs or import a standard curve


 


•                                          Save
graphs as JPEG files


 


•                                          Automatically
export and/or back up data


 


[screen shot omitted]


 


23

















 


Specifications


 


Optics*


 


Dye detection limit < 2 nM for FAM/Cy3/TxR/Cy5


Optical channel characterization:


 


	
  Channel

  	
   

  	
  1

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  4

  
	
  Excitation (nm)

  	
   

  	
  450-495

  	
   

  	
  500-550

  	
   

  	
  565-590

  	
   

  	
  630-650

  
	
  Emission (nm)

  	
   

  	
  510-527

  	
   

  	
  565-590

  	
   

  	
  606-650

  	
   

  	
  670-750

  
	
  Simplex Dyes

  	
   

  	
  FAM

  SYBR[R] Green

  	
   

  	
  Cy3, TET

  	
   

  	
  TxR, ROX

  	
   

  	
  Cy5

  
	
  Multiplex Dyes

  	
   

  	
  FAM

  	
   

  	
  Cy3

  	
   

  	
  TxR

  	
   

  	
  Cy5

  



 


Reaction site thermal controls*


 


Solid state heater and
forced-air cooling at each site


Reaction chamber
thermistors calibrated to ± 0.50 °C using National Institute of Standards and

Technology (NIST)-traceable standards


16 independently-controlled reaction sites per
processing block


 


Reaction tubes


 


Single-use disposable tubes


Polypropylene construction


25- and 100 μL volumes


No-leak closures


 


User interface


 


Real-time display of growth curves and temperature
profiles

Define threshold settings, protocols, and graph formats

Specify ramp rates for thermal cycling and melt functions

Automatically advance to the next PCR stage after crossing a user-defined
threshold

Compare runs in real time

Save and import standard curves

Customize melt curve peak analysis


 


Data analysis


 


Qualitative or quantitative analysis

Primary growth curve or second derivative analysis

Melt analysis using intercalating dyes or Molecular Beacons probes

Multiplexing with internal controls

Export data into Microsoft Excel

Export graphs as JPEGs

Administrative defined data access capabilities


 












* Covered by issued or pending
patents


 


24

















 


Performance parameters


 


	
  Heating ramp rates (max):

  
	
  10 oC/sec from
  50 oC to 95 oC

  
	
  Cooling ramp rates (max):

  
	
  2.5 oC/sec from
  95 oC to 50 oC

  
	
  Temperature duration accuracy:

  
	
  ± 1.0 sec from
  programmed time

  
	
  Temperature accuracy:

  
	
  ± 0.5 oC from 60
  oC to 95 oC

  
	
  Melt curve programmable ramp rates:

  
	
  0.1 oC/sec to
  1.0 oC/sec

  



 


Physical dimensions


 


Processing block: 
12” 2 x 12” h x 10” l, 22 lbs


As little as 2.5 linear feet of bench space


Smart Cycler II TD
travel case:  24” w x 20” h x 25.5” l,

total weight with processing block, computer & accessories 74 lbs


 


Power requirements


 


100-240 VAC, 50-60 Hz, 350 Watts


 


25

















 


Smart Cycler Software 2.0


 


Performing real-time PCR just got
easier


 


Smart Cycler Software 2.0 incorporates new features to
streamline your real-time PCR protocols, analysis, data access, and
display.  Whether you have one
experimental protocol or many, real-time PCR is only a few easy steps away.


 


The Smart Cycler Software allows each of the system’s
sixteen reaction sites to run independently. 
The ability for multiple users to concurrently use the instrument and
perform rapid assay optimization creates invaluable time savings.  Smart Cycler Software 2.0 provides the
unique ability to automatically stop each site after the cycle threshold, or
transition to a melt analysis in order to obtain the same concentration or
purity of product.


 


New features


 


Flexibility


 


Automatically move to the next PCR stage after
crossing a user-defined threshold


Copy an experimental run setup for use in running
routine assays


Define ramp rates for each step of a protocol


 


Data display


 


Monitor two experimental runs simultaneously


Overlay growth curves from different runs for easy
comparison


Import and save a standard curve into an experimental run


 


Customized analysis


 


Create system analysis defaults for use in each new
run


Customize parameters of melt curve analysis


Easily adjust threshold on graph to appropriate level
for dataset


 


Data management


 


Export graph data


Export Graphs and screens as JPEG files


Print graphs and associated experimental results table


Program automatic export of runs and/or backup of
database


Create user-defined access to protocols, graphs and
data


 


Operating systems


 


Windows 98 second edition, or Windows 2000, SP2


 


To order


 


Part no. 900-0082, Software upgrade
kit:  Smart Cycler
Software 2.0 CD, Smart Cycler II User Manual


 


[screen shot omitted]


 


26

















 


Specifications


 


I-CORE Optical system*


 


Dye detection limit < 2 nM for FAM/Cy3/TxR/Cy5

Optical channel characterization:


 


	
  Channel

  	
   

  	
  1

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  4

  
	
  Excitation (nm)

  	
   

  	
  450-495

  	
   

  	
  500-550

  	
   

  	
  565-590

  	
   

  	
  630-650

  
	
  Emission (nm)

  	
   

  	
  510-527

  	
   

  	
  565-590

  	
   

  	
  606-650

  	
   

  	
  670-750

  
	
  Simplex Dyes

  	
   

  	
  FAM

  SYBR[R] Green

  	
   

  	
  Cy3, TET

  	
   

  	
  TxR, ROX

  	
   

  	
  Cy5

  
	
  Multiplex Dyes

  	
   

  	
  FAM

  	
   

  	
  Cy3

  	
   

  	
  TxR

  	
   

  	
  Cy5

  



 


Reaction site thermal controls*


 


Solid state heater and
forced-air cooling at each site


Reaction chamber
thermistors calibrated to ± 0.50 °C using National Institute of Standards and

Technology (NIST)-traceable standards


16 independently-controlled reaction sites per
processing block


 


Reaction tubes


 


Single-use disposable tubes

Polypropylene construction

25- and 100 μL volumes

No-leak closures


 


User interface


 


Real-time display of growth curves and temperature
profiles

Define threshold settings, protocols, and graph formats

Specify ramp rates for thermal cycling and melt functions

Automatically advance to the next PCR stage after crossing a user-defined
threshold

Compare runs in real time

Save and import standard curves

Customize melt curve peak analysis


 


Data analysis


 


Qualitative or quantitative analysis

Primary growth curve or second derivative analysis

Melt analysis using intercalating dyes or Molecular Beacons probes

Multiplexing with internal controls

Export data into Microsoft Excel

Export graphs as JPEGs

Create user-defined access to protocols, graphs and data


 












* Covered by issued or pending
patents


 


27

















 


Characteristic assay performance


 


M13mp18 assay


Cycles to detection (108 molecules) = 13.9


Time to detection = 9.5 minutes


Cycles to detection (100 molecules) = 34.3


Time to detection = 22 minutes


 


Xyella fastidiosa assay


Cycles to detection (3 x 106 cells) = 17.1


Time to detection = 13 minutes


 


Bacillus anthracis assay


Cycles to detection (100 pg DNA) = 21.1


Time to detection = 13 minutes


Cycles to detection (0.1 pg DNA) = 31.5


Time to detection = 19 minutes


 


Performance parameters


 


Heating ramp rates (max):


10 oC/sec from 50 oC to
95 oC


Cooling ramp rates (max):


2.5 oC/sec from 95 oC to
50 oC


Temperature duration accuracy:


± 1.0 sec from programmed
time


Temperature accuracy:


± 0.5 oC from 60 oC to 95
oC


Melt curve programmable ramp rates:


0.1 oC/sec to 1.0 oC/sec


 


Physical dimensions


 


Processing block: 
12” 2 x 12” h x 10” l, 22 lbs


As little as 2.5 linear feet of bench space


Smart Cycler II TD
travel case:  24” w x 20” h x 25.5” l,

total weight with processing block, computer & accessories 74 lbs


 


Power requirements


 


100-240 VAC, 50-60 Hz, 350 Watts


 


28

















 


A New Generation in Real-Time
Detection


 


The Smart Cycler* II System


 


Cepheid’s real-time PCR instrument incorporates
advanced optics allowing more dye choices for use with real-time PCR.  The Smart Cycler’s four optical channels
have optimized spectral separation providing sensitive identification of
positive or negative results and precise quantitation.  The instrument’s optics allow application to
the rapidly evolving needs of a molecular biology lab using detection methods
including Molecular Beacons and TaqMan[R] probes, AmplifluorTM and
ScorpionTM primers, and intercalating dyes such as SYBR® Green.


 


At the core of the Smart Cycler System are sixteen
I-CORE® (Intelligent Cooling/heating Optical REaction) modules,
incorporating state-of-the-art microelectronic and optical design.  Each independently programmable I-CORE
module performs four-color, real-time fluorometric detection.


 


Reaction tubes


 


Samples are amplified and measured in the Smart
Cycler’s proprietary, sealable reaction tubes, which are designed to optimize
rapid thermal transfer and optical sensitivity, as well as to reduce the
possibility of amplicon contamination. 
The tubes are available in 25 μL or 100 μL volumes.


 


Smart Cycler Software 2.0


 


The system software enables one or more operators to
define and simultaneously carry out separate experiments, each with a unique
set of cycling protocols, threshold criteria, and data analysis.  Additionally, thermal and optical data can
be monitored in real-time and graphs of temperature, growth, and melt curves
are displayed during data collection. 
Advanced features include automatically moving to the next PCR stage
after crossing a user-defined threshold, importing and saving a standard curve
in an experimental run, and programming automatic backup or export of runs and
database.


 


System configurations


 


The Smart Cycler II Starter System includes all
equipment and software needed to obtain rapid, real-time PCR assay
results.  The system includes a Smart
Cycler II processing block, desktop computer, CDRW drive and flat panel
monitor, Smart Cycler Software version 2.0, operator’s manual, and accessory
kit.  The accessory kit features a
mini-centrifuge, tube racks, and a cooling rack specifically designed to
accommodate Smart Cycler reaction tubes. 
A laptop configuration is also available.


 


A truly transportable system is available with the
Smart Cycler II TD System, designed to hold the complete system, including
processing block, laptop computer and accessories.  The rugged case has wheels and a retractable handle allowing
real-time PCR to be performed when and where it’s needed.


 


29

















 


	
  North American

  Part Number

  	
   

  	
  Description

  
	
   

  	
   

  	
   

  
	
  SC2000N1-1

  	
   

  	
  Smart Cycler II Starter System (processing block,
  manual, accessory kit, and desktop computer with flat-panel monitor)

  
	
   

  	
   

  	
   

  
	
  SC2000N2-1

  	
   

  	
  Smart Cycler II TD Starter System (processing block,
  manual, accessory kit, and laptop computer and rugged travel case)

  
	
   

  	
   

  	
   

  
	
  SC2000N3-1

  	
   

  	
  Smart Cycler II add-on processing block

  
	
   

  	
   

  	
   

  
	
  SC2000N4-1

  	
   

  	
  Smart Cycler II Laptop Starter System (processing
  block, manual, accessory kit, and laptop computer)

  
	
   

  	
   

  	
   

  
	
  900-0028

  	
   

  	
  Cooling block

  
	
   

  	
   

  	
   

  
	
  900-0020

  	
   

  	
  Mini-centrifuge (U.S.)

  
	
   

  	
   

  	
   

  
	
  700-0630

  	
   

  	
  Mini-centrifuge (Canada)

  
	
   

  	
   

  	
   

  
	
  900-0027

  	
   

  	
  Tube racks, 4-pack

  
	
   

  	
   

  	
   

  
	
  900-0023

  	
   

  	
  Smart Cycler reaction tubes, 100 μL, qty 1000

  
	
   

  	
   

  	
   

  
	
  900-0022

  	
   

  	
  Smart Cycler reaction tubes, 25 μL, qty 1000

  
	
   

  	
   

  	
   

  
	
  900-0004

  	
   

  	
  Smart Cycler reaction tubes, 100 μL, qty 50

  
	
   

  	
   

  	
   

  
	
  900-0003

  	
   

  	
  Smart Cycler reaction tubes, 25 μL, qty 50

  



 


30

















 


Exhibit 2b


 


The GeneXpert® System utilizes polymerase
chain reaction (PCR) and real-time PCR to amplify and detect target nucleic
acid.  The system is the first to fully
automate and integrate all the steps required for PCR-based testing:  sample preparation, amplification and
detection.  Designed to simplify
hands-on preparation, the system provides PCR test results from a raw sample,
enabling time-critical tests.  The
GeneXpert module forms the core of the Biohazard Detection System deployed
nationwide by the United States Postal Service for anthrax testing in mail
sorting facilities.  An expanded menu of
tests is currently in development.


 


The GeneXpert System is a random access instrument
integrating real-time amplification and detection features seen in the
SmartCycler System, but delivering results from unprocessed samples.  The I-CORE module is the common technology
link between the SmartCycler and GeneXpert, performing real-time amplification
and detection.  The GeneXpert automates
sample preparation, integrating the complex steps of nucleic acid extraction in
the microfluidic cartridges.


 


Each GeneXpert module also incorporates a syringe
drive, rotary drive and a ultrasonic driver. 
The driver delivers ultrasonic energy necessary to lyse the raw specimen
and release nucleic acids contained within, while the combination of the
syringe drive and rotary drive moves liquid between cartridge chambers in order
to wash, purify and concentrate these nucleic acids.  After the automated extraction is complete, the nucleic acid
concentrate is moved into the cartridge reaction chamber where amplification
and detection takes place.


 


The GeneXpert® System is the world’s first
and only real-time PCR instrument which combines fully integrated sample prep
with the amplification and detection process. 
The cornerstone of the GeneXpert testing process are Cepheid’s patented,
self-contained, single use cartridges. 
This ground-breaking technology allows laboratory and non-laboratory
personnel to conduct sophisticated molecular-based testing in a wide range of
environments – including hospitals, research laboratories, physician offices,
public health clinics or factories.


 


Most DNA analysis and detection procedures start with
nucleic acids that have been extracted or removed from the sample.  In many cases, samples are complex in
composition (whole blood, human cells or tissue, swabs) and the associated
sample preparation protocols are complex and time-consuming.  In addition, many real world applications involve
detection of a very small number of pathogens or target genes in a large volume
of sample


 


Cepheid’s cartridges are designed to handle a variety
of volumes, which provides the ability to obtain higher concentrations of
starting target materials in the cartridge. 
Concentration and purification of the target nucleic acids in a sample
and removal of extraneous materials further increases the sensitivity of the
resulting test.


 


The following text is associated with a graphic
depicting the Structure of the GeneXpert System:


 


Processing changers
– contain reagents, filters, and capture technologies necessary to extract,
purify, and amplify target nucleic acids


 


31

















 


Optical windows –
enable real time optical detection


 


Reaction tube –
thin chamber enables very rapid thermal cycling


 


Valve – enables
fluid transfer from changer to chamber; may contain nucleic acids lysis and
filtration components


 


[pictures of GeneXpert System and module omitted]


 


32